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TMI Blog2021 (12) TMI 1297X X X X Extracts X X X X X X X X Extracts X X X X ..... ures and its suppliers as well as the recipients companies are created for name sake for bogus supply without actual movement of goods and all the companies are being operated by the same person and therefore, this is nothing but contravention of section 132(1)(b) of CGST Act, 2017, which is mandatory to show the turnover and same has been initiated by the applicant in the category of (taxable service) in CGST on return for the month of April, 2021. The goods are not entitled for exempted services. This is nothing but huge loss to the Government. This is nothing but while collar crime which needs to be investigated in detail. The investigation is at crucial stage. More than 5000 invoices are included which are used as bogus invoices and needs to be recovered at the instance of applicants. Applicant nos.2 and 3 have supported the applicant no.1 in this conspiracy of evasion of taxes. Considering the seriousness and gravity of the economic offence in which 48 crores evasion of taxes at the instance of applicants, investigation is at crucial stage, chance to tamper prosecution evidence and flee over justice, it is held that all the applicants does not deserve sympathy for enlargement ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... aid goods are exempted goods under the Act as it is not nonbranded goods. He further argued that the summons does not even mention the DIN number of the alleged defaulter company and the same speaks loud for the ill and malafide intentions of the prosecution agency. He further argued that the issuing summons u/s.70 of the CGST Act, 2017 was an empty formality and even after knowing that there is no violation of any of the provisions of the law by the accused, the CA of accused came to be arrested after their detention. He further argued that as the summons itself is issued by manthorial person by using duty of Commissioner, hence not valid. He argued that it is not the case of prosecution that the accused have collected GST and have not paid the same. There are no input/output credit claims by the accused. There is no supply of goods/service without an invoice in order to evade tax. There are numerous bills and agianst which the accused has purchased and sold goods which is exempted under the Act. There is no malafide intentions of the accused to avail any GST benefit. Hence, there is no prima facie violation of the provisions of the law as alleged by the prosecution. He furth ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ts obtained from ADVAIT (Advanced Analytics in Indirect Taxation) a data analytical tool of the Central Board of Indirect Taxes and Customs, a verification was initiated in M/s. SRK Ventures. It was observed that M/s. SRK Ventures (27ACXFS3235Q2Z2) had taken registration on 07.04.2021 and immediately thereafter within a month declared high value of supplies of goods to the tune of ₹ 963 Crores as seen from their GSTR3B return for the month of April, 2021. He further argued that detailed investigation was initiated against above firm by undertaking search under the provisions of Section 67(2) of CGST Act, 2017. Panchanama dated 08.10.2021 was drawn at the premises of M/s. SRK Ventures which was admeasuring 12 ft. X 10 ft approximately. He argued that accused no.1 and 2 are present at the premises. No document on record related to M/s. SRK Ventures were available at the premises. Accused no.1 was asked about the reason for nonavailability of any records pertaining to M/s. SRK Ventures at their registered premises in response to which he stated that all the documentation work is maintained by his CA accused no.3. No physical stock was available at the premises. Thereaf ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e approximately 48.17 crores on issue of invoices without supply of goods together with crucial role of the accused persons. There is every possibility that the accused will interfering the investigation by tampering the witnesses. Hence, prayed to reject the applications. 10. I have gone through all three bail applications along with reply filed by the respondent i.e., CGST & Central Excise, Mumbai South, Commissionerate and all the documents as well as the citations. 11. The SPP has placed reliance on the following citations: 1. Mr. Krishna Murari Singh Vs. Union of India & Ors.,Writ Petition (Stamp) No.9767 of 2021 dated 06.05.2021. 2. Amit Kumar Shukla Vs. Union of India & Ors., Writ Petition (ST.) No.9335 of 2021 dated 06.05.2021. 3. Nimmagadda Prasad Vs. C.B.I., Criminal Appeal No.728 of 2013 SCC. 4. Rakesh Arora Vs. State of Punjab passed in CRMM1511 of 2021. 5. Arvind Kumar Munka Vs. The Union of India - CRM10075 of 2019 Calcutta High Court. 6. Jatinder Manro Vs. DGGI - CRMM36714 of 2018, P& H High Court. 7. Mohammed Yunus Vs. State of Rajasthan - Rajasthan High Court. 8. Pankaj Agarwal Vs. Union of India - Chhattisgarh High Court. 9. Vika ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nsidered. The case laws material to the controversy are as follows: In the case of Nimmagadda Prasad, the Hon'ble Supreme Court held that "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 rotted conspiracies and involving huge loss of public funds needs to be viewed seriously and considered as grave offences affecting the economy of the country as a whole and thereby posing serious threat to the financial health of the country". 14. So far as the contention in respect of reasons to believe is concerned, in the case in hand, it is evident that the respondent inspected the place of business as respondent officer found that the huge turnover i.e., ₹ 963,57,69,458/ immediately after their registration i.e., April, 2021 and no turnover in the successive months. Accordingly, the investigation was initiated against the M/s. SRK Ventures (27ACXFS3235Q2Z2). On the basis of inputs obtained from ADVAIT (Advanced Analytics in Indirect Taxation) a data analytical tool of the Central Board of Indirect Taxes and Customs, a verification was initiated in r/o M/s. SRK Ventures. A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ar Mehta (applicant no.1) one of the partner of M/s. SRK Ventures in his voluntary statement had admitted that he has found/created M/s. SRK Ventures on the directions of Ushik M. Gala, director of M/s. Rangoli Tradecomm Ltd. (now known as M/s. Suumaya Corporation Ltd.) which is also evident from the facts that Sushil Dilipkumar Mehta has admitted that all the business activities of M/s. Wonderkids Metrics Pvt. Ltd., and M/s. Suumaya Retail Ltd., are managed by Shri. Ushik M. Gala. Shri. Sushil Dilipkumar Mehta has also admitted that all the sales and purchase transactions of M/s. SRK Ventures were only on paper and there were no physical movement of goods which is also supported by the other applicants. It is to be noted that he has admitted in his statement that he has never received any sales order from his customer nor he has given any purchase order to the supplier at the instance of Ushik Gala. He took now GST registration bearing no.(27ACXFS3235Q2Z2) in the name of M/s. SRK Ventures in the month of April, 2021. Ushik Gala had promised Mr. Sushil Mehta to give a commission of ₹ 4.5 crores (₹ 30 per quintal) therefore, it appears that the applicant with the help of ..... X X X X Extracts X X X X X X X X Extracts X X X X
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