Rajnandini Metal LTD. vs. Union Of INDIA And Others
Held
The High Court held that the action taken under Rule 86A was not sustainable as the impugned order lacked independent application of mind and was bereft of any material or 'reason to believe' that the petitioner was guilty of fraudulent transactions.
Facts
The petitioner's Input Tax Credit (ITC) was blocked under Rule 86A of the CGST Rules based on an intelligence report about a racket involving fake ITC. The petitioner's representation against this action was rejected by the respondents.
Key Issues
Whether blocking of ITC under Rule 86A was justified without sufficient recorded reasons and independent application of mind by the authority.
Sections Cited
Rule 86A
AI-generated summary — verify with the full judgment below
IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH CWP No.26661 of 2021 (O&M) Date of Decision : 31.05.2022 Rajnandini Metal Ltd. ….Petitioner Versus Union of India and others …..Respondents CORAM : HON’BLE MR. JUSTICE TEJINDER SINGH DHINDSA HON’BLE MR. JUSTICE PANKAJ JAIN Present : Mr. Jagmohan Bansal, Senior Advocate assisted by Mr. Naveen Bindal, Advocate and Mr. Aman Garg, Advocate for the petitioner. Mr. Anshuman Chopra, Sr. Standing Counsel for the respondents. PANKAJ JAIN, J
. Aggrieved by the action of the respondents of blocking his Input Tax Credit by proceeding under Rule 86A of the Central Goods and Services Tax Rules, 2017 (for short, the CGST Rules), the petitioner has approached this Court seeking quashing of the order dated 17th of December, 2021 (Annexure P-18).
The petitioner, a Public Limited Company is engaged in manufacturing of copper wire rod and submersible winding wire and is registered under the Central Goods and Services Tax Act, 2017. As per the petitioner, respondents blocked Input Tax Credit amounting to Rs.1.9 Crore lying in Electronic Credit Ledger on 2nd of September, 2021. The petitioner DEEPAK KUMAR 2022.06.02 19:17 I attest to the
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