TMI Blog2023 (11) TMI 1156X X X X Extracts X X X X X X X X Extracts X X X X ..... ial in any event would take some time. Since the alleged offence constitutes the act of crediting amount of ITC through the departmental Online system, to the account of the certain entities which have been alleged to be non-existent and the money has been subsequently received by the petitioner, the evidence tendered by the opposite party/complainant would essentially be documentary and electronic. The ocular evidence will be through official witnesses of the department due to which there can be no apprehension of tampering, intimidating or influencing. This Court is inclined to grant the prayer for bail made by the petitioner subject to such stringent terms and conditions imposed - bail application allowed. - HONOURABLE SHRI JUSTICE M.S. SAHOO For the Petitioner : Mr. R.P. Kar, Sr. Advocate instructed by Mr. S.Tibrewal Mr. Rahul Raheja, Advocates For the Opp. Parties : Mr. P. Mohapatra, Sr. Standing Counsel, DGGST along with Mr. A. Kedia, Junior SC, CGST Customs M.S. SAHOO, J. The petition under section 439, Cr.P.C. has been filed by the petitioner challenging the order dated 22.08.2023, rejecting the prayer for bail by the petitioner passed by l ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd physical verification at the premises of supplier of the firms is also non-existent at their registered premises. Presumably, the entities having GSTIN and their supplier entity, have been created to pass on and avail Input Tax Credit under the GST regimen (for short ITC ) to defraud government exchequer. The details of vehicle numbers mentioned on the eWay bills generated for purported supply were verified and found to be non-existent. It is alleged that the fictitious entities have shown export of goods in their GST returns, however, they have never actually received any goods from the alleged supplier. There is no movement of any vehicle for transportation of the alleged goods. It is alleged, the exports declared are all bogus and fake. The ITC received from the Government is misuse of benefits extended by the Government to exporters. 5.2 The bank accounts where the ITC has been credited have been verified from the banks and the ITC has been received in the bank accounts. 5.3 It has been stated in the complaint before the learned S.D.J.M. that searches were conducted in the premises as per the office address of the firms and it was found that there were no goods in t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... less Rs. 2 crores. However, the Department in order to make the offence non-bailable, has added ITC of firms that does not lie within their jurisdiction. Though the DGGI, BBSR Zonal Unit has power to investigate, the amount adjudicated in the complaint in the 2(c) CC before competent court, is tentative. The petitioner is neither the proprietor nor the beneficiary in any firm. Therefore, the allegation under section 132 of the GST Act would not be tenable. 6.3 The authorities have relied on the statement of accused no.2 which has been retracted already. No action has been taken against the proprietor of any of the entities those have been named to have received ITC. The amount of ITC which is alleged to have been received by the recipient entities can be recovered from the entities with interest as per the sections 73 or 74 assuming that there has been contravention of the provisions contained in section 16(2) of the Act. 6.4 By virtue of section 138 of the CGST Act, 2017, the offences are to be tried summarily and also the offences are compoundable by virtue of section 138 of the Act. The final prosecution report has been filed by the authorities, even if further investigati ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the investigation indicates a complex network of fraudulent activities, potentially hindering coordination among all India investigative agencies. Incriminating materials like mobile phone has been seized from the petitioner. The petitioner is a flight risk. Case Law cited : 8. The learned counsel for the petitioner has relied on the following decisions to support his submissions to allow the prayer for bail : (i) BLAPL No. 9407 of 2021 (Smruti Ranjan Sahoo v. State of Odisha) disposed of on 26.11.2021. (ii) BLAPL No. 8217 of 2021 (Gurdit Dang v. State of Odisha) disposed of on 26.11.2021. (iii) BLAPL No. 3175 of 2021 (Subash Chandra Swain v. State of Odisha) disposed of on 07.09.2021. (iv) BLAPL No. 9642 of 2020 (Kashmir Kumar Agrawal v. State of Odisha) disposed of on 15.11.2023. (v) BLAPL No. 6643 of 2020 (Amit Beriwal v. State of odisha) disposed of on 10.11.2020. (vi) BLAPL No. 4266 of 2020 (Bikas @ Vikas Sarawgi v. State of Odisha) disposed of on 23.12.2020. (vii) BLAPL No. 4125 of 2020 (Pramod Kumar Sahoo v. State of Odisha) disposed of on 23.12.2020. (viii) S.B Crl. Misc. Bail Application No. 5882 of 2 