Mahadev Steel Industries Vs Union of India and another (Punjab and Haryana High Court)
The Punjab and Haryana High Court in Mahadev Steel Industries v. Union of India & Anr. directed GST authorities to decide within one week the petitioner’s request for unblocking ₹33,80,886 Input Tax Credit (ITC) in its Electronic Credit Ledger. The firm’s ITC had been blocked on 25 June 2024 under Rule 86A(3) of the CGST Rules, 2017. The petitioner argued that, as per the proviso to Rule 86A(3), the restriction cannot extend beyond one year and should automatically lapse thereafter. The Court noted that the petitioner’s plea was limited to enforcing this time limit and directed the department to pass an appropriate order in accordance with law. The ruling aligns with earlier judicial interpretations emphasizing that ITC blocking under Rule 86A is temporary and cannot exceed the statutory one-year period unless renewed through fresh proceedings.
FULL TEXT OF THE JUDGMENT/ORDER OF PUNJAB AND HARYANA HIGH COURT
1. The petitioner is seeking a direction to the respondents to unblock the Input Tax Credit available in Electronic Credit Ledger of the petitioner to the tune of Rs.33,80,886/- as the statutory period of one year as stipulated under Rule 86A(3) of the CGST Rules, 2017 has lapsed.
