Delhi HC Quashes blocking of ‘Electronic Credit Ledger’ under Rule 86A in excess of available GST ITC

The Delhi High Court quashed the blocking of the electronic credit ledger under Rule 86A of the CGST Rules, where the blocked amount exceeded the available Input Tax Credit (ITC). The court ruled that the tax authorities had acted in excess of their powers by blocking credit beyond what was available. This judgment emphasizes the need for tax authorities to adhere strictly to statutory provisions and protect taxpayers’ rights. It serves as a precedent for ensuring that actions taken under Rule 86A must be proportional and based on actual available credit, preventing arbitrary or excessive blockages.