Case Law Details
Naveen Bansal Vs. Commissioner Central Tax (Patiala House court)
In the present case also in the reply itself it has been mentioned that accused has admitted of causing loss to the tune of Rs.7-8 crores to the exchequer. Accused is in custody since 25.03.2021. To decide whether or not admit accused on bail or not abovesaid parameters as held by Hon’ble Supreme Court of India have to be measured/have to be assessed. The fact that accused was straightaway sent to judicial custody is prima facie indicative of the fact that accused is not required for custodial interrogation. Further, no previous involvement of accused in any similar offence has been brought on record which implies that it is his first offence and he is not a habitual offender. It is also to be seen that accused is not at a flight risk and no submissions have been made to this effect. It has been argued on behalf of respondent department that investigation is still pending and the argument of applicant/accused that complaint shall not be filed within stipulated time is speculative at best. It is correct that it cannot be decided or presumed at this stage that complaint shall or shall not be filed in the stipulated time. However, still it is to be seen that whether or not there is any requirement of accused for investigation as well as whether or not releasing the accused on bail may hamper the investigation. It has been argued on behalf of respondent department that Vikas Bansal, brother of accused is not responding to the process issued by the department and is at large. First, in the reply, voluntary statement of applicant/accused had been relied upon, wherein it is mentioned that applicant/accused had admitted that although his brother is shown as owner of the firm but the entire violation was made by him and his brother has nothing to do with this. Besides this, keeping the accused behind bar will not help the investigating agency in ensuring that other accused responds to the process and cannot be a reason for holding a person behind bar without establishing a direct nexus/any material on record to show any connivance/assistance by the said accused. Therefore, keeping in view the totality of circumstances, the period of incarceration and the fact that accused is not required for any further custodial interrogation, which is otherwise also not possible as 15 days since arrest of accused have already passed, as well as no report of any previous involvement, accused is admitted in bail on his furnishing personal bond in the sum of Rs.1,00,000/- (Rupees One Lakh only), with one surety of equal amount, subject to following terms :
1. That accused shall not leave the country without permission of the court and shall also submit his passport in court as and when the physical hearing is permitted by Hon’ble High Court of Delhi.
2. That accused shall appear before investigating agency as and when required and will also co-operate in investigation.
3. That he shall attend the hearing in compliance of this order and bail bonds so executed.
4. That he shall not commit offence similar to the offence alleged in this case.
5. That he shall not do any act/omission to influence the witnesses.
FULL TEXT OF THE PATIALA HOUSE COURT COURT ORDER
Present: Sh. Satish Aggarwala, Ld. SPP for department of GST (through VC)/ Sh. Gagan for Department of GST.
Sh. Ramesh Gupta, ld. Senior Advocate along with Sh. Kapil Dua, Sh. Bharat Sharma and Sh.Honey Chopra, ld. Counsel for applicant/accused (through VC).
1. It is submitted on behalf of applicant/accused that a search was conducted at the office of applicant on 15.03.2021. That it concluded at 05:00 p.m. and notice was given that day itself to applicant to join proceedings at 05:50 p.m. That in the garb of recording voluntary statement, applicant was forcibly kept at the office of department till next day. That arrest of accused was made in an arbitrary manner and arrest memo as well as remand application bear witness to that. It is argued that it is clear from arrest memo that applicant has committed offence under Clause (a) or (b) or (c) or (d) of Section 132 (1) of CGST Act. That in remand application, heading mention to have committed offence u/s. 132(1) (a) whereas, body of application mentions commission of offence u/s. Clause (b) and Clause (c) of Sec. 132(1) of said Act. It clearly shows that the department itself is neither sure nor justified in making arrest of accused. That accused is in custody since 25.03.2021 and almost 39 days have passed and accused is no more required in custody as no custody of accused for custodial interrogation was sought. That seeking judicial custody of accused straight-away means that custodial interrogation was not required. It is also submitted that it has been held that provisions of Sec. 41(A) Cr.PC shall apply in the present case. It is also submitted that the period for completing investigation and filing complaint is 60 days. That approximately 2/3rd period has been passed and experience has shown that in other cases also, complaint has not been filed in time. It is submitted that the arrest of accused is also not justified for the reason that there is no material to show/support that there were reason to believe of commission of alleged offence. It is also argued that under the present Act, offence is an allegation of upto the amount of Rs.5 crore is bailable and beyond that it is a non-bailable offence. It is also submitted that in the present case there are allegations of causing loss of approximately Rs. 9 crores, which indicates that severity is not such especially in the back-drop that offences involving violation upto Rs. 5 crores are bailable. It is also submitted that given applicability of section 41(A) Cr.PC decision held by Hon’ble Supreme Court of India in the case of Arnesh Kumar vs. State of Bihar also applied because the maximum punishment in the present matter of alleged offences is upto five years. Further, reliance has been placed on following judgments :
