9911796707
TMI Blog2020 (9) TMI 1231X X X X Extracts X X X X X X X X Extracts X X X X ..... on GST portal to show huge quantity of Iron and Steel purchased from one supplier and then sold to other purchaser, about 25 in numbers, situated in various parts of the country. When, upon receipt of secret information, GST intelligence authorities made enquiries and scrutinized large number of invoices, e-way bills and carried out physical verification with regard to claim, sale, purchase and supply, it was found that such sale and purchase had actually not taken place nor transportation of goods, as claimed by the applicant, ever took place and thus, without there being actual sale and supply of claimed goods, Rs. 62 crores were claimed as Input Tax Credit thereby playing fraud and not only benefiting the applicant but the ultimate manufacturer and supplier at his point facilitating availing of Input Tax Credit without there being any transaction. 2. Learned senior counsel for the applicant argued that the allegations against the applicant are based on certain material which were never disclosed nor explanation of the applicant was ever obtained. Learned senior counsel would argue that the applicant's company is a reputed trading company involved in sale and purchase of ste ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... her interrogation took place from the applicant which shows that his custodial interrogation was never required. It is next submitted that looking to the nature of allegations, further detention of the applicant is no longer necessary because all the informations which were submitted by the applicant, have already been uploaded in the GST portal as also premises of the applicant were raided and all records, documents etc. which were considered to be necessary and relevant, have already been seized. Even after grant of temporary bail to the present applicant, there is no specific allegation against the applicant that the applicant has misused his liberty either by tampering with prosecution witnesses or attempting to flee away from justice or not extending co-operation in the matter of investigation. He would submit that neither before the Supreme Court nor before this Court, any application for cancellation of temporary bail was moved by the respondent authorities seeking cancellation either on the ground of misuse of liberty or non-cooperation during investigation, much less tampering with the witnesses or attempt to flee away. Learned senior counsel would argue that in the prese ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... CC 273, Dataram Singh v. State of Uttar Pradesh, (2018) 3 SCC 22, P. Chidambaram v. Directorate of Enforcement, (2019) SCC OnLine SC 1549, Firoz Khan v. State (NCT of Delhi), Bail Appl. No.945/2020, Amit Chandrakant Shah v. State of Gujarat, R/Criminal Misc. Application No.24151 of 2019, Amit Bothra v. State of MP, MCrC No.21628/2020 and Aditya Gupta v. Union of India and ors., WP (Crl) 184/2020. 4. On the other hand, learned counsel for the respondent would argue that a prima facie case is made out against the applicant because, when upon receipt of secret information, Intelligence authorities enquired into large number of transactions of sale and supply, as claimed by the applicant and on which basis, Input Credit to the tune of crores of rupees was availed, involving scrutiny of about 400 invoices, corresponding E-way bills, various transactions uploaded in the GST portal and when cross checked, the authorities found that transactions actually did not take place and did not involve movement of goods in the course of alleged sale and supply of iron and steel products as claimed in the various returns, E-way bills and invoices by the applicant. He would submit that without there ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... with the prosecution witnesses but also tamper with various records and documents pertaining to the alleged transaction. He would further submit that various judgments cited by the applicant are not applicable at this stage because it is not a case involving actual transaction of sale and supply of goods where the applicant has wrongly claimed input tax credit. Present is a case where there is no actual sale and supply and the act of the applicant is more in the nature of fraudulent one rather than bonafide claim of the statutory scheme of availing Input Tax Credit. As far as compounding part is concerned, he would submit that it is for the applicant to offer for compounding of offence as per the law and it is only when such offer is made by the applicant that the respondent may consider any such offer of compounding strictly as per the provisions of the Act but existence of the scheme of compounding of offence could not be taken as basis by the applicant to claim bail in such a serious matter. In support of his submission, he relies upon decisions in the case of P.V. Ramana Reddy v. Union of India, 2019 SCC Online TS 2516, P.V. Ramana Reddy v. Union of India, SLP (Crl.) No.4430/20 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ainable under the law. The decisions which have been cited before this Court by both the parties are mostly those where institution of criminal case was assailed and prayer was made for a restraint order against arrest. Therefore, at this stage, when this Court is considering matter relating to post arrest bail application, it is not necessary to go into detail of those contentions advanced before this Court. 7. The allegation against the present applicant, as have been detailed in the written submissions and as borne out from the records in hand are that the applicant has availed Input Tax Credit on the basis of fake invoices, E-way bills and fabricated entries without there being actual sale / supply of goods and this involves the applicant and many other fake firms, traders who have helped the applicant in getting those false documents and records prepared. In sum and substance, the allegation is that only in order to avail Input Tax Credit, fabricated documents were prepared without there being actual sale, supply or movement of goods in the course of trade involving the present applicant. About Rs. 60 crores is said to be involved. As according to the investigating authoritie ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Court that the respondent should come out with the written objection stating the grounds, this fact was not disclosed. Learned senior counsel for the applicant argued that the applicant never refused any summons. He has stated that the applicant undertakes to appear before the authorities as and when summons are received by him within the shortest possible time. 11. After going through the records and diary placed before this Court, it is found that after initial arrest of the applicant, there is not enough material on record to show that the applicant was put to interrogation time and again. The records do not show as to what purpose is going to be served to get the applicant in custody any more at this stage when he has remained in custody for about a month before grant of ad-interim bail. 12. It is also revealed that after arrest of the applicant and during the period he remained in custody for about 30 days, no further interrogation had taken place. There is hardly any cogent material placed before the Court to show that the applicant misused his liberty either by tampering with prosecution witnesses or attempting to flee away from justice except one solitary incident of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 33 Cri LJ 94] it was observed, while dealing with Section 498 which corresponds to the present Section 439 of the Code, that it conferred upon the Sessions Judge or the High Court wide powers to grant bail which were not handicapped by the restrictions in the preceding Section 497 which corresponds to the present Section 437. It was observed by the court that there was no hard and fast rule and no inflexible principle governing the exercise of the discretion conferred by Section 498 and that the only principle which was established was that the discretion should be exercised judiciously. In Emperor v. Hutchinson [AIR 1931 All 356, 358 : 32 Cri LJ 1271] it was said that it was very unwise to make an attempt to lay down any particular rules which will bind the High Court, having regard to the fact that the legislature itself left the discretion of the court unfettered. According to the High Court, the variety of cases that may arise from time to time cannot be safely classified and it is dangerous to make an attempt to classify the cases and to say that in particular classes a bail may be granted but not in other classes. It was observed that the principle to be deduced from the vari ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he background of the term of sentence being seven years if convicted and in that regard it has been held that in determining the grant or otherwise of bail, the seriousness of the charge and severity of the punishment should be taken into consideration." The Supreme Court, thereafter, proceeded to hold - "23. Thus, from cumulative perusal of the judgments cited on either side including the one rendered by the Constitution Bench of this Court, it could be deduced that the basic jurisprudence relating to bail remains the same inasmuch as the grant of bail is the rule and refusal is the exception so as to ensure that the accused has the opportunity of securing fair trial. However, while considering the same the gravity of the offence is an aspect which is required to be kept in view by the Court. The gravity for the said purpose will have to be gathered from the facts and circumstances arising in each case. Keeping in view the consequences that would befall on the society in cases of financial irregularities, it has been held that even economic offences would fall under the category of "grave offence" and in such circumstance while considering the application for bail in such matt ..... X X X X Extracts X X X X X X X X Extracts X X X X
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