Ambika Creation vs. Commissioner, Govt. Of Gujarat
Facts
The petitioner, Ambika Creation, invoked the writ jurisdiction of the Gujarat High Court seeking a direction to respondent no. 3 to unblock its Electronic Credit Ledger. The ledger had been blocked, and the petitioner contended that the one-year period prescribed under sub-rule 3 of Rule 86A of the CGST/GGST Rules had elapsed. The Court had previously issued notice for final disposal. On the hearing date, the learned Additional Government Pleader fairly conceded that the one-year period had indeed elapsed. The petitioner had also filed a representation regarding the unblocking, which was not heeded by the authority.
Held
The Court held that the Electronic Credit Ledger, once blocked for a period of one year under sub-rule 3 of Rule 86A of the CGST/GGST Rules, should automatically get unblocked upon the expiry of that period. The Court found it unfortunate that the authority failed to permit the writ-applicant to avail the input credit even after the statutory period ended and despite a representation being filed. The authority had no discretion to keep the ledger blocked beyond the statutory one-year period without passing a fresh order. The Court directed that the Electronic Credit Ledger be unblocked. The Court also warned that in similar future cases, the concerned authority would be held personally liable for any loss suffered by the assessee during the interregnum period. The writ-application was disposed of with these directions.
Key Issues
1. Whether the Electronic Credit Ledger, blocked under sub-rule 3 of Rule 86A of the CGST/GGST Rules, should be unblocked upon the expiry of the one-year period prescribed therein, and if not, what is the recourse for the petitioner? The petitioner argued that the statutory period of one year for blocking the Electronic Credit Ledger had expired, and therefore, it should be automatically unblocked. They relied on the explicit provision of sub-rule 3 of Rule 86A. The petitioner also pointed out that their representation to the authority for unblocking was ignored. The respondent, through the learned AGP, conceded that the one-year period had elapsed.
Sections Cited
Rule 86A
AI-generated summary — verify with the full judgment below
C/SCA/17564/2021 JUDGMENT DATED: 12/01/2022 IN THE HIGH COURT OF GUJARAT AT AHMEDABAD R/SPECIAL CIVIL APPLICATION NO. 17564 of 2021
FOR APPROVAL AND SIGNATURE:
HONOURABLE MR. JUSTICE J.B.PARDIWALA and HONOURABLE MS. JUSTICE NISHA M. THAKORE ================================================================ 1 Whether Reporters of Local Papers may be allowed to see the judgment ? NO 2 To be referred to the Reporter or not ? NO 3 Whether their Lordships wish to see the fair copy of the judgment ? NO 4 Whether this case involves a substantial question of law as to the interpretation of the Constitution of India or any order made thereunder ? NO ================================================================ AMBIKA CREATION Versus COMMISSIONER, GOVT. OF GUJARAT ================================================================ Appearance: MR AVINASH PODDAR, ADVOCATE for the Petitioner(s) No. 1 MR UTKARSH SHARMA, AGP for the Respondent(s) No. 1,2,3 ================================================================ CORAM: HONOURABLE MR. JUSTICE J.B.PARDIWALA and HONOURABLE MS. JUSTICE NISHA M
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