1. Make My Trip v. Union of India, 2016 (44) STR 481 (Del.)
2. Akhil Krishnan Maggu & Anr. vs. Deputy Director, DGGI & Ors., 2019 SCC OnLine P&H 5416,
3. Collector of Malabar vs. Ebrahim, AIR 1954 SC 119
4. Vimal Yashwantgiri Goswami vs. State of Gujarat, 2019-TIOL-1746-HC-AHMGST
5. Cleartrip Pvt. Ltd. Mumbai &Ors. vs. The Union of India, 2016-TIOL-863-HCMUM-ST
6. Jayachandran Alloys (P) Ltd. vs. Superintendent of GST
7. Central Excise and Ors., 2019 SCC OnLine Mad 31224
8. Siddharam Satlingappa Mhetre v. State of Maharashtra, (2011) 1 SCC 694
9. Bindal Smelting Pvt Ltd vs. Additional Director General, DGGI, 2020 (34) GSTL 592
10. P. V. Ramana Reddy vs. Union of India, 2019 (25) GSTL 185
11. CCE v. Duncan Agro Industries, (2000) 7 SCC 53
12. K. Cigarettes Ltd. vs. Commissioner of Central Excise, 2009 (242) E.L.T. 189 (Del.)
13. Mahesh Chandra v. Regional Manager, U.P. Financial Corporation, (1993) 2 SCC 279
14. SLP (CRl) No. 6834/2019 titled as C. Pradeep vs The Commissioner of The GST And Central Excise Selam & Anr.
It is submitted that accused is no more required for investigation and otherwise also the evidence is documentary in nature. It is also argued that reason of his brother Vikas Bansal not joining the investigation, cannot be a ground to keep applicant/accused behind bar. Submission is made that application be allowed and accused be admitted in bail.
2. A detailed reply has been filed on behalf of respondent department. Written submissions have also been filed on behalf of respondent department. It has been argued that present matter involved an economic offence and thus, is required to be dealt with on a separate footing as it is not an offence committed during heat of the moment but is a result of careful planning and is a deliberate offence. It is submitted that it has been so held in catena of judgments by Hon’ble Supreme Court of India and Hon’ble High Courts. It is argued that in the present case accused has made a voluntary statement, which is admissible in evidence and can also be basis of conviction. It is also argued that Sh. Abhishek Kumar, Accountant in the violating firm had disclosed about commission of offence. It is argued that in the present matter fake transactions have been carried out and in the said fake transactions, fake invoices of his firm and fake invoices of other firms without accompanying the goods were used. After that payment is made through RTGS/through cheques and same is received back in cash from the firm, which issued fake invoice. Similarly, payment is received through cheques/RTGS and cash is being given to the said firm. That accused Naveen Bansal had stated that he looked after the work of firm detailed in the reply. That Vikas Bansal is younger to him and on paper, he is the owner but the entire work is done under his guidance. Applicant/accused has also stated that they do not have any other godown except at Bawana but the said godown was found non-functioning and no work was going on there. It has been further argued that accused by indulging in such economic offence has caused loss to national treasury and is also adversely affecting the economy of the country, which makes it a very severe offence. Details have been mentioned in the reply in respect of the offences submitted by applicant/accused. It is also argued that investigation is still going on and is likely to unearth details of suppliers from who he had received fake invoices. That accused has caused a huge loss to the tune of Rs.7-8 crores, which has been admitted by him. It is also argued that the arguments advanced by applicant/accused that without assessment, it cannot be held even prima facie that offence has been committed, does not hold water because investigation is carried out and figures so reached do indicate that determination had been made. It is also argued that the judgment of Make My Trip case (supra) referred and relied by ld. Counsel for applicant is not applicable for the reason that it was in respect of the then applicable Service Tax law, secondly, determination has already been made and also for the reason that the judgment of Hon’ble High Court of Punjab & Haryana wherein it is held that “the said judgment of Make My Trip is parimateria applicable to CGST Act, 2000 is pending adjudication before Hon’ble Supreme Court of India”. Reliance has been placed on the judgments :
