Electronic credit ledger cannot be blocked without providing an opportunity of personal hearing

Last updated: 23 January 2023
Quick Summary
The Jharkhand High Court has ruled that a taxpayer's Electronic Credit Ledger (ECL) cannot be blocked without first providing them with an opportunity for a personal hearing. In this case, the court found that the blocking of the petitioner's ECL and the subsequent orders were invalid because they violated the principles of natural justice. The court quashed the previous orders and allowed the petitioner to revise their GST TRAN-1 form, with the possibility of fresh proceedings if the revised form is not filed correctly.

Court :
Jharkhand HC

Brief :
The Hon'ble Jharkhand High Court in M/s Vinayak Metal and Chemicals& Ors. v. the State of Jharkhand & Ors. [W.P.(T) No. 3022 of 2020 dated November 14, 2022] quashed and set aside the orders blocking Electronic Credit Ledger ("ECL") of the assessee without providing an opportunity of personal hearing.  Permitted the assessee to file a revised Form GST TRAN-1, and further directed the Revenue Department that, in case the assessee fails to file a revised Form GST TRAN-1, it can initiate fresh proceeding after issuance of a proper Show Cause Notice ("SCN") in accordance with law.

Citation :
W.P.(T) No. 3022 of 2020 dated November 14, 2022

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Bimal Jain
Published in GST
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