The Respondent is directed to unblock the ITC availed by petitioner.
Rule 86A of the CGST Rules, 2017 – Blocking of ITC - The petitioner prayed for unblocking the ITC availed by the petitioner in its electronic credit ledger. The counsel for the petitioner submitted that restriction imposed under sub-rule (1) of rule (3) of rule 86A would cease to have effect after expiry of one year from the date of imposition thereof. The input tax credit was blocked on January 26, 2020 and since more than 20 months have lapsed by now, by operation of law, the petitioner is entitled to relief claimed in this writ petition. The respondent counsel submitted that after the process of verification is complete, the input tax credit would be unblocked. The court observed that having regard to the statutory mandate in sub-rule (3) of rule 86A, the petitioner is entitled to claim that the input tax credit ought to have been unblocked immediately after one year of the restriction being imposed. However, to say that reply is awaited and hence lifting of the restriction has not been resorted to is clearly illegal.
Held that:- The Hon’ble High Court disposed the petition accordingly
The Respondent is directed to unblock the ITC availed by petitioner.
Rule 86A of the CGST Rules, 2017 – Blocking of ITC - The petitioner prayed for unblocking the ITC availed by the petitioner in its electronic credit ledger. The counsel for the petitioner submitted that restriction imposed under sub-rule (1) of rule (3) of rule 86A would cease to have effect after expiry of one year from the date of imposition thereof. The input tax credit was blocked on January 26, 2020 and since more than 20 months have lapsed by now, by operation of law, the petitioner is entitled to relief claimed in this writ petition. The respondent counsel submitted that after the process of verification is complete, the input tax credit would be unblocked. The court observed that having regard to the statutory mandate in sub-rule (3) of rule 86A, the petitioner is entitled to claim that the input tax credit ought to have been unblocked immediately after one year of the restriction being imposed. However, to say that reply is awaited and hence lifting of the restriction has not been resorted to is clearly illegal.
Held that:- The Hon’ble High Court disposed the petition accordingly