2019 (5) TMI 360 - HC - GST

Court grants anticipatory bail in Rs. 57.60 Crores GST evasion case citing compliance, cooperation, and stringent conditions.

Mrs. B. Banu Bee W/o S. Mohammed Basha Versus State of Karnataka by Inspector of Central Tax

The court granted anticipatory bail to accused No.2 in a case involving alleged GST evasion of Rs. 57.60 Crores. The court considered the petitioner's ... Grant of anticipatory bail - Whether the petitioner/accused has committed the alleged offence or not is a matter which has been considered and appreciated only after investigation and the charge sheet is filed? - HELD THAT:- This Court in the case of Sri.Avainash Aradhya Vs. the Commissioner of Central Tax [2019 (3) TMI 373 - KARNATAKA HIGH COURT] has elaborately discussed the provisions of law and other aspects as to under what circumstances the bail has to be considered and granted. Those facts and circumstances are also similar to the present facts of the case on hand and as such I feel that if by following the said precedent by imposing some stringent conditions, if petitioner/accused is ordered to be released on anticipatory bail, it is going to meet the ends of justice. The petition is allowed and petitioner/accused No.2 is ordered to be released on anticipatory/bail in the event of her arrest. Issues:Anticipatory bail under Section 438 of Cr.P.C. in a case involving alleged GST evasion of Rs. 57.60 Crores by accused No.2 in collusion with accused No.1, diversion of tax invoices, and issuance of fake invoices without actual supply of goods.Analysis:1. Request for Anticipatory Bail: The petitioner, accused No.2, filed a petition seeking anticipatory bail due to the fear of arrest in a case registered by the Commissioner of Central Tax. The petitioner's counsel highlighted the urgency as the petitioner's daughter needed to attend NEET exam coaching, and any police arrest could disrupt this schedule.2. Allegations and Defense: The case involved accused No.1 as the proprietor of several shell firms and accused No.2 as a partner. The allegations included diversion of tax invoices without actual goods supply, causing a GST evasion of Rs. 57.60 Crores. The petitioner's defense emphasized non-involvement in the transactions, compliance with GST Act provisions, absence of revenue loss, and willingness to cooperate and offer sureties.3. Prosecution's Opposition: The prosecution argued that fake invoices led to substantial revenue loss to the state, highlighting ongoing investigations and the risk of evidence tampering if the petitioner is granted anticipatory bail.4. Judicial Consideration: The court reviewed submissions from both sides and examined the case records. It emphasized that the determination of guilt would occur post-investigation and charge sheet filing. Reference was made to a previous case involving similar circumstances where bail was granted, indicating a precedent for considering bail under stringent conditions.5. Judicial Decision: Citing the precedent and considering the facts of the present case, the court granted anticipatory bail to accused No.2. The bail order included conditions such as executing a personal bond, surrendering before the Investigating Officer within 15 days, refraining from tampering with evidence, marking attendance monthly at the police station, staying within court jurisdiction, and avoiding similar criminal activities.This detailed analysis of the judgment showcases the legal considerations, arguments presented by both sides, and the court's reasoning leading to the decision to grant anticipatory bail to accused No.2 in the GST evasion case.