TaxTMI 
TaxTMI 
2025 (4) TMI 1011
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....g proprietorship of a firm in the name and style M/S Goodwill Traders having GST Registration Certificate and also a law abiding person. Upon receipt of a summon from the investigating agency on 06.03.2025, the petitioner appeared before the authority and on 07.03.2025, he was arrested in connection with this case and since then, he is in judicial custody. As per allegation, he indulged in issuance of fake invoices without actual supply of goods and thereby passed ineligible ITC of Rs. 30.89 Crores. However, during his entire period in judicial custody, the Investigating Authority did not asked for any police remand nor made any prayer for custodial interrogation. He has been arrested connection with this case merely on suspicion and in a very mechanical manner and without any proper investigation or his involvement in the alleged offence, and accordingly, Mr. Choudhury submitted that it is a fit case wherein the accused/ petitioner may be granted with the privilege of bail. 5. Mr. Choudhury further submitted that though the Central Goods & Services Tax Act, 2017 (in short, 'CGST Act') is a special enactment, but the same is not a complete Code in itself as regards to the provis....
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....as decisively rejected in Arvind Kejriwal (supra). It was held that "reasons to believe" are to be furnished to the arrestee such that they can challenge the legality of their arrest. Exceptions are available in one-off cases where appropriate redactions of "reasons to believe" are permissible. The relevant portion reads: "41. Once we hold that the accused is entitled to challenge his arrest under Section 19(1) of the PML Act, the court to examine the validity of arrest must catechise both the existence and soundness of the "reasons to believe", based upon the material available with the authorized officer. It is difficult to accept that the "reasons to believe", as recorded in writing, are not to be furnished. As observed above, the requirements in Section 19(1) are the jurisdictional conditions to be satisfied for arrest, the validity of which can be challenged by the accused and examined by the court. Consequently, it would be incongruous, if not wrong, to hold that the accused can be denied and not furnished a copy of the "reasons to believe". In reality, this would effectively prevent the accused from challenging their arrest, questioning the "reasons to believe". We ....
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....he Investigating Agency and in a very mechanical and arbitrary manner, the accused/petitioner was arrested without proper determination of tax, cess, penalty and the interest by the Assessing Authority and imposed an imaginary figure of Rs. 30.89 Crores without proper assessment. More so, considering the maximum punishment under the offence attributed in the instant case, the issuance of Notice under Section 35(3) of BNSS, corresponding to Section 41(A) Cr.P.C., is mandatory as per direction of the Hon'ble Supreme Court passed in the case of Arnesh Kumar Vs. State of Bihar and reiterated in Satender Kumar Antil Vs. CBI, reported in 2022 SCC OnLine SC 825. 10. Mr. Choudhury further raised the issue of non-mentioning of DIN number in 3 (three) documents, namely, Authorization Letter of Arrest, Grounds of Arrest and Arrest Memo. He submitted that in absence of DIN number, a person cannot be arrested and can be considered as a good ground for bail. More so, he submitted that the reasons to believe are also not available in all those documents while issuing the same to the petitioner and thus, the accused/petitioner was not in a position to know as to on what ground he is being arres....
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....ed that considering all these grounds and also considering the non compliance of the provision of Section 41/41A Cr.P.C., viz-a-viz non-compliance of Sections 47/48 of BNSS, and also considering the non-furnishing of reasons to believe, as recorded by the authority concerned, the bail prayer of the present petitioner may be considered. 15. Mr. Keyal, learned Standing Counsel, GST submitted in this regard that in all the documents, the DIN numbers have been mentioned and there is sufficient compliance of Section 70 of CGST Act, which is corresponding to Section 41A of Cr.P.C. Further he submitted that the reasons to believe has already been recorded by the authority concerned which is in the file. He accordingly produced the record wherefrom it is seen that the reasons to believe has been recorded by the investigating authority. He further submitted that the arrest was also made complying all the necessary formalities as required under Section 69 of the CGST Act and there is no dispute in regards to the compliance of Section 69 of CGST Act at the time of arrest of the present accused/petitioner. He also submitted that the grounds of arrest are also communicated to the present pet....
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....the present case is also considered to be an economic offence and hence it has to be viewed with a different approach while dealing with the matter of bail. In that context, he also relied on a judgment of Hon'ble Supreme Court passed in the case of Y.S. Jagan Mohan Reddy Vs. Central Bureau of Investigation (Criminal Appeal No. 730 of 2013) and emphasized on paragraph Nos. 15 & 16 of the judgment, which reads as under: "15) Economic offences constitute a class apart and need to be visited with a different approach in the matter of bail. The economic offence having deep rooted conspiracies and involving huge loss of public funds needs to be viewed seriously and considered as grave offences affecting the economy of the country as a whole and thereby posing serious threat to the financial health of the country. 16) While granting bail, the court has to keep in mind the nature of accusations, the nature of evidence in support thereof, the severity of the punishment which conviction will entail, 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 apprehens....
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....) 8 SCC 254. 23. It is also an admitted position that in the Authorization Letter as well as Grounds of Arrest, which were communicated to the accused/petitioner, the DIN numbers are missing, though in the Arrest Memo, the DIN number was incorporated in the hand written form, which was allegedly inserted subsequently. But, as per the Circular No. 122/41/2019-GST, dated 05.11.2019, issued by the Commissioner, GST-Inv, the Arrest Memo and the other documents, which are to be supplied to the accused/petitioner, the DIN number has to be incorporated otherwise it shall be deemed to have never been issued. 24. Coming to the communication of "reasons to believe", it is seen that admittedly the "reasons to believe" was duly recorded in the file at the time of issuing Authorization Letter of Arrest. It is also an admitted fact that it is an internal and confidential document when the arresting authority will record their "reasons to believe" before issuing any Authorization Letter. But, as per the view expressed by the Hon'ble Apex Court in the case of Radhika Agarwal (supra), it can be held that "reasons to believe" are to be furnished to the arrestee so that they can challenge their....