Negative Blocking of ITC in Excess of Amount available in ECL to Disallow Debit not allowable under GST Rule 86A(1): Delhi HC

The Delhi High Court ruled that negative blocking of Input Tax Credit (ITC) beyond the available balance in the Electronic Credit Ledger (ECL) is impermissible under GST Rule 86A(1). The case stemmed from a dispute where the authorities blocked ITC greater than the balance in the ECL, causing undue hardship to the taxpayer. The court concluded that blocking such credits must adhere to legal limitations, ensuring that taxpayers' rights are not violated through arbitrary administrative actions. This judgment affirms proper GST administration.