2023 (1) TMI 1024 - HC - GST

Unblocking of Input Tax Credit - seeking directions regarding refund claim - HELD THAT - We have already discussed the implications of the order dated 13 September 2022 which has already been acted upon and there was no challenge to the said order, though the learned counsel for the Respondent No.1-State has sought to contend that State has not been given opportunity to contest the case, the Respondent-State has permitted to utilize the account. It is not possible for us to reverse the effect of the order dated 13 September 2022 as it has already been given effect to by the Respondents without challenging the said order. Though Petitioner states that amount more than what was prayed was allowed to be utilized, we do not find anything on record regarding the same nor the prayer is amended. Writ petition is disposed off.

Summary

Issues:
1. Unblocking of Input Tax Credit and refund sought by Petitioner.
2. Quashing of impugned orders.
3. Waiver of late fee and interest for non-filing of returns.
4. Direction to not pass assessment order until Input Tax Credit is unblocked.
5. Implications of the order dated 13 September 2022.
6. Consideration of legal remedies under Section 73/74 of the CGST Act.
7. Examination of the implications of the unblocking of the account.
8. Disposition of the writ petition.

Analysis:
1. The Petitioner sought the unblocking of Input Tax Credit amounting to Rs.81,68,812 and refund, along with the quashing of impugned orders. The Court directed Respondent No.3 to unblock the Input Tax Credit account and refund the amount. The Petitioner also requested the waiver of late fees and interest for non-filing of returns, which was considered in the detailed order passed on 12 December 2022.

2. The Court addressed the issue of quashing impugned orders as per the Petitioner's prayers. The Respondents were directed not to pass the assessment order until the Input Tax Credit amount was unblocked and refunded to the Petitioner.

3. The Court discussed the implications of the order dated 13 September 2022, which directed the unblocking of the Input Tax Credit account. The Respondents filed a reply stating that the ledger account was unblocked, and the Petitioner utilized the Input Tax Credit. The Court considered the actions taken after the unblocking and filing of returns by the Petitioner.

4. The legal remedies under Section 73/74 of the CGST Act were examined. The State argued that under Rule 86A of the Rules, the account could be blocked to prevent fraudulent transactions. The Court deliberated on the appropriate remedy and the powers of the Respondents to block the account.

5. The Court considered whether the petition had been rendered academic after the unblocking of the account and subsequent actions taken by the Petitioner. The implications of the order dated 13 September 2022 were analyzed, and the course of action for the pending petition was discussed.

6. The Court disposed of the writ petition by concluding that the issue regarding the unblocking of the Input Tax Credit account was settled by the order dated 13 September 2022. Other aspects were kept open for consideration in pending proceedings or for the Respondents to take further legal action, which the Petitioner could challenge as per the law.