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TMI Blog2019 (3) TMI 1187X X X X Extracts X X X X X X X X Extracts X X X X ..... ies as also to the fact that the Petitioner No.1 was residing abroad and was not involved in day to day affairs of the company. This Court is not convinced by the arguments advanced by the counsel for the Petitioner for the very reason that Petitioner No.1 is the Director of the company since 08.08.2012 and has been receiving managerial remuneration from the company to the tune of about ₹ 60 lakh per annum. Petitioner No.1 became the Managing Director of Petitioner No.2 on 30.05.2018, hence contention of counsel for the Petitioner that he was not involved in day to day affairs of the company, cannot be accepted. The contention that the tax is to be first determined under Section 73 74 of the Act does not have any force for the very reason that in an offence committed under Section 132 of the Act determination of tax is not required and the Department can proceed straight away by issuing summons or if reasonable grounds are available by arresting the offender. Since offence under Section 132 is made out and Senior Officials of Company are behind bars, Petitioner being Managing Director is responsible and Department has the right to proceed under Section 69 and 70 of th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... his reputation. 5. Counsel for the Petitioners has placed reliance on Make My Trip (India) Pvt. Ltd. vs. Union of India 2016 SCC online Del.4951, wherein the Delhi High Court held that Section 70 of the Goods and Services Tax Act does not permit the Sale Tax Department to by pass procedure before going ahead with arrest of a person. Decision to arrest a person must not be taken on whimsical grounds, it must be based on credible material . 6. It is contended by counsel for the Petitioners that the judgment passed by the Delhi High Court was affirmed by the Apex Court in Civil Appeal No.8080/2018 Union of India Ors. vs. Make My Trip (India) Pvt. Ltd. decided on 23.01.2019, wherein the Apex Court has affirmed the judgment of the Delhi High Court and held that it is mandatory to follow the procedure contained in Section 73-A(3) (4) of the Finance Act, 1994 before going ahead with the arrest of a person under Sections 90 91 of the Act. 7. Reliance has also been placed on Meghraj Moolchand Burad vs. Directorate General of GST (Intelligence), Pune and Anr. SLP (Criminal) No(s). 244/2019 dated 13.12.2018 of the Apex Court, wherein the Apex Court granted p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... contended that the Officials of the company were arrested as there was reasonable ground to believe that they have committed offence under clause (b) or clause (c) or clause (d) Sub-section (1) of Section 132 of the Act. It is argued that even bail applications of the officials stand rejected by the Court which goes to show that the company was involved in fraudulent claiming of input tax credit by furnishing fake invoices. It is also contended that though Petitioner No.1 was residing at United States of America, he was the Director of the company from August, 2012 and was receiving managerial remuneration from the company to the tune of about ₹ 60 lakh per annum. Hence, he cannot shake off his responsibilities from the criminal act committed by him and the company. 13. With regard to the judgment referred to by the counsel for the Petitioners Make My Trip (India) Pvt. Ltd. vs. Union of India (supra), it is contended that facts of that case are entirely different in Make My Trip (India) Pvt. Ltd. vs. Union of India case. Make my trip collected amount with GST but the GST was not deposited. The amount was passed on to the hotels alongwith GST after retaining commiss ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Director of the company since 08.08.2012 and has been receiving managerial remuneration from the company to the tune of about ₹ 60 lakh per annum. Petitioner No.1 became the Managing Director of Petitioner No.2 on 30.05.2018, hence contention of counsel for the Petitioner that he was not involved in day to day affairs of the company, cannot be accepted. 20. The case set up by the Department is that the Petitioner has claimed input tax credit on fake invoices, which fact is not controverted by the Petitioner. Hence, Department has all rights to take any action permissible by law. 21. The contention that the tax is to be first determined under Section 73 74 of the Act does not have any force for the very reason that in an offence committed under Section 132 of the Act determination of tax is not required and the Department can proceed straight away by issuing summons or if reasonable grounds are available by arresting the offender. 22. It is clear case of the Department that a raid was conducted at the premises of the Petitioner company at Bhiwadi and two officials and Petitioners were summoned and their statements were recorded and from the statements, it is reveale ..... X X X X Extracts X X X X X X X X Extracts X X X X
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