Where the Rule 86A Law Is Actually Being Made

The five notes before this one set out what the courts have held about blocking a credit ledger. This one is about where they held it, because the answer affects how much of that law you can actually use.

Of the judgments on this database which turn on Rule 86A — naming it five times or more, rather than reciting it in passing — 121 engage it substantively. Two High Courts account for 87 per cent of them.

It is not an artefact of what has been collected

The obvious objection is that this measures the database rather than the litigation. It does not, and the way to test it is to normalise against each court's GST judgments in the same corpus.

Kerala has the largest GST holding of any court here and one judgment turning on Rule 86A. Orissa has nearly as many judgments as Karnataka and a twenty-sixth of the rate. The concentration is in the litigation, not in the collection.

Within Karnataka it is recent and sustained rather than a single burst: 12 judgments in 2024, 63 in 2025, across 43 separate decision dates.

Volume is not influence

Here the figures invert, and it is the practical point of this note.

Delhi contributes one judgment of the 121. That judgment is Best Crop Science (P) Ltd v. Principal Commissioner, CGST, which decided the negative blocking question across eight petitions and is now followed or distinguished wherever that question arises. One judgment, and it settled more than the sixty-three from Karnataka in the same year.

The same is true in reverse. Karnataka's volume has produced something the others have not: a worked-out, repeatedly applied test for "reasons to believe", with borrowed satisfaction at its centre, stated in K-9 Enterprises v. State of Karnataka and applied down a long line of cases since. That is not the product of one decision. It is the product of eighty.

So the two things a body of case law can give you come from different places. The settled propositions — negative blocking, the one-year limit — come from courts which have decided the point once, carefully. The texture, the sense of what an officer may and may not get away with on ordinary facts, comes from the court which sees it every week.

What follows if you are not in Karnataka

Most readers of these notes are not. Three consequences are worth drawing out.

You are reading law built on another bar's arguments. The formulation that recurs through the Karnataka judgments — drastic and draconian, borrowed inquiry, the twin pre-requisites — is persuasive everywhere and binding in one place. Before a court which has not adopted it, it has to be argued rather than cited.

The divisions matter more than the propositions. This series has run into three: whether a pre-decisional hearing is required, whether negative blocking is permitted, and what follows from Rule 86A not being a recovery provision. In each, the answer differs by jurisdiction. A note which told you the law without telling you that would be worse than useless.

Absence of local authority is not absence of law. Telangana has 1,989 GST judgments on this database and none turning on Rule 86A at depth — yet the Bombay High Court in King Enterprises records Telangana as having held negative blocking to be beyond the rule. Decisions exist which this corpus has not reached, and a search which returns nothing from your own High Court has not established that your High Court is silent.

A note on the numbers

These counts are of judgments on this database, which is a large collection of High Court GST decisions but not a complete one. Coverage differs by court and by period, and the normalisation above controls for the size of each court's holding rather than for how completely that holding has been gathered.

Duplicates have been removed by comparing the text of each judgment, which matters more than it sounds: before that step the raw figures showed 299 judgments rather than 263, and elsewhere in this corpus a single batch of writ petitions had inflated one court's apparent output fourfold.

In short

1. Eighty-seven per cent of the substantive law on Rule 86A comes from two High Courts, and the concentration survives normalising for corpus size.
2. Check whether the proposition you are relying on is local. The Karnataka formulation is persuasive, not binding, outside Karnataka.
3. Where the question is one of the three divisions, establish your jurisdiction first and plead accordingly.
4. Do not treat silence in your own High Court as settled law. Decisions exist that no database has caught up with.
5. Read the leading cases from elsewhere anyway. Delhi's single judgment decided more than most courts' whole output.

This is the last note in the series on Rule 86A. The others covered what the rule requires, reasons to believe, the pre-decisional hearing split, negative blocking and the one-year limit and the Rule 86A(2) application.

This note is general information drawn from reported decisions and is not advice upon any particular matter. The figures are counts of judgments held on bharattax.net as at 3 October 2026 and will move as the collection grows.