GST
Officer pressing to pay blocked credit in cash
Updated . Every paid answer is checked by a CA. Free AI answers are labelled until a CA verifies them.
Facts
No law requires you to pay a blocked amount just to lift the block. Any payment should be your own considered decision, made through DRC-03 after review.
Provisions and law
- Rule 86A(2), CGST Rules 2017Debit may be allowed again, fully or partly, once the officer is satisfied
- CBIC guidelines on Rule 86A, 2 November 2021Blocking needs material evidence and is not to be done mechanically or on mere suspicion
- Rule 142(2), CGST Rules 2017Payment of tax before notice is intimated in DRC-03
Analysis
The CBIC guidelines say blocks must not be mechanical, and release under Rule 86A(2) depends on evidence, not on payment. If after review some ITC is truly doubtful, you may choose to pay that part with interest through DRC-03. Ask for any demand in writing. Example: an oral request to pay ₹10 lakh should be met with a written representation and a request for reasons.
Conclusion
- Ask for the demand and reasons in writing.
- Review each blocked invoice with your CA.
- Pay only amounts you accept, through DRC-03.
- Keep a record of all conversations and letters.
Payments made under pressure are hard to get refunded later.
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