HC directed dept. to unblock ECL & recover ITC with interest if payment not made to supplier
- Blog|News|GST & Customs|
- < 1 minute
- By Taxmann
- |
- Last Updated on 30 December, 2022
Latest from Taxmann
Case Details: Sunny Jain v. Union of India - [2022] 145 taxmann.com 601 (Delhi)
Judiciary and Counsel Details
-
- Vibhu Bakhru & Purushaindra Kumar Kaurav, JJ.
-
Rajkumar, Harpreet Singh, Sr. Standing Counsel, Ms Suhani Mathur & Jatin Kumar Gaur, Advs. for the Respondent.
Facts of the Case
The Electronic Credit Ledger (ECL) of petitioner was blocked by the department for alleged non-payment of consideration to its supplier. The petitioner filed writ petition against blocking of ECL and contended that ECL could not be blocked for eighteen months as provision allows blocking same for maximum period of one year.
High Court Held
The Honorable High Court noted that as per Rule 37 of CGST Rules read with proviso to section 16(2) of CGST Act, a taxpayer is entitled to avail ITC without paying consideration to his supplier and has to reverse same if he fails to make such payment within 180 days. However, the ITC availed before making payment to supplier and expiry of period of 180 days could not make petitioner ineligible.
Therefore, the action of blocking ECL by the department for such extended period was without authority of law. The Court directed department to unblock ECL with liberty to recover ITC with interest if it was required to be included in output liability of petitioner.
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.
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
Sign Up
To subscribe to our weekly newsletter please log in/register on Taxmann.com
Latest Books
Everything on Tax and Corporate Laws of India
To subscribe to our weekly newsletter please log in/register on Taxmann.com
CA | CS | CMA
