9911796707
TMI Blog2024 (6) TMI 955X X X X Extracts X X X X X X X X Extracts X X X X ..... GURBAKSH SINGH SIBBIA VERSUS STATE OF PUNJAB [ 1980 (4) TMI 295 - SUPREME COURT] , the Hon ble Apex Court held that The question whether to grant bail or not depends for its answers upon a variety of circumstances, the cumulative effect of which must enter into the judicial verdict . It is settled law that while considering the prayer for grant of anticipatory bail, the accusation's nature and gravity and the accused's exact role must be properly comprehended before arrest is made. In the event of some doubt as to the genuineness of the Prosecution, the normal course of events is that the accused is entitled to an order of anticipatory bail. The Court must adequately exercise its jurisdiction to protect the personal liberty of a citizen. It is also a well-accepted principle that bail is the rule and the jail is the exception. This Court views that even if the Petitioners are granted pre-arrest bail, there cannot be any apprehension for the Prosecution that they will tamper with the evidence. The material placed on record discloses that the Petitioners have a permanent abode. It is not the Prosecution's case that the Petitioners would flee away from the jurisdiction of t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tter. Additionally, a Show Cause-cum-Demand Notice had been issued by the D.G.G.I., proposing a penalty of approximately Rs. 16 Crores under the provisions of the Central Goods and Services Tax (C.G.S.T.) Act, 2017, for the irregular availment of I.T.C. iii. M/s. Avexa Corporation Private Limited (A.C.P.L.) in Andhra Pradesh has wrongly or illegitimately claimed Input Tax Credit (I.T.C.) based on invoices despite not receiving the associated services from July 2017 to March 2022. Moreover, it is acknowledged that they transferred these irregularly claimed I.T.C. amounts to various entities without providing any services during the mentioned period. Based on the admission of A.2, it appears that they intentionally misrepresented facts in their GSTR-3B returns by indicating receipt of services when, in fact, they had not received them. iv. Explanation 2 of Section 74 of the Central Goods and Services Tax (C.G.S.T.) Act 2017 defines suppression as the act of not disclosing facts or information that a taxable person is obligated to declare in returns, statements, reports, or any other documents as required under the Act or the rules established therein. It also includes the failure to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , they couldn't provide such subcontracted work to M/s. Jakson Eminence Pvt. Ltd. It appears that an amount of Rs. 21,93,08,317/- was improperly diverted by A.C.P.L. without receiving any goods or services, and all four of the listed firms/companies were implicated in misappropriating government funds. viii. Furthermore, M/s. Avexa Corporation Private Limited (A.C.P.L.) received a work order dated 27.10.2017 for the construction of the N9 Road Near Uddandarayunipalem to Nidamarru in Amaravathi on a subcontract basis from M/s. B.S.R. Infratech India Pvt. Ltd. The investigation uncovered that A.C.P.L. diverted funds to four fictitious entities, namely (1) M/s. Khwahish Marketing Pvt. Ltd. (2) M/s. Noida Ispat India Limited (3) M/s. Prasant Industrial Corporation (4) M/s. Goldphoenix Iron and Steels Pvt. Ltd. A.C.P.L. issued outward invoices to M/s. B.S.R. Infratech India Pvt. Ltd. with a taxable value of Rs. 23,43,92,315/- along with G.S.T. of Rs. 2,81,27,078/-. This implies that A.C.P.L. received a total amount of Rs. 26,25,19,393/- from M/s. BSR Infratech India Pvt. Ltd., the principal contractor. ix. Additionally, according to the Show Cause Notice issued by the Directorate Ge ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... piracy presented by the complainant seems to be a fabrication aimed at politically targeting the Petitioners' husband and brother-in-law (A.4 and A.5). It's implied that this move stems from their outspoken opposition to individuals in influential positions within the current administration. However, there is a noticeable absence of prima facie evidence substantiating the alleged offences, casting doubt on the genuine intentions or bona fides behind the complaint. vi. The initiation of the current criminal proceedings appears to be a deliberate attempt to hinder the active participation of the Petitioners' family in the upcoming General Elections of 2024, with a potential motive to undermine their political involvement through legal means. 6. The case of the Petitioners in Crl. P. No. 1489 of 2024, in brief, is that: i. The allegations outlined in the F.I.R. or complaint are deemed to be incredibly far-fetched and inherently improbable. They lack the substance necessary for any prudent individual to arrive at a reasonable conclusion that there are sufficient grounds for initiating proceedings against the Petitioners. Merely citing sections of the law and subjecting the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Supreme Court has laid down specific guidelines for applications for anticipatory bail. In paragraph 25.10, the Hon'ble Supreme Court held as under: 25.10. We all also reproduce para 112 of the judgment in the Siddaram Satingappa case , where the Court delineated the following factors and parameters that need to be taken into consideration while dealing with