Anticipatory bail in GST fraud inquiries may be refused where summons are ignored and custodial interrogation is necessary.

Anticipatory bail in a GST inquiry may be refused where summons have been ignored, documents have not been produced, and the allegations concern fraudulent availment of input tax credit through fake invoices. A person summoned for inquiry is not insulated from investigation merely because the process is at the summons stage; the court will assess whether there is a real apprehension of arrest and whether custodial interrogation is necessary for effective investigation. On the stated facts, the alleged loss to the exchequer, persistent non-cooperation, and the need for custodial interrogation justified rejection of bail.

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Issues: Whether anticipatory bail should be granted to a person summoned under Section 70 of the Central Goods and Services Tax Act, 2017 in an inquiry alleging wrongful availment of input tax credit through fake invoices and non-cooperation with investigation.

Analysis: The petitioner was summoned in a GST inquiry concerning alleged fraudulent availment of a large amount of input tax credit through fictitious transactions and fake invoices. The record indicated that the inquiry was at a nascent stage, that the petitioner had not appeared in response to summons, and that the documents sought had not been produced. The Court noted that a person summoned under Section 70 of the Central Goods and Services Tax Act, 2017 is not, by that fact alone, insulated from inquiry, and that anticipatory bail at the summons stage depends on concrete circumstances showing a real apprehension of arrest. In the facts of the case, the magnitude of the alleged loss to the public exchequer, the absence of cooperation, and the need for effective investigation made custodial interrogation necessary.

Conclusion: Anticipatory bail was declined and the petition was dismissed.

Ratio Decidendi: In a GST inquiry involving serious allegations of fraudulent input tax credit and persistent non-cooperation, anticipatory bail may be refused where custodial interrogation is found necessary for effective investigation and no exceptional circumstance is shown.

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