Bail cancellation in GST evasion case denied where investigation stayed incomplete and no misuse of liberty was shown.

In bail-cancellation proceedings arising from alleged GST evasion under the CGST Act, the court held that the gravity of an economic offence by itself did not justify recalling bail where the investigation remained incomplete for years, no complaint had been filed, and no misuse of liberty was shown. Although economic offences require a stricter approach at the bail stage, the investigating agency's failure to complete the inquiry within time weighed against interference. The earlier bail was therefore maintained, with the court noting that default bail would have been available if the investigation had continued to remain incomplete.

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Issues: Whether bail granted to the respondent in proceedings under Section 132 of the Central Goods and Services Tax Act, 2017 ought to be cancelled on the ground that the allegations involved a large-scale GST evasion and the investigation was incomplete.

Analysis: The petition challenged the bail order on the premise that the trial court had underestimated the seriousness of the alleged GST evasion and had attached undue weight to the partial deposit made by the respondent. The record showed that the investigation remained incomplete even after several years and that no complaint had yet been filed. The Court noted that economic offences are serious and require a different approach at the stage of bail, but also observed that the department had not completed the investigation within the stipulated time and had not shown misuse of the liberty granted to the respondent. In these circumstances, continued custody was not justified, particularly when default bail would have been available if the investigation had remained incomplete.

Conclusion: Bail was not liable to be cancelled, and the liberty already granted to the respondent was maintained.

Ratio Decidendi: In bail-cancellation proceedings arising from economic offences, gravity of alone does not justify interference where the investigating agency has failed to complete the investigation within time and no misuse of bail is shown.

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