2018 (9) TMI 688 - HC - GST

Court denies bail in GST fraud case; highlights speedy trial imperative

Ranjeet @ Ranjeet Singh Versus Union of India And 2 Others

The Court rejected the bail application under Sections 132(1)(b) of the Central Goods and Services Tax Act, 2017, in a case involving fraudulent availment ... Bail Application - Section 132(1)(b) of Central Goods and Services Tax Act, 2017 - fraudulent availment of ITC - fake purchase bills - Held that:- This Court is of the opinion, that learned counsel for the applicant could not point out any good ground for grant of bail to the applicant - the bail application filed on behalf of the applicant is hereby rejected - decided against applicant. Issues: Bail application under Sections 132(1)(b) of Central Goods and Services Tax Act, 2017 for a case involving fraudulent availment of input tax credit and evasion of GST.Analysis:The bail application was filed by the applicant in Case Crime No. 02 of 2018 under Sections 132(1)(b) of the Central Goods and Services Tax Act, 2017, related to fraudulent availment of input tax credit. The supplementary counter affidavit filed by the opposite party revealed that the investigation was ongoing, with the fraudulent amount exceeding Rs. 30 crores based on false declarations in GSTR-3B. The applicant was alleged to have produced fake purchase bills with an input tax credit of only Rs. 3 crores, while follow-up searches detected fraudulent input tax credit of over Rs. 16.57 crores issued from a firm controlled by the applicant. The prosecution's case detailed discrepancies found during a raid at a specific location, indicating evasion of GST through forged firms.The applicant contended that he was falsely implicated, emphasizing that the alleged tax evasion did not exceed Rs. 2 crores, making the offense non-cognizable and bailable. Additionally, it was argued that no prior sanction was obtained from the Commissioner, rendering the entire prosecution illegal under Section 132(6) of the Act. Conversely, the opposite party and the Additional Government Advocate highlighted the recovery of incriminating items during the search, suggesting that the tax evasion amount could be significantly higher.After hearing arguments from both sides and reviewing the bail application and rejection order, the Court found no compelling grounds for granting bail to the applicant. Consequently, the bail application was rejected. The Court directed the expeditious trial of the case within six months, emphasizing the importance of timely proceedings without unnecessary adjournments. It was clarified that the observations made in the order were limited to the bail application and should not be misconstrued as reflecting on the case's ultimate merits.