AI Drafter 
TaxTMI 
TaxTMI 
2022 (12) TMI 653
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....he petitioner that ITC has been "unblocked blocked". The petitioner claims that prior to that, on 07.09.2021, he had filed a letter with respondent no.3 raising a grievance that his ECL had been locked for a period of eighteen months without any intimation or enquiry. He had also raised an issue that in terms of Rule 86A of the Central Goods and Services Tax Rules, 2017 (hereafter 'the CGST Rules'), it was impermissible to block the ECL for a period exceeding one year. Accordingly, the petitioner requested the respondents to unblock his ECL, however, the respondents did not accede to the same. 3. The petitioner claims that he sent an e-mail dated 06.10.2021 to the office of the respondent nos.3,4 and 5 (Anti Evasion Office CGST, Delhi), requesting the respondents to furnish the list of documents required for unblocking the ECL. In response to the aforesaid e-mail, the respondents sought certain documents including copies of the Bills of Entry reflecting the IGST paid on import of goods for the financial year 2017-18 to financial year 2020-21; copy of the GSTR - 2A reflecting the IGST paid on account of import for the financial year 2017-18 to financial year 2020-21; and, compara....
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....e had not paid the consideration for supplies received from D.G. Impex within the period of 180 days and therefore, was liable to pay interest under Section 16(2)(d) of the CGST Act. Rule 86A of the CGST Rules entitles the Commissioner or any officer authorized by him in this behalf, not below the rank of Assistant Commissioner, to not permit debit (utilization) of the ITC lying to the credit in the ECR of a taxpayer in certain circumstances. Concededly, the action of the respondents to block the petitioner's ITC lying in his ECR is in exercise of the power under Rule 86A of the CGST Rules 8. Rule 86A of the CGST Rules reads as under: "RULE 86A. Conditions of use of amount available in electronic credit ledger.- (1) The Commissioner or an officer authorised by him in this behalf, not below the rank of an Assistant Commissioner, having reasons to believe that credit of input tax available in the electronic credit ledger has been fraudulently availed or is ineligible in as much as - (a) the credit of input tax has been availed on the strength of tax invoices or debit notes or any other document prescribed under rule 36- (i) issued by a registered person ....
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....trued. 12. In CST v. Modi Sugar Mills Ltd.: (1961) 2 SCR 189, the Supreme Court has observed as under:- "10. .....In interpreting a taxing statute, equitable considerations are entirely out of place. Nor can taxing statutes be interpreted on any presumptions or assumptions. The court must look squarely at the words of the statute and interpret them. It must interpret a taxing statute in the light of what is clearly expressed: it cannot imply anything which is not expressed; it cannot import provisions in the statutes so as to supply any assumed deficiency." 13. The words "inasmuch as" as used in Rule 86A(1) of the CGST Rules qualify the word "ineligible". The expression "inasmuch as" is not of a wide import; it is used in a restrictive sense to qualify the subject. 14. According to A Dictionary of Modern Legal Usage by Bryan A. Garner, second edition, the expression "inasmuch as" is defined as: "In modern AmE usage, the standard spelling of each group is inasmuch as and insofar as, both single words except for the final element. In modern BrE, usage is split: inasmuch as is standard and the expression in so far as is preferred as four separate words. Howe....
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....lectronic credit ledger of such person. (2) Notwithstanding anything contained in this section, no registered person shall be entitled to the credit of any input tax in respect of any supply of goods or services or both to him unless,-- (a) he is in possession of a tax invoice or debit note issued by a supplier registered under this Act, or such other tax paying documents as may be prescribed; (b) he has received the goods or services or both. [Explanation.- For the purposes of this clause, it shall be deemed that the registered person has received the goods or, as the case may be, services-- (i) where the goods are delivered by the supplier to a recipient or any other person on the direction of such registered person, whether acting as an agent or otherwise, before or during movement of goods, either by way of transfer of documents of title to goods or otherwise; (ii) where the services are provided by the supplier to any person on the direction of and on account of such registered person;] [(ba) the details of input tax credit in respect of the said supply communicated to such registered person under Section 38 has no....
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....e ITC along with interest. The taxpayer's liability to account for the ITC availed without paying for the same within the period of 180 days, is required to be assessed as a part of his output liability. 22. The third proviso to Section 16(2) of the CGST Act further specifies that in the event the recipient pays the amount due towards the value of the supply of goods or services or both, along with the tax payable thereon, the recipient would be entitled to avail of the ITC. The second and third provisos to Section 16(2) of the CGST Act make it amply clear that a party is not disentitled to avail the ITC in respect of goods/services prior to his discharging the liability to pay the supplier for such goods/services and tax thereon. However, if the taxpayer does not discharge his liability to the supplier within a period of 180 days, he is required to account for the benefit of the ITC availed by the taxpayer along with interest as a part of the output liability. In terms of the third proviso to Section 16(2) of the CGST Act, the taxpayer would be entitled to avail of the ITC once again on payment being made to the supplier. 23. Rule 37 of the CGST Rules provides for the mechan....