Case Law Details
Ems Projects Pvt. Ltd. Vs Commissioner Of CGST (Gujarat High Court)
It is not in dispute that one year period has elapsed since GST Electronic credit ledger came to be blocked. Rule 86A of Central Goods and Services Tax Rules, 2017 empowers the authority to block the electronic credit ledger if the authority has reason to believe that the dealer has obtained the Input Tax Credit fraudulently or the same is ineligible.
Be that as it may, if the period of one year i.e. the statutory time period during which the ledger can be blocked has come to an end, then, as on date, it can be said that there is no blocking of the electronic credit ledger. However, before the dealer can once again start using the Input Tax Credit accumulated in his electronic credit ledger, the authority will have to open it on the portal.
We dispose of this writ application with a direction to the concerned authority to permit the writ applicant to now operate the electronic credit ledger as the original order blocking the ledger has already come to an end.
FULL TEXT OF THE JUDGMENT/ORDER OF GUJARAT HIGH COURT
By this writ application under Article 226 of the Constitution of India, the writ applicant has prayed for the following reliefs:
“A. Your Lordships may be pleased to admit this petition;
B. Your Lordships may be pleased to allow this petition;
C. Your Lordships may be pleased to issue writ of mandamus or any other appropriate writ directing the respondent authorities to immediately unblock the credit amounting to Rs. 17,31, 100/- (Rs. 8,65,550/- towards Central Tax and Rs. 8,65,550/- towards State Tax) as the same is illegally and arbitrarily blocked in the credit ledger of petitioner No.1 herein;
D. Your Lordships may be pleased to issue writ of mandamus or any other appropriate writ striking down Rule 86A of Central Goods and Service Tax Rules, 2017 as the same is ultra-vires to the provisions of Central Goods & Service Tax Act, 2017 ;
E. Your Lordships may be pleased to grant such other and further relief/(s) that may be deemed fit and proper in the interest of justice in favor of the petitioner.”
2. We have heard Mr. D. K. Trivedi, the learned counsel appearing for the writ applicant and Mr. Priyank Lodha, the learned standing counsel appearing for the respondent No.1.
3. The controversy involved in the present litigation is in a very narrow compass. The electronic credit ledger of the writ applicant No.1 came to be blocked under Rule 86A of the Central Goods and Services Tax Rules, 2017 [for short, “the Rules, 2017”]. It is not in dispute that one year period has elapsed since the ledger came to be blocked. Rule 86A of the Rules, 2017 empowers the authority to block the electronic credit ledger if the authority has reason to believe that the dealer has obtained the Input Tax Credit fraudulently or the same is ineligible.
4. Be that as it may, if the period of one year i.e. the statutory time period during which the ledger can be blocked has come to an end, then, as on date, it can be said that there is no blocking of the electronic credit ledger. However, before the dealer can once again start using the Input Tax Credit accumulated in his electronic credit ledger, the authority will have to open it on the portal.
5. We dispose of this writ application with a direction to the concerned authority to permit the writ applicant to now operate the electronic credit ledger as the original order blocking the ledger has already come to an end. Let this exercise be undertaken at the earliest and the needful shall be done in accordance with law. Direct service is permitted.
