2021 (5) TMI 701 - HC - GST

Chartered Accountant granted bail in GST fraud case after Court considers custody, family, legal arguments

The Court granted bail to the petitioner, a Chartered Accountant, who was accused of offences under the Central Goods & Service Tax Act, 2017. Despite ... Grant of Bail - GST evasion - petitioner being CA was instrumental in registration of 11 fake firms and these firms have availed fraudulent input tax credit - HELD THAT:- Taking note of the fact that Chartered Accountant has remained in custody for a period of one year and five months and that petitioner is also having a child and also considering the contentions put forth by counsel for the petitioner, it is deemed proper to allow the bail application. It is directed that accused petitioner shall be released on bail provided he furnishes a personal bond in the sum of ₹ 1,00,000/- together with two sureties in the sum of ₹ 50,000/- each - Bail application allowed. Issues involved:Bail application under Section 439 of Cr.P.C. for offence under Section 132(1)(i)(iv) read with Sub-Section (5) of Central Goods & Service Tax Act, 2017.Analysis:The petitioner, a Chartered Accountant, filed a bail application under Section 439 of Cr.P.C. The complaint against the petitioner alleged offences under Section 132(1)(i)(iv) of the Central Goods & Service Tax Act, 2017. The petitioner was accused of creating firms based on documents provided by co-accused, charging higher fees for GST returns, and facilitating the registration of fake firms. The petitioner's statement, initially recorded by authorities but retracted later, claimed he was coerced into making false statements after being subjected to physical abuse. The complaint did not allege that the petitioner received any amount related to wrong input tax credit. The petitioner had been in custody for over a year, with the maximum sentence for the offence being six months, triable by a First Class Magistrate.The Union of India opposed the bail application, alleging that the petitioner was instrumental in registering fake firms that availed input tax credit worth Rs. 146 crores. It was claimed that the petitioner knowingly filed GST returns for non-existent firms. The prosecution argued that the offence the petitioner was charged with carried a maximum sentence of five years, and cited a previous case where bail for a Chartered Accountant in a similar situation was rejected by a Co-ordinate Bench of the Court.After considering the arguments presented by both parties, the Court acknowledged the petitioner's prolonged custody, the fact that he had a child, and the contentions made by his counsel. The Court deemed it appropriate to grant bail to the petitioner. The bail application was allowed, with the condition that the petitioner furnish a personal bond of Rs. 1,00,000 and two sureties of Rs. 50,000 each to the satisfaction of the trial court. The petitioner was directed to appear before the court and any subsequent hearings as required.