Regular bail in GST evasion allegations turned on weak linkage, limited recovery, and the CGST non-bailable threshold.

Regular bail was considered in a prosecution alleging GST evasion and allied forgery offences, with the Court placing weight on the petitioner not being named in the FIR, the alleged tax evasion already having been recovered from other persons, and the main material against him consisting of Section 161 CrPC statements treated as hearsay and debatable. The Court also noted that only a small recovery was attributed to the petitioner, no input tax credit was shown in his account, trial had not advanced with witness examination, and the statutory threshold under Section 132 of the CGST Act was relied on to support the case that the offence was not non-bailable. Bail was granted.

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Issues: Whether the petitioner was entitled to regular bail in a case arising out of alleged GST evasion and allied forgery offences.

Analysis: The petitioner was not named in the FIR. The amount alleged to have been evaded had already been recovered from other persons who had taken the benefit of input tax credit. The material implicating the petitioner consisted mainly of statements recorded under Section 161 of the Code of Criminal Procedure, 1973, and the linkage to the petitioner was treated as hearsay and debatable. No recovery other than a small amount was attributed to the petitioner, no input tax credit was shown to have been credited to his account, and the trial had not progressed with examination of witnesses. The Court also noticed that the statutory framework under Section 132 of the Central Goods and Services Tax Act, 2017 was relied upon in support of the contention that the alleged tax evasion did not cross the threshold said to make the offence non-bailable.

Conclusion: The petitioner was held entitled to regular bail.

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