2024 (4) TMI 552 - HC - GST

Accused in GST Fraud Case Secures Bail After Challenging Procedural Irregularities and Insufficient Evidence Against Them

Sagar Dilip More Versus State of Maharashtra

HC granted bail in GST fraud case involving allegations of using fake documents to claim substantial tax refunds. Court considered defense arguments about ... Seeking grant of bail - Evasion of GST - Petitioner claimed that his signature were forged - absence of prior sanction from the Commissioner for prosecuting offenses u/s 132(1) - Non compliance of Section 132 (6) of the Central Goods and Services Act, 2017 - On the basis of fake documents and papers, amount claimed by the concerned persons towards return of the amount of GST paid - HELD THAT:- Admittedly, there is no previous sanction of the Commissioner and, therefore, there is no question of the applicant being prosecuted for breach of Section 132 (1) (e) (f) (l) (ii) (iv) of the G.S.T Act. Though Assistant GST Commissioner – Balaji Narhare is the original complainant, he has not been shown as a witness. The trial has already commenced and the evidence of P.W.1 – Dhondiram Hariba Bembade has been recorded by the Metropolitan Magistrate 34th Court, Vikroli, Mumbai. This witness, during his cross-examination, gave vital admissions indicating that the investigation was conducted by Balaji Narhare. He does not know anything more than that - prima facie, incarceration of the applicant appears to be without any concrete material against him. It is submitted that the applicant has been in custody for more than two years. The applicant – Sagar More is released on bail on furnishing a P.R. bond in the sum of Rs.20,000/- with one surety in the like amount to the satisfaction of the trial Court in Crime No.327 of 2020 registered with Tilak Nagar Police Station - Application allowed. Issues involved: Application for bail under section 439 of Cr. P.C. for offences under Sections 420, 468, 471 of IPC r/w Section 132 of GST Act.Summary:The applicant sought bail in a case involving offenses under IPC and GST Act. The first informant, an Assistant State Commissioner in GST, discovered discrepancies in the applicant's accounts leading to the registration of offenses. The applicant was accused of using fake documents to claim a substantial amount of GST. The applicant allegedly opened a GST account in the name of a company he owned and withdrew the claimed amount through fake bank accounts. The defense highlighted the lack of previous sanction from the Commissioner for prosecution under the GST Act, pointing out discrepancies in the case. An anomaly was revealed where someone misused the applicant's PAN and Aadhar cards, forging his signature. The trial had commenced, and evidence was being recorded, but the defense argued that the applicant's incarceration seemed unjustified as concrete evidence was lacking. After considering the arguments, the court allowed the application for bail, requiring the applicant to furnish a bond and attend all court dates, with provisions for bail cancellation in case of breaches.The judgment highlighted the complexities of the case involving allegations of financial fraud and procedural irregularities. The defense raised valid concerns regarding the lack of proper sanction for prosecution under the GST Act and discrepancies in the evidence presented. The court's decision to grant bail reflected a balance between the legal requirements and the applicant's right to liberty pending trial.