Karnataka HC says Rule 86A Blocking Requires an Effective Opportunity to Respond

The taxpayer's ITC of ₹16.46 lakh was blocked under Rule 86A on the allegation that the credit was based on documents from fictitious entities. Although the Department produced evidence of a prior personal-hearing intimation, the Court found that the taxpayer should nevertheless have an opportunity to place documents establishing the genuineness of its transactions before the authority deciding whether the blocking should continue.