Delhi HC Upholds Bail, Rules Re-Arrest Unwarranted in Fraudulent ITC Case

Directorate General of GST Intelligence Vs Yogesh Kumar Gupta (Delhi High Court)

Delhi High Court held that bail granted in fraudulent ITC generated and passed by the respondent is upheld since there was no pending investigation. Re-arrest of respondent is unwarranted since he has fully cooperated in investigation.

Facts- The Respondent, Sh. Yogesh Kumar Gupta, is the mastermind of a fraudulent billing racket, operating through 16 firms/ companies, engaged in the practice of issuing GST invoices without the actual supply of goods or services. The Respondent has also been playing an active role in passing of fraudulent ITC.

The Respondent was arrested on the basis of the evidence obtained from his mobile phone as well as his statement dated 27^th January, 2025, in which he admitted to be involved in the availing and passing on of fake/bogus ITC. Furthermore, during a search of the office premises of Mr. Rakesh Kumar Aggarwal, who is also alleged to be involved in the fraudulent billing network, his statement was recorded, in which he confirmed that most of the fake/bogus invoices issued by the fraudulent companies were routed through the Respondent.

The Respondent was arrested on 28^th January, 2025. Thereafter, he filed an application dated 10^th February, 2025 seeking regular bail before the CJM. However, the same was rejected. The Petitioner field a reply to the second bail application on 1st March, 2025 and arguments were also advanced on the said date. The Petitioner raised a preliminary objection regarding the maintainability of the second bail application, citing the absence of any change in circumstances since the dismissal of the first bail application. However, on 3^rd March, 2025, the CJM, through the impugned order, granted bail to the Respondent. Aggrieved by the decision, the Petitioner has approached this Court.