2021 (7) TMI 748 - HC - GST

Seeking cancellation of the bail granted - Irregular and fraudulent ITC - credit availed on the strength of bills of various suppliers which were non-existing and fictitious - HELD THAT - On a query raised by this Court and as is evident from the impugned order as well, the petitioner appears to have availed ITC worth more than ₹ 212 crores in M/s Brilliant Metals Pvt. Ltd., more than ₹ 21 crores in M/s Progressive Alloys India Pvt. Ltd. and more than ₹ 27 crores in M/s JBN Impex Pvt. Ltd. totaling to ₹ 260 crores availment. Till date, the case of the respondent is that the petitioner has availed ineligible ITCs to the tune of ₹ 27.05 crores, thereby implying that at the moment there is no material before the respondent that ITC s worth around 233 crores are also fraudulent. This Court deems it fit to stay the impugned order till the next date of hearing. NBW issued against the petitioner are kept in abeyance - List on 21st September, 2021.

Summary

Issues:
1. Exemption from filing attested affidavits
2. Impugning the order seeking cancellation of bail
3. Allegations of fraudulent ITC claims and bail cancellation

Exemption from filing attested affidavits:
In CRL.M.A. 10706/2021, the court directed attested affidavits to be filed within two weeks, disposing of the application. This issue primarily pertained to procedural requirements in the case.

Impugning the order seeking cancellation of bail:
In W.P.(CRL) 1267/2021 and CRL.M.A. 10704/2021, the petitioner challenged the order seeking cancellation of bail granted earlier. The respondent alleged that the petitioner had availed fraudulent ITC worth crores. The petitioner complied with the bail conditions by submitting cash and debiting ITC ledgers. However, the respondent later claimed the ITC ledgers were questionable, leading to the bail cancellation and issuance of non-bailable warrants. The court noted discrepancies in the amount of alleged fraudulent ITC and stayed the order, keeping the warrants in abeyance. Affidavits were ordered to be filed within specific timelines for further proceedings.

Allegations of fraudulent ITC claims and bail cancellation:
The respondent accused the petitioner of availing ineligible ITCs amounting to crores through different companies. While the respondent claimed fraudulent ITCs worth 27.05 crores, the total availed ITCs were significantly higher. The court observed that the respondent lacked evidence of the entire availed ITC being fraudulent. Consequently, the court stayed the order and deferred the non-bailable warrants. The case was scheduled for further proceedings, with deadlines set for filing affidavits by both parties. The order was to be uploaded on the court's website for public access.