2019 (7) TMI 159 - HC - GST

Grant of regular bail - offence punishable under Sections 132(1)(b), 132(1)(c), 132(1)(k), 132(1)(i) and Section 16 of the Central Goods and Services Tax Act, 2017 - HELD THAT - In the facts of the case, the allegations made against the Applicant, the evidence collected by the prosecution, the submissions put-forth on behalf of the parties and further considering the seriousness of the offence and involvement of the money in the offence, I am not inclined to release the Applicant on bail. Bail application dismissed.

Summary

Issues:
Bail application under Section 439 of the Code of Criminal Procedure for grant of regular bail in connection with a case registered under the Central Goods and Services Tax Act, 2017.

Analysis:
The Applicant, a Director/Proprietor of two firms, was arrested in connection with a case registered under Sections 132(1)(b), 132(1)(c), 132(1)(k), 132(1)(i), and Section 16 of the Central Goods and Services Tax Act, 2017. The prosecution alleged that the Applicant was involved in creating bogus entities to pass on irregular and inadmissible Input Tax Credit (ITC) to beneficiaries, resulting in a loss of over ?100 Crores to the Government Exchequer. The Applicant was arrested following a search at his residence where books of accounts, registers, and fake invoices were recovered. The prosecution claimed that the Applicant's firms were major beneficiaries of these transactions, which were conducted through circular/semicircular transactions involving more than ?500 Crores. The Applicant has been in custody since the arrest on 7.5.2019.

The Applicant's counsel contended that he is innocent and wrongly implicated in the case. It was argued that no complaint has been filed against him, and there is no evidence of him receiving any money personally. The counsel further argued that the arresting officer wrongly exercised power under Section 69(3) of the Act of 2017, as the Applicant's transactions were through bank transactions. It was emphasized that the Applicant, being a permanent resident of Raipur, poses no flight risk or threat to tamper with evidence, warranting the grant of bail.

In response, the Respondent's counsel asserted that there is substantial evidence linking the Applicant to the alleged offence, emphasizing the significant loss caused to the Government Exchequer. The Respondent argued that the Applicant was rightfully arrested under Section 69 of the Act of 2017 by authorized officers.

After considering the arguments, evidence, and seriousness of the offence, the Court declined to grant bail to the Applicant. The decision was based on the allegations against the Applicant, the evidence collected by the prosecution, and the substantial amount of money involved in the offence. Consequently, the bail application was rejected.