anticipatory bail: (a) The nature and gravity of the accusation and the exact role of the accused must be properly comprehended before arrest is made; (b) The antecedents of the applicant, including the fact as to whether the accused has previously undergone imprisonment on conviction by a Court in respect of any cognizable offence; (c) The possibility of the applicant of fleeing from justice; (d) The possibility of the accused's likelihood to repeat similar or other offence; (e) Where the accusations have been made only with the object of injuring or humiliating the applicant by arresting them; (f) Impact of grant of anticipatory bail, particularly in cases of large magnitude affecting a vast number of people; (g) The Courts must carefully evaluate the available material against the accused. The Court must also clearl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... person, he is entitled to all the fundamental rights, including the right of liberty, guaranteed under Article 21 of the Constitution of India. 14. It is settled law that while considering the prayer for grant of anticipatory bail, the accusation's nature and gravity and the accused's exact role must be properly comprehended before arrest is made. In the event of some doubt as to the genuineness of the Prosecution, the normal course of events is that the accused is entitled to an order of anticipatory bail. The Court must adequately exercise its jurisdiction to protect the personal liberty of a citizen. It is also a well-accepted principle that bail is the rule and the jail is the exception. 15. It could be seen from the record that 2nd respondent/Defacto Complainant, holding the position of Deputy Director, Andhra Pradesh State Directorate of Revenue Intelligence, Vijayawada, Andhra Pradesh, lodged a written complaint with the 1st Respondent/Station House Officer, Machavaram P.S., and 1st Respondent initiated the legal process by registering F.I.R. No. 63 of 2024, dated 25.02.2024 for the offences punishable under sections 420, 409, 467, 471, 477A, 120B r/w 34 of I.P.C. 16 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... .3's involvement with Avexa Corporation Pvt. Ltd. commenced following the unfortunate passing of her late husband, Sri Boggavarapu Markhandeyulu (A.6), who held a directorial position at the time of his demise. Subsequently, A.3 was appointed as the Additional Director of the company. Since her appointment in 2020, A.3 has maintained a non-participatory stance in the day-to-day operations of Avexa Corporation Pvt. Ltd. 19. In Crl. P. No. 1539 of 2024, the first Petitioner is represented as B.S.R. Infratech India Limited through its Managing Director, Balusu Srinivasa Rao. The second Petitioner is Balusu Srinivasa Rao. 20. The Petitioners in Crl. P. No. 1539 of 2024 assert that the first Petitioner, a reputable construction company, has a well-established presence in the construction industry, undertaking government projects across multiple states such as Maharashtra, Karnataka, Odisha, Telangana, and Andhra Pradesh. Specifically, concerning constructing the 'N9 Road' in Amaravati, authorities have expressed satisfaction with the completed work and accompanying test reports. Consequently, they approved the M.Book and released payments for the completed tasks. Furthermore ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... while A.1 was acting as Additional Director of M/s. Avexa Company, a sub-contractor, an amount of Rs. 50,00,000/- was transferred from M/s. B.S.R. Infra Tech, who was an original contractor to the Government illegally on 31.01.2020. Abusing the position and influence of his father, A.1 entered into a conspiracy with the companies with a common intention of misappropriating funds which were entrusted to carry out the earmarked work contracts at Amaravati region, created false documents as if certain supplies or services were rendered by filing false invoices without actually doing no such work and diverted huge Government amounts to the companies by using false documents as genuine and by creating false G.S.T. accounts and claimed Input Tax Credit to a tune of Rs. 8,00,00,000/-. 24. The learned Special Public Prosecutor contends that D.G.G.I., Hyderabad's investigation is confined to determining the evasion of input tax credit by the A.V.E.X.A. company and issued a show cause notice for the payment of Rs. 16/- crores as a penalty under section 74(1) of the provisions of the C.G.S.T. Act, 2017; the investigation done by D.G.G.I., Hyderabad unit established that M/s. Avexa company ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ubmits that the parties are private entities and there is no contractual relationship with the Government; there is no privity of contract between the B.S.R. (Principal) and the Government, hence, the case against the cannot be upheld; the execution of work is already done, and therefore, there is no question of diversion of funds, as the funds are all utilized towards the works; the claim of investigating agency stating that execution of work nonetheless is of no relevance at this stage of the case cannot be upheld; any concerned case against the Respondent is to be carried out by the G.S.T. authorities, as the orders are not granted yet in relevance to irregular input tax credits and the present allegations cannot be proved by the Respondent/State. 