2024 (5) TMI 601 - HC - GST

Restraint on respondents from taking action against the petitioner pursuant to the order of withholding of sanction of refund and blocking of Input Tax Credit (ITC) - HELD THAT - Reliance placed upon the decision of the Division Bench of this Court in the case of M/S S.S. INDUSTRIES VERSUS UNION OF INDIA 2020 (12) TMI 1120 - GUJARAT HIGH COURT wherein similar issue is considered by the Division Bench of this Court and considering the delay in completion of the investigation where it was held that We once again clarify that we have not gone into the issue as regards the constitutional validity of Rule 86A of the Rules. None of the observations made by us in this judgment should prejudice any of the litigant who might have challenged or who may deem fit to challenge the constitutional validity of Rule 86A on the grounds available in law. The challenge to the constitutional validity of Rule 86A if any shall be examined independently. This petition is disposed of as not pressed without expressing any opinion on merits on a statement made at the Bar by the learned A.G.P. that the investigation shall be completed within a period of three months from today and the notice in Form GST-DRC-01 shall be issued to the petitioner on or before 2nd August 2024 by the respondents authorities.

Summary

Issues involved: Petition to restrain action against petitioner u/s withholding of refund sanction and blocking of Input Tax Credit (ITC).

Summary:
The petition sought to restrain action against the petitioner u/s withholding of refund sanction and blocking of Input Tax Credit (ITC). Both parties relied on a previous Division Bench decision regarding a similar issue, emphasizing the need for timely completion of investigation. The Court directed completion of investigation within four weeks and issuance of a show-cause notice under Section 74 of the Act. The Court highlighted that interference in statutory proceedings is justified only in exceptional circumstances. The writ applications were rejected, clarifying that the constitutional validity of Rule 86A was not addressed. The Court emphasized that challenges to the constitutional validity of Rule 86A would be examined independently. The investigation was to be completed within three months, with a show-cause notice to be issued accordingly. The petitioner waived the issuance of a specific form, and the respondent agreed to issue a show-cause notice under the GST Act. The petitioner did not press the petition at that stage, reserving the right to revive it if needed. The petition was disposed of without expressing any opinion on merits, with the understanding that the investigation would be completed within the specified timeframe.

This summary provides a detailed overview of the judgment, highlighting the key issues and decisions made by the Court regarding the petition to restrain action against the petitioner u/s withholding of refund sanction and blocking of Input Tax Credit (ITC).