2021 (2) TMI 1125 - HC - GST

Arrest under section 69 of the Central Goods and Services Tax Act, 2017 - offence of availing ineligible Input Tax Credit - out of the alleged availing of ineligible Input Tax Credit of slightly more than ₹ 9 crores, petitioner No.1 has deposited ₹ 4.80 crores which is more than 50% of the alleged dues - HELD THAT - It is directed that no coercive action shall be taken against petitioner Nos. 2 to 8 till the next date. However, petitioner Nos.2, 7 and 8 shall appear before the investigating authority as summoned on 26.02.2021 at 11 00 a.m. and thereafter as and when summoned. Rest of the petitioners shall appear before the investigating authority as and when summoned and co-operate with the investigation. Stand over to 16.03.2021 for filing of reply and rejoinder.

Summary

Issues:
Petition challenging arrest under section 69 of the Central Goods and Services Tax Act, 2017.

Analysis:
The judgment delivered by the High Court of Bombay pertains to a petition challenging the arrest of individuals under section 69 of the Central Goods and Services Tax Act, 2017. The primary concern raised in the writ petition was the apprehension of arrest at the hands of certain respondents. The petitioners highlighted that key individuals associated with the petitioner company had already been arrested and were in judicial custody due to allegations of availing ineligible Input Tax Credit using fake invoices. It was emphasized that a significant portion of the alleged dues had already been deposited by the petitioner, demonstrating cooperation with the investigation. The petitioners argued that further arrests would serve no purpose other than causing humiliation.

Upon hearing the arguments presented by the parties, the Court directed that no coercive action should be taken against certain petitioners until the next date of hearing. However, specific petitioners were instructed to appear before the investigating authority as summoned on a particular date and time, emphasizing the need for cooperation with the ongoing investigation. The remaining petitioners were also required to appear before the investigating authority as and when summoned and cooperate accordingly. The Court scheduled the next hearing for the filing of replies and rejoinders, indicating a continuation of the legal proceedings in this matter.

This judgment showcases the Court's consideration of the apprehensions raised by the petitioners regarding potential arrests under the tax legislation. By issuing specific directives to the concerned parties and emphasizing cooperation with the investigation, the Court aims to balance the interests of all parties involved while ensuring the progression of the legal process. The decision reflects a nuanced approach to addressing the complexities of tax-related matters and the implications of arrests on individuals associated with the alleged offenses.