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TMI Blog2022 (8) TMI 918X X X X Extracts X X X X X X X X Extracts X X X X ..... fake invoices. The essence of main allegations of the respondent are that applicant is guilty of circular trading by claiming Input Tax Credit (ITC) on the materials without movement and passing on such ITC to companies and therefore there has been contravention of Sec. 132(1)(b)(c) which is cognizable and non bailable offence U/Sec. 132(5) of the CGST Act. There are some admissions from M/s. Amarnath Industries were aware of some illegal transactions being carried out by accused applicant company for the purpose of evading CGST - It appears instead of cooperating with the ongoing investigation by submitting relevant documents and making themselves available for further investigation and enquiry. Applicant filed an anticipatory bail application before this Court. Looking at the gravity of the offence and the amount involved for which an offence U/sec. 151(1)(c) of CGST Act is imposed for evading huge amount of GST and thereby defrauding the Govt. Exchequer for the tune of Crores of Rupees, investigation is in progress and if released on prearrest bail the investigation will become stagnant and they will tamper with the evidence - It is apposite to note that as per Sec. 132 of CGST ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... documents pertaining are in the custody of agency. Nothing as such is to be recovered. Applicant has a fixed place of residence. There is no chance to abscond. Applicant will keep available before investigating agency as and when called. 5] Considering the investigation which is carried out applicant has a grave apprehension that he would be arrested on false and baseless allegations and the crime committed by some other persons. 6] On the other hand, respondent No.2 filed their detail reply alongwith the details lists and chart of the transaction and the notices served upon him. Ld. Spl. P.P. vehemently argued that investigation is under progress. Despite of repeated summons applicant failed to appear before the Authority though they filed the reply but the same was not satisfactory it needed explanation from the applicant and therefore, the investigation could not be carried out further. It is further stated that fake invoices were issued to evade GST. 7] Ld. Spl.P.P. further stated that the other two companies involved in the evasion of tax alongwith the applicant are also enquired. One of them is arrested. There appears to be fake invoices. Without the supply of goods throu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Ld. Spl.PP for the respondent vehemently argued that the name of the applicant company reflected in the lists of risky exporters received from the Director general of analytic and Risk managers functions under the central Board of Indirect Taxes and Customs and accordingly the investigation was initiated and it was noticed the premises where the company of applicant was located was on rental basis. The second aspect the co. of applicant company had inward supplies from M/s. Empire exim inc. whose GST registration has been surrendered and cancelled. The Empire exim has passed an ITC to company of applicant appears to be fake ITC. Similarly the another company M/s. Amarnath Company being a supplier of applicant company has also passed on fake ITC. In support of their argument they placed reliance on plethora of the authorities. On careful perusal of the observations most of them are on similar points and issues. Hence, those authorities which are related with the present facts and issue are only hereby mentioned which are as follows : [1] Hon'ble Bombay High Court in Criminal Application No.520/2020 in the case of Nilesh Yogesh Jagiwala V/s. The Superintendent (Anti Evasion) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uilty of circular trading by claiming Input Tax Credit (ITC) on the materials without movement and passing on such ITC to companies and therefore there has been contravention of Sec. 132(1)(b)(c) which is cognizable and non bailable offence U/Sec. 132(5) of the CGST Act. There are some admissions from M/s. Amarnath Industries were aware of some illegal transactions being carried out by accused applicant company for the purpose of evading CGST. 18] It is apposite to note in the terms of Sec.136 CGST of the Act, disclosure in the statement is relevant for proving any offence under this Act. Under these circumstances, when it is shown fraudulent ITC claimed about 6 Crores of Rupees is a matter of grave concern and requires thorough investigation for which presence of applicants is absolutely necessary. 19] It appears instead of cooperating with the ongoing investigation by submitting relevant documents and making themselves available for further investigation and enquiry. Applicant filed an anticipatory bail application before this Court. 20] The contentions of Ld. Advocate for the applicant submitted that unless and until the invoices as required and the returns under GSTR are ver ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hequer for the tune of Crores of Rupees, investigation is in progress and if released on prearrest bail the investigation will become stagnant and they will tamper with the evidence . 28] As far as considering the rather interest of Public and State in serious cases like this wherein it is shown the applicant was aware of the illegal transactions carried out thereby fake ITC's were availed for the involvements of goods which they allegedly purchased. Therefore applicant has not made out a case for anticipatory bail. 29] It is apposite to note that as per Sec. 132 of CGST Act, 2017 issuance of invoice or bill without supply of goods or services and wrongful availment or utilisation of input tax limit is cognizable and punishable offence if the amount is over Rs. 5 Crores. In the instant case prima facie there appears a sufficient material which requires physical interrogation. 30] At this stage without going into the details of the allegations, custody of applicant is necessary for further investigation. The observations are for limited purpose for deciding present application, it may not have effect on the merits of case. On the above said observations, considering the facts ..... X X X X Extracts X X X X X X X X Extracts X X X X
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