Case Law Details
Goyal Iron And Steel Traders Vs Assistant Commissioner Palam Division CGST Delhi South & Ors. (Delhi High Court)
High Court directed to decide the matter by way of a reasoned order where the electronic credit ledger was blocked citing a mismatch in the Input Tax Credit claimed in GSTR-3B and that appearing in GSTR-2A.
High COurt held that writ petition is directed to be treated as a representation to Assistant Commissioner Palam Division CGST Delhi South, who is directed to decide the same by way of a reasoned order within four weeks, in accordance with law, after giving an opportunity of hearing to the petitioner and/or its authorized representative. Till the said representation is decided by Assistant Commissioner Palam Division CGST Delhi South, the parties are directed to maintain status quo with regard to the impugned notice dated 28th January, 2020.
Comment: Rule 86A (blocking of credit) is becoming a powerful tool in the hands of the department, by blocking the credit when there is a ‘reason to believe’. This decision required the passing of the reasoned order considering the representation of the assessee, it cannot be just automatic. Further Rule 86A does not provide the mismatch of credit in 3B & 2A as a reason for blocking the credit.
FULL TEXT OF THE HIGH COURT ORDER /JUDGEMENT
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