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2019 (3) TMI 486 - HC - GSTGrant of regular bail - offence punishable under Section 132 (1) (a), (b) and (c) of Goods & Services Tax Act, 2017 - issuance of fake invoices to get input tax credit - main accused have not been arrested so far - Held that - U/s. 69 of the GST Act, the Commissioner is having power to arrest if he has reasons to believe that a person has committed an offence specified in Clause (a) or (b) or (c) of sub-section (1) of Section 132 of the GST Act. Section 132(1) (a), (b) and (c) of GST Act define types of offences and according to which, whoever commits offence of supply of any goods or services without issue of any invoice or issues any invoice or bill without supply of goods or services of both or avails input tax credit using such invoice, shall be punished with imprisonment of term which may extend to 5 years and with fine, if the amount involved is more than ₹ 500 Lakhs. In view of the statement of the petitioner recorded u/s. 70 of the GST Act and the fact that the main accused have not been arrested so far, in the considered opinion of this Court, the petitioner is not entitled for grant of bail. Application dismissed.
Issues:
Application for bail under Section 439 Cr.P.C. in a case involving arrest for offences under GST Act and IPC. Analysis: The petitioner was arrested during an investigation in a case registered under the GST Act for offences punishable under Section 132(1)(a), (b), and (c) related to tax evasion and fraud. The prosecution alleged that the petitioner, as the proprietor of a firm, was involved in creating fake firms, issuing fake invoices, and defrauding the government exchequer by availing input tax credit through bogus transactions. The investigation revealed a significant amount of fake invoices issued and received, resulting in a substantial evasion of GST. The petitioner's alleged involvement was based on his confession and statements made during the investigation, implicating him in the fraudulent activities orchestrated with another individual. The petitioner applied for regular bail under Section 439 of Cr.P.C., contending that he was falsely implicated in the case. His defense argued that he was not a registered dealer under the GST Act, did not render any services, issue any invoices, or engage in any taxable transactions. The petitioner expressed willingness to cooperate in further investigation and asserted that his custody was unnecessary. However, the prosecution opposed the bail application, citing the admissibility of the petitioner's recorded statement as evidence against him and highlighting the non-arrest of the main accused in the case as a reason to deny bail. The court considered the provisions of the GST Act, specifically Section 69 empowering the Commissioner to arrest individuals suspected of committing specified offences under Section 132(1)(a), (b), or (c). The court emphasized the seriousness of the offences related to the issuance of fake invoices and availing input tax credit unlawfully, punishable with imprisonment and fines. Based on the recorded statement of the petitioner and the non-arrest of the main accused, the court concluded that the petitioner was not entitled to bail. Consequently, the bail application was rejected, and the petition was dismissed, upholding the decision of the lower court in denying bail to the petitioner.
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