TaxTMI 
TaxTMI 
2024 (8) TMI 1444
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....r came on surface when based upon a specific intelligence and evidence regarding evasion of GST by way of clandestine supply of TMT Bars by M/s Shree Radhey Radhey Ispat Private Ltd. from its factory premises at Malwan, Fatehpur, Uttar Pradesh having its principal place of business at Fazalganj, Kanpur, searches were conducted at the premises of the aforesaid firm and residences of Navin Jain, the Director of the firm / present applicant including his dealers Rippan Kansal, who was the distributor of Ms. Kamdhenu and Kamdhenu Nxt brand TMT bars and had been creating business for M/s Shree Radhey Radhey Ispat Pvt. Ltd. owned by the present applicant as well as Sanjay Gupta, proprietor of M/s Jagdamba Steel Corporation, Jhansi, one of the dealers of Kamdhenu Brand TMT bars. During search it was discovered that the present applicant through his firm clandestinely supplied branded TMT bars of Rs. 344 crores and in this way evaded GST to the tune of Rs. 52 crores approximately during the period January, 2019 to the November, 2022. Subsequent to that the present applicant was arrested and sent to jail. 5. It is submitted by the learned Senior Counsels appearing for the applicant that ....
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....ny logical end so far, the present applicant cannot be termed as repeat or habitual offender in view of the Circular No. 4/2022-23 dated 1.9.2022 and C.L. No. 1/2022-23 dated 25.5.2022 issued by the department itself. It is further submitted that in the first application for judicial remand moved by the department dated 26.6.2024 and in the subsequent application for extension of the same as well, the department never prayed for departmental custody of the accused which shows that the department never required any custodial interrogation from the accused applicant. 9. Another limb of the argument is that the present applicant and his staff as well had been fully cooperative to the department and no hindrance of any kind was made on behalf of the firm of the accused and Jitendra Kumar Ojha, one official of the firm, himself arranged the inspection of all areas of the firm and extended his full cooperation to the department and accordingly panchnama dated 24/25.6.2024 was prepared by the department. 10. It is further submitted that a tally of physical stock available on the ground was made with the stock statement provided by Jitendra Kumar Jha by the department and the panchna....
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....de by Rippan Kansal and Sanjay Gupta, but however law pertaining to the statement made by a third person cannot be made binding upon the person who is charged with the actual commission of the crime and it is submitted that the statements made by Rippan Kansal and Sanjay Gupta are in no way binding upon the present applicant. 13. It is further argued that merely on the basis of data alleged retrieved from a third party, tax cannot be demanded and the recovery of any alleged data and private records is being denied by the applicant strongly. 14. Emphasis has been laid upon a decision of this Court in Kumar Trading Company, Varanasi vs. Commissioner of Trade Tax, U.P. Lucknow, Trade Tax Revision No. 195 of 2007, decided on 24.9.2007, wherein it has been held that : ""................It is settled principle of law that in case, if the Revenue wants to rely upon the entries of the document seized from the premises of third party, the burden lies upon the Revenue Authority to prove the genuineness and authenticity of the said entry and to connect the said entry with the dealer, in case, if the dealer denies to have any connection with such entry...." 15. It is further ....
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....ection 69 of the CGST Act, 2017. In case applicant is released on bail, he promises not to misuse the liberty of bail and to extend his full cooperation with the trial. In support of his submissions, learned Senior Counsels appearing for the applicant has placed reliance on the following decisions : (i) Satender Kumar Antil vs. Central Bureau of Investigation, (2022) 10 SCC 51. (ii) Continental Cement Company vs. Union of India, MANU/ UP/1995/2014. (iii) Commissioner, Central Gst and Cx 117/7 Sarvaodaya Nagar vs. M/s Raghunath International Ltd., Kanpur, decided on 11.11.2022. (iv) Commissioner of C. Ex. vs. Laxmi Engineering Works, MANU/PH/1082/2010. (v) Sanjeev Agarwal vs. Union of India, (2024) 162 taxmann.com 369 (Allahabad). (vi) Kumar Trading Company, Varanasi vs. The Commissioner, Trade Tax, U.P. Lucknow, decided on 24.9.2007. (vii) Synergy Steels Ltd. vs. Commissioner of Central Excise, Alwar, 2020 (372) E.L.T. 129 (Tri. - Del.). (viii) Basudev Garg vs. Commissioner of Customs, MANU/DE/ 1876/2013. (ix) Commissioner of Central Excise vs. Parmarth Iron Pvt. Ltd. (x) J and K Cigarettes Lt....
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....ments of Sanjay Gupta, Anurag Shah and Gyan Prakash Jaiswal corroborating the prosecution version and he at the same time mentioned that they were the dealers appointed by Rippan Kansal, who was making business for his company M/s Shree Radhey Radhey Ispat Pvt Ltd. by way of generating orders from the dealers and informing them to get the orders delivered to the respective dealers from where the orders were received and in lieu of the same he was getting the payments realized. It is also submitted that the applicant has a history of non-cooperation with the department and if he is granted bail in all possibility he may influence the investigation, which is being carried out against his company. The statements of key persons or the dealers are still to be recorded. It is further submitted that no deviation in the stock of the factory premises of the accused can immune him from the GST liability on the clandestine supplies of TMT bars valuing Rs. 344 crores during he period January, 2019 to November, 2022 having GST implication amounting to Rs. 52 crores approximately which was never disclosed by the accused to the department. 19. It is next submitted that the department has colle....
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....ment and a massive tax evasion on the part of an accused causing loss to the government exchequer, the Court should be slow in granting bail to the accused and it must be borne in mind that a different approach is required in the cases relating to the economic offences, as they constitute a different class. 22. No doubt on the basis of the law laid down in the cases cited by the CGST department and apart from those from other decisions viz. Tarun Kumar vs. Assistant Director Directorate of Enforcement, 2023 SCC OnLine SC 1486, Serious Fraud Investigation Office vs. Nittin Johari and another, (2019) 9 SCC 165 and Nimmagadda Prasad vs. CBI, (2013) 7 SCC 466 it can be said that the Court should proceed with a different approach while dealing with applications for grant of bail in the cases relating to economic offences and tax evasion but at the same time the Court should also keep in mind that grant of bail in such matters is not absolutely barred. 23. The attention of the Court is also drawn to a relevant pronouncement made by Hon'ble Apex Court in Satender Kumar Antil case (supra) wherein dealing specifically with the economic offences, it has been held by the Hon'ble....
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....have committed. Such consideration with regard to the gravity of offence is a factor which is in addition to the triple test or the tripod test that would be normally applied. In that regard what is also to be kept in perspective is that even if the allegation is one of grave economic offence, it is not a rule that bail should be denied in every case since there is no such bar created in the relevant enactment passed by the legislature nor does the bail jurisprudence provide so. Therefore, the underlining conclusion is that irrespective of the nature and gravity of charge, the precedent of another case alone will not be the basis for either grant or refusal of bail though it may have a bearing on principle. But ultimately the consideration will have to be on case-to-case basis on the facts involved therein and securing the presence of the accused to stand trial." 25. In Sanjay Chandra v. CBI, (2012) 1 SCC 40, the Hon'ble Apex Court noticed that it was a case of fraud wherein by cheating and dishonestly inducing delivery of property by using as genuine a forged document was involved but the punishment for the offence was imprisonment for a term which may extend to seven years....