📰 𝗣𝘂𝗻𝗷𝗮𝗯 𝗮𝗻𝗱 𝗛𝗮𝗿𝘆𝗮𝗻𝗮 𝗛𝗶𝗴𝗵 𝗖𝗼𝘂𝗿𝘁 𝗥𝘂𝗹𝗶𝗻𝗴: 𝗔𝗹𝗹𝗲𝗴𝗲𝗱 𝗨𝗻𝗷𝘂𝘀𝘁 𝗕𝗹𝗼𝗰𝗸𝗶𝗻𝗴 𝗼𝗳 𝗜𝗻𝗽𝘂𝘁 𝗧𝗮𝘅 𝗖𝗿𝗲𝗱𝗶𝘁 📢 Court’s Statement: "The blocking of Input Tax Credit (ITC) must not proceed solely on supplier scrutiny without proper investigation into the taxpayer's conduct."

🔍 𝗙𝗮𝗰𝘁𝘀: • 𝗖𝗮𝘀𝗲 𝗧𝗶𝘁𝗹𝗲: K.J. International vs State of Punjab • 𝗖𝗼𝘂𝗿𝘁: Punjab and Haryana High Court • 𝗗𝗮𝘁𝗲: 06-Oct-2023 • 𝗖𝗮𝘀𝗲 𝗡𝘂𝗺𝗯𝗲𝗿: CWP-22514 of 2023

𝗜𝘀𝘀𝘂𝗲: The petitioner, K.J. International, contested the blocking of ITC in its Electronic Credit Ledger, arguing that the restriction was based on a generalized supplier audit rather than any specific investigation of their transactions. The petitioner asserted that prolonged ITC blocking without adjudication could prevent it from filing returns, risking registration cancellation.

𝗣𝗿𝗼𝗰𝗲𝗲𝗱𝗶𝗻𝗴𝘀: K.J. International argued that only suppliers, not its own records, were scrutinized. The petitioner requested that blocking orders be quashed, enabling compliance with return filing and avoiding registration issues.

⚖ 𝗝𝘂𝗱𝗴𝗺𝗲𝗻𝘁: The Court ruled in favor of the petitioner, ordering immediate unblocking of the ITC account while permitting a 10% pre-deposit of any assessed penalty amount as a condition for proceeding. This judgment emphasizes taxpayer rights against preliminary restrictions without due process.

📜 𝗜𝗺𝗽𝗹𝗶𝗰𝗮𝘁𝗶𝗼𝗻𝘀: This ruling reinforces the necessity of transparent, thorough inquiry before imposing restrictive measures, supporting taxpayers’ procedural rights in tax matters. Team GSTpanacea 7503031378