https://www.taxtmi.com/caselaws?id=419870 The Gujarat HC quashed the blocking of input tax credit (ITC) under Rule 86A of CGST Rules. The court held that Rule 86A confers drastic powers requiring strict compliance with procedural safeguards. The authority must have objective material to form "reason to believe" that credit was fraudulently utilized and must record reasons in writing before blocking ITC. Since no reasons were conveyed to the taxpayer and the power affects civil consequences, principles of natural justice must be followed. The blocking order was set aside as the authority failed to satisfy mandatory requirements of reasonableness and procedural fairness. en-us Wed, 23 Feb 2022 00:00:00 +0530 Wed, 02 Apr 2025 10:34:00 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=419870 The Gujarat HC quashed the blocking of input tax credit (ITC) under Rule 86A of CGST Rules. The court held that Rule 86A confers drastic powers requiring strict compliance with procedural safeguards. The authority must have objective material to form "reason to believe" that credit was fraudulently utilized and must record reasons in writing before blocking ITC. Since no reasons were conveyed to the taxpayer and the power affects civil consequences, principles of natural justice must be followed. The blocking order was set aside as the authority failed to satisfy mandatory requirements of reasonableness and procedural fairness. Case-Laws GST Wed, 23 Feb 2022 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=419870