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of <h1>Bail decisions must consider each accused's role; denial due to co-accused's investigation under Section 132 CGST is unjustified</h1> <h3>Manish Kumar and Amit Kumar Goyal Versus Directorate General, Goods & Service Tax Intelligence, Zonal Unit, Ludhiana.</h3> Manish Kumar and Amit Kumar Goyal Versus Directorate General, Goods & Service Tax Intelligence, Zonal Unit, Ludhiana. - 2025:PHHC:097148 ISSUES: Whether an accused can be denied regular bail under Section 132 of the Central Goods and Services Tax Act, 2017 (CGST Act) solely on the ground that investigation qua another co-accused is pending.Whether criminal prosecution under Section 132 of the CGST Act can be initiated prior to completion of assessment proceedings under Sections 73 and 74 of the CGST Act.The legality and procedural propriety of arrest and detention in economic offence cases under the CGST Act, particularly regarding adherence to statutory requirements and guidelines.The impact of prolonged pre-trial custody without substantial progress in trial on the fundamental right to speedy trial under Article 21 of the Constitution of India.The relevance of documentary and electronic evidence in assessing the risk of tampering with evidence or influencing witnesses in bail considerations under the CGST Act.The applicability of established principles governing grant of bail, including the nature of offence, severity of punishment, character of accused, and likelihood of tampering or flight risk. RULINGS / HOLDINGS: On the issue of bail denial due to pending investigation against a co-accused, the Court held that 'an accused in a complaint under Section 132 of the CGT Act cannot be denied the concession of bail, solely on the ground that investigation remains pending qua a co-accused.'Regarding initiation of prosecution under Section 132 prior to completion of assessment under Sections 73 and 74, the Court reaffirmed that while normally assessment proceedings should precede prosecution, in 'exceptional circumstances' prosecution may proceed if the Commissioner records 'explicit' reasons and sufficient material to believe an offence is committed.The Court found that the arrest authorization under Section 69 CGST Act must be based on 'reasons to believe' supported by material and evidence, and that procedural safeguards, including explanation of grounds of arrest as mandated by CBIC Circular No. 01/2025-GST, must be complied with.The Court emphasized that prolonged pre-trial custody without substantial trial progress violates the 'right to speedy trial as enshrined under Article 21 of the Constitution of India' and that 'curtailment of personal liberty to some extent, during the judicial process, cannot be avoided' but excessive delay affects fairness guaranteed under Article 21.It was held that where evidence is primarily documentary and electronic and prosecution witnesses are officials, the apprehension of tampering or influencing witnesses is minimal, thus negating grounds to deny bail on such basis.The Court applied settled bail principles requiring consideration of 'nature of accusations,' 'severity of the punishment,' 'character, behaviour, means and standing of the accused,' and 'reasonable apprehension of the witnesses being tampered with,' and found no sufficient grounds to refuse bail in the present case. RATIONALE: The Court relied on the statutory framework of the CGST Act, particularly Sections 73, 74 (assessment and penalty proceedings) and Section 132 (criminal prosecution for tax evasion), and the procedural safeguards under Section 69 (authorization of arrest).The Court extensively referred to the three-Judge bench judgment of the Supreme Court in Radhika Aggarwal vs. Union of India, which clarified that prosecution under Section 132 can be initiated prior to assessment completion only in exceptional cases with recorded reasons and sufficient material.Empirical data from affidavits of various tax and excise commissioners revealed systemic delays in trial and conviction rates, indicating a pattern of 'abrupt arrests' without timely conclusion of proceedings, undermining the purpose of criminal prosecution and infringing on fundamental rights.The Court underscored the fundamental right to a speedy trial under Article 21 of the Constitution, citing Supreme Court precedents emphasizing that prolonged detention without trial completion violates this right and that bail should ordinarily be granted unless exceptional circumstances exist.Judgments such as Vineet Jain vs. Union of India and Sanjay Chandra vs. CBI were relied upon to highlight that severity of offence or public sentiment alone cannot justify denial of bail, especially where investigation is complete, and evidence is documentary in nature.The Court noted that the prosecution's reliance on potential evidence tampering was unfounded given the nature of evidence and that the accused had clean antecedents and cooperated fully with investigation.The Court imposed conditions on bail to safeguard trial integrity, including passport deposit, cooperation with trial, prohibition on tampering with evidence or witnesses, and restriction on disposing of property under investigation.The Court observed that denial of bail merely because investigation is pending against other accused is neither justified nor supported by law and that each accused's bail application must be adjudicated on individual merits.
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