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mic offences are of a distinct nature and must be treated differently concerning bail. Factors considered while granting bail include the nature of accusations, evidence, potential punishment, the accused s character, unique circumstances, and reasonable possibilities. (ii) State of Gujarat v. Mohanlal Jitamaliji Porwal and another : (1987) 2 SCC 364 wherein considering the appeal against acquittal it was held economic offences are marked by calculated, deliberate designs for personal profit, disregarding the community s interest and causing damage to the national economy and interest. (iii) Mohit Jain v. Union of India (Misc. Criminal Case No. 26215 of 2023, disposed of on 04.07.2023 to contend that the instances involving substantial GST refunds through fraudulent entities, anticipatory bail should not be granted. (iv) Nimmagadda Prasad v. C.B.I., Hyderabad (2013) 7 SCC 466 to contend that when granting bail in such cases, the court should should consider various factors, including the nature of the accusations, the evidence supporting them, potential punishment upon conviction, the accused s character, unique circumstances, witness tampering concern ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... accused at the trial, that the proper test to be applied in the solution of the question whether bail should be granted or refused is whether it is probable that the party will appear to take his trial and that it is indisputable that bail is not to be withheld as a punishment. In two other cases which, significantly, are the Meerut Conspiracy cases observations are to be found regarding the right to bail which deserve a special mention. In K.N. Joglekar v. Emperor [K.N. Joglekar v. Emperor, 1931 SCC OnLine All 60 : AIR 1931 All 504] it was observed, while dealing with Section 498 which corresponds to the present Section 439 of the Code, that it conferred upon the Sessions Judge or the High Court wide powers to grant bail which were not handicapped by the restrictions in the preceding Section 497 which corresponds to the present Section 437. It was observed by the court that there was no hard-and-fast rule and no inflexible principle governing the exercise of the discretion conferred by Section 498 and that the only principle which was established was that the discretion should be exercised judiciously. In Emperor v. H.L. Hutchinson [Emperor v. H.L. Hutchinson, 1931 SCC ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... es of each particular case. Since the object of the detention or imprisonment of the accused is to secure his appearance and submission to the jurisdiction and the judgment of the court, the primary inquiry is whether a recognizance or bond would effect that end. It is thus clear that the question whether to grant bail or not depends for its answer upon a variety of circumstances, the cumulative effect of which must enter into the judicial verdict. Any one single circumstance cannot be treated as of universal validity or as necessarily justifying the grant or refusal of bail. 24. Article 21 is the Ark of the Covenant so far as the Fundamental Rights Chapter of the Constitution is concerned. It deals with nothing less sacrosanct than the rights of life and personal liberty of the citizens of India and other persons. It is the only article in the Fundamental Rights Chapter (along with Article 20) that cannot be suspended even in an emergency [see Article 359(1) of the Constitution]. At present, Article 21 is the repository of a vast number of substantive and procedural rights post Maneka Gandhi v. Union of India [Maneka Gandhi v. Union of India, (1978) 1 SCC 248]. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d. 15. Presumption of innocence has been acknowledged throughout the world. Article 14(2) of the International Covenant on Civil and Political Rights, 1966 and Article 11 of the Universal Declaration of Human Rights, 1948 acknowledge the presumption of innocence, as a cardinal principle of law, until the individual is proven guilty. [Emphasis Supplied] 16. Both in Australia and Canada, a prima facie right to a reasonable bail is recognised based on the gravity of offence. In the United States, it is a common practice for bail to be a cash deposit. In the United Kingdom, bail is more likely to consist of a set of restrictions. xxx xxx xxx 19. The position in India is no different. It has been the consistent stand of the courts, including this Court, that presumption of innocence, being a facet of Article 21, shall inure to the benefit of the accused. Resultantly burden is placed on the prosecution to prove the charges to the court of law. The weightage of the evidence has to be assessed on the principle of beyond reasonable doubt. xxx xxx xxx Economic offences (Category D) 90. What is left for us now to discuss are the economic ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d. Such