TaxTMI 
TaxTMI 
Guidelines for disallowing debit of electronic credit ledger under Rule 86A of the Assam GST Rules, 2017
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.... State Tax or an officer authorised by him, on the basis of reasonable belief that credit of input tax available in the electronic credit ledger has been fraudulently availed or is ineligible, may not allow debit of an amount equivalent to such credit in electronic credit ledger. 2. Doubts have been raised by the field formations on various issues pertaining to disallowing debit of input tax credit from electronic credit ledger, under rule 86A of the Rules. Further, Hon'ble High Courts in some cases have emphasized the need for laying down instructions for the purpose of invoking rule 86A. In view of the above, the following instructions are hereby issued with respect to exercise of power under rule 86A of the Rules: 3.1 Grounds f....
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.... may, for reasons to be recorded in writing, not allow debit of an amount equivalent to such credit in electronic credit ledger for discharge of any liability under section 49 or for claim of any refund of any unutilised amount. (2) The Commissioner, or the officer authorised by him under sub-rule (l) may, upon being satisfied that conditions for disallowing debit of electronic credit ledger as above, no longer exist, allow such debit. (3) Such restriction shall cease to have effect after the expiry of a period of one year from the date of imposing such restriction." 3.1.2 Perusal of the rule makes it clear that the Principal Commissioner of State Tax, or an officer authorised by him, not below the rank of Ass....
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....gistered person, only after proper application of mind considering all the facts of the case, including the nature of prima facie fraudulently availed or ineligible input tax credit and whether the same is covered under the grounds mentioned in sub-rule (1) of rule 86A as discussed in para 3.1.2 above; the amount of input tax credit involved; and whether credit ledger of a person is necessary for restricting him from utilizing / passing on fraudulently availed or ineligible input tax credit to protect the interests of revenue. 3.1.4 It is reiterated that the power of disallowing debit of amount from electronic credit ledger must not be exercised in a mechanical manner and careful examination of all the facts of the case is importan....
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.... Rupees 1 crore but not exceeding Rs 5 crore Joint Commissioner of State Tax Above Rupees 5 crore Principal Commissioner of State Tax / Special Commissioner of State Tax / Additional Commissioner of State Tax 3.3 Procedure for disallowing debit of electronic credit ledger / blocking credit under Rule 86(A): 3.3.1 The amount of fraudulently availed or ineligible input tax credit availed by the registered person, as per the grounds mentioned in sub-rule (1) of rule 86A, shall be prima facie ascertained based on material evidence available or gathered on record. It is advised that the powers under rule 86A to disallow debit of the amount from electronic credit ledger of the registered person may be exercised by the Princip....
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....Principal Commissioner of State Tax or the authorized officer, as the case may be, either on his own or based on the submissions made by the taxpayer with material evidence thereof, may examine the matter afresh and on being satisfied that the input tax credit, initially considered to be fraudulently availed or ineligible as per conditions of sub-rule ineligible or wrongly availed, either (1) of rule 86A, is no more partially or fully, may allow the use of the credit so disallowed / restricted, up to the extent of eligibility, as per powers granted under sub-rule (2) of rule 86A. Reasons for allowing the debit of electronic credit ledger, which had been earlier disallowed, shall be duly recorded on file in writing, before allowing such debi....