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2021 (10) TMI 803 - HC - GSTSeeking grant of anticipatory bail - wrongful availment of Input Tax Credit - fake bills - compliance with the mandatory procedure under Chapter XII of the Code of Criminal Procedure, 1973 including Section 154, 157,167,172 etc. for valid commencement and continuation of the investigation into any offence qua the petitioners in respect of investigation - vires of section 69 of the Central Goods and Service Tax Act, 2017 - HELD THAT:- Section 69 of the GGST Act empowers the Commissioner to arrest a person, who has committed any offence stipulated in the said section if the Commissioner has reason to believe that the said person has committed any offence as stated in the said provision - it is revealed that the Commissioner can delegate his powers to his subordinate officer. It is contended by learned advocate for the applicants that even assuming that the Commissioner is empowered to delegate his powers to his subordinate, as per Section 69 of the GGST Act, reasonable belief should be that of the Commissioner. The Commissioner can delegate his powers to his subordinate. A very same reasonable belief will be that of the authority upon whom the power is delegated. Thus, the power under Section 69 of the GGST Act can be exercised by the authority upon whom the power is delegated provided the delegatee has reasons to believe that the assessee has committed offence under Section 132 of the GGST Act. Thus, the condition precedent, i.e. 'reasonable belief', for the purpose of exercise of power under Section 69 of the Act remains the same. Thus, this Court is of the view that the submissions canvassed by learned advocate for the applicants on this aspect is misconceived. It is alleged by the prosecution that the present applicants in connivance with other persons, entered into transaction with 36 dummy firms and false invoices and sales were raised and in pursuance thereto, the Company has issued cheques to 36 dummy firms including four person, who are now arrested by the respondent – department. There were receipts of more than ₹ 737.00 Crores and amount has been withdrawn by bearer cheque or transferred to other Company or by RTGS to dummy firms and during the course of investigation from one Mr. Afzal, certain material is collected - It is the specific case of the department that the transaction worth of ₹ 737.00 Crores were entered into with 36 dummy firms and there would be liability of more than ₹ 137.00 Crores. Thus this Court is of the view that in the facts of the present case, the custodial interrogation of the applicants would be required. There are provisions in the GGST Act that the registration of the firm can be cancelled with retrospective effect. In the present case, during the course of investigation, it has been revealed that at the time of registration of the firm, the concerned persons have provided necessary documents for the purpose of registration, however as per the case of the prosecution, subsequently it was found that without there being any actual movement of the goods, false invoices were raised and after the arrest of four persons and during the course of investigation, it is revealed that those 36 firms were dummy firms. Thus in the facts of the present case, the custodial interrogation of the applicants is necessary. The present applications are dismissed.
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