2024 (2) TMI 997 - HC - GST

Regular bail granted to accused in GST fraud case involving fictitious firms for input tax credit under Section 132

Parag Nathalal Haria Versus State of Gujarat

Gujarat HC granted regular bail to an applicant accused of creating fictitious firms in his and his wife's names to fraudulently avail input tax credit ... Seeking grant of Regular Bail - fictitious firms created and opened in the name of the present Applicant and his wife and the benefit of input tax credit availed in the names of the said fictitious firms - HELD THAT:- From the record, it emerges that the investigation is over and the charge sheet is also filed so also considering the nature of offence and the role attributed to the present Applicant, the Application deserves consideration. This Court has also considered the fact that Section 132 of the GST Act describes punishment of imprisonment which may extend to 5 Years and with fine for the offence alleged against the present Applicant. Considering this aspect, the Application deserves consideration. Taking into consideration the facts of the case, nature of allegations, gravity of accusation, availability of the Applicant Accused at the time of Trial etc. and the role attributed to the present Applicant accused, the present Application deserves to be allowed and accordingly stands allowed. This Court has also gone through the FIR and police papers and also the earlier order passed by the learned Sessions Court where the learned Sessions Judge has disallowed the bail Application at initial stage. The Applicant Accused is ordered to be released on bail in connection with the aforesaid FIR on executing a personal bond of Rs. 10,000/- with one surety of the like amount to the satisfaction of the trial Court, subject to the conditions imposed. Bail application allowed. Issues involved: Application for Regular Bail under Section 439 of the Code of Criminal Procedure for offences under Sections 132(1)(b), 132(1)(c), and 132(1)(1) of the Central Goods and Service Tax Act, 2017.Details of the Judgment:1. The Applicant, engaged in legitimate trading, seeks bail, asserting genuine transactions with valid documents and no monetary benefit from the alleged offence. No incriminating material linking the Applicant to the offences except a confessional statement obtained under duress. Applicant's cooperation with authorities and lack of past antecedents are highlighted. Applicant willing to comply with imposed conditions if granted bail.2. Respondent No. 2 opposes bail, citing a systematic fraud of over Rs. 67.72 Crores involving fictitious firms created in the Applicant's and his wife's names for availing input tax credit. Respondent urges dismissal of the bail application, submitting an opposing Affidavit.3. The learned APP opposes bail, emphasizing the serious nature of the offence and advises against granting bail.4. After hearing both sides and examining the records, it is noted that investigation is complete, charge sheet filed, and the offence carries a potential imprisonment of up to 5 years. Factors considered include prima facie case, accused's presence at trial, and witness tampering. Applicant's custody since 19.12.2023 is acknowledged. Citing relevant legal precedents, the Court deems the application for bail deserving of consideration.5. Considering the gravity of the accusation, nature of allegations, and the Applicant's role, bail is granted. Applicant to execute a personal bond of Rs. 10,000/- with one surety of the same amount, subject to various conditions including non-tampering with evidence, maintaining law and order, and providing proof of residence and contact details.6. Bail bond to be executed before the Trial Court, which may grant time for furnishing a solvency certificate if requested. Breach of conditions may lead to appropriate legal action. The Applicant to surrender passport, if any, and not leave India without Court permission.7. The trial Court is instructed not to be influenced by the prima facie observations made by the High Court in this bail order. The rule is made absolute, and direct service is permitted.