Case Law Details
Bhagwan Sahay Gupta Vs Union Of India (Rajasthan High Court)
GST: Arrest of Chartered Accountant on allegation of fake firms; Granted conditional bail by the High Court of Rajasthan
In Bhagwan Sahay Gupta Vs. Union of India, O/o Sr. Intelligence Officer, GST Intelligence Directorate, Jaipur Region Unit, Jaipur through an order dated: 04.05.2021, a bail application filed by a chartered accountant is allowed by the Hon’ble High Court of Rajastan, taking note of the fact that he has remained in custody for a long period and that petitioner is also having a child and also considering the contentions put forth by counsel for the petitioner, subject to certain conditions.
Facts of the case
Mr. Bhagwan Sahay Gupta, a chartered Accountant of Jaipur was arrested under the provisions of section 132 of the Central Goods & Services Tax Act, 2017 (CGST Act) by the the Jaipur branch of Directorate General of GST Intelligence (DGGI), on 23.01.2021 alleging that, he was instrumental in registration of 11 fake firms and these firms have availed input tax credit to the tune of ₹146 crores under the GST Acts. It is also contended that petitioner was aware as he was filing GST returns of non-existent firms. After having prolonged judicial custody in the Central Jail, Jaipur, he has filed a Criminal Miscellaneous Bail Application before the High Court of Rajasthan U/s. 439 of the Cr.P.C. His contention in the bail application is that, being a Chartered Accountant he had created the firms only on the basis of documents provided by the co-accused. Per contra, as per the complaint filed by the Department, petitioner instead of charging ₹1500.00 per GST return, charged around ₹3,500.00 per GST return. However, there is no allegation in the complaint that the petitioner has received any amount or any percentage with regard to the wrong input tax credit. It is also contended that with the complaint, statement of Vishnu Garg, the co-accused is also attached who has mentioned that petitioner has created the firms on the basis of documents provided by him. Further it is contended that petitioner is in custody from 23.01.2021. The maximum sentence provided for the offence with which petitioner is charged is six months. It is contended that as per the charge-sheet, petitioner has only received ₹75,000.00 for filing GST returns and ₹5,000.00 per firm for the registration. Offence is triable by First Class Magistrate.
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