Prince Steel Vs State Of Karnataka (Karnataka High Court)
Karnataka High Court held that blocking of Electronic Credit Ledger by invoking Rule 86A of the CGST Rules merely on the basis of report of enforcement authority, without independent or cogent reasons, impermissible in law.
Facts- Vide the present petition, the petitioner has contested the blocking of Electronic Credit Ledger by invoking rule 86A of the Central Goods and Services Tax Rules, 2017. Petitioner mainly alleges that before passing the impugned order, pre-decisional hearing was not provided to the petitioner nor does impugned order contain any reason to believe as to why it was necessary to block the Electronic Credit Ledger.
Conclusion- Held that in the instant case, since no pre-decisional hearing was provided/granted by the respondents before passing the impugned order, coupled with the fact that the impugned order invoking Section 86A of the CGST Rules by blocking of the Electronic credit ledger of the petitioner does not contain independent or cogent reasons to believe except by placing reliance upon the reports of Enforcement authority which is impermissible in law.
FULL TEXT OF THE JUDGMENT/ORDER OF KARNATAKA HIGH COURT
In this petition, the petitioner seeks the following reliefs:
“(A) Issue a writ, order or direction in the nature of certiorari or any other appropriate writ, order or direction quashing the order dated 28.02.2024 bearing No. ACCTK/LGSTO-071/ITC BLOCK/ Order No.01/2023-24, passed by the respondent No.2 herein (Annexure-A).
(B) Issue a writ or a direction in the nature of certiorari or any other appropriate writ, order or direction quashing the intimation dated 16.02.2024 bearing No. ACCTK/GSTO-07/FTC/T.NO.3626/2023-24 dated 16.02.2024 (Annexure-B).
(C) Grant such other relief that this Hon’ble Court be pleased to deem fit in the facts of the present case.”
2. Heard learned counsel for the petitioner and learned counsel for the respondents and perused the material on record.
