Anticipatory bail in alleged GST input tax credit fraud was refused on strong prima facie material and risk to evidence.

Anticipatory bail was refused in a GST-related economic offence alleging fraudulent availment and passing on of ineligible input tax credit. The Court applied settled bail factors, including prima facie material, seriousness of the accusation, antecedents, risk of absconding, and likelihood of tampering with evidence. It noted material showing transactions with alleged fake entities, an investigation at an early stage, and non-existent entities, and found that pre-arrest protection could impede inquiry and allow destruction of evidence. On that basis, discretionary relief was denied.

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Issues: Whether anticipatory bail should be granted in a case involving alleged fraudulent availment and passing on of ineligible input tax credit under the GST regime.

Analysis: The application was assessed on settled anticipatory bail principles, including prima facie material, gravity of the accusation, antecedents, possibility of absconding, and likelihood of tampering with evidence. The material on record indicated that the applicant's concern had transactions with entities alleged to be fake, and the investigation showed ineligible ITC beyond the statutory threshold. The proceedings were at an initial stage, the alleged entities were stated to be non-existent, and the Court found that granting protection at that stage could impede the investigation and enable destruction of evidence. In the context of an economic offence involving alleged fraudulent ITC, the Court treated the prima facie material as sufficient to deny discretionary relief.

Conclusion: Anticipatory bail was not justified and was rejected.

Final Conclusion: The application failed because the Court found sufficient prima facie material of a serious GST-related economic offence at an early stage of investigation, warranting refusal of pre-arrest protection.

Ratio Decidendi: In economic offences under the GST law, anticipatory bail may be refused where there is prima facie material of fraudulent input tax credit, the investigation is at an initial stage, and there is a real risk of evidence being destroyed.

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