M/S Apl Metals Limited And Another vs. Union Of INDIA And Others
Held
The Court held that the blocking of the petitioner's electronic credit ledger, which was ordered on January 15, 2020, has lost its force and cannot be continued beyond one year from the date of the order, in accordance with Sub-Rule (3) of Rule 86A of the Central GST Act. The Court reasoned that since the respondents confirmed no further order of extension was passed, the statutory period of one year for the blocking had expired. The ratio decidendi is that a blocking order under Rule 86A(3) is time-bound for one year, and its continuation beyond that period without a fresh order is impermissible. The Court declared the impugned blocking of the electronic credit ledger to have lost its force and directed the respondents to take suitable action as a consequence of this declaration.
Facts
The petitioner, M/s. APL Metal Limited & Anr., challenged the blocking of its electronic credit ledger by the respondents. The blocking order was issued on January 15, 2020. The petitioner contended that as per Sub-Rule (3) of Rule 86A of the Central GST Act, the validity of such blocking is one year, and therefore, the blocking should have expired and lost its force after January 15, 2021. Despite the expiry of the one-year period, the respondents had not unblocked the credit ledger. The respondents' counsel, on instruction, confirmed that no further order of extension for the blocking had been passed.
Key Issues
1. Whether the blocking of the petitioner's electronic credit ledger, ordered on January 15, 2020, has lost its force and validity after one year, as stipulated by Sub-Rule (3) of Rule 86A of the Central GST Act? Petitioner's argument: The petitioner argued that the blocking order, issued on January 15, 2020, is valid for only one year as per Sub-Rule (3) of Rule 86A of the Central GST Act. Consequently, the blocking should have expired and become ineffective after January 15, 2021. They contended that the respondents' continued refusal to unblock the ledger beyond this period is illegal. Revenue's argument: The respondents did not present any argument against the petitioner's contention regarding the expiry of the blocking period. Their counsel, when asked to take instructions, confirmed that no further order of extension for the blocking had been passed.
Sections Cited
Rule 86A(3)
AI-generated summary — verify with the full judgment below
2021 p.b. Sl. No.127. W.P.A. 8484 of 2020 M/s. APL Metal Limited & Anr. Vs. Union of India & Ors. (Via Video Conference) Mr. N. K. Chowdhury, Mr. Arujit Chakraborty, Mr. Nilotpal Chowdhury, Mr. Prabir Bera. …….for the petitioner. Mr. K. K. Maiti, Ms. Aishwarya Rajyashree. ……..for the respondent. Heard both the parties. In this matter, petitioner has challenged the impugned action of order of blocking electronic credit ledger of the petitioner by contending that period of validity of such blocking is one year as per Sub-Rule (3) of Rule 86A of the Central GST Act. It has been submitted that such order of blocking was made on 15th January, 2020 and in view of the aforesaid provision validity of such blocking has expired and lost its force after a year, but still respondents are not unblocking the same. In this regard, Mr. Maiti, learned advocate appearing for the respondents was asked to take instruction from the respondents concerned as to whether any further order of extension of the blocking in question has been passed to which he
2 submits on instruction that no such further order of extension has been passed. Considering the submission of the p
The judgment continues below.
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