M/S K K Alloys vs. Union Of INDIA And Others
Held
The Court held that blocking of ITC in excess of the available credit in the ECL, creating a negative balance, is not permissible under Rule 86A. Such actions are unsustainable and set aside.
Facts
The petitioner's Electronic Credit Ledger (ECL) had its Input Tax Credit (ITC) blocked in a negative manner, allegedly in violation of Rule 86A of the CGST Act and principles of natural justice. The blocking exceeded the available credit in the ECL.
Key Issues
Whether Rule 86A permits blocking of ECL by an amount exceeding the credit available at the time of the order, and if an artificial negative balance can be created.
Sections Cited
Rule 86A, Section 73, Section 74, Section 29, Section 83
AI-generated summary — verify with the full judgment below
1
CM-16715-CWP-2025 in/and CWP-26150-2025
115-a IN THE HIGH COURT OF PUNJAB AND HARYANA
AT CHANDIGARH
CM-16715-CWP-2025 in/and CWP-26150-2025
Date of Decision: November 19, 2025
M/S K.K. ALLOYS
.....Petitioner
Versus
UNION OF INDIA AND ORS
..... Respondents
CORAM:- HON'BLE MRS. JUSTICE LISA GILL
HON'BLE MR. JUSTICE PARMOD GOYAL
Present: Mr. Sholab Arora, Advocate for the applicant-petitioner.
Mr. Sourabh Goel, Senior Standing counsel for the respondents.
****
LISA GILL, J.
CM-16715-CWP-2025
Heard.
For the reasons mentioned in the application as well as arguments addressed, hearing of petition is preponed from 20.01.2026 for today itself.
Application is, accordingly, disposed of. CWP-26150-2025
Learned counsel for petitioner submits that prayer in this writ petition is restricted to action of respondents blocking Electronic Credit Ledger RITU SHARMA 2025.11.29 15:41 I attest to the accuracy and integrity of this document
2
CM-16715-CWP-2025 in/and CWP-26150-2025
(ECL) of petitioner and for
The judgment continues below.
Read the full judgment
A free account opens 10 full GST judgments a month (one account works on both bharattax.net and this site). Re-reading one you have already opened does not count again.
The summary, the parties, the sections and the citations above are open to everyone and always will be. Only the text of the order and the PDF are metered.
Reproduced from the public record of the Punjab and Haryana High Court. Verify against the court's own copy before relying on it. Income tax judgments are on bharattax.net.