2019 (11) TMI 879 - HC - GST

Grant of anticipatory bail - alleged availment of input tax credit on the basis of forged invoice - Section 132 of the Jharkhand GST Act 2017 - alleged offence of Smt. Renu Singh - HELD THAT - The petitioner of A.B.A. No.6521 of 2018 namely Smt. Renu Singh is directed to surrender in the Court of learned Chief Judicial Magistrate Bokaro within four weeks from today and in the event of her arrest or surrendering she will be enlarged on bail provisionally for a period of one month from the date of her surrender on showing proof of reversing input tax credit of 50, 00, 000/- with the Goods and Service Tax Department after the date of this order and on furnishing bail bond of 25, 000/- (Twenty five thousand) with two sureties of the like amount each to the satisfaction of learned Chief Judicial Magistrate Bokaro in connection with Bokaro Steel City P.S. Case No.121 of 2018 corresponding to G.R. No.663 of 2018 with the condition that she will co-operate with the investigation of the case and appear before the investigating officer as and when noticed by him and furnish her mobile number and photocopy of the Aadhar Card with an undertaking that she will not change her mobile number during the pendency of the case and subject to the conditions as laid down under Section 438(2) of the Code of Criminal Procedure. Petitioner of A.B.A. No.4745 of 2018 namely Nikit Mittal - HELD THAT - The petitioner of A.B.A. No.4745 of 2018 namely Nikit Mittal is directed to surrender in the Court of learned Chief Judicial Magistrate Bokaro within one month from today and in the event of his arrest or surrendering he will be enlarged on bail on showing proof of reversing input tax credit of 1, 06, 282/- to the Goods and Service Tax Department after the date of this order and on furnishing bail bond of 25, 000/- with two sureties of the like amount each to the satisfaction of learned Chief Judicial Magistrate Bokaro in connection with Bokaro Steel City P.S. Case No.121 of 2018 corresponding to G.R. No.663 of 2018 with the condition that he will cooperate with the investigation of the case and appear before the investigating officer as and when noticed by him and furnish his mobile number and photocopy of the Aadhar Card with an undertaking that he will not change his mobile number during the pendency of the case and subject to the conditions as laid down under Section 438(2) of the Code of Criminal Procedure.

Summary

Issues:
Grant of anticipatory bail in connection with a case under Sections 409, 420, and 120-B of the Indian Penal Code read with Sections 132(1)(e), 132(1)(f), 132(1)(i), and 132(1)(iv) of the Goods and Service Tax Act, 2017.

Analysis:
The petitioners sought anticipatory bail in a case involving alleged offenses under various sections of the Indian Penal Code and the Goods and Service Tax Act, 2017. The allegations against one petitioner, Smt. Renu Singh, included falsely claiming input tax credit based on forged invoices amounting to over ?2.9 crores. The other petitioner, Nikit Mittal, was accused of a similar offense involving an amount of ?1,06,282. The petitioners contended that the prosecution was initiated with malicious intent to harass them, without following the procedures under Sections 73 and 74 of the Jharkhand Goods and Services Tax Act, 2017.

The petitioners argued that the power to punish under Section 132 of the Act should only be exercised post-determination of the demand due from an assessee following an assessment. They relied on judgments from the Madras High Court and the Supreme Court emphasizing the necessity of following due procedures before arrest or prosecution under similar statutes. They highlighted the importance of completing adjudication under Sections 73 and 74 of the Act before launching prosecutions under Section 132.

The petitioners expressed their willingness to cooperate with the investigation and reverse the allegedly availed input tax credit amounts. Smt. Renu Singh offered to reverse ?50,00,000 in installments, while Nikit Mittal agreed to reverse ?1,06,282. The petitioners urged that without following the prescribed procedures, the prosecution should not have been initiated, and they should be granted anticipatory bail to facilitate their cooperation with the investigation.

After considering the submissions and circumstances, the Court granted anticipatory bail to the petitioners. Smt. Renu Singh was directed to surrender within four weeks and provide proof of reversing ?50,00,000 in input tax credit to be enlarged on bail. Similarly, Nikit Mittal was directed to surrender within a month and reverse the input tax credit of ?1,06,282 to be granted bail. Conditions included cooperation with the investigation, providing necessary documents, and not changing contact details during the case's pendency. Failure to comply with the reversal of input tax credit amounts would result in the cancellation of bail and appropriate actions by the trial court for facing trial.

In conclusion, the Court granted anticipatory bail to the petitioners based on their willingness to cooperate and reverse the alleged input tax credit amounts, emphasizing the importance of following due procedures before initiating prosecutions under the relevant sections of the Goods and Service Tax Act, 2017.