TaxTMI 
TaxTMI 
2025 (6) TMI 1842
X X X X Extracts X X X X
X X X X Extracts X X X X
....ction 132 of HPGST/CGST Act, 2017, read with Section 20 of the IGST Act, 2017. It was asserted that M/s G.M. PowerTech is a registered taxable person consisting of a partnership firm of Gagan Deep Singh and Jatinder Mohan (the present petitioners/accused). Information was received from reliable sources that the petitioners indulged in large-scale evasion of tax by availing the fraudulent input tax credit during the years 2017-18 and 2018-19. They declared inward supplies (purchases) from Delhi and U.P.-based floating fictitious and non-existent firms, which were registered to pass on the fraudulent benefit of input tax credit on the strength of fake invoices. The matter was examined on the GST Portal, and it was verified that several consignments were delivered in twowheelers, three-wheelers or cars. The registration numbers of many vehicles declared to have transported the goods from outside the State were found to be fake. The consignments were also transported in cars, but it was not possible to transport such heavy goods in cars. Goods worth Rs. 2,89,26,299/- were declared to have been transported by a fake or non-existent vehicles. Input tax credit (ITC) of Rs. 61,69,147/- was....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ises of the petitioners were searched under the due authority as per Section 67 of CGST. The petitioners were summoned to provide the record or other information. They initially provided the record through their counsel, but thereafter, they failed to appear. The investigation regarding the validity of suppliers was carried out, and it was found that no such supplier existed at the given address; therefore, it was prayed that the present petition be dismissed. 6. I have heard Mr. Dinesh Singh Rawat and Mr. Anil Chauhan, learned counsel for the petitioners and Mr. Prashant Sen, learned Deputy Advocate General, for the respondent/State. 7. Mr. Dinesh Singh Rawat, learned counsel for the petitioners, submitted that the HPGST/CGST Act does not provide for investigation and filing of the complaint. The investigation was carried out by the officials of the department, which materially prejudiced the petitioners. The continuation of the proceedings before the learned Trial Court amounts to an abuse of the process of the law. Learned Trial Court wrongly fixed the matter for pre-charge evidence; therefore, it was prayed that the present petition be allowed and the proceedings pending befo....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ase against the accused. (2) Where the allegations in the first information report and other materials, if any, accompanying the FIR do not disclose a cognizable offence, justifying an investigation by police officers under Section 156(1) of the Code except under an order of a Magistrate within the purview of Section 155(2) of the Code. (3) Where the uncontroverted allegations made in the FIR or complaint and the evidence collected in support of the same do not disclose the commission of any offence and make out a case against the accused. (4) Where the allegations in the FIR do not constitute a cognizable offence but constitute only a non-cognizable offence, no investigation is permitted by a police officer without an order of a Magistrate as contemplated under Section 155(2) of the Code. (5) Where the allegations made in the FIR or complaint are so absurd and inherently improbable based on which no prudent person can ever reach a just conclusion that there is sufficient ground for proceeding against the accused. (6) Where there is an express legal bar engrafted in any of the provisions of the Code or the concerned Act (under which a criminal proceeding is institute....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ngs at the threshold, thereby pre-empting the Prosecution from building its case before the Trial Court. The grounds for quashing, inter alia, contemplate the following situations : (i) the criminal complaint has been filed with mala fides; (ii) the FIR represents an abuse of the legal process; (iii) no prima facie offence is made out; (iv) the dispute is civil in nature; (v.) the complaint contains vague and omnibus allegations; and (vi) the parties are willing to settle and compound the dispute amicably (State of Haryana v. Bhajan Lal, 1992 Supp (1) SCC 335) 12. The present petition is to be decided as per the parameters laid down by the Hon'ble Supreme Court. 13. The applicability of the provisions of Cr.P.C to GST Act was considered by Hon'ble Supreme Court in Radhika Agarwal v. Union of India, (2025) 150 GSTR 121, and it was held that the provisions of Cr.P.C. apply to the proceedings conducted under GST Act if there is no provision to the contrary. It was observed: "13. Section 4(1) stipulates that offences under the Penal Code, 1860, shall be investigated, inquired into, tried, and otherwise dealt with by the Code. For offences under any other local law, section 4(2) st....
X X X X Extracts X X X X
X X X X Extracts X X X X
....duced before a Magistrate. It also deals with the power of the authorised officers to release an arrested person on bail in case of a non-cognizable and bailable offence, having the same power and subject to the same provisions as applicable to an officer in charge of a police station. We would, therefore, agree with the contention that the GST Acts are not a complete code when it comes to the provisions of search and seizure, and arrest, for the provisions of the Code would equally apply when they are not expressly or impliedly excluded by provisions of the GST Acts. 14. Therefore, the submission that the provisions of Cr.P.C. do not apply to GST Act and the Act is silent regarding the procedure for investigation, inquiry, or trial is not correct. 15. It was submitted that the learned Trial Court erred in ordering that the pre-charge evidence be led. This submission is not acceptable. Section 132 provides for imprisonment, which may extend to five years or a fine. Section 2(X) of the Cr.P.C. defines a warrant case as a case relating to an offence punishable with imprisonment for a term exceeding two years. Since imprisonment provided is five years, which is more than two years,....