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TMI Blog2021 (10) TMI 1022X X X X Extracts X X X X X X X X Extracts X X X X ..... oss of revenue and increase in inflation. It also have the impact on morale, increase in corruption and resulting in accumulation of black money and money laundering. So the impact on the nation as a whole is enormous. It is always considered that fiscal discipline is the base for strong economy that too for a fast developing country like India. Economic offences are always considered as serious threat to the economy of the country. It is nothing but economic terrorism. Therefore, such offences are considered as a class apart. The Hon ble Apex Court in Y.S. JAGAN MOHAN REDDY VERSUS CENTRAL BUREAU OF INVESTIGATION [ 2013 (5) TMI 896 - SUPREME COURT] categorically held that economic offences constitute a class apart and needs to be visited with a different approach in the matter of bail. Under such circumstances, the strong suspicion of evasion of tax by the petitioner cannot be taken lightly. Only after a detailed investigation, the truth or otherwise in the allegations made could be found out. The conduct of the petitioner in not cooperating with the Investigating Officer is to be taken into consideration while deciding this petition. Initially the raid was held on few prem ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... only with an intention to disrupt the normal life of the petitioner in carrying on his business. It is stated that the petitioner is having in all 13 vehicles to carry on his business. The vehicles were purchased by obtaining loan from various banks. The bank statements, income tax returns and other relevant documents are available in the public domain and the respondent could easily access to all those documents. The petitioner was not required to be summoned to appear before the respondent to produce those documents. Therefore, it is the contention of the petitioner that summoning him by the respondent is only with an ulterior motive to tease and harass him. 4. It is contended that the petitioner has reason to believe that he may be apprehended on accusation of committing the offence under Section 132(5) of the Act which is non-bailable in nature. As per section 69(1) of the CGST Act, the Commissioner is empowered to authorize any officer of Central Tax to arrest a person, if he has reason to believe that such person committed the offence under Section 132 of CGST Act. Therefore, the petitioner is having reasonable apprehension of being arrested and detained in custody by maki ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he relevant documents need to be carried by the person in-charge of the conveyance and should be produced as and when required. When search was held on credible information, incriminating documents were found. The petitioner had given his statement admitting involvement in such illegal transportation of goods without following the procedure as contemplated under law and thereby evading tax payable to the State. The search conducted by the respondent on the basis of credible information cannot be termed as harassment or highhanded acts. 9. Learned Standing Counsel submitted that the petitioner is required to co-operate in the investigation, but, the petitioner is avoiding to appear before the respondent or the authorized officer and not co-operating in the investigation. A search was held in the office premises of the petitioner on 28.11.2020. The house premises of the petitioner could not be searched, as the same was kept under lock and key to avoid search and seizure of incriminating materials. Therefore, the premises was seized and the summons under Section 70(1) of the CGST Act was affixed on the door, requiring the petitioner to appear before the authorized officer on 01.1 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... facie disclose grave economic offences. The respondent suspects that it is a racket having its links inter-state and crores of rupees of tax suspected to have been evaded by the petitioner. Under such circumstances, the petitioner is not entitled for grant of pre-arrest protection. Thus, the petition filed by the petitioner under Section 438 Cr.P.C. is not maintainable. Accordingly, he prays for dismissal of the petition as devoid of merits. 12. In view of the rival contentions urged by the learned counsel for both the parties, the point that would arise for my consideration is: Whether the petitioner is entitled for grant of anticipatory bail under Section 438 of Cr.P.C.? My answer to the above point is in Negative for the following: REASONS 13. In Sri Hanumanthappa Pathrera Lakshmana (supra), the co-ordinate Bench of this Court considered the position of law as to whether there is any bar to entertain the petition for anticipatory bail under Section 438 of Cr.P.C., when the offences involve fraudulent involvement of input tax credit on the basis of invoices without actual supply of goods in contravention of Section 16 of CGST Act, which has resulted in loss ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ted for transaction was utilized by the firms for not only availing input tax credit, but for getting refunds by showing the sales to export units. The refunds were received for the tax which was actually never received by the revenue and under such circumstances, it relied on the opinion formed by the Hon ble Apex Court in Y S Jagan Mohan Reddy Vs CBI (2013) 7 SCC 439, wherein, it is held: Economic offences constitute a class apart and need to be visited with a different approach in the matter of bail. The economic offence having deep rooted conspiracies and involving