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2021 (12) TMI 1002 - HC - GSTSeeking grant of regular bail - fake input tax credit invoices, without actual supply of goods - fraudulent and irregular input tax credit affecting collection of Goods and Services Tax - without assessment of amount involved, search and seizure conducted - Sections 16 & 132 (1) (b) & (c) of the Central Goods and Services Tax Act, 2017 - HELD THAT:- Section 67 of the GST Act provides for power of inspection, search and seizure. For search and seizure, if Proper Officer only after recording reason to believe that a taxable person has suppressed any transaction relating to supply of goods or services or both or stock of goods or claimed input tax credit in excess of his entitlement to evade tax under the GST Act; or goods of a person engaged in business of transporting or operator of a warehouse have escaped payment of tax may authorize any other officer to inspect any place of business of taxable person. Except recording reason to believe, there is no other bar for the Proper Officer for inspection, search and seizure. It is not the case of applicant nor any argument to the effect has been advanced that no reason has been recorded. Hence, submission that prior assessment has not been made before invoking powers under Section 67 of the GST Act, does not stand and it is hereby repelled. Applicants are arrested for commission of offences punishable under Sections 16 & 132 (1) (b) & (c) of the GST Act. Section 138 of the GST Act deals with compounding of offences. Offence registered against applicants under Section 132 (1) of the GST Act is made compoundable by the Commissioner on making payment to the Central Government or State Government either before or after institution of prosecution. In case at hand, case is instituted against applicants and they were arrested. The applicant are allowed to be enlarged on bail - application allowed.
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