M/S Alukkas Enterprises Private Limited vs. Assistnat Commissioner Of Central Tax
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Cause title — parties, addresses and appearances
ORAL ORDER
In this Petition, petitioner seeks the following reliefs: "Wherefore, the Petitioner prays that this Honourable Court may be pleased to grant the following rellefs: (A) Issue a writ of declaration or certiorari any other appropriate writ or direction declaring the provisions of Rule BGA of CGST Rules, 2017 enclosed as Annexure A as being illegal, unreasonable and arbitrary, contrary to the provisions of CGST Act, 2017 and therefore to be struck down as violative of Article 14 and/or 19; (5) Issue a writ of declaration or certiorari any other appropriate writ or direction declaring the provisions of Rule 86A of KGST Rules, 2017 enclosed as Annexure A1 as being illegal, unreasonable and arbitrary, contrary to the provisions of KGST Act, 2017 and therefore to be struck down as violative of Article 14 and/or 19; (C) Issue a writ of certiorari or any other appropriate writ or order to quash the impugned letters dated 26.09.2023 blocking the credit balance of Rs. 1,07,55,874/- issued by the First Respondent enclosed as Annexure Band Annexure B1, as violative of Articles 14, 19 and 300A being unreasonable, oppressive, excessive, arbitrary, premeditated and without the authority of law. (D) Direct the Respondents by an appropriate writ or Order in the nature of Mandamus or otherwise, to unblock or release the blocking of credit balance of Rs. 1,07,55,874/ of the Petitioner with interest in their account in GSTN Portal as per the blockage of HC-KAR NC: 2025:KHC:48193 credit balance issued by the First Respondent enclosed as Annexure - B1. (E) Grant such other reliefs as this Honourable High Court may think fit including the cost of this writ petition."
Heard learned counsel for the petitioner and passed the following interim order: ""Sri. H. Shanthi Bhushan, learned DSGI is directed to accept notice for respondent No.
Learned AGA accepts notice for respondent No.3. HC-KAR NC: 2025:KHC:48193 Sri. Jeevan J. Neeralgi, learned counsel is directed to accept notice for respondent No.
Copies to be served. Heard learned Senior Counsel for the petitioner and perused the material on record. In addition to reiterating the various contentions urged in the memorandum of petition and referring to the material on record, learned Senior Counsel for the petitioner invited my attention to the orders passed by the Co-ordinate Bench of this Court in W.P.No.7686/2020 dated 06.07.2020 and W.P.No.6138/2020 dated 17.03.2020 in order to point out that under identical circumstances in relation to blocking of the in-put tax credit under Rule 86A of the CGST Rules, this Court has directed unblocking of the credit ledger of the petitioner by the respondent – department that the same would be subject to the final outcome of the petition. It is also pointed out that in W.P.No.31298/2023 and connected matters filed by the suppliers, the Madras High Court has directed stay of the disputed penalty subject to payment of 10% by the said writ petitioner. The said submission is placed on record. Re-list on 02.04.2024. Meanwhile, by way of interim arrangement and without prejudice to the rights and contentions of the parties, respondents are directed to unblock the credit ledger of the petitioner to enable the petitioner to make use of the credit balance on the condition that the same would be subject to the final outcome of the petition. Liberty is reserved in favour of respondents to seek vacation / modification of this order." HC-KAR NC: 2025:KHC:48193 As a matter of/on record and pursuant to the interim order, the electronic ledger of the petitioner has been unblocked. Under these circumstances, this petition deserves to be disposed of in terms the judgment in K9 Enterprises supra.
In the result, I pass the following: ORDER
i) The petition is hereby allowed.
(ii) The impugned order at Annexures –B and B1
dated 26.09.2023 issued by respondent No.1 are hereby set-aside. (S.R.KRISHNA KUMAR) JUDGE BSV List No.: 2 Sl No.: 19
Reproduced from the public record of the Karnataka High Court. Verify against the court's own copy before relying on it. Income tax judgments are on bharattax.net.