2023 (5) TMI 560 - HC - GST

Bail granted in GST fraud case involving fraudulent input tax credit claims across 455 companies with Rs.1 lakh bond

Mohd. Rashid Siddiqui Versus State of U.P. Thru. Prin. Secy. Home Lko.

Allahabad HC granted bail to applicant in GST fraud case involving fraudulent input tax credit claims across 455 companies nationwide causing huge tax ... Seeking grant of bail - availment of fraudulent input tax credit - huge tax evasion by way of making false claim of input tax credit in 455 companies, all over the country - HELD THAT:- On going through the material available on record, contents of F.I.R., other relevant documents, gravity of offence as well as facts and circumstances of the case, it is evident that during the course of investigation Rs.1.12 lakh is found in the account of wife of the applicant by the main accused, Sanjay Yadav. It is also evident that said Sanjay Yadav, has already been enlarged on bail. In such circumstances, it is opined that the applicant is entitled to be released on bail. Let applicant - Mohd. Rashid Siddiqui - be released on bail in aforesaid Case Crime, on his furnishing personal bond of Rs.1,00,000/- and two reliable sureties of Rs.1,00,000 each to the satisfaction of the court concerned subject to the conditions imposed - application allowed. Issues involved:The judgment involves a bail application in a case concerning Sections 419, 420, 467, 468, 471, 506, and 120-B of the Indian Penal Code (IPC) and Section 66 of the Information Technology Act, Police Station - S.G.P.G.I., District - Lucknow.Details of the Judgment:Bail Application:The applicant filed a bail application asserting innocence and false implication, stating that he is a young lawyer associated with the informant, who sent firms for legal aid and G.S.T. services. The applicant's counsel argued that the only evidence found was a payment of Rs.1,12,000/- in the applicant's wife's account by a co-accused. It was highlighted that the main accused implicated the applicant in association with a Chartered Accountant. The applicant was on bail in other cases, and the charge sheet had been filed, with no ongoing trial. The defense emphasized the lack of evidence supporting the prosecution's claims against the applicant.Opposition to Bail:The Additional Advocate General and counsel for the complainant opposed the bail application, mentioning a pending bail cancellation application related to a co-accused. They presented information on significant tax evasion and false claims of input tax credit, emphasizing the gravity of the offense.Decision and Conditions:After considering all submissions, the court granted bail to the applicant, Mohd. Rashid Siddiqui, upon furnishing a personal bond and sureties. The court imposed several conditions, including restrictions on committing similar offenses, tampering with evidence, and adjournments during trial. The judgment emphasized the need for the applicant's presence at court proceedings and warned against misuse of bail.Special Investigation Team:The judgment highlighted the need for a Special Investigation Team comprising police officials, G.S.T. experts, audit experts, and cyber experts to investigate cases involving false input tax credit. Directions were issued to relevant authorities for further investigation and compliance, with a follow-up scheduled for July 2023.Compliance and Discharge:The Additional Chief Secretary and other officials were directed to file compliance affidavits, and the presence of certain individuals was discharged by the court.Conclusion:The judgment granted bail to the applicant, outlined stringent conditions, and called for specialized investigation in cases of false input tax credit, emphasizing the seriousness of the offense and the need for thorough examination by expert teams.