2019 (9) TMI 617 - DSC - GST

Accused in IGST refund fraud granted bail with conditions

DGGI Versus Ramesh Wadhera

The accused, involved in a fraudulent scheme related to IGST refunds, was granted bail by the court. The judge considered the lack of direct involvement ... Grant of Bail - irregular availment of input tax credit - alleged offence u/s 132(1)(b) and 132(1)(c) of CGST Act - requirement of custodial interrogation - HELD THAT:- Section 132(1)(b) provides that whoever issues any invoice or bill without supply of goods or services in violation of the provisions of the Act leading to wrongful availement or utilisation of Input Tax Credit or refund of tax shall be punished - section 132(I)(c) provides that whoever avails Input Tax Credit by using such invoices or bills referred to in clause (b) shall be punished. In the case in hand, as per the reply filed by the department, neither any invoice or bill has been issued by the applicant/accused nor any Input Tax Credit was availed by the applicant/accused himself or by any firm in which he is a proprietor or partner. The entire case put forth by the department against the applicant/accused is that he is the person who conspired with co-accused persons for wrongful availement of refund of IGST. It is pertinent to mention that the evidence collected so far against the applicant/accused is the statement of the applicant/accused recorded u/s 70 of CGST Act which has already been retracted by the applicant/accused when he was produced before the Court after his arrest. Considering the totality of facts and circumstances, period of custody already undergone by the applicant/accused and the nature of evidence available against the applicant/accused, applicant/accused Ramesh Wadhera is entitled to bail in this case at this stage. Hence, applicant/accused Ramesh Wadhera is hereby admitted to bail on furnishing personal bond in the sum of ₹ 1 lac with one surety. Bail application stands disposed of. Issues involved: Bail application under sections 132(1)(b) and 132(1)(c) of CGST Act.Detailed Analysis:1. Allegations and Arguments by the Defense: The defense argued that the accused was falsely implicated based on a statement recorded under duress, which was retracted immediately. It was contended that the accused did not issue any invoice or avail Input Tax Credit as alleged, making the offense bailable. The defense highlighted that the accused had been in custody for a month, and custodial interrogation was unnecessary as the accused was willing to cooperate with the investigation.2. Allegations by the Department: The department alleged that the accused was the mastermind behind a fraudulent scheme involving IGST refund, with co-accused facilitating the creation of fake firms to avail the refund. It was argued that the accused orchestrated the withdrawal of a significant amount of money, demonstrating habitual offending behavior. The department emphasized ongoing investigations and opposed bail for the accused.3. Judicial Analysis: The judge considered the provisions of sections 132(1)(b) and 132(1)(c) of the CGST Act, which criminalize the issuance of invoices without supply of goods or services and wrongful availing of Input Tax Credit, respectively. The judge noted that the allegations against the accused focused on his involvement in a scheme to fraudulently avail IGST refunds through fake firms, with evidence primarily based on a retracted statement. The judge highlighted the absence of direct involvement in issuing invoices or availing credits by the accused himself.4. Decision and Conditions of Bail: After evaluating the arguments and evidence, the judge granted bail to the accused, considering the period already spent in custody, the nature of evidence, and the lack of direct involvement in the alleged offenses. Bail was granted on the condition of furnishing a personal bond and surety, cooperating with the investigation, refraining from tampering with evidence or influencing witnesses, and attending court proceedings as required. The judge also imposed restrictions on leaving the country without court permission.5. Conclusion: The bail application was disposed of, with the order sent to the Jail Superintendent for compliance. The decision to grant bail was based on a thorough analysis of the arguments, allegations, legal provisions, and available evidence, ensuring a balanced approach to the accused's rights and the ongoing investigation.