2020 (11) TMI 833 - HC - GST

Grant of Bail - allegation of fraudulent availment of input tax credit - passing of forged GST - HELD THAT - Taking into consideration the nature of allegations against the petitioner his length of custody the pendency of investigation the offence being compoundable and the severity of punishment under Section 132 of the CGST Act; but without expressing any opinion on the merits of the case this Court deems it just and proper to enlarge the petitioner on bail. The bail application is allowed and it is directed that accused-petitioner Subhash Chandra Tyagi S/o Late Shri Chiranji Lal shall be released on bail under Section 439 Cr.P.C. in connection with afore-mentioned FIR registered at concerned Police Station provided he furnishes a personal bond in the sum of Rs. 1 00 000/- together with two sureties in the sum of Rs. 50 000/- each to the satisfaction of the trial Court with the stipulation that he shall comply with all the conditions laid down under Section 437(3) Cr.P.C.

Summary

Issues:
Bail application under Section 439 Cr.P.C. in connection with Criminal Complaint under Section 132 of Central Goods & Services Tax Act, 2017 (GST Act, 2017).

Analysis:

The petitioner filed a bail application under Section 439 Cr.P.C. alleging false implication in the case. The petitioner's counsel argued that the companies in question, deemed fake, were closed after obtaining NOC from the competent authority. It was highlighted that an amount of Rs. 2.6 crore had already been recovered from the petitioner. The petitioner had been in judicial custody since 08.01.2020, with a complaint filed against him on 05.03.2020. The counsel emphasized the absence of criminal antecedents and requested bail, citing the compoundable nature of the offence and a maximum sentence of 5 years under Section 132 of the GST Act, 2017.

On the contrary, the complainant's counsel opposed the bail application, pointing out grave allegations against the petitioner for fraudulently obtaining input tax credit and passing forged GST credit amounting to Rs. 33.50 crore. The investigation was still pending, leading to the argument that the petitioner did not merit bail.

Considering the arguments presented by both parties, the High Court evaluated the nature of allegations, the petitioner's custody duration, the ongoing investigation, the compoundable nature of the offence under Section 132 of the CGST Act, and the severity of punishment. Without expressing any opinion on the case's merits, the Court found it just to grant bail to the petitioner.

Consequently, the bail application was allowed, directing the release of the accused-petitioner upon furnishing a personal bond of Rs. 1,00,000/- and two sureties of Rs. 50,000/- each to the satisfaction of the trial Court. The petitioner was instructed to comply with all conditions specified under Section 437(3) Cr.P.C.