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2023 (12) TMI 66 - TELANGANA HIGH COURTBlocking of ITC - non-compliance with the statutory requirements under the CGST Act, 2017 and rules framed therein so far as steps necessary to be initiated prior to blocking of electronic credit ledger under the Rules - contravention to Rule 86A of CGST Rules, 2017 - non-speaking order - violation of principles of natural justice - HELD THAT:- A plain reading of the said notice dated 02.12.2022 would clearly reveal that, the said notice being a notice so far as blocking of the electronic credit ledger of the petitioner under Section 86A of the CGST Act. There was also no mention of the same being an intimation in respect of proceedings drawn under Section 74 of the Telangana State (TS) GST Act, 2017. From plain reading of the contents of letter dated 04.11.2023, it would make it evident that the notice dated 04.11.2023 or for that matter 02.12.2022 are not under Section 74 of the Act. The fact that the impugned notice (Annexure P2) called upon the petitioner to submit his explanation as would be evident from Annexure P2 would also goes to establish that it was not an order of attachment of ITC account of the petitioner. If the letter dated 02.12.2022 is neither an order under Section 86A, nor an order under Section 74 of the Act, in these factual circumstances, it is difficult to sustain the said letter dated 02.12.2022. If at all the same is the notice or the order of blocking the ITC account of the petitioner, the same is clearly in contravention to the statutory provisions governing the field of blocking of availment of ITC. The impugned notice dated 02.12.2022 therefore being in contravention to the provisions of CGST and TSGST Acts are concerned, the same deserves to be and are accordingly set aside - petition allowed.
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