Anil Kumar Vs Union of India (Rajasthan High Court)
Summary: Rajasthan High Court dismissed the regular bail application of Anil Kumar, who was arrested in proceedings under Section 132(1)(b), (c), (f) and (l) of the CGST Act, 2017. The prosecution alleged that he managed seven firms which issued invoices without supply of goods, availed invoices from fake firms created by Ashutosh Garg, opened four additional firms, sold invoices on commission and passed on fake Input Tax Credit of ₹20,28,40,841. The petitioner, in custody since 18.11.2023, argued that the offences were triable by a Magistrate, carried a maximum punishment of five years and that the trial would take considerable time; he relied on the Supreme Court decision in Ratnambar Kaushik v. Union of India.
The High Court distinguished that decision on facts, observing that it concerned supply of goods without payment of CGST and not generation of fake ITC. It further noted that in Lalit Goyal v. Union of India, involving alleged fake firms and ITC of ₹18.91 crore without transportation of goods, the Supreme Court had dismissed the special leave petition against denial of bail. Holding that economic offences constitute a class apart and require a different approach in bail matters, and considering the gravity of the allegations and the alleged fake ITC of ₹20.28 crore, the Court declined to enlarge the petitioner on bail and dismissed the application.
Cases Discussed
- Ratnambar Kaushik Vs Union of India, 2022 SCC OnLine SC 1678; decided on 05.12.2022 (Supreme Court) — Distinguished. The petitioner relied upon the decision seeking bail, but the Rajasthan High Court held that its facts were entirely different because that matter concerned goods supplied without payment of CGST, whereas the present allegation involved generation of fake ITC.
- Lalit Goyal Vs Union of India & Anr., Special Leave to Appeal (Crl.) No. 3509/2022; 26.08.2022 (Supreme Court) — Relied upon. The Revenue cited the decision, and the High Court noted that the Supreme Court had dismissed the SLP in a matter involving alleged creation of fake firms and ITC of ₹18.91 crore without transportation of goods.
- Basudev Mittal Vs Union of India, Special Leave to Appeal (Crl.) No. 8128/2022; 12.12.2022 (Supreme Court) — Cited by Revenue. The Revenue relied upon this order while opposing the petitioner’s prayer for bail.
FULL TEXT OF THE RAJASTHAN HIGH COURT ORDER
The instant bail application has been filed under Section 439 Cr.P.C. on behalf of accused-petitioner. The petitioner has been arrested in connection with Complaint No.DGGI/INV/122/2023-Gr-F O/o ADG-DGGI-ZU-Jaipur for the offence(s) under Section 132 (1) (b) (c) (f) and (l) of CGST Act, 2017.
Learned counsel for the accused-petitioner submitted that the petitioner has been falsely implicated under Section 132 (1) (b) (c) (f) and (l) of CGST Act, 2017. The accused-petitioner is behind the bars since 18.11.2023. The offence is triable by Magistrate and having maximum punishment of five years. The trial of the case may take considerable time, therefore, the bail application of accused-petitioner may be allowed.
Learned counsel for the accused-petitioner placed his reliance upon the order passed by Hon’ble Apex Court in the case of Ratnambar Kaushik Vs. Union of India [2022 SCC Online SC 1678] decided on 05.12.2022 and invited attention of this Court at Para No.6 of the order.
Per contra, learned Senior Counsel for Union of India opposed the bail application and submitted that accused-petitioner Anil Kumar issued fake bills from seven firms managed by him and taking ITC through fake bills issued by fake firms created by Shri Ashutosh Garg. It is also alleged against the accused-petitioner that he opened four more firms and issued fake bills without supplying of goods/services. He also submitted that present petitioner is also involved for selling invoices issued from fake firms of Shri Ashutosh Garg on commission basis. The investigation also reveals that accused-petitioner Anil Kumar operated seven firms and have issued goods less invoices passing on fake ITC amounting to Rs.20,28,40,841/-.
Learned Senior Counsel for Union of India further submitted that charge-sheet against the accused-petitioner for prosecuting under Section 132 (1) (b) (c) (f) and (l) of CGST Act, 2017 read with sub-Section 5 of the Act has already been submitted. He further argued that the facts of the case referred by learned counsel for the petitioner are entirely different from the facts in the case of Ratnambar Kaushik (supra). It was alleged against the accused that he clandestinely transported raw un-manufactured tobacco brought from Gujarat by seven trucks weighing 90,520 Kgs. and the raw un-manufactured tobacco was cleared in the name of M/s. Maa Ambe Enterprises. It was also alleged that supply of chewing tobacco was made without paying leviable duties amounting to Rs.15,57,28,345/-. In the present case, the accused-petitioner has initiated the fake ITCs without supplying goods and caused loss of Rs.20,28,40,841/- to the Government.
Learned Senior Counsel for Union of India placed his reliance upon the order passed in Lalit Goyal Vs. Union of India & Anr. passed by Hon’ble Apex Court in Special Leave to Appeal (Crl.) No.3509/2022 dated 26.08.2022 and Special Leave to Appeal (Crl.) No.8128/2022 in Basudev Mittal Vs. Union of India dated 12.12.2022. He further submitted that the offences under Section 132 (b) (c) and (l) are cognizable and non- bailable offence.
Learned Senior Counsel for Union of India further submitted that economic offences constitute a class apart and need to be visited with a different approach in the matter of bail, therefore, considering the fact that accused-petitioner has fake ITCs amount of Rs.20,28,40,841/- without supplying the goods, bail application of accused-petitioner may be dismissed.
Heard and perused the charge sheet, so also, the law referred by both the parties.
The allegation in the charge sheet itself speaks and states that accused-petitioner has generated the fake ITCs of Rs.20,28,40,841/-. It is settled law that economic offences constitute a class apart and required to be scanned with a different approach in the matter of bail. In the matter of Ratnambar Kaushik (supra), the facts were entirely different and that was not a case of generating the fake ITC. In that case, goods were supplied without paying the CGST. In the present case, the facts are entirely different. The Hon’ble Apex Court in the matter of Lalit Goyal (supra) vide order dated 26.08.2022 dismissed the bail application of the petitioner. In the matter of Lalit Goyal, it was alleged that petitioner Lalit Goyal and other persons had made various fake firms and claimed Input Tax Credit of Rs.18.91 Crores without any transportation of goods. In that case, co-ordinate Bench of this Court in S.B. Criminal Misc. Bail Application No.13042/2021 dated 07.09.2021 dismissed the bail application of the petitioner and in SLP vide order dated 26.08.2022, the Hon’ble Apex Court dismissed the Special Leave Petition, therefore, considering the gravity of the offence, so also, that petitioner has taken a fake Input Tax Credit (ITC) worth of Rs.20,28,40,841/-, I am not inclined to enlarge the accused-petitioner on bail.
Accordingly, the bail application of accused-petitioner under Section 439 Cr.P.C. is dismissed.
