GST input tax credit fraud and evidence tampering risks justified refusal of regular bail

Fraudulent availment and passing on of input tax credit under GST, supported by suspicious and fictitious suppliers, was treated as a serious economic offence justifying denial of regular bail. The Court relied on material indicating prima facie involvement, substantial tax evasion, invoice movement without corresponding vehicle movement, and the risk of tampering with evidence or obstructing further investigation. Although the charge-sheet had been filed, further investigation was still continuing, and the gravity of the allegations and public interest in economic offences weighed against release. Bail was refused.

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Issues: Whether the applicant, facing of fraudulent availment and passing on of input tax credit under the GST law, was entitled to regular bail in view of the seriousness of the allegations, the material collected during investigation, and the apprehension of interference with further investigation.

Analysis: The application arose from allegations of illegal availment of input tax credit on the basis of suspicious and fictitious suppliers, with material indicating substantial tax evasion and movement of invoices without corresponding movement of vehicles. The Court noted that the case diary reflected a prima facie serious role attributed to the applicant, that the charge-sheet had been filed but further investigation was still underway, and that the possibility of tampering with evidence and obstructing the investigation could not be ruled out. Applying the settled considerations governing bail, including the nature of accusations, the evidence collected, the gravity of the offence, and the larger public interest involved in economic offences, the Court found no ground to release the applicant on bail.

Conclusion: Bail was refused and the applicant was not entitled to regular bail.

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