2022 (8) TMI 389

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....through the firms created and operated by him and ineligible ITC of Rs.77.11 Crores through the firms managed and operated by other persons, on commission basis. The applicant / accused in connivance with other culprits indulged in defrauding the Government Exchequer to the tune of Rs.83.74 Crores.   The Directorate General of GST Intelligence, Delhi Zone Unit investigated the matter on the basis of inputs shared by DG of GST Intelligence, Coimbatore Zone Unit who busted a racket in Chennai and Madurai of availing of ineligible ITC. Fake invoices were being issued without actual supply of goods. On the basis of the said fake invoices, ineligible ITC was taken. Identical modus operandi has been adopted by the present applicant / accused. There are two groups of syndicate being operated by two persons, namely, Lt. Smt. Aarti Kapoor (@ Aaurti Kapoor) and the present applicant / accused Aman Singh (@ Aman Chhatwal). Sh. Ashwin Kumar and Sh. Raj Mishra are the accountants working in these respective groups. The applicant / accused is the authorized signatory of M/s Kllifton Forge Pvt. Ltd., proprietor of M/s AVP Trading Company and M/s A-One Enterprises. In his statement u....

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.... M/s Kllifton Forge Pvt. Ltd., M/s A-One Enterprises and M/s AVP Trading Company was got cancelled on 31.08.2019, 13.03.2020 and 25.09.2019 respectively. This cancellation cannot be granted unless all the dues of tax are cleared by the applicant. The applicant / accused joined investigation and did not run away. His statements were recorded by the department on 06.06.2022 and 14.06.2022. Again his statement has been recorded while he has been in JC. Except for the statements of the applicant / accused, there is no material against the applicant / accused. In the case Make My Trip (India) Pvt. Ltd. Vs. Union of India, 2016 SCC Online Delhi 4951, it was held that without determining the exact amount of tax liability, power of arrest should not be exercised. The maximum punishment for the offence alleged against the applicant / accused is 5 years. No further investigation is pending with regard to the applicant / accused. In Sunder Singh Bhati Vs. State, 2022 SCC Online Del 134, Hon'ble High Court held that the magnitude of the offence cannot be the only criterion for denial of bail. It was submitted on behalf of the complainant department that in economic offences, the documen....

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....nion of India Vs. Make My Trip (India) (P) Ltd. (2019) 11 SCC 765, Jayachandran Alloys (P) Ltd. Vs. Superintendent of GST and Central Excise, 2019 SCC Online Mad 31224, Sh. Raghav Agarwal Vs. Commissioner of Central Tax, 2020 SCC Online Delhi 1699, Akhil Krishan Maggu Vs. Deputy Director, 2019 SCC Online P&H 5416, Shravan A. Mehra & Ors. Vs. Superintendent of Central Tax, Anti-evasion, GST Commissionerate (Criminal Petition Nos. 979 and 980/2019) and Sunder Singh Bhati Vs. State, 2022 SCC Online Del 134. Ld. Counsel for the applicant / accused argued that the total ineligible ITC alleged against the applicant / accused is 83.70 Crores. Out of this, only Rs. 6.63 Crores is concerned with the three firms, i.e. M/s Kliffton Forge Pvt. Ltd., M/s A-One Enterprises and M/s AVP Trading Company, with which the applicant / accused is concerned. The rest of the amount of Rs.77.11 Crores is not directly concerned with the applicant / accused or the aforementioned firms. To substantiate this argument, Ld. Counsel for the applicant / accused relied upon the remand application filed by the complainant department before the Ld. CMM concerned. In Para No. 6 of this application, the aforemention....

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....allowed if there are any GST dues with regard to the assessee. In this regard, Ld. Counsel for the Department submitted that, that the documents filed by the applicant / accused do not categorically state that there were no dues against the assessees. Even after cancellation of GST, there is no bar for the department to conduct investigation. In my considered opinion, there can be no dispute regarding the powers of the department to investigate the matter. The cancellation of GST registration does not bar the department from investigating any GST fraud. However, there is no categorical submission on behalf of the department that the GST registration of the said three firms was got cancelled fraudulently. At this stage, the cancellation of GST registration of the said three firms is a relevant fact. Ld. Senior Standing Counsel for the Department submitted that the statements recorded under Section 70, point towards the guilt of the applicant / accused. Further, the applicant / accused himself has given statements under Section 70 of the CGST Act whereby he has disclosed the details about his own involvement in the commission of the offence. The said statements are relevant as per....

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....ided by the petitioner. It was to be decided whether the services provided by the petitioner were to be classified as "tour operators" or "hotel operators". Particular reference was made to Para No. 57 of this judgment, wherein it was stated that the understanding of the DGCEI of the transaction of online booking of hotel rooms using the web portals from the petitioner appears to be prima facie incorrect. This view was with regard to the classification of services provided by the petitioners which were classified as hotel service providers. It is further observed that this case was with regard to the non-deposit of service tax. As such, the case cited by the Ld. Counsel for the applicant / accused is not of much help in the present matter. In the present case, much reliance has been placed by the complainant department on the statements recorded under Section 70 of the CGST Act. The truth of these statements shall be seen at the time of trial. The applicant / accused has been examined thrice by the complainant. The time period for seeking custodial interrogation of the applicant / accused has already lapsed in terms of Section 167(2) CrPC. In Bail Application No. 3771/2021....

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....h as may be prescribed, subject to the minimum amount not being less than ten thousand rupees or fifty per cent of the tax involved, whichever is higher, and the maximum amount not being less than thirty thousand rupees or one hundred and fifty per cent of the tax, whichever is higher. (3) On payment of such compounding amount as may be determined by the Commissioner, no further proceedings shall be initiated under this Act against the accused person in respect of the same offence and any criminal proceedings, if already initiated in respect of the said offence, shall stand abtaed. In the present case, there cannot be any conflict with the fact that petitioner has been charged with economic offence. However, it is to be reiterated that the offence does not contemplate punishment for more than five years or commission of any serious offence along with the economic offence as it is usually the case in offences under other special statues dealing with economic offences like Prevention of Money Laundering Act, 2003. Thus, as per the scheme of the CGST Act, though the offence is of economic nature yet the punishment prescribed cannot be ignored to determine the heinous....