2021 (5) TMI 268 - DSC - GST

Grant of Anticipatory Bail - fraudulent ITC - Fake invoices - evasion of GST - HELD THAT - In this case when accused has already joined the investigation, he is not required for any custodial interrogation and on being inquired it is also submitted by the IO that as on today, there is no requirement of the arrest of the accused. There is no arrest since the recording of his statement on 15.12.2020. The firms which obtained the fraudulent ICT are not booked as they have deposited some of the amount. Any amount which is required to be deposited by the applicant is not disclosed. Applicant's involvement is not being the office bearer or the employee of these firms which have availed fraudulent ICT. There is no allegations from the side of the department of tampering of evidence or hampering the investigation by the accused after the grant of interim bail on 31.12.2020. In these circumstances, it is directed that in the event of arrest one week prior notice shall be served upon the applicant/accused Nitin Singhania and he is directed to join the investigation as and when directed by the IO and shall not leave the country without the permission of the Trial Court. . Application disposed off.

Summary

Issues:
1. Application for anticipatory bail based on allegations of providing fake invoices for fraudulent ITC.
2. Accused's role in supplying fake invoices and receiving commissions.
3. Comparison of accused's actions with other firms involved in GST evasion.
4. Accused's cooperation in the investigation and lack of custodial interrogation requirement.
5. Direction for prior notice of arrest and cooperation in the investigation.

Analysis:
1. The application before the court sought anticipatory bail for the accused due to allegations of providing fake invoices to multiple firms for the purpose of availing fraudulent Input Tax Credit (ITC) amounting to approximately ?14 crore. The accused's involvement was limited to the supply of fake invoices in exchange for commissions from the recipient firms.

2. It was highlighted during the proceedings that the accused had not personally availed the fraudulent ITC but had facilitated various firms in obtaining it through forged invoices. The accused's role was distinct from the firms' actions in evading GST, as he was not an office bearer or employee of the said firms.

3. The defense argued for anticipatory bail by pointing out that the firms involved in GST evasion had not faced arrests and had already deposited substantial amounts towards their liabilities, reducing the offenses to bailable levels. This comparison was crucial in assessing the accused's culpability in the context of the overall investigation.

4. The court noted that the accused had cooperated with the investigation, having already provided a statement to the department under Section 108. Given the lack of requirement for custodial interrogation and no pending liabilities towards GST, the court found no grounds for the accused's arrest since his statement on 15.12.2020.

5. Consequently, the court directed that in case of any potential arrest, the accused must be served with one week's prior notice and instructed to cooperate with the investigation as directed by the Investigating Officer (IO). Additionally, the accused was prohibited from leaving the country without the Trial Court's permission, ensuring his availability for further proceedings.

In conclusion, the court disposed of the application for anticipatory bail with the specified directions, emphasizing the importance of the accused's continued cooperation and compliance with the investigation process.