TaxTMI 
TaxTMI 
Seeking reason for blocking ITC
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....eeking reason for blocking ITC<br> Query (Issue) Started By: - Shyam Naik Dated:- 10-5-2021 Last Reply Date:- 11-5-2021 Goods and Services Tax - GST<br>Got 7 Replies<br>GST<br>Dear All, ITC has been blocked, purportedly u/r 86A. Upon receiving notification from GSTN, we requested to the proper officer to let us know the reason. We again requested for the reason almost after one month. However, de....
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....partment is yet to intimate the reason for taking action of blocking the ITC. Whether, the reason can be sought by filing an application under the RTI Act. Regards, Shyam Reply By Ganeshan Kalyani: The Reply: Sir, you can contact your Jurisdictional GST Office and ask the reason. Search contact details of the office and approach personally. You will get the response. Reply By ABHISHEK TRIPAT....
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....HI: The Reply: Dear Shyam Ji, Rule 86A is silent with respect to passing any specific order in case of its invocation. That is why department is not providing reason/order after invoking Rule 86A. File an application requesting an order containing the reasons for invoking rule 86A, may use the following broader point. * Invocation of rule 86A without having an order containing reason to beli....
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....eve is a violation of PNJ and PNJ should be read into the rules because your statutory rights are being affected. * The need for reasoned order is to avoid arbitrary action by the authorities and that should also be read into R. 86A (frame your argument like that). Catena of Hon'ble SC Judgments on that. For instance, use Ajanta Industries, 1975 (12) TMI 1 - SUPREME COURT. * Rely on Aryan Trad....
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....elink v. Union of India = 2021 (2) TMI 685 - KARNATAKA HIGH COURT, wherein the Hon'ble Karnataka HC has directed the authorities to pass a detailed order u/r. 86A. * Etc. Etc. If the department still doesn't provide you with the order, then challenge rule 86A. It has been challenged in lot of HCs as being arbitrary. Why RTI won't work? PIO will merely cite Sec. 8(1)(h) against you and wo....
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....n't provide you the information. 8(1)(h) information which would impede the process of investigation or apprehension or prosecution of offenders; Reply By KASTURI SETHI: The Reply: Sh.Shyam Naik Ji, Confrontation with the department will not yield any fruitful result, especially, in viiew of Section 155 of CGST Act which is extracted below :- SECTION 155 of CGST Act. Burden of proof....
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..... - Where any person claims that he is eligible for input tax credit under this Act, the burden of proving such claim shall lie on such person. Reply By GB Rao: The Reply: Dear sir, It is always better to approach the jurisdictional office with a detailed letter seeking for the reasons for blocking the ITC u/r 86A. If it does not yield result, then you can think of other options. Neverthless se....
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....eking information through RTI is definitely not a remedy for your problem. Reply By KASTURI SETHI: The Reply: There is no harm in seeking the information from the department by way of a letter. Needless to say, letter should be in a polite language. Such like problems are worth to be solved amicably. Every problem cannot resolved through litigation or confrontation with the department. 99 % prob....
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....lems can be solved without going to the Court. Reply By ABHISHEK TRIPATHI: The Reply: Shyam Ji, It depends whether to be confrontational or not. Most cases department tells you the reason (verbally), but very few officers don't. In these few cases you need confrontation. At least you will get to know the reason behind such blocking, so that you may resolve and get your business going. Its b....
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....een month and still department is not responding, so you may take the call. My view: Communication made to the department should be documented. It is extremely necessary. [ It depends how you word your communication] Getting an order for reason for blocking ITC will be an issue, for that you may have to make representation. Reply By KASTURI SETHI: The Reply: Agreed with SH. ABHISHEK TRIPATHI....
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...., Sir. In my view, Coronavirus may be the reason for such inordinate delay. Coronavirus has derailed every office, business and day-today life etc.<br> Discussion Forum - Knowledge Sharing ....