Order Date – 08 February 2024

Parties: Tvl.J.M.Traders Vs The Deputy Commissioner (ST) and The Commercial Tax Officer, North-I

Facts –

• The Petitioner, Tvl.J.M.Traders, stated that ITC to the extent specified amount was blocked by the second respondent by issuing a text message on 11.12.2023.

Issue –

• Whether the blocking of ITC is illegal and arbitrary?

Order – 

• The Single Bench of Hon’ble High Court observed that Rule 86A does not stipulate a prior notice, the language thereof and the nature of power exercised by resort thereto require the contemporaneous communication of reasons in writing to the assessee.
• In the case at hand, m. Therefore, the petitioner is entitled to the unblocking of ITC. Hence, the writ petition is disposed of by directing the first respondent to take necessary action to remove the block on the ITC in the electronic credit ledger.