Manoj Kumar Garg Vs Union of India (Allahabad High Court)
The Allahabad High Court granted bail to Manoj Kumar Garg in a case involving the fraudulent claim of over ₹40 crore in Input Tax Credit (ITC) using fake Goods and Services Tax (GST) invoices. The applicant, arrested under Sections 132(1)(c) and 132(1)(i) of the Central Goods and Services Tax (CGST) Act, 2017, had filed a third bail application after previous applications were dismissed on technical grounds (as not pressed or because he was not in custody).
Allegations and Defense
The Directorate General of GST Intelligence (DGGI) alleged that the applicant, by utilizing fake GST invoices without the supply of goods, fraudulently claimed a tax refund exceeding ₹40 crore. The prosecution also contended that the alleged suppliers linked to the applicant’s network of 15 firms were non-existent.
The applicant’s defense counsel countered that the allegations were false and that the GST Department failed to demonstrate any direct link between the applicant and the alleged fake firms, which were duly registered and allotted GSTINs. A key argument raised was that any determination of the evaded ITC amount without a proper adjudication or assessment under Section 73 of the CGST Act was premature, meaning the ₹40 crore figure could not be definitively stated as evaded tax at this stage.
