Sai Balaji Extraction And Alloys PVT LTD vs. Directorate General Of Goods And Service Tax Intelligence And Others

Held

The Court noted that the petitioner's Electronic Credit Ledger had been blocked since January 17, 2020, and was still blocked as of the date of the hearing. The petitioner's primary grievance was that this blocking had continued beyond the one-year period stipulated in Rule 86-A(3) of the CGST Rules, 2017. The respondents, while not filing a formal reply, indicated that the petitioner's representation dated February 15, 2021, seeking the unblocking of the ledger, would be decided expeditiously. In light of this submission, the Court disposed of the petition. The Court directed respondents Nos. 2 and 4 to decide the pending representation of the petitioner dated February 15, 2021, on or before September 15, 2021, in accordance with Rule 86-A(3) of the CGST Rules, 2017. The Court explicitly left open the petitioner's remedy to seek damages for the alleged illegal blocking of the ledger beyond one year, without expressing any view on the merits of such a claim.

Facts

The petitioner, Sai Balaji Extraction and Alloys Pvt. Ltd., filed a writ petition before the Bombay High Court, Aurangabad Bench, challenging the continued blocking of its Electronic Credit Ledger. The ledger had been blocked since January 17, 2020. The petitioner argued that the blocking had extended beyond one year, which is contrary to the provisions of Rule 86-A(3) of the CGST Rules, 2017. The respondents, including the Directorate General of Goods and Service Tax Intelligence, had not filed a formal affidavit in reply. However, on instructions, their counsel submitted that the petitioner's representation dated February 15, 2021, seeking the unblocking of the ledger, would be decided expeditiously.

Key Issues

1. Whether the continued blocking of the petitioner's Electronic Credit Ledger beyond one year, as stipulated in Rule 86-A(3) of the CGST Rules, 2017, is illegal and warrants intervention by this Court? Petitioner's Contention: The petitioner argued that its Electronic Credit Ledger has been blocked since January 17, 2020, and this blocking has persisted beyond the one-year period prescribed by Rule 86-A(3) of the CGST Rules, 2017. Therefore, the continued blocking is in violation of the said rule and the petitioner is entitled to have the ledger unblocked. The petitioner also sought to amend its petition to include a prayer for unblocking the ledger. Revenue's Contention: The respondents (Revenue) did not file a formal affidavit in reply. However, their counsel, on instructions, submitted that the petitioner's representation dated February 15, 2021, requesting the unblocking of the ledger, would be decided expeditiously.