GST Authority Can’t Pass Order for Insertion of Negative Balance in Credit Ledger of Assessee | Telangana HC

  • Blog|News|GST & Customs|
  • 2 Min Read
  • By Taxmann
  • |
  • Last Updated on 8 May, 2024

Recent Posts

News, Blog, Insolvency and Bankruptcy Code

Interim Moratorium Barred Continuation of Proceedings u/s 138 of NI Act Against Petitioner Due to IBC’s Overriding Effect | HC

Blog, News, FEMA & Banking

Borrower’s Right to Redeem Secured Asset Ends on Publication of Notice u/s 9(1) of SI Rules, Not After Sale Completion | SC

Latest from Taxmann

Negative Balance in Credit Ledger

Case Details: Laxmi Fine Chem v. Assistant Commissioner - [2024] 161 taxmann.com 270 (Telangana)

Judiciary and Counsel Details

    • P. Sam Koshy & N. Tukaramji, JJ.
    • S. Dwarkanath, Ld. Sr. Counsel & Siddharth Gilda, Ld. Counsel for the Petitioner.
    • Swaroop Oorilla, Ld. Sp. Govt. Pleader, Rajesh Reddy, Ld. Counsel & Gadi Praveen Kumar, Ld. Dy. Solicitor General of India for the Respondent.

Facts of the Case

The petitioner had filed instant writ petition against the action on part of the department in blocking input tax credit (ITC) to tune of Rs. 50.06 lakhs for the period from 01.02.2024 to 13.02.2024. It was contended that the ITC had been blocked in contravention to Rule 86A, where blocking can only be done so far as ITC available in electronic credit ledger of petitioner and could not have been by way of making negative credit.

High Court Held

The Honorable High Court noted that as per Rule 86A, only blocking of availing of ITC to whatever is in credit of petitioner is permissible. No power is conferred upon authorities for block of ITC to be availed by petitioner in future. In the instant case, the department had made a negative credit entry in the electronic credit ledger of the petitioner which is not permissible. Therefore, the Court held that the action of authority in blocking ITC by making negative credit in electronic credit ledger was in contravention of Rule 86A and directed to immediately recall order of blockage.

List of Cases Reviewed

List of Cases Referred to

Disclaimer: The content/information published on the website is only for general information of the user and shall not be construed as legal advice. While the Taxmann has exercised reasonable efforts to ensure the veracity of information/content published, Taxmann shall be under no liability in any manner whatsoever for incorrect information, if any.

Leave a Reply

Your email address will not be published. Required fields are marked *

«
»

Everything on Tax and Corporate Laws of India

To subscribe to our weekly newsletter please log in/register on Taxmann.com

Author: Taxmann

Taxmann Publications has a dedicated in-house Research & Editorial Team. This team consists of a team of Chartered Accountants, Company Secretaries, and Lawyers. This team works under the guidance and supervision of editor-in-chief Mr Rakesh Bhargava.

The Research and Editorial Team is responsible for developing reliable and accurate content for the readers. The team follows the six-sigma approach to achieve the benchmark of zero error in its publications and research platforms. The team ensures that the following publication guidelines are thoroughly followed while developing the content:

  • The statutory material is obtained only from the authorized and reliable sources
  • All the latest developments in the judicial and legislative fields are covered
  • Prepare the analytical write-ups on current, controversial, and important issues to help the readers to understand the concept and its implications
  • Every content published by Taxmann is complete, accurate and lucid
  • All evidence-based statements are supported with proper reference to Section, Circular No., Notification No. or citations
  • The golden rules of grammar, style and consistency are thoroughly followed
  • Font and size that's easy to read and remain consistent across all imprint and digital publications are applied