2025 (1) TMI 726 - HC - GST

Grant of anticipatory bail - offences under Sections 420, 467, 468, 471, 474 and 477-A IPC and Section 132 (1) (b) of Central Goods and Sevices Tax Act, (CGST), 2017 - HELD THAT - In the present case, the FIR was registered by the police on 18.06.2019 and now, the petitioner is sought to be arrested after more than 05 years and 06 months. Still further, the documentary evidence has already been taken into possession by the police, during the course of investigation and the petitioner has reversed the ITC availed by the firm of the petitioner. The present petition is allowed and the petitioner is granted concession of anticipatory bail, subject to the conditions as provided under Sections 482 (2) of B.N.S.S.

1. ISSUES PRESENTED and CONSIDERED

The core legal questions considered in this judgment are:

Whether the petitioner is entitled to anticipatory bail under Section 482 of the B.N.S.S. in connection with the FIR registered for alleged offenses under the Indian Penal Code (IPC) and the Central Goods and Services Tax Act (CGST), 2017?
Whether the delay in seeking the arrest of the petitioner impacts the decision to grant anticipatory bail?
What are the implications of the petitioner having reversed the Input Tax Credit (ITC) in relation to the alleged offenses?

2. ISSUE-WISE DETAILED ANALYSIS

Issue 1: Entitlement to Anticipatory Bail

Relevant Legal Framework and Precedents: The application for anticipatory bail is considered under Section 482 of the B.N.S.S., which provides the court with the power to issue directions or orders necessary to prevent abuse of the process of any court or to secure the ends of justice. The court also considers precedents where similarly placed co-accused have been granted bail.
Court's Interpretation and Reasoning: The court noted that the petitioner was implicated in a case involving a fake firm allegedly used for tax evasion. However, the main accused and another co-accused had already been granted bail. The court emphasized the principle of parity in granting bail.
Key Evidence and Findings: The petitioner's firm had reversed the ITC availed, and the main accused had already been granted regular bail. The documentary evidence was already in possession of the police.
Application of Law to Facts: The court applied the principle of parity and considered the reversal of ITC as a mitigating factor, indicating compliance with tax obligations.
Treatment of Competing Arguments: The state opposed the bail, citing the seriousness of the crime. However, the court found the petitioner's compliance in reversing the ITC and the delay in arrest significant.
Conclusions: The court concluded that anticipatory bail should be granted, subject to conditions under Section 482 (2) of B.N.S.S.

Issue 2: Impact of Delay in Arrest

Relevant Legal Framework and Precedents: The court considers the impact of delay in arrest on the entitlement to bail, often seen as a factor in favor of the accused.
Court's Interpretation and Reasoning: The court noted the significant delay of over five years in seeking the petitioner's arrest and found that this delay weighed in favor of granting anticipatory bail.
Key Evidence and Findings: The FIR was registered on 18.06.2019, and the petitioner was sought to be arrested after more than five years and six months.
Application of Law to Facts: The delay in arrest was considered alongside the reversal of ITC, suggesting that the petitioner was not an immediate flight risk or threat to evidence.
Treatment of Competing Arguments: The state did not provide compelling reasons for the delay, which undermined their opposition to bail.
Conclusions: The delay was a significant factor in the court's decision to grant anticipatory bail.

Issue 3: Reversal of ITC and its Implications

Relevant Legal Framework and Precedents: The reversal of ITC is relevant under the CGST Act, indicating compliance with tax obligations.
Court's Interpretation and Reasoning: The court viewed the reversal of ITC as evidence of the petitioner's compliance and mitigation of any alleged tax evasion.
Key Evidence and Findings: The petitioner had reversed the ITC availed by their firm, which was a central point in their defense.
Application of Law to Facts: The reversal of ITC was considered a mitigating factor, reducing the severity of the alleged offenses.
Treatment of Competing Arguments: While the state argued the seriousness of tax evasion, the court found the reversal of ITC indicative of the petitioner's intent to comply with tax laws.
Conclusions: The reversal of ITC supported the petitioner's case for anticipatory bail.

3. SIGNIFICANT HOLDINGS

Preserve verbatim quotes of crucial legal reasoning: "Thus, without commenting on the merits of the case, the present petition is allowed and the petitioner is granted concession of anticipatory bail, subject to the conditions as provided under Sections 482 (2) of B.N.S.S."
Core Principles Established: The principle of parity in bail decisions, the significance of delay in arrest, and the impact of compliance with tax obligations through ITC reversal.
Final Determinations on Each Issue: The petitioner was granted anticipatory bail, recognizing the delay in arrest, the reversal of ITC, and the principle of parity with co-accused who had been granted bail.

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