2024 (2) TMI 1071 - HC - GST

Seeking grant of bail - availment of fake ITC - issuance of fake bills from seven firms managed by him and taking ITC through fake bills issued by fake firms created - HELD THAT - The allegation in the charge sheet itself speaks and states that accused-petitioner has generated the fake ITCs of Rs. 20,28,40,841/-. It is settled law that economic offences constitute a class apart and required to be scanned with a different approach in the matter of bail. In the matter of Ratnambar Kaushik 2022 (12) TMI 263 - SUPREME COURT , the facts were entirely different and that was not a case of generating the fake ITC. In that case, goods were supplied without paying the CGST. In the present case, the facts are entirely different. The Hon ble Apex Court in the matter of Lalit Goyal 2022 (8) TMI 1319 - SC ORDER dismissed the bail application of the petitioner. In the matter of Lalit Goyal, it was alleged that petitioner Lalit Goyal and other persons had made various fake firms and claimed Input Tax Credit of Rs. 18.91 Crores without any transportation of goods. In that case, co-ordinate Bench of this Court in S.B. Criminal Misc. Bail Application No.13042/2021 dated 07.09.2021 2021 (9) TMI 1347 - RAJASTHAN HIGH COURT dismissed the bail application of the petitioner and in SLP vide order dated 26.08.2022 2022 (8) TMI 1319 - SC ORDER , the Hon ble Apex Court dismissed the Special Leave Petition, therefore, considering the gravity of the offence, so also, that petitioner has taken a fake Input Tax Credit (ITC) worth of Rs. 20,28,40,841/-, the accused-petitioner is not enlarged on bail. The bail application of accused-petitioner under Section 439 Cr.P.C. is dismissed.

Summary

Issues:
The judgment involves a bail application filed under Section 439 Cr.P.C. on behalf of the accused-petitioner who has been arrested for offences under Section 132 (1) (b) (c) (f) and (l) of CGST Act, 2017.

Accused's Submission:
The accused-petitioner's counsel argued that the petitioner has been falsely implicated and has been in custody since a specific date. It was highlighted that the offence is triable by a Magistrate with a maximum punishment of five years, indicating that the trial may take considerable time, thus requesting bail.

Union of India's Opposition:
The Senior Counsel for Union of India opposed the bail application, alleging that the accused-petitioner was involved in issuing fake bills and generating fake ITC through various means. It was claimed that the accused operated multiple firms, issued goods less invoices, and passed on fake ITC amounting to a significant sum.

Legal Arguments:
The Senior Counsel emphasized that a charge-sheet had already been submitted against the accused-petitioner under the relevant sections of the CGST Act, asserting that economic offences like these require a different approach when considering bail applications. Referring to previous judgments, it was argued that the offences in question are cognizable and non-bailable.

Judicial Analysis:
After examining the charge sheet and legal references provided by both parties, the court noted the gravity of the offence involving the generation of fake ITC worth a substantial amount. Drawing a distinction from previous cases, the court highlighted that economic offences require a distinct approach in bail matters. Citing precedents where bail applications were dismissed in similar cases, the court concluded that due to the seriousness of the offence and the significant fake ITC involved, the accused-petitioner was not granted bail.

Decision:
Consequently, the bail application under Section 439 Cr.P.C. filed by the accused-petitioner was dismissed by the court.