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TMI Blog2021 (3) TMI 541X X X X Extracts X X X X X X X X Extracts X X X X ..... ependent directors had appeared before the investigating authorities and their statements were also recorded. As a matter of fact in the statement of Mr. Akashnand Karnik, director of the petitioner company recorded on 01.02.2021, he meticulously answered all the queries pertaining to various transactions of the petitioner company with M/s. Wiggins Coretech Equipments Pvt Ltd, M/s. Siddharth Education Services, M/s. HNO Furnishings Ltd, M/s. Creative Business Associates, M/s. Mystique Media Pvt Ltd, M/s. Gradient Infotainment Ltd and M/s. Cannon Ball Trading Pvt Ltd including supply of computers and whatever services were provided by them - there is no instance of the petitioners tampering with documents or trying to influence any witness being brought on record. Merely saying or apprehending that in future they may tamper with evidence or induce any witness as observed by the learned Magistrate cannot be a justification to deny bail. It is already noticed that the maximum sentence that can be imposed upon conviction for the said offence is imprisonment for five years. This brings us to section 167 of the Cr.P.C.. Section 167(2)(a)(ii) makes it clear that a person cannot be kept ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... out briefly as under:- 5.1. Mr. Sunil Kumar Jha is the petitioner in writ petition (st) No. 5484 of 2021 whereas Mr. Akshay Chhabra is the petitioner in writ petition (st) No. 5486 of 2021. Mr. Akshay Chhabra is the chairman cum managing director of the company called One Point One Solutions Ltd (briefly petitioner company hereinafter) having its registered office at International Infotech Park, Vashi. Mr. Sunil Kumar Jha is the Chief Financial Officer of the petitioner company. Petitioner company is engaged in the business of providing business process outsourcing (BPO) services to various clients covering a range of services from customer support to consultancy services, to healthcare and retailing etc. 5.2. It is stated that petitioner company is listed in the National Stock Exchange having a work force of more than 5000 employees. 5.3. On 17.09.2020 respondent No. 2 conducted a search and seizure operation in the office premises of the petitioner company whereafter summons dated 24.09.2020 were issued to Mr. Jha to tender evidence and also to provide purchase invoices of seven companies viz, (i) Siddharh Education Services Ltd, (ii) HNO Furnishing Ltd, (iii) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and seizure operation on 05.02.2021 in the Pawne office of the petitioner company whereafter various documents were seized. Petitioners have stated that in the course of the search and seizure operation, respondent No. 2 wanted to know the location of the modular furniture supplied by M/s. HNO Furnishings Ltd which was shown by Mr. Akash Chhabra by taking respondent No. 2 and other officials to the various work stations where modular furniture were installed. Though apparently respondent No. 2 was satisfied about the modular furniture supplied by M/s. HNO Furnishings Ltd, nevertheless the accompanying officials called upon the petitioner company to submit documentary evidence of the rentals of its premises from the year 2014 onwards. Even such details were furnished by the petitioner company. 5.9. In the meanwhile, recording of statements continued and on 09.02.2021 statement of Mr. Sunil Kumar Jha was recorded. Thereafter, statement of Mr. Akshay Chhabra and Mr. Sunil Kumar Jha were again recorded on 12.02.2021, 15.02.2021 and 16.02.2021. 5.10. While the petitioners went to attend the office of respondent No. 2 on 16.02.2021 after being summoned, they were arrested under sec ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tting offence under section 132(1)(b) and (c) of the CGST Act which is punishable under clause (i) of sub-section (1) of section 132 which is a cognizable and non-bailable offence. While contending that petitioners have the regular remedy of moving bail applications, the affidavits have also given details of various transactions entered into by the petitioner company to highlight the seriousness of the allegation against the petitioners. 7. Mr. Ponda and Mr. Jagtiani, learned senior counsel for the petitioners have contended that when the petitioners had cooperated with the investigation and had responded to the summons issued, there was no justification for taking the petitioners into custody. Referring to section 132(1)(i) of the CGST Act, they submit that the maximum penalty for committing an offence under section 132(1)(b) and (c) is five years with fine. Since the maximum sentence is less than seven years, judgment of the Supreme Court in Arnesh Kumar Vs. State of Bihar (2014) 8 SCC 273 would be applicable. Referring to the recent judgment of this Court in Daulat Samirmal Mehta Vs. Union of India Order dated 15.02.2021 in Civil Writ Petition No. 471 of 2021., it is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that the present is not a fit case for grant of bail to the petitioners. 9. Submissions made by learned counsel for the parties have been duly considered. We have also perused the materials on record. Judgments cited at the bar have been duly carefully examined. 10. There is no dispute to the fact that petitioners were arrested on 16.02.2021 under section 69 of the CGST Act. A perusal of the arrest memo dated 16.02.2021 issued by the Superintendent (Anti Evasion) would go to show that the allegation against the two petitioners is committing an offence under section 132(1)(b) and (c) of the CGST Act punishable under section 132(1)(i) thereof. As per the remand application, it is alleged that petitioners had played a crucial role in the illegal availment / utilization of ineligible input tax credit to the tune of ₹ 9,04,89,054.00 without supply of goods and / or services and have utilized the same for payment of GST besides issuing fake invoices to fake / fictitious companies like M/s. Germanium Trading Pvt Ltd. Interestingly, in the prayer portion of the remand application, the arresting authority sought judicial custody of the two petitioners for 60 (sixty) days though ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 32(1)(b) and (c) is five years and with fine. In Arnesh Kumar (supra), Supreme Court had held that in case of an offence where the punishment upon conviction is seven years if a person complies with a notice under section 41-A of the Code of Criminal Procedure, 1973 (briefly Cr.P.C. ) particularly sub-section (3) thereof which says that where such person complies and continues to comply with the notice, he shall not be arrested in respect of the offence referred to in the notice unless for reasons to be recorded the police officer is of the opinion that he ought to be arrested. Relying upon Arnesh Kumar (supra), this Court in Daulat S. Mehta (supra) also held that the reasons to believe contemplated in subsection (1) of section 69 must not only pertain to commission of any offence as specified but also the need and necessity for arresting such person when that person had complied with the summons. 13. In the instant case, we find that both the petitioners taken together had appeared before the respondents on multiple occasions particularly on 20.11.2020, 01.02.2021, 03.02.2021, 09.02.2021, 12.02.2021, 15.02.2021 and 16.02.2021 when their statements were recorded. Not only that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dicial custody for 60 days though in the penultimate paragraph, this was overwritten to 14 days but without initials. This only indicates the manner in which the respondents have proceeded in the matter whereby the process of detention itself is sought to be converted into a penalty. We say this and no more on this aspect. 16. We have also noticed that as per the remand application, the allegation against the two petitioners is that they had played a crucial role in illegally availing input tax credit of ₹ 9,04,89,054.00. Petitioners have stated that on 18.02.2021, petitioner company made a payment of ₹ 1,36,56,638.00 under protest. Thereafter further payments were made on 23.02.2021 for a total amount of ₹ 3,44,02,350.00. In all, petitioners have paid ₹ 4,80,58,988.00 till date and they have made a statement that they would be bound to pay whatever amount is found due and payable upon investigation and adjudication subject to their right of appeal. 17. In Daulat S. Mehta (supra), this Court has held that bail jurisprudence which has evolved over the years stands on a different footing altogether. This is more so when admittedly respondents have not lo ..... X X X X Extracts X X X X X X X X Extracts X X X X
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