Capacity-based duty evasion allegations justify bail refusal where prima facie concealment, disputed facts, and witness-tampering risk remain.

Bail was declined in an alleged duty-evasion case under a capacity-based levy regime because prima facie material supported clandestine manufacture and concealment of packing machines. The Court held that the applicant's claim that one machine was non-functional raised disputed factual questions that could not be resolved at the bail stage. It relied on search material, statements, seizure of machines and goods, and the alleged concealment to treat the matter as a serious economic offence involving public revenue. Continuing investigation, alleged non-cooperation, and the risk of tampering with evidence or influencing witnesses were treated as further grounds against release.

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Issues: Whether bail should be granted where the prosecution alleges clandestine manufacture and evasion of duty on the basis of installed packing machines under the newly introduced capacity-based duty regime.

Analysis: The allegations rested on the statutory scheme under the 2026 Rules and the corresponding notification, which prescribed levy and determination of duty with reference to installed packing machines and notified capacity. The Court held that the applicant's plea that one machine was non-functional involved disputed factual questions requiring evidence and could not be conclusively examined at the bail stage. It further found prima facie support for the prosecution version from the search material, statements, seizure of machines and goods, and the allegation of concealment of packing machines. The Court treated the alleged evasion as an economic offence involving substantial public revenue and held that the continuing investigation, the alleged non-cooperation, and the apprehension of tampering with evidence and influencing witnesses were relevant considerations against release on bail.

Conclusion: Bail was declined because the Court found a prima facie case of serious economic wrongdoing under the capacity-based duty regime and held that the applicant was not entitled to release at that stage.

Ratio Decidendi: In a case of alleged economic offence involving duty evasion under a statutory capacity-based levy scheme, bail may be refused where prima facie material supports concealment and clandestine manufacture, disputed factual defenses require trial, and there remains a real apprehension of tampering with evidence or influencing witnesses.

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