2025 (7) TMI 1935 - HC - Customs

Regular bail denied to accused u/ss 132, 135 Customs Act in alleged fake firms, forged imports scam

HC rejected the applicant/accused's petition for regular bail under Sections 132 and 135 of the Customs Act, noting prima facie involvement as an ... Grant of Regular Bail - offence of serious nature - applicant/accused has acted as an authorized representative of a fake firm named Golden Feather Traders by forging the name of Rana Thakur to import, clearance and transportation of pepper - offence punishable under Sections 132, 135 of the Customs Act - HELD THAT:- The statements of the accused were taken, in which the applicant/The accused has admitted to sending black pepper/betel nut from one place to another by making a fake e-way bill on the basis of the fake firm and the said firm on the instructions of Kirtiraj and the pepper sent was not shown in the return of the firm. The firm shown in the complaint is the GST of the firm. On investigation by the complainant department of the return, import-export suppliers and buyers, it has been shown that all the firms and the e-way bill issued were illegally availed of input tax credit by making fake invoices and also taking refund and duty back from the government in lieu of fake exports. Table 3 shown in paragraph no. 9 of the complaint, in which 19 firms are mentioned, all those firms are shown to be fake/fake. On 11.03.2025, the Department has registered a case under Section 108 Customs Act, 1962 against the applicant/accused. The applicant/accused in his statement has said that the fake Aadhaar card should be made in the Bhadohi Tehsil Varanasi court. Applicant/ What is the evidentiary value of the statement of the accused and how much of the facts which have come up in the investigation are true or false, it can be evaluated only after the statements of important witnesses are recorded. At this stage, the applicant/applicant The accused is accused of causing huge revenue loss, which is going to affect the economy of the country. In the judgments submitted on behalf of the applicant, particularly in Y.S. Gagan Mohan Reddy vs. CBI [2013 (5) TMI 896 - SUPREME COURT] the Hon'ble Supreme Court has held that economic offences are meant to destroy or destroy the public treasury, such offences must be taken seriously and such offences affect the economy of the entire nation. The Hon'ble Supreme Court in the decision of Nimmagadda Prasad vs. CBI [2013 (5) TMI 920 - SUPREME COURT] has also held that economic offences are of a much more serious nature than ordinary offences, as they are carried out for personal gain, especially in a planned manner, against the interests of the public. Therefore, without commenting on the merits of the case on the basis of the above discussion, it does not appear to be appropriate to grant bail to the applicant-accused in view of all the facts and circumstances of the case and the gravity of the offence. This bail application filed by the applicant-accused is rejected and rejected. 1. ISSUES PRESENTED AND CONSIDERED 1.1 Whether the applicant-accused was entitled to regular bail in a case under Sections 132 and 135 of the Customs Act, 1962, involving alleged creation and use of fake firms, forged identities and bogus documents causing substantial loss of customs revenue. 1.2 How the gravity and character of the alleged economic offence, including its impact on public revenue and the national economy, affect the exercise of discretion to grant bail at the investigation stage. 1.3 Whether, at the stage of consideration of bail, the Court should rely on the statements recorded under Section 108 of the Customs Act and other investigation material and what weight should be accorded to them, including in the face of allegations of coercion. 2. ISSUE-WISE DETAILED ANALYSIS Issue 1 - Entitlement to regular bail in offences under Sections 132 and 135 of the Customs Act Legal framework (as discussed by the Court) 2.1 The prosecution is based on alleged offences punishable under Sections 132 and 135 of the Customs Act, 1962, relating to fraudulent import, customs clearance and transport of black pepper through a fake firm, using forged identity documents and bogus invoices/e-way bills causing loss of customs revenue of Rs. 12,52,94,634/-. Statements of the applicant were recorded under Section 108 of the Customs Act, 1962. Interpretation and reasoning 2.2 The Court noted the specific allegations that the applicant acted as authorised representative of a fake firm styled 'Golden Feather Traders', used a forged identity in the name of 'Rana Thakur', and submitted fake documents at ICD, Jaipur to obtain customs clearance of black pepper, thereby causing revenue loss of Rs. 12.52 crores. During search at the applicant's residence three Aadhaar cards bearing different names were recovered, and forensic extraction of data from three seized mobile phones revealed documents of 19 allegedly fake firms. 2.3 The Court took into account that, in statements recorded under Section 108 of the Customs Act, the applicant admitted: (i) operating under a pseudonym ('Rana Thakur'); (ii) creation of fake firms on the directions of 'Kirtiraj'; (iii) preparation of bogus e-way bills and invoices in the names of such firms for transport of black pepper/supari; (iv) non-reflection of such goods in the firms' returns; and (v) that specific named firms, including R.M. Enterprises and Shivansh Marketing, were fake and were used to generate bogus invoices for supply of black pepper from Golden Feather Traders, Delhi. 2.4 The Court referred to the complaint material indicating that, on departmental investigation of GST returns, import-export details, suppliers, buyers and e-way bills, all 19 firms mentioned (including those in Table 3 of the complaint) were found to be fake, and that fake invoices and e-way bills were allegedly used to illegally avail input tax credit, secure refund and duty drawback on fictitious exports. 