huge loss of public funds need to be viewed seriously and considered as grave offences affecting the economy of the country as a whole and thereby posing serous threat to the financial health of the country. Relying on the specific observation made by the Hon ble Apex Court, it was held that there are no reasons to grant bail to the accused and rejected the petition filed under Section 439 of Cr.P.C., wherein paras 22 to 24 and 27 reads as under: 22. Moreover, the courts cannot lose sight of the adverse impact such activities would have in the economy. It appears that a large number of cases have n ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... th the emerging technologies so as to get rid of practical hiccups. With these observations, the Court rejected the prayer for grant of bail. 17. In Vikas Goel Vs Dy. Dir., Directorate General of GST Intelligence, Gurugram 2019 (28) GSTL 590 , the High Court of Punjab and Haryana (Chandigarh), considering the seriousness, nature and gravity of the offence punishable under Section 132 of CGST Act, rejected the bail sought by the accused, by observing as under: 4. Perusal of the record shows that there are serious allegations against the present petitioner, who is the main accused, that he along with co-accused, by falsely showing bogus billing etc., adjusted the amount without any actual transportation of the goods or sale of goods etc., Only paper transactions were done and the accused have wrongly claimed the relief of more than 80 crore. The case is at preliminary stage. 18. In Tejas Pravin Dugad and Others Vs Union of India and Others MANU/RH/0441/2021, the High Court of Bombay (Aurangabad Bench) considered similar situation, where the petitioner had sought for anticipatory bail, where the allegations of evasion of tax was made after granting interim re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... bail probability of abscondance not within country but beyond country is more probable. The Court held that keeping in view the principle settled by the Hon ble Apex Court there are no merit in the application filed under Section 438 of Cr.P.C. 22. In the light of various decisions rendered by the Hon ble Apex Court and other High Courts, the facts and circumstances of the present case are considered. It is the specific contention of the prosecution that the authorities received credible information regarding involvement of the petitioner in transportation of goods illegally without raising invoices as required under Section 31 of CGST Act and without generating e-way bills as required under Rule 138 of CGST Rules. It is not in dispute that as per Rule 138A of CGST Rules, the person in charge of conveyance should carry all relevant documents and he is required to produce the same as and when required. It is also the contention of prosecution that when the premises belonging to the petitioner was searched, incriminating documents were found and when the petitioner was summoned to appear before the authorized officer, he virtually admitted of being involved in such illegal transp ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... much necessary to get proper answers which matches with the documents that are available. The contention of the learned counsel that since the petitioner is already questioned and some of the premises are already searched, the petitioner is not required for further questioning also cannot be accepted. It is the prerogative of the Investigating Officer to question the petitioner on the basis of information he is having for the purpose of satisfying himself that there is compliance of requirements of law by the petitioner while carrying on the business. As it is contended that the offence suspected to have been committed by the petitioner is an economic offence, which results in loss to the revenue, same cannot be ignored or lost sight of by this Court. It is premature to form an opinion that the petitioner is not required for interrogation. It will amount to interference in investigation of suspected white collar crime. 26. Even though the learned counsel relied on the decision of the co-ordinate Bench of this Court in Hanumanthappa Pathrera Lakshmana (supra) the same is not helpful to the petitioner as the position of law that there is no bar to entertain the petition seeking a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er. 29. The allegation made against the petitioner is that he is supplying the goods without issuance of invoice or bill, without supply of goods, availing input tax credit either using the invoices or bills or fraudulently availing such input tax credit without any invoice or bill and that he is collecting the amount as tax, but fails to pay the same to the Government in violation of the provisions of CGST Act and the Rules made thereunder, with an intention to evade tax. GST Act 2017 is enacted to make provision for levy and collection of taxes on intra-state supply of goods or services or both by the Central Government. The main aim of the Act is to simplify the taxation mechanism, to reduce the burden of taxes and clarify conformity of the tax payment. It also aims at consolidation of all indirect tax levies into a single tax and to remove cascading effect of the taxes. It is to achieve the motive of one nation one tax and to reduce tax evasion, to have corruption free tax administration, to reduce complications, encourage technically driven procedures and to provide ease of operation for e-commerce. If the citizens understand the importance of payment of tax, achieving the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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