consideration with regard to the gravity of offence is a factor which is in addition to the triple test or the tripod test that would be normally applied. In that regard what is also to be kept in perspective is that even if the allegation is one of grave economic offence, it is not a rule that bail should be denied in every case since there is no such bar created in the relevant enactment passed by the legislature nor does the bail jurisprudence provide so. Therefore, the underlining conclusion is that irrespective of the nature and gravity of charge, the precedent of another case alone will not be the basis for either grant or refusal of bail though it may have a bearing on principle. But ultimately the consideration will have to be on case-to-case basis on the facts involved therein and securing the presence of the accused to stand trial. [Underlined to supply Emphasis] 92. Sanjay Chandra v. CBI [Sanjay Chandra v. CBI, (2012) 1 SCC 40 : (2012) 1 SCC (Cri) 26 : (2012) 2 SCC (L S) 397] : (SCC pp. 62-64, paras 39-40 46) 39. Coming back to the facts of the present case, both the courts have refused the request for grant of bail on two grounds : the p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f liberty. Liberty, as embedded in the Code, has to be preserved, protected, and enforced by the criminal courts. Any conscious failure by the criminal courts would constitute an affront to liberty. It is the pious duty of the criminal court to zealously guard and keep a consistent vision in safeguarding the constitutional values and ethos. A criminal court must uphold the constitutional thrust with responsibility mandated on them by acting akin to a high priest. 12. In Ratnambar Kaushik v. Union of India, (2023) 2 SCC 621 : 2022 SCC OnLine SC 1678 (at page 622 of SCC), the Hon ble Supreme Court granted bail to the petitioner therein, the facts of the case being somewhat similar to the present case. The relevant paragraphs are quoted herein : (paragraphs 3 to 8 of SCC) 3. The gist of the allegations against the petitioner in the prosecution initiated against him is that the petitioner had clandestinely transported raw unmanufactured tobacco brought from Gujarat by 7 trucks weighing 90,520 kg. It is alleged that raw tobacco was cleared in the name of M/s Maa Ambey Enterprises, Bakoli from M/s Arihant Traders, Kheda, Gujarat but the said trucks went to Patparganj are ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... re taken note of. It is no doubt true, that an allegation is made with regard to the transportation of unmanufactured tobacco and it is alleged that such procurement of unmanufactured tobacco is for clandestine manufacture and supply of zarda without payment of leviable duties and taxes. Though it is further contended that in the process of the investigation, the transportation of a larger quantity of unmanufactured tobacco weighing about 35,57,450 kg is detected, these are all matters to be established based on the evidence, in the trial. 8. In considering the application for bail, it is noted that the petitioner was arrested on 21-7-2022 and while in custody, the investigation has been completed and the charge-sheet has been filed. Even if it is taken note that the alleged evasion of tax by the petitioner is to the extent as provided under Section 132(1)(l)(i), the punishment provided is, imprisonment which may extend to 5 years and fine. The petitioner has already undergone incarceration for more than four months and completion of trial, in any event, would take some time. Needless to mention that the petitioner if released on bail, is required to adhere to the conditions ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ll the above aspects in the perspective, in the facts and circumstances of the present case, by applying the principles enunciated by the Hon ble Supreme Court in Satender (supra) and Ratnambar (supra), this Court is inclined to grant the prayer for bail made by the petitioner subject to such stringent terms and conditions that would be imposed by the learned court in seisin of the matter, for which the court shall hear the learned counsel for the complainant as well as the learned counsel for the petitioner and further conditions as would be deemed appropriate can be imposed along with the following conditions : Two sureties for an amount to the satisfaction of the learned court in seisin of the matter, out of the two sureties one shall be a family member of the petitioner and the other shall be a local person; the court in seisin of the matter shall ensure and verify the credential of the sureties, the court shall direct and record its satisfaction; the petitioner shall not in any manner make any inducement, threat or promise to the prosecution witnesses so as to dissuade them from disclosing truth before the court and shall not tamper with the evidence; the ..... 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