ECL Re-Blocking Within One Year Valid | HC

Case Details: Creative Enterprises vs. State of Telangana - [2026] 184 taxmann.com 183 (Telangana)

Judiciary and Counsel Details

• Aparesh Kumar Singh, CJ. & G.M. Mohiuddin, J.
• M.Uma Shankar, Learned counsel for the Petitioner.
• Swaroop Oorilla, Learned Special Govt. Pleader for the Respondent.

Facts of the Case

The petitioner challenged the re-blocking of its Electronic Credit Ledger (ECL) under Rule 86A of the CGST Rules on the ground that such action was beyond the permissible period of one year and without jurisdiction. The petitioner confined the writ petition only to the challenge against the blocking of the ECL and contended that the action of the department was not sustainable if the blocking had continued beyond the prescribed time limit. During the course of proceedings, the department submitted that the ECL had been re-blocked and that the period of one year from the date of such re-blocking had not expired. The department also produced an order-in-original passed pursuant to a show cause notice (SCN) issued under Section 74 of the CGST Act, disallowing input tax credit (ITC) and imposing tax, interest, penalty and late fee. The matter was accordingly placed before the High Court.

High Court Held

The High Court held that the writ petition did not disclose the proceedings initiated under Section 74 of the CGST Act or the linkage of the blocking of the ECL with such proceedings. The Court observed that non-disclosure of material facts in writ proceedings was fatal to the grant of relief. It further held that the re-blocking of the ECL was founded on the demand created under Section 74 of the CGST Act and that the one-year period from the date of re-blocking had not expired. In view of these circumstances, the Court concluded that interference in writ jurisdiction was unwarranted and dismissed the writ petition.