TaxTMI 
TaxTMI 
2024 (12) TMI 400
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....isc. Cancellation Bail Application under Section 439 (2) of Cr.P.C., against the order dated 03.11.2023, passed by the learned Additional Sessions Judge No. 2, Jaipur Metropolitan-II, whereby the Bail Application No. 179/2022 under Section 132 (1) (c) and (f) of Central Goods and Services Tax Act, 2017 (from now on referred to as 'CGST Act') was allowed. 3. It is vehemently argued by learned counsel for the petitioner that the court below committed an error while granting bail to the present respondent-Gautam Garg. The learned Court below has observed that the statement of respondent-Gautam Garg was not recorded under normal circumstances; there was no evidence that Gautam Garg is a Manager in Firm M/s Gurbax Rai Cotton Industries, M/s Gurbax Rai & Sons and M/s Gurbax Rai Praveen Kumar. No electronic evidence was found on the residential premises of Gautam Garg; the department could not produce the reasons for believing in the arrest memo of Gautam Garg. The State Goods and Services Tax Department of Rajasthan has issued a summons to Gautam Garg. Two proceedings cannot run simultaneously. Lastly, the evasion of Goods and Services Tax (from now on referred to as 'GST') is only Rs.7....
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....reunder, to evade tax and issues any invoice or bill without supplying the goods or avails Input Tax Credit (from now on referred to as 'ITC') using such invoices or bills referred to in Clause B or fraudulently availing ITC without any invoice or bill is punishable by up to five years with a fine, and the offences cognizable and non-bailable. The learned trial Court wrongly observed that there was no evidence that Gautam Garg has issued or received good-less invoices on behalf of M/s Gurbax Rai Cotton Industries, M/s Gurbax Rai and Sons & M/s Gurbax Rai Praveen Kumar. As per amended Section 132 of the CGST Act, any person who causes to commit and retain the benefits arising out of fraudulently availing ITC without any invoice or bill is responsible and can be prosecuted under Section 132 of the CGST Act. There was enough material on the record to show that respondent Gautam Garg committed and retained the benefits arising from issuing bills without receiving goods and fraudulently availing ITC on behalf of the three companies. The petitioner didn't need to show that petitioner was appointed as Manager of the three companies or was engaged in the business of the company. Therefore,....
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....held that while granting bail, the Court has to keep in mind the nature of the accusation, the nature of evidence and support thereof, the severity of the punishment with a conviction which entirely the character of the accused, circumstances which are peculiar to the accused, reasonable possibility of securing the presence of the accused at the trial reasonable apprehension of the witnesses being tampered with the more significant interest of public/State and other similar occasions, therefore, in the light of the above judgments, the learned trial Court has wrongly enlarged the petitioner under Section 439 (2) of Cr.P.C. 8. Therefore, the application for cancelling the petitioner's bail may be allowed, and the respondent may be directed to be taken into custody. 9. Learned counsel for the respondent justifies the order passed by the court below about granting bail to the respondent. 10. It is contended by learned counsel for the respondent that the evidence collected by the prosecution explicitly suggests that the respondent is not the Director or Proprietor of M/s Gurbax Rai Cotton Industries, M/s Gurbax Rai and Sons & M/s Gurbax Rai Praveen Kumar. It is further contended tha....
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....be grounds for bail cancellation. (iv) If the accused poses a significant risk to public safety or threatens the community, the Court may cancel bail to protect society. (v) If the accused repeatedly fails to appear in Court when required, the Court may cancel bail due to his nonappearance. (vi) Courts have the authority to cancel bail if it is deemed necessary in the interests of justice. This discretion should be exercised judiciously and not arbitrarily. (vii) If the accused tries to obstruct the legal process or interferes with how justice is served. (viii) When the accused attempts to escape or avoid facing the legal consequences of his actions. (ix) If the person misuses the freedom granted to him by bail for unlawful activities. (x) If it becomes evident that the accused is planning to flee the jurisdiction to avoid prosecution, the Court may cancel his bail. (xi) If the individual uses his freedom on bail for unlawful activities, such as committing another crime or engaging in activities that undermine the legal process. (xii) If evidence suggests that the accused is attempting to intimidate or influence witnesses in the case, his bail can be canc....
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....ting fake invoices or aiding such companies in availing the input credit illegally. The earlier provisions lacked the provision regarding catching hold of the persons behind the curtains, enabling the companies to avail of the input credit by falsifying and manoeuvring the documents. Such unethical offenders were free from the clutches of the law-enforcing agencies. 16. Thus, the arguments raised by the respondent's counsel are misconceived and against the express provisions of section 132 of the CGST Act. The arguments that only the individuals engaged in the company's management are accountable for the prosecution are unsustainable. Likewise, the Court completely ignored the incriminating material collected against the petitioner. The factual aspects show that many documents and electronic evidence were collected and petitioner was found to be directly involved in generating the false and fabricated goodless invoices. Further, the Court below ignored the factual aspect put forth by the Department and also failed to appreciate that the respondent had wrongly availed ITC by generating fake invoices causing wrongful gain to the three companies and wrongful loss to the Gover....