Home Case Index All Cases GST GST + HC GST - 2021 (9) TMI HC This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2021 (9) TMI 826 - HC - GSTWithholding the Input Tax Credit - vires of Section 16(2)(c) of CGST Act, 2017 - Seller has not deposited the tax (GST) with the Government revenue - One year has passed since the order of attachment - HELD THAT:- Chapter IX of the said Rules pertains to payment of tax. Rule 86 refers to electronic credit ledger which shall be maintained in relation to the registered dealer where his eligible input tax credit would be accumulated for the purpose of discharging his tax liability to the Government. Rule 86A however provides conditions of use of amount available in such electronic credit ledger - the restrictions that can be imposed on use of amount available in electronic credit ledger of a person can be by way of a temporary measure for a period not exceeding one year. The decision to impose such restriction would be taken by the Commissioner or a person authorised by him upon being satisfied that the input tax credit has been fraudulently availed or is ineligible. In such a case, after recording reasons in writing restriction on use therefore of would be imposed. This is an interim measure and, therefore, cannot take shape of a permanent arrangement. This is an interim measure and, therefore, cannot take shape of a permanent arrangement. If the department wants to permanently disallow credit of accumulated amount in the ledger of a dealer, it must adjudicate the issue and pass an order after bi-parte hearing. Sub-rule (3) of Rule 86A clearly brings about this legislative intent while it provides that such restrictions shall cease to have effect after the expiry of a period of one year. The department cannot continue to subject the petitioner’s electronic credit ledger to the restrictions imposed by the Commissioner, on 21st May 2020. The same shall be released. In other words, it would be open for the petitioner to utilise the amount credited in the said ledger for the purpose of payment of its taxes in accordance with law. Interim order passed - Writ petition be listed on 16th November 2021.
|