2024 (9) TMI 1584

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....on 3rd August 2022 for supply of taxable goods inter alia goods falling under HSN 7204 (ferrous waste and scrap; remelting scrap ingots of iron or steel- waste and scrap of cast iron). In a year of its existence, it had supplied ferrous waste and scrap of Rs.122 crore involving 22 crore. It is source of pronouncement of said scraps are dubious. 2.1 M/s Jai Bhole Enterprises have filed GSTR-3B returns from August 2022 to October 2023 for the total taxable supply of Rs.1,24,86,01,948/- and payable GST thereon of Rs.22,45,92,868/- and out of which M/s Jai Bhole Enterprises have set off their GST liability of Rs.22,26,95,967/- through Input Tax Credit (ITC) only, which indicates dubious nature of transactions. 2.2 In order to verify the quantum of ITC received by their supplier(s) i.e. through GSTR-2A of M/s Jai Bhole Enterprises for the period from August 2022 to October 2023 were downloaded. On perusal of the same, it appears that during the period from August 2022 to October 2023, M/s Jai Bhole Enterprises have received ITC to the tune of Rs.22.31 crore mainly from 09 firms. 2.3 On 26.10.2023 in execution of search authorization the team visited the principal place of busin....

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....nd submitted his voluntarily statement in this regard. 2.8 In view of the above, investigation carried out so far, it appears that M/s Jai Bhole Enterprises is a non-existence firms created on paper with sole intention to pass on irregular and inadmissible Input Tax Credit to various entities. 2.9 Upon scrutiny of GSTR-2A of M/s Jai Bhole Enterprises, it appears that M/s Jai Bhole Enterprises have availed input tax credit from the following entities. (i) M/s Bhumi Lightmetal Udhyog Private Limited; (ii) M/s Niracalo Metal Private Limited; (iii) M/s Vibranta Enterprise Private Limited; (iv) M/s Exela Metal Vyapaar Private Limited; (v) M/s Inval Metal Enterprise Private Limited; (vi) M/s Pavapuri Vyapaar Private Limited; (vii) M/s Gagandeep Iron Private Limited; (viii) M/s Vibranta Scrap Private Limited etc. Accordingly, the office initiated investigation against the above firms and during the investigation all the above said firms found to be fake. 2.10 Further, summons dated 02.02.3024 issued to Shri Panchanan Sardar to appear in this office on 14.02.2024 for tendering statement under Section 70 of the CGST Act, 2017. In response of summons dated 02.02.2024, one person Shr....

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....vate Limited. 2.16 Further, the statement of owner of the additional place of business Shri Aayub Khan was recorded under Section 70 of the CGST Act, 2017, wherein he has stated that he is the owner of the said premises and rented the same to Vivek Pandey, who works in M/s Kedarnath Trexim Pvt. Ltd. and also stated that he did not know Panchanan Sardar. As such, M/s Jai Bhole Enterprises was created by the Director of M/s Maa Sharda Endeavor Private Limited, M/s Makers Casting Private Limited and key person of M/s Kedarnath Trexim Private Limited for availing of fake ITC from it. 2.17 Thereafter, the summons was issued to Gyan Chandra Jaiswal, who never turned up to tender his statement. On 24.06.2024, Shri Gyan Chandra Jaiswal appeared and his statement was recorded under Section 70 of the CGST Act, 2017. Shri Gyan Chandra Jaiswal has stated that end users of GST ITC availed and passed on by M/s Jai Bhole Pvt. Ltd., Bhumi Light Metal Udhyog Pvt. Ltd., Vibranta Enterprise Pvt. Ltd., Exela Metal Vyapar Pvt. Ltd., Inval Metal Enterprises Pvt. Ltd., Pavapuri Vyapar Pvt. Ltd., Gangadeep Iron Pvt. Ltd., Vibranta Scrap Pvt. Ltd. From the very statement of Gyan Chandra Jaiswal, who ....

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....itioner has further submitted that when the aforesaid circular read with Section 122(1)(ii) of the CGST Act, 2017, the petitioner could not have been arrested and could not have been prosecuted for the offence under Section 132 of the CGST Act. The custody of the petitioner is directly in conflict with the guidelines issued by the Hon'ble Apex Court in the case of Satyendra Kumar Antil Vs. CBI reported in (2022) 10 SCC 51 inasmuch as the maximum punishment prescribed is five years. The petitioner is not a Director and does not hold any position in M/s Kedarnath Trexim Private Limited and as would be evident, there is an admission in the hands of the prosecution itself. The petitioner does not pose any flight risk inasmuch as the place of permanent residence is at Jamshedpur, Jharkhand and is ready and willing to abide by all the conditions that may be imposed by the Court. The petitioner is having no criminal antecedent. 6. Per contra, the learned counsel for the Union of India has submitted that Shree Gyaan Chandra Jaiswal is the mastermind, who created M/s Jai Bhole Enterprises through which he availed bogus ITC of Rs.22.31 crore and further passed on the said bogus credit of ....