TMI Blog2022 (9) TMI 1105X X X X Extracts X X X X X X X X Extracts X X X X ..... products were removed from the factory. Raw material and finished products are two sides of the same coin and one is directly corelated to the other. Merely, because statement of the accused has to be recorded, is not a reason for declining pre arrest bail to the accused. Further, the stand of the IO that accused is required to be arrested, while apparently, no decision in that regard has been taken by the competent authority under the Act, further strengthens the claim of the applicants. Considering that the accused is not a fly by night entity and has been paying considerable amount of taxes, which is not disputed, it is directed that in the event of the arrest of the accused, he be admitted to bail on furnishing of bail bonds, two surety bonds in the sum of Rs.1,00,000/- each. Application disposed off. - Bail Matter No. 1561/2022 - - - Dated:- 17-9-2022 - (HARJYOT SINGH BHALLA) ROSTER JUDGE/ADDL. SESSIONS JUDGE, Present : None. ORDER 1. Briefly stated, it is the case of applicant/accused that he is a 54 years old businessman engaged in manufacturing of Tobacco products. The present case seems, it seems, is a offshoot of two trucks intercepted some time ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ory of the applicant/accused, but the entire lot of the said ready/finished product was accounted for and the IO was unable to find any unaccounted raw Tobacco or unaccounted finished product within the factory premises of the applicant/accused. 4. On being further questioned, the IO has stated that the statement of the Accountant of the applicant has already been recorded. He has supplied the production chart and details to the Investigating Agency, which is also all in order. Documents were seized during the said raid as per the panchnama dated 17.08.2022 from the factory which includes the sales account, purchase account invoices etc. as well as pendrive, hard disk containing the back up of tally data pertaining to B.G. Noida, which panchnama is annexed to the bail application. 5. The counsel for applicant/accused has submitted that not only the accused is an established businessman, he has already deposited taxes equal to about Rs.313 Crores in the regular course of business and the factory and Noida employs about 200 workers. He has submitted that the applicant/accused is a case of acute medical history, inasmuch as, he has gone through multiple surgeries pursuant to det ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... inted out that contrary to aforesaid submission, elsewhere in the reply, it has been claimed that the B.G. Tobacco has already been booked for the huge tax evasion and one of the seller and employees of the transporter company have already accepted that they were involved in transporting raw Tobacco to the applicant/accused in the name of fake firms. 9. It is further noticed that in the reply filed by the Department, it is claimed that only summons dated 17.08.2022 have been issued to accused Naresh Gupta to tender his statement and verifying the case record. In fact, the entire thrust of the arguments of the Department seems to be that custody of the applicant/accused is required so that his statement can be recorded. 10. On being questioned about the statement of the seller Shiv, IO has stated that the name of one Kakkar, Ranjeet and Mayank have appeared in the statement made by the said Shiv. Kakkar is the transporter involved in the present case. On being questioned, IO has stated that none of the said sellers have directly named the applicant/accused as the purchaser of the said products. 11. In any event, on being question, it has been also submitted that transporter ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ishan Kant Pandey, Bail Matter No. 104/22. 16. Having heard the rival contentions, I may refer to the decision in Tarun Jain (supra). 17. While disposing of the anticipatory bail application of the accused, granting anticipatory bail, the Delhi High Court in Tarun Jain (supra) made certain interesting observations and the same are being quoted for ease of reference: 33. Section 138 of the CGST Act further dilutes the heinousness of offences under the Act. The said section makes every offence under the Act compoundable except for certain circumstances which have been specified under different clauses to the proviso of Section 138. The relevant section has been reproduced hereunder: 138. Compounding of offences:(1) Any offence under this Act may, either before or after the institution of prosecution, be compounded by the Commissioner on payment, by the person accused of the offence, to the Central Government or the State Government, as the case be, of such compounding amount in such manner as may be prescribed: Provided that nothing contained in this section shall apply to-- (a) a person who has been allowed to compound once in respect of any of the offen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f central tax to arrest such person. (2) Where a person is arrested under subsection (1) for an offence specified under subsection (5) of section 132, the officer authorised to arrest the person shall inform such person of the grounds of arrest and produce him before a Magistrate within twenty-four hours. (3) Subject to the provisions of the Code of Criminal Procedure, 1973 (2 of 174)(a) where a person is arrested under subsection (1) for any offence specified under subsection (4) of section 132, he shall be admitted to bail or in default of bail, forwarded to the custody of the Magistrate; (b) Commissioner or the Assistant Commissioner shall, for the purpose of releasing an arrested person on bail or otherwise, have the same powers and be subject to the same provisions as an officer-incharge of a police station. 70. Power to summon persons to give evidence and produce documents.: (1) The proper officer under this Act shall have power to summon any person whose attendance he considers necessary either to give evidence or to produce a document or any other thing in any inquiry in the same manner, as provided in the case of a civil court under the provisio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... economic offence. However, it is to be reiterated that the offence does not contemplate punishment for more than five years or commission of any serious offence along with the economic offence as it is usually the case in offences under other special statutes dealing with economic offences like Prevention of Money Laundering Act, 2003. Thus, as per the scheme of the CGST Act, though the offence is of economic nature yet the punishment prescribed cannot be ignored to determine the heinousness of the offence. To conclude, in my view the offences under the Act are not grave to an extent where the custody of the accused can be held to be sine qua non. 19. However the matter does not ends here but the Ld. Hon ble Single Judge made further observations regarding the power of custodial interrogation in Para 55 of the said order which reads as follows: Custodial interrogation in the instant matter is neither warranted nor provided for by the statute. Detaining the petition in Judicial Custody would serve no purpose rather would adversely impact the business of the petitioner. (Emphasis supplied). 20. This court had while disposing off bail applications in a different ca ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... have been retrieved, which have been deciphered with the help of the statement of Sh. Mukesh Dwivedi, who has admitted that each name corresponds with a Salesman. The next figure is the dealer number and the two figures after that indicates the number of sacks supplied. Each sack contains 6 bags. Each bag contains 21 packets and each packets contains 62 pouch of the product and therefore, each sack contains around 7812 pouches of product with value ranging between 50 paisa to Rs.2/. Similarly, codes are used for receiving payments and accounting, inasmuch as, the sale is clandestine and no paper trail is maintained. Ld. Counsel for Department has also pointed out that even on an earlier occasion in the year 2018, the accused persons were similarly summoned by DGGI, Lucknow learning about their evasion of GST. Ultimately, the proceedings culminated in deposit of penalty of Rs.2 crores by the accused persons and only then the matter was closed. Therefore, he has stated that the accused persons are habitual of avoiding generating bills and invoices with GST and of clandestine manufacture and supply of dutiable goods. Ld. Counsel for Department has also taken me through some ..... X X X X Extracts X X X X X X X X Extracts X X X X
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