2026 (2) TMI 593 - HC - GST

Wrongful availment of ineligible input tax credit via fake invoices: regular bail granted subject to furnishing bail bonds.

Wrongful availment of ineligible input tax credit through fake invoices was treated as a documentary-evidence prosecution; because investigation was ... Wrongful availment of ineligible input tax credit - use of fake invoices - regular bail in economic/CGST offences - custodial detention vs. investigation concluded - documentary evidence-based prosecution - offences triable by Magistrate and sentencing ceiling - clean criminal antecedents as bail factor - prohibition on influencing prosecution witnesses - precedential reliance on Vineet Jain and Ratnambar Kaushik - HELD THAT:- The case being based on documentary evidence, the investigation having been concluded, the nature of allegations levelled, the offence being triable by the Court of Magistrate, clean criminal antecedents of the petitioners and the law clarified as per the judgments passed in the matters of Vineet Jain [2025 (5) TMI 925 - SC ORDER] wherein the Hon’ble Supreme Court granted the benefit of bail when the accused reflected no criminal antecedents and after noticing the prosecution was based on the documentary evidence and the maximum sentence was 5 years., Ratnambar Kaushik [2022 (12) TMI 263 - SUPREME COURT] wherein similar benefits had been extended to the petitioner(s) therein and Jashanpal Singh [2026 (2) TMI 324 - PUNJAB AND HARYANA HIGH COURT]. I deem it appropriate to allow the instant petitions. Accordingly, both the petitions are allowed and the petitioners are ordered to be admitted to regular bail subject to their furnishing bail/surety bonds to the satisfaction of the trial Court/Duty Magistrate/Illaqa Magistrate concerned. The observation made hereinabove shall not be construed as an expression on the merits of the case and the trial Court shall decide the case on the basis of available material. Issues: Whether the petitioners accused under Sections 132(1)(b) and 132(1)(c) of the Central Goods and Services Tax Act, 2017 are entitled to regular bail.Analysis: The petitions relate to allegations of wrongful availment of ineligible input tax credit through fake invoices and non-receipt of goods, with an asserted tax evasion of Rs. 23.12 crores. Considered factors include the documentary nature of the prosecution case, that parts of investigation are complete, the offences are triable by a Magistrate and carry a maximum sentence of five years, absence of confessional statements or direct evidence of the petitioners' involvement, period of custody already undergone, and precedent authorities allowing bail in similar circumstances. Conditions against influencing witnesses and furnishing bail/surety bonds are proposed.Conclusion: Bail granted to the petitioners; they are to be admitted to regular bail subject to furnishing bail/surety bonds to the satisfaction of the trial Court/Duty Magistrate/Illaqa Magistrate and subject to conditions preventing threat or influence of prosecution witnesses.