2022 (10) TMI 503 - HC - GST

CA granted bail after borrowing colleague's UDIN for certificate upload and excess Input Tax Credit benefit

The Punjab and Haryana HC granted regular bail to petitioner who borrowed UDIN from colleague for uploading and issuing CA certificate and was beneficiary ... Seeking grant of regular bail - UDIN borrowed from colleague for uploading and issuance of the CA certificate - beneficiary of the excess Input Tax Credit - HELD THAT:- In the present case the investigation has been completed and the challan stands presented; he is not involved in any other case; he is in custody since 17.5.2022; nothing is to be recovered from him; there are a total of 21 PWs; it is a Magisterial trial, which is yet to commence; thus, further incarceration of the petitioner behind bars would not serve any useful purpose, the present petition for grant of regular bail deserves to be allowed. The petitioner is ordered to be released on regular bail, subject to his furnishing bail/surety bonds amounting to Rs.10 lakhs to the satisfaction of trial Court/Duty Magistrate concerned and subject to him not being required in any other case - Petition allowed. Issues:Grant of regular bail under Section 439 Cr.P.C. in a case registered under Section 132(1)(i) read with Section 132(1)(b)(c)(e)(f) of the Central Goods and Services Tax Act, 2017.Detailed Analysis:1. Petitioner's Qualification and Role: - The petitioner, a Chartered Accountant, sought bail in a case involving professional fees for uploading refund of Input Tax Credit. - He borrowed UDIN from a colleague for issuing the CA certificate, which he argues was not required under Rule 89(m) of CGST Rules. - The petitioner's involvement was limited to professional services, with no direct benefit from the alleged excess Input Tax Credit. 2. Prosecution's Position: - The prosecution opposed bail citing the department's significant loss and ongoing investigations. - Some bank accounts were frozen, and companies refunded amounts voluntarily. - The prosecution acknowledged the recovery of relevant documents and the pending trial with 21 prosecution witnesses. 3. Legal Precedents and Bail Jurisprudence: - Various judgments, including those of the Supreme Court, emphasized that bail is the rule and jail the exception. - Gravity of the offense, societal impact, and the accused's role are crucial factors in bail considerations. - Each case's circumstances dictate bail decisions, with no fixed formula for granting bail. 4. Judicial Decision and Conditions: - The court considered the completed investigation, presented challan, lack of recovery needs, and the petitioner's custody since the arrest. - Citing relevant legal precedents, the court granted regular bail with stringent conditions, including a bail amount and restrictions on travel and behavior. - Failure to comply with the conditions could lead to bail cancellation at the prosecution's request. 5. Final Remarks: - The judgment clarified that it did not express a final opinion on the case's merits, allowing the trial to proceed independently. - The decision balanced the petitioner's right to bail with the seriousness of the allegations and the need for procedural fairness.This detailed analysis of the judgment highlights the legal arguments, factual circumstances, and judicial considerations that led to the grant of regular bail in the case under scrutiny.