Delhi HC Set Aside Negative ITC Blocking Due to Lack of Credit Balance

Best Crop Science Pvt. Ltd. Vs Principal Commissioner (Delhi High Court)

The Delhi High Court decided a batch of writ petitions challenging orders passed under Rule 86A of the Central Goods and Services Tax Rules, 2017, to the extent they blocked input tax credit (ITC) in taxpayers’ Electronic Credit Ledgers (ECLs) beyond the credit actually available, thereby creating artificial negative balances.

The petitioners, registered taxpayers under the CGST/DGST Acts, contended that Rule 86A permits blocking only of ITC that is available in the ECL at th

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