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Issues: (i) Whether the arrest of the petitioner under section 69 of the Central Goods and Services Tax Act, 2017 was supported by valid reasons to believe and the necessary factual basis; (ii) Whether the petitioner was entitled to be enlarged on bail in exercise of writ jurisdiction under Article 226 of the Constitution of India.
Issue (i): Whether the arrest of the petitioner under section 69 of the Central Goods and Services Tax Act, 2017 was supported by valid reasons to believe and the necessary factual basis.
Analysis: Section 69 permits arrest only where the Commissioner has reasons to believe that a person has committed one of the specified offences under section 132. The expression imports an objective foundation and not a merely routine or mechanical satisfaction. The record showed repeated appearance by the petitioner in response to summons under section 70 and did not disclose any concrete incident of tampering with evidence, influencing witnesses, evasion of investigation, or likelihood of flight. The recorded reasons largely reproduced the statutory language and did not disclose specific material justifying arrest as a necessary step.
Conclusion: The arrest was not shown to rest on sufficient, concrete reasons to believe and the statutory threshold for arrest was not satisfactorily established.
Issue (ii): Whether the petitioner was entitled to be enlarged on bail in exercise of writ jurisdiction under Article 226 of the Constitution of India.
Analysis: The matter was assessed against the settled bail factors, including the nature of the accusation, the possibility of tampering with evidence, securing the presence of the accused, and the public interest involved. The Court noted cooperation with investigation, absence of a formal complaint or first information before arrest, and the pre-trial stage of the matter. Although economic offences are serious and custodial interrogation may in appropriate cases be justified, the facts did not show that continued detention was necessary. The Court also considered that compounding applications had been moved and that personal liberty required protection where the statutory safeguards for arrest were not convincingly satisfied.
Conclusion: The petitioner was entitled to bail.
Final Conclusion: The writ petition succeeded and the petitioner was directed to be released on bail, subject to the conditions imposed by the Court.
Ratio Decidendi: An arrest under section 69 of the Central Goods and Services Tax Act, 2017 must be founded on concrete, objective reasons showing that arrest is necessary, and writ jurisdiction under Article 226 may be exercised to protect liberty where those requirements are not met.
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