2.5 The defence contentions that: (i) the applicant was not an importer and had no duty liability; (ii) he was falsely implicated; (iii) Section 132 was a bailable offence; (iv) data in his mobile phones was fabricated by Customs officers; (v) he suffered serious health issues and disability; and (vi) he was incapable of influencing witnesses or absconding, were noted but not accepted as sufficient to override the nature and magnitude of the allegations at this stage. 2.6 On the precedent cited by the applicant, particularly the decision where bail was granted after the accused had remained in custody for over 10 years, the Court held that the applicant had been in judicial custody only since 28.02.2025, and therefore the principle of prolonged incarceration underlying that precedent was inapplicable. 2.7 The Court emphasised that the matter was still under investigation and, given the nature of the alleged network of fake firms and documents, releasing the applicant on bail at this stage could not exclude the possibility of his influencing or tampering with the evidence. Conclusions on Issue 1 2.8 Without commenting on the ultimate merits, and considering (i) the prima facie material indicating use of multiple fake identities and firms; (ii) the alleged loss of revenue of Rs. 12.52 crores; (iii) the ongoing investigation; and (iv) the corresponding risk of evidence being influenced, the Court held that it was not appropriate to extend the benefit of regular bail to the applicant at this stage and rejected the bail application. Issue 2 - Effect of gravity and economic nature of the offence on the grant of bail Legal framework (as discussed by the Court) 2.9 The Court considered binding precedents of the Supreme Court regarding the treatment of economic offences and 'white collar crimes' at the stage of bail. It noted the principles laid down in decisions such as Y.S. Jaganmohan Reddy, Nimmagadda Prasad, Rohit Tandon and other authorities cited by the department, all of which characterise economic offences as grave and having serious implications for public funds and the national economy. Interpretation and reasoning 2.10 The Court recorded that, as per the cited Supreme Court jurisprudence, economic offences which deplete or destroy public exchequer and affect public interest are to be viewed with great seriousness, and such offences can affect the economy of the entire nation. 2.11 It further noted the judicial view that economic offences stand on a different and more serious footing than ordinary crimes, since they are generally: (i) committed in a well-planned, organised manner; (ii) targeted at securing personal illegal gain; and (iii) perpetrated at the cost of public interest and public funds. 2.12 Referring to the characterisation of 'white collar crimes' in the cited decisions, the Court observed that such offences are considered more dangerous to society than ordinary crimes because they involve a deliberate, systematic breach of trust and are designed to cause harm to the public and to the national economy. 2.13 On this basis, the Court treated the alleged acts-use of fake firms and forged documents to evade customs duty, fraudulently avail input tax credit, refunds and duty drawback, and cause a loss of Rs. 12.52 crores to the revenue-as an economic offence of a very serious nature, directly attracting the principles laid down in the above precedents against liberal grant of bail. Conclusions on Issue 2 2.14 The Court concluded that, in view of the gravity and economic character of the alleged offence, and its potential impact on the national economy and public revenue, the case did not warrant exercise of discretion in favour of bail, and the seriousness of the economic offence was a decisive factor in rejecting the bail application. Issue 3 - Use and evidentiary value of Section 108 Customs Act statements and investigation material at the bail stage Legal framework (as discussed by the Court) 2.15 The Court noted that statements of the applicant had been recorded under Section 108 of the Customs Act, 1962, and that searches and forensic data extraction had been carried out, yielding multiple identity documents and digital records of alleged fake firms. Interpretation and reasoning 2.16 The Court expressly referred to the contents of the Section 108 statements, including the applicant's admissions about: (i) operating under a pseudonym; (ii) having multiple Aadhaar cards with different names; (iii) creation and use of fake firms and e-way bills for movement of black pepper/supari; and (iv) the existence of numerous bogus firms as detailed in the complaint and its tables. 2.17 At the same time, the Court observed that the precise evidentiary value of the applicant's statements under Section 108, and the truth or falsity of the facts emerging from investigation, could be properly evaluated only after the recording of the statements of important witnesses and further development of evidence at trial. 2.18 Allegations by the applicant of coercion, inhuman treatment and fabrication/tampering of mobile data by customs officers were recorded as part of the defence submissions but were not adjudicated upon at this stage. The Court effectively treated such contentions as matters going to the evidentiary value and voluntariness of the statements, which would be assessed at a later stage on the basis of evidence. 2.19 For the limited purpose of deciding bail, the Court considered the investigation material, including the Section 108 statements, seized Aadhaar cards, and forensic data showing 19 fake firms, to provide sufficient prima facie basis to support the allegation of a serious economic offence involving substantial revenue loss. Conclusions on Issue 3 2.20 The Court held that, notwithstanding pending questions about the ultimate evidentiary value and voluntariness of the applicant's statements and other material, the existing investigation record under Section 108 and related documents furnished adequate prima facie grounds at this stage to justify denial of bail, and that a detailed evaluation of such evidence must await recording of witness testimony and trial.