The Orissa High Court has refused to entertain writ alleging illegal exercise of power in blocking Input Tax Credit (ITC).
The bench of Chief Justice Harish Tandon and Justice Murahari Sri Raman has observed that where decision has been rendered in the context of allegation against the availing input tax credit that fact-finding on the nature of dispute set up by the Department can be subject-matter for adjudication by the statutory authority empowered in this behalf and thereafter, if need arises the same could be tested before the other statutory authorities in the hierarchy of adjudicatory process.
The petitioner/assessee, registered taxable person under GST Act is engaged in works contract business, received e-mail on 28.04.2025, whereby it is intimated that the Input Tax Credit amounting to Rs.1,88,120/- has been blocked against the Electronic Credit Ledger available on GST portal. Since the action of the Department was unilateral without compliance of principles of natural justice, on enquiry, it has come to fore that the Supplier-M/s. Metro International, with GSTIN being non-existent, the goods supplied by it would not entitle the petitioner to avail the benefit of Input Tax Credit to the extent of Rs.1,88,120.
On visiting the portal, the petitioner stated to have downloaded documents which demonstrate that said supplier-M/s. Metro International has reflected all the transactions effected with the petitioner and discharged its liability fully for the period in question. It is also revealed that M/s. Metro International, the alleged supplier is not a non-existent person; nonetheless, the documents available in the web-portal of the Department concerned indicate factum of furnishing returns by discharge of full liability with respect to transactions effected during the period 2024-25.
As Input Tax Credit has been blocked since 28.04.2025, despite representation or reply submitted with material particulars is kept pending for the reason best known to the Authority concerned, the petitioner feeling constrained approached this Court beseeching extraordinary jurisdiction by invoking provisions of Articles 226 and 227 of the Constitution of India.
The department contended that the statutory authority has invoked powers under Rule 86A of the OGST Rules, 2017 and having found prima facie material from the material available on record received by way of confidential report, submitted that the suppliers, namely, M/s. Metro International and M/s. Cerebral Trade Exim had been issuing invoices notwithstanding the fact that their registration certificates are shown to have been cancelled since 20.01.2024 and 18.01.2024 respectively.
The court held that it is not a fit case for exercise of extraordinary jurisdiction under Articles 226 and 227 of the Constitution of India, this Court refrains from entertaining the writ petition.
Case Details
Case Title: M/s. TRANSTECH SOLUTION Versus The Commissioner CT & GST
Case No.: W.P.(C) No.13821 of 2025
Date: 24.07.2025
Counsel For Petitioner: Kananbala Roy Choudhury
Counsel For Respondent: Sunil Mishra
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