Blocking of Electronic Credit Ledger under Rule 86A quashed due to lack of reasoning and natural justice violation

Blocking of Electronic Credit Ledger under Rule 86A quashed due to lack of reasoning and natural justice violationCase-LawsGSTThe HC quashed the order blocking petitioner’s Electronic Credit Ledger under Rule 86A of CGST/SGST Rules. The court found that t

Blocking of Electronic Credit Ledger under Rule 86A quashed due to lack of reasoning and natural justice violation
Case-Laws
GST
The HC quashed the order blocking petitioner's Electronic Credit Ledger under Rule 86A of CGST/SGST Rules. The court found that the impugned order lacked independent reasoning, instead relying on enforcement authority reports which constituted “borrowed satisfaction.” Additionally, no pre-decisional hearing was granted to the petitioner before blocking the ECL, violating principles of natural justice. The order merely stated the registered person was “found to be a bill trader and involved in issuance/availment in fake invoices” without providing substantive reasoning. The court determined these procedural and substantive defects rendered the blocking order legally untenable and allowed the petition.
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