GST evasion bail turns on mandatory arrest safeguards and completed investigation, with custody found unwarranted

Bail was granted in a GST evasion prosecution under Section 132(1)(c) of the CGST Act because the alleged offence carried a maximum sentence of five years, the petitioner had already spent more than three months in custody, and the charge-sheet had been filed. The Court further noted that the mandatory arrest safeguards, including notice before arrest in cases punishable up to seven years, had not been complied with. Although another case against the petitioner was pending, charge-sheet had also been filed there, so continued custody was not warranted. Non-compliance with arrest safeguards, coupled with completion of investigation, supported release on bail.

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Issues: Whether the petitioner was entitled to bail in a GST evasion case despite the alleged non-compliance with mandatory arrest safeguards, and whether the pendency of another case barred grant of bail.

Analysis: The offence alleged under Section 132(1)(c) of the Central Goods and Services Tax Act, 2017 carries a maximum sentence of five years. The record showed that the petitioner had remained in custody for more than three months and that investigation in the present matter had culminated in filing of the charge-sheet. The Court noted that the statutory and judicial mandate requiring compliance with arrest safeguards, including notice before arrest in cases punishable up to seven years, had not been followed. The pendency of another case was noticed, but it was also recorded that charge-sheet had been laid in that matter as well. In light of the settled requirements governing arrest and bail, the Court found that continued custody was not warranted.

Conclusion: Bail was granted to the petitioner.

Ratio Decidendi: Where the offence is punishable up to seven years and the mandatory arrest safeguards are not complied with, non-compliance can justify grant of bail, especially when investigation is complete and charge-sheet has been filed.

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