2024 (8) TMI 302 - HC - GST

Accused granted regular bail in fake GST entities case with fraudulent ITC claims after 4+ months custody

Sandeep Mohanty Versus Union of India

Sandeep Mohanty Versus Union of India - 2024 (89) G. S. T. L. 343 (Ori.) Issues Involved:1. Legality of the petitioner's arrest and detention.2. Necessity of custodial interrogation.3. Petitioner's criminal antecedents and risk of re-offending.4. Risk of tampering with evidence and influencing witnesses.5. Applicability of Supreme Court precedents on bail.6. Public interest and state revenue considerations.Issue-Wise Analysis:1. Legality of the Petitioner's Arrest and Detention:The petitioner challenged the legality of his arrest, arguing that the Investigating Officer (I.O.) violated mandatory procedural requirements under Section 41(a) of Cr.P.C., as outlined in the Supreme Court judgments in *Satender Kumar Antil vs. CBI & Anr.* and *Arnesh Kumar vs. State of Bihar and Anr.*. The petitioner contended that his detention was contrary to Section 41(a) of Cr.P.C. and violative of Article 21 of the Constitution of India. The court noted that the maximum punishment prescribed under the alleged sections is up to 5 years and that the offences are triable by a magistrate.2. Necessity of Custodial Interrogation:The petitioner argued that no further custodial interrogation was required as the case was based on documentary evidence, which was already in possession of the authorities. The petitioner had been in custody for over four months, and the final P.R. had been submitted. The court found that since the investigation had concluded and the evidence was primarily documentary, further custodial interrogation was unnecessary.3. Petitioner's Criminal Antecedents and Risk of Re-offending:The petitioner acknowledged having a similar criminal antecedent but argued that this did not conclusively prove his guilt in the present case. The petitioner had already been in pretrial detention for nearly four months and was willing to abide by any conditions imposed by the court. The court considered the petitioner's willingness to comply with conditions and his permanent residency in Odisha, reducing the risk of absconding.4. Risk of Tampering with Evidence and Influencing Witnesses:The petitioner argued that the case relied on documentary evidence stored electronically, reducing the risk of tampering. Additionally, all witnesses were official witnesses, minimizing the chance of influencing them. The court found that the nature of the evidence and the status of the witnesses mitigated the risk of tampering or influence.5. Applicability of Supreme Court Precedents on Bail:The petitioner cited the Supreme Court judgments in *Ratnambar Kaushik vs. Union of India* and *Satender Kumar Antil vs. CBI & Anr.*, emphasizing the importance of personal liberty and the conditions under which arrest and detention are justified. The court agreed that these precedents were applicable, noting that the maximum punishment was up to 5 years, and the petitioner had already been in custody for over four months. The court was persuaded to grant bail based on these precedents.6. Public Interest and State Revenue Considerations:The prosecution argued that the alleged offence was an economic crime of grave magnitude, involving significant government revenue. They contended that releasing the petitioner on bail could lead to tampering with evidence, influencing witnesses, and re-offending. The court acknowledged these concerns but balanced them against the petitioner's right to personal liberty and the nature of the evidence. The court imposed stringent conditions to mitigate these risks.Conclusion:The court directed that the petitioner be released on bail with stringent conditions, including not indulging in similar offences, cooperating with the investigation, appearing before the trial court, not leaving the jurisdiction without permission, not tampering with evidence, and surrendering travel documents. Violation of any conditions would result in automatic cancellation of bail. The bail application was allowed based on the principles laid down by the Supreme Court and the specific circumstances of the case.