Blocking and unblocking of Input Tax Credit: representations and evidential certificate must be considered; fresh order directed within eight weeks.

Blocking and unblocking of input tax credit requires prior consideration of representations and any evidential certificate before final blocking under Rule 86A(2); the administrative authority must afford an opportunity to be heard and base action on the certificate of the Assistant Commissioner. A direction is issued to the respondent to pass a fresh order taking into account the petitioners representations dated 06.11.2025 and 10.11.2025 and the evidential certificate, with that exercise to be completed within eight weeks. Writ petition disposed accordingly.

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Issues: Whether the impugned notice under Rule 86A(1)(a) blocking Input Tax Credit can be sustained without considering the petitioner's representations and the certificate from the tax administration confirming the supplier's genuineness, and whether the blocking order must be reconsidered under Rule 86A(2).

Analysis: The notice issued under Rule 86A(1)(a) resulted in blocking of a specified quantum of Input Tax Credit on the ground that the supplier was non-existent. The petitioner submitted representations for unblocking and produced a certificate issued by the tax administration asserting that the supplier is a genuine and active taxpayer carrying on business from the declared place. The petitioner has outstanding tax liabilities for subsequent months, which are relevant to any final recovery. The matter falls within the scope of Sub-Rule (2) of Rule 86A, which permits examination of representations and passing of fresh orders after hearing and verification of the supplier's status. The record warrants that the respondent re-examine the representations and the certificate and hear the petitioner before passing a final order.

Conclusion: Direction issued to the Respondent to pass a fresh order under Rule 86A(2) after considering the petitioner's representations and the certificate regarding the supplier's genuineness and after affording the petitioner an opportunity of hearing; matter to be completed within eight weeks. The interim blocking is not finally sustained without such reconsideration.

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