BAIL IN GOODS AND SERVICES TAX

Meaning of 'bail' and 'bailable offence'

The offences from 'bail' point of view can be categorized into two types - bailable and non-bailable. While in a bailable offence, granting of bail is done in normal course whereas in case of non-bailable offence, an arrest can be effected, even for the purpose of investigation implying that offenders detention is discretionary. Non-bailable offence means where arrested person may be released on bail only by the Magistrate. Bail is basically a concept used to ensure offender's appearance to answer the charges made. The criminal offences where detention of the accused is deemed necessary to ensure his or her appearance for investigation and trial are termed as 'non-bailable'. The offences where detention may not be warranted are bailable offences.

For non-cognizable offences, the Assistant Commissioner or Deputy Commissioner is bound to release a person on bail against a bail bond. The bail conditions should be informed in writing to the arrested person and also informed on telephone to the nominated person of the person arrested. The arrested person should be also allowed to talk to a nominated person. The conditions will relate to, inter alia, execution of a personal bail bond and one surety of like amount given by a local person of repute, appearance before the investigating officer when required and not leaving the country without informing the officer. The amount to be indicated in the personal bail bond and security will depend, inter alia, on the amount of tax involved.

If the conditions of the bail are fulfilled by the arrested person, he shall be released by the officer concerned on bail forthwith. However, only in cases where the conditions for granting bail are not fulfilled, the arrested person shall be produced before the appropriate Magistrate without unnecessary delay and within twenty-four (24) hours of arrest. The arrested person may be handed over to the nearest police station for his safe custody, within 24 hours, during the night under a challan, before he is produced before the Court.

In the event of circumstances preventing the production of the arrested person before a Magistrate without unnecessary delay, the arrested person may be handed over to nearest Police Station for his safe custody, within 24 hours, under a proper challan, and produced before the Magistrate on the next day, and the nominated person of the arrested person may be also informed accordingly.

The Revenue Authorities is required to maintain Bail Register with requisite details and should follow the reporting system- daily or monthly.

Bail is basically a concept used to ensure offender's appearance to answer the charges pressed on him. The criminal offences where detention of the accused is deemed necessary to ensure his or her appearance for investigation and trial are termed as 'non bailable'. The offences where detention may not be warranted are bailable offences.

The offences from 'bail' point of view can be categorized into two types - bailable and non-bailable. While in a bailable offence, granting of bail is done in normal course whereas in case of non-bailable offence, an arrest can be effected, even for the purpose of investigation, implying that offender's detention is non- discretionary. Non-bailable offence means where arrested person may be released on bail only by the Magistrate.

Types of Bail

In India, generally following types of bail are granted:

• Regular Bail - Generally granted to a person who has been arrested or in police custody. A bail application can be filed for the regular bail under sections 437 and 439 of Cr.P.C.
• Interim Bail- This type of bail is granted for a short period of time and it is granted before the hearing for the grant of regular bail or anticipatory bail.
• Anticipatory Bail- It is granted under section 438 of Cr.P.C. either by Session Court or High Court. An application for grant of anticipatory bail can be filed by the person who discerns that he may be arrested by the police for a non-bailable offence.

Release of arrested persons

Section 69(3) of the CGST Act, 2017 law empowers the Deputy Commissioner or the Assistant Commissioner of GST to release the person so arrested on bail in case of non-cognizable and bailable offences, and for this purpose they have the same power as that of an officer-in-charge of a police station but subject to provision under section 436 of the Code of Criminal Procedure, 1973. (Now Bhartiya Nagarik Suraksha Sanhita, 2023 w.e.f. 01.07.2024)

Thus, any arrested person may be released subject to the following:

(a) Release may be on bail or otherwise;

(b) Release of arrested person is allowed only in case of a non-cognizable offence and bailable offence;

(c) Release can be made by the Deputy Commissioner or Assistant Commissioner of CGST/SGST;

(d) The officer has the same powers and subject to same powers as that of an officer-in-charge of police station;

(e) Provision of release is subject to provisions of Code of Criminal Procedure, 1973 (Section 436).

Select 2026 pronouncements on bail

• In Sahil Jain Versus Superintendent (Anti Evasion). - 2026 (3) TMI 1684 - SC Order, where the condition requiring furnishing of a bank guarantee of Rs. 50 lakhs as a condition of bail was legally sustainable, it was held that the appellant had already furnished a personal bond of Rs. 1 crore with two sureties of like amount, and the impugned bank guarantee condition was examined in light of the governing principles on bail conditions. Considering the nature of the case, the existing bond and surety arrangement, and the legal position relied upon [Saravanan Versus State represented by the Inspector of Police - 2020 (10) TMI 1249 - Supreme Court], the additional bank guarantee was found to be excessively onerous and unsustainable. The Apex Court assessed the condition against the governing principles on bail conditions and the existing security arrangement, and found that the additional guarantee was not legally sustainable considering the fact that the appellant was required to furnish personal bond of Rs. 1 crore with two sureties of same amount, which had already been furnished. The bank guarantee requirement was therefore, set aside reversing the high court order in Sahil Jain Versus Superintendent (Anti Evasion). - 2025 (8) TMI 1789 - PUNJAB AND HARYANA HIGH COURT. The appeal was allowed.

• In FASIL M & ANR. Versus COMMISSIONER OF CUSTOMS & ORS. - 2025 (1) TMI 1226 - SC Order, where the petitioner had filed petition for grant of anticipatory bail but in the meanwhile, the petitioner was arrested, it was held that since the petitioner had already been arrested, petition seeking anticipatory bail had become infructuous and was therefore, dismissed. However, petitioner was at liberty to seek a regular bail.

• In Lokesh @ Lokesh Hasija Versus Union Of India Through Director General, G.S.T. Intelligence - 2025 (12) TMI 318 - ALLAHABAD HIGH COURT, where CA was involved in input tax credit related fraud and was arrested for two months, the court granted bail as the entire prosecution was based on documentary evidence and trial would take a longer time. Further, a maximum period perishable for such offences was five years and applicant had no criminal background. The bail was granted subject to condition of furnishing of personal bonds and two sureties.

• In E. Ishitha, Revathi E., Versus Assistant Commissioner of Commercial Taxes (Enforcement) -01, Bengaluru, Additional Commissioner of Commercial Taxes (Enforcement), Bengaluru, Commissioner of Commercial Taxes, Bengaluru. - 2026 (1) TMI 772 - KARNATAKA HIGH COURT, department conducted search and seizure operation under section 67 and the petitioner sought interim bail on humanitarian grounds. The court observed that grounds of arrest, reasons in reasons of arrest or reason to arrest is not justiciable, unless it depicts blatant non-application of mind. Facts in case at hand cannot be termed as so exceptional, that High Court in exercise of its jurisdiction under Article 226 read with section 482 of Code of Criminal Procedure, 1973, should entertain petition and grant interim bail. It was held that High Court cannot exercise jurisdiction under Section 482 Code of Criminal Procedure, 1973 to grant interim bail as a matter of course unless there are exceptional circumstances; notwithstanding finding of no illegality in arrest proceedings, in exercise of writ jurisdiction, High Court cannot release accused showing mercy or sympathy.

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