30. He further contends that section 132 of the Central Goods and Services Act, 2017 (hereinafter referred to as 'the Act') provides punishment for certain offences.- Whoever commits, or causes to commit and retain the benefits arising out of, any of the following offences, namely: (a) supplies any goods or services or both without the issue of any invoice, in violation of the provisions of this Act or the rules made thereunder ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... with a notable political career that includes multiple terms as a member of the Andhra Pradesh Legislative Assembly, spanning from 1999 to 2019. From 2014 to 2019, the 1st Petitioner held significant ministerial portfolios, including Agriculture, Agriculture Processing, Marketing and Warehousing, Animal Husbandry, Dairy Development, Fisheries, Food and Civil Supplies, and Price-Monitoring and Consumer Affairs. Moreover, the 2nd Petitioner, the daughter of the 1st Petitioner, expresses apprehension regarding the possibility of imminent arrest in connection with F.I.R. No. 63 of 2024, dated 25.02.2024. Notably, the 1st Petitioner's son is arrayed as A.1 in the F.I.R. as mentioned above and was consequently apprehended on 29.02.2024. Additionally, it is contended that the 2nd Petitioner in Crl. P. No. 1489 of 2024 has never held the position of Director within Avexa Corporation Pvt. Ltd. at any point. 34. It is also contended on behalf of the Petitioners in Crl. P. No. 1489 of 2024 that even according to the complaint itself, both A.1, the son of the first Petitioner, and the first Petitioner were merely Directors of Avexa Corporation Pvt. Ltd., with no active involvement beyond t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on in the forthcoming general elections in 2024. 37. The first Petitioner (in Crl. P. No. 1448 of 2024), a woman aged 64 years, and the other Petitioners, have expressed their willingness to comply with any conditions set forth by the Court and to cooperate fully with the investigation. 38. As seen from the record, the Directorate General of Goods and Services Tax Intelligence (D.G.G.I.) had previously investigated the submission of counterfeit invoice bills by the shell companies associated with the firm. These entities purportedly claimed to be engaged in development activities in the Amaravati region, although no actual work transpired. Consequently, the D.G.G.I. recommended a penalty of Rs. 16 crores against A.1's company under the Central Goods and Services Tax Act, 2017. This indicates that the D.G.G.I., Hyderabad, has undertaken a significant portion of the investigation. 39. This is evident from the committee's comprehensive report regarding the allegations against M/s. Avexa Corporation Private Limited by A.P.S.D.R.I., Vijayawada; the matter originated from a letter sent by the Special Commissioner of A.P.S.D.R.I., Vijayawada, to the Special Chief Secretary, Financ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd the execution of work as per agreement . 42. The learned Special Public Prosecutor contends that the committee held in the report that the fact regarding the raising of outward invoices having a taxable value of Rs. 17.71/- crores along with G.S.T. of Rs. 2,81,27,078/ without any supply of Goods or services by Avexa is to be ascertained from M/s. B.S.R. Infratech Pvt., Ltd., by the investigating agency. 43. As seen from the record, the Respondent/State grieves that the directors of the M/s.Avexa company, with a malafide intention to misuse public funds, diverted the public funds secured from the Principal contractor to the shell companies, created fake invoices with G.S.T. to the shell companies to avoid input tax credit, and thereafter diverted the public funds to the shell companies. 44. The learned counsel for the Petitioners contends that when a particular enactment, i.e., the G.S.T. Act, covers the criminal act of an offender, the offender gets out of the net of the Indian Penal Code. The material on record discloses that the D.G.G.I., Hyderabad, has already investigated in respect of submitting fake invoice bills by the shell companies of A.1's firm under the guise of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ity, the release of the accused persons is unlikely to prejudice the ongoing investigation. 51. The existence of the power to arrest is one thing; the justification for exercising it is quite another. Apart from the power to arrest, the police officers must be able to justify the reasons. No arrest can be made routinely on a mere allegation of the commission of an offence made against a person. It would be prudent and wise for a police officer not to arrest without reasonable satisfaction being reached after some investigation into the genuineness of the allegation. (In this regard, a reference can be made to Arnesh Kumar V. State of Bihar. (2014) 8 SCC 273 ). 52. It is not the Prosecution's case that the Petitioners did not cooperate with the investigation and are not available for interrogation. There is no indication of a likelihood that the Petitioners would abscond from the court's jurisdiction. The Petitioners have expressed a willingness to cooperate with the investigation agency. The object of the bail is neither punitive nor preventative. The likelihood of levying accusations to harm or embarrass the Petitioners through potential arrest is not improbable, especiall ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
