TaxTMI 
TaxTMI 
2026 (5) TMI 1728
X X X X Extracts X X X X
X X X X Extracts X X X X
....ns firstly a raid was conducted at the principal place of his business on 19.01.2026 and certain documents were seized by projecting that petitioner and his partner have claimed 'input tax credit' in an illegal manner. As per petitioner on the same day they were taken into custody, but in an illegal manner their formal arrest was shown on 20.01.2026. According to petitioner, his arrest was in violation of the settled principle of law as the grounds of arrest were not communicated to him. While claiming that no illegal acts, whatsoever, has been committed by him or his partner it has been alleged that proper proofs/documents with regard to legal claim of 'Input Tax Credit' were handed over to the officers of the respondent, but while ignoring all the above mentioned valid documents, his illegal arrest has been made. Hence the present petition. 3. The above mentioned petition has been opposed by the learned Senior Standing Counsel for the respondent and a detailed written reply has been filed. In the abovesaid reply each and every ground taken by the petitioner in his petition for bail, has been controverted by the respondent. It has been alleged that after thoroug....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... of the furnace of the petitioner and other relevant documents, such as GST invoices, E-way bill etc. were handed over to the officer of the respondent proving that, that the business was actually being run by the petitioner's firm and there was no illegal claim of ITC without actual business transaction, but the officer of respondent failed to look into the valid reasoning of the petitioner and illegally arrested him on 20.01.2026. 8. It has also been contended by learned counsel for the petitioner that not only the arrest was without any legal basis, but also the manner in which petitioner was formally arrested was illegal, as he was detained on 19.01.2026, but his formal arrest was shown on 20.01.2026, and before the arrest the grounds of arrest were not served upon the petitioner. 9. In addition to above, it has also been contended by learned counsel for the petitioner that otherwise also the petitioner has already faced incarceration for a period of more than four months and he has no criminal antecedents and the offence is punishable with maximum imprisonment up to five years and that the entire evidence is documentary in nature which has already been collected, and the....
X X X X Extracts X X X X
X X X X Extracts X X X X
....T Evasion) CGST Commissionerate Ludhiana, and his statement was recorded under Section 70 CGST Act. As per learned Senior Standing counsel for the respondent, thereafter, an authorization order under Section 69(1) of CGST Act was passed by the Principal Commissioner CGST Ludhiana, and that pursuant thereto, the petitioner was formally arrested on 20.01.2026. 13. In addition to above, the learned Senior Standing Counsel for the respondent has also contended that in the present case very large number of documents are supposed to be scanned by the respondent and the above mentioned process is still going on. According to learned Senior Standing counsel for the respondent the total custody period of the petitioner is barely four months, which by any standard, cannot lead to an inference that the petitioner is being subjected to prolonged incarceration due to delay in investigation or trial. 14. This claim of petitioner has also been specifically denied by learned Senior Standing counsel for the respondent that before his arrest the grounds of arrest were not communicated to him. With regard to above, the learned Senior Standing counsel for the respondent has come forward with the....
X X X X Extracts X X X X
X X X X Extracts X X X X
....h regard to right to bail, the Hon'ble Supreme Court of India in the case of 'Vineet Jain v. Union of India (supra), has made the following observations:- "The offences alleged against the appellant are under Clauses (c), (f) and (h) of Section 132(1) of the Central Goods and Services Tax Act, 2017. The maximum sentence is of 5 years with fine. A charge-sheet has been filed. The appellant is in custody for a period of almost 7 months. The case is triable by a Court of a Judicial Magistrate. The sentence is limited and in any case, the prosecution is based on documentary evidence. There are no antecedents. We are surprised to note that in a case like this, the appellant has been denied the benefit of bail at all levels, including the High Court and ultimately, he was forced to approach this Court. These are the cases where in normal course, before the Trial Courts, the accused should get bail unless there are some extra ordinary circumstances. By setting aside the impugned order dated 24th January, 2025 of the High Court of Judicature for Rajasthan, Bench at Jaipur, we grant bail to the appellant. The appellant shall be immediately produced before the Tria....
X X X X Extracts X X X X
X X X X Extracts X X X X
....hat the fundamental rights of the accused under Articles 21 and 22 of the Constitution of India have been violated while arresting the accused or after arresting him, it is the duty of the Court dealing with the bail application to release the accused on bail. The reason is that the arrest in such cases stands vitiated. It is the duty of every Court to uphold fundamental rights guaranteed under Articles 21 and 22 of the Constitution." 24. The Hon'ble Supreme Court of India in the case of 'State of Kerala v. Raneef (supra)', has observed that the primary purposes of bail in a criminal case are to release the accused of imprisonment, to release the State of the burden of keeping him, pending trial, and at the same time, to keep the accused constructively in the custody of the court, whether before or after conviction, to ensure that he will submit to the jurisdiction of the Court and being attendance thereon whenever his presence is required. 25. In the case of Sanjay Chandra (supra), the Hon'ble Supreme Court of India has observed that it is not in the interest of justice that accused should be in jail for any indefinite period. According to Hon'ble Apex Court, even if the off....
X X X X Extracts X X X X
X X X X Extracts X X X X
....hich among others, shall also include the condition to direct the petitioner to deposit his passport. Further, such other conditions shall also be imposed by the trial Court to secure the presence of the petitioner to diligently participate in the trial. It is further directed that the petitioner be produced before the trial Court forthwith, to ensure compliance of this order." 28. In addition to above, it is also relevant to note here that the principles of law laid down by the Hon'ble Supreme Court of India in the case of 'Dataram versus State of Uttar Pradesh and another', (2018) 3 SCC 22, are relevant, wherein it has been observed that "a fundamental postulate of criminal jurisprudence is the presumption of innocence, meaning thereby that a person is believed to be innocent until found guilty. However, there are instances in our criminal law where a reverse onus has been placed on an accused with regard to some specific offences but that is another matter and does not detract from the fundamental postulate in respect of other offences. Yet another important facet of our criminal jurisprudence is that the grant of bail is the general rule and putting a person in jail or in a ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....n order to ensure that cases proceed efficiently". 31. To elucidate further, this Court is conscious of the basic and fundamental principle of law that right to speedy trial is a part of reasonable, fair and just procedure enshrined under Article 21 of the Constitution of India. This constitutional right cannot be denied to an undertrial prisoner, as mandated by Hon'ble Apex court in 'Balwinder Singh versus State of Punjab and another' 2024 SCC Online SC 4354. 32. In the light of above mentioned principles of law if the factual matrix of he present case is analysed it transpires that: i) the petitioner is already in custody for a period of approximately four months; ii) the petitioner has clean antecedents; iii) the maximum punishment prescribed for the commission of offence allegedly committed by the petitioner, is imprisonment up to 7 years; iv) the entire evidence to be collected by the investigating agency is documentary in nature, and therefore, detention of petitioner in judicial custody is not likely to serve any purpose; v) argument of learned Senior Standing counsel for the respondent fails to convince that if released on ....