The Uttarakhand High Court disposed of Kotdwar Steel’s writ petitions against a negative block on its electronic credit ledger, recording that a Rule 86A restriction ceases to operate once one year expires.
A restriction placed on a taxpayer’s electronic credit ledger under Rule 86A of the CGST Rules stops operating once one year has passed from the date it was imposed, leaving nothing further to decide in a challenge to the block [Kotdwar Steel Ltd. v. Office of the Deputy Commissioner & Anr., 2026-juristway.com-3198-HC(Uttarakhand)-GST].
The order was passed by a Division Bench of Acting Chief Justice Manoj Kumar Tiwari and Justice Subhash Upadhyay in three connected writ petitions filed by the same company.
The petitioner, registered under the Uttarakhand GST Act, sought directions to remove a negative block on its electronic credit ledger for different periods.
Counsel for both sides were unanimous that more than one year had passed since the restriction was placed on the ledger. The Court reproduced Rule 86A(3): “Such restriction shall cease to have effect after the expiry of a period of one year from the date of imposing such restriction.”
Since any restriction under Rule 86A remains operative only for a year, and that period had admittedly expired, the Court held that no useful purpose would be served by keeping the petitions pending.
The petitioner’s counsel also informed the Court that an assessment order had since been passed on the same demand challenged in the writ petitions, and that the petitioner’s appeal against it was pending before the appellate authority.
The petitions were disposed of without further orders. The Court made clear that the GST authorities remain at liberty to proceed in the matter in accordance with law.
The order does not record the dates on which the ledger was blocked or the periods covered by the three petitions.
2026-juristway.com-3198-HC(Uttarakhand)-GST