1. I. Pavunny v. Asstt. Collector, Central Excise – 1997 (90) ELT 241 (S.C.)
2. Toofan Singh Vs. State of Tamilnadu – Crl. Appeal No.152/2013
3. Sapna Jain & Ors. –SLP (Cri) 4322-4324/2019
4. Vimal Yashwant Giri Goswami Vs. State of Gujarat – R/Special Civil Application No.13679/2019
5. Rajasthan High Court in Rajesh Goel Vs. Union of India-S.B. Criminal Misc. Bail Application No. 726/2011-decided on 27.01.2011
6. Ashish Jain Versus Union of India and Others, Writ Petition No. 3804 of 2019 decided on 31.07.2019
7. State of Gujarat vs. Mohanlal Jitamalji Porwal: (1987) 2 SCC 364]
8. P. Chidambaram Versus Enforcement of Directorate in Criminal Appeal No.1340/2019 decided by Supreme Court on 05.09.2019
9. Y. S. Jagan Mohan Reddy vs. Central Bureau of Investigation: (2013) 7 SCC 439
10. Crl. Appeal No.1175/2018 – State of Orissa Vs. Mahimananda Mishra
11. Crl. Appeal No.1938/2017 – Anil Kumar Yadav Vs. State (NCT) of Delhi
12. State of U.P. v. Amarmani Tripathi, (2005) 8 SCC 21 : 2005 SCC (Cri) 1960 (2)
13. State of Bihar & Another Vs. Amit Kumar @ Bachcha Rai – (2017) 13 Supreme Court Cases 751
14. Bail Application No.820/2007 – Lalit Goel Vs. Commissioner of Central Excise (Delhi-I), decided on 23.07.2007
15. Gudikanti Narasimhulu Vs. Public Prosecutor (1978) 1 SCC 240,
16. State Vs. Jaspal Singh Gill AIR 1984 SC 1503,
17. CBI, Hyderabad Vs. B. Ramaraju Crl. 2011 Crl. L.J. 301,
18. Prasanta Kumar Sarkar Vs. Ashis Chatterjee & Anr., 2010 (11) Scale 408
19. Kanimozhi Karunanithi Vs. CBI – Bail Application No.724 of 2011 decided on 08.06.2011
20. Nimmagadda Prasad Vs. CBI: (2013) 7 SCC 466;
21. State of Gujarat vs. Mohanlal Jitamalji Porwal: (1987) 2 SCC 364;
22. State of Bihar & Anr. Vs. Amit Kumar alias Bachcha Rai: (2017) 13 SCC 751;
23. Gautam Kundu vs. Directorate of Enforcement:(2015)16SCC1;
24. Sunil Dahiya vs. State (Govt. of NCT of Delhi): (2016) SCC Online Del 5566;
25. Suresh Thimiri vs. The State of Maharashtra: (2016) SCC Online Bom 2602
26. Chhagan Chandrakant Bhujbal vs. Union of India: (2016) SCC Online Bom 9938
3. I have heard both the parties and gone through all the record and written submissions, all of which have been transmitted electronically. While deciding the application of bail, it has been held by Hon’ble Supreme Court of India in the case State of UP vs. Amar Mani Tripathi (2005)8SCC21 :
“18. It is well settled that the matters to be considered in an application for bail are (i) whether there is any prima facie or reasonable ground to believe that the accused had committed the offence; (ii) nature and gravity of the charge; (iii) severity of the punishment in the event of conviction; (iv) danger of the accused absconding or fleeing, if released on bail; (v) character, behaviour, means, position and standing of the accused; (vi) likelihood of the offence being repeated; (vii) reasonable apprehension of the witnesses being tampered with; and (viii) danger, of course, of justice being thwarted by grant of bail …”
3a. In the present case also in the reply itself it has been mentioned that accused has admitted of causing loss to the tune of Rs.7-8 crores to the exchequer. Accused is in custody since 25.03.2021. To decide whether or not admit accused on bail or not abovesaid parameters as held by Hon’ble Supreme Court of India have to be measured/have to be assessed. The fact that accused was straightaway sent to judicial custody is prima facie indicative of the fact that accused is not required for custodial interrogation. Further, no previous involvement of accused in any similar offence has been brought on record which implies that it is his first offence and he is not a habitual offender. It is also to be seen that accused is not at a flight risk and no submissions have been made to this effect. It has been argued on behalf of respondent department that investigation is still pending and the argument of applicant/accused that complaint shall not be filed within stipulated time is speculative at best. It is correct that it cannot be decided or presumed at this stage that complaint shall or shall not be filed in the stipulated time. However, still it is to be seen that whether or not there is any requirement of accused for investigation as well as whether or not releasing the accused on bail may hamper the investigation. It has been argued on behalf of respondent department that Vikas Bansal, brother of accused is not responding to the process issued by the department and is at large. First, in the reply, voluntary statement of applicant/accused had been relied upon, wherein it is mentioned that applicant/accused had admitted that although his brother is shown as owner of the firm but the entire violation was made by him and his brother has nothing to do with this. Besides this, keeping the accused behind bar will not help the investigating agency in ensuring that other accused responds to the process and cannot be a reason for holding a person behind bar without establishing a direct nexus/any material on record to show any connivance/assistance by the said accused. Therefore, keeping in view the totality of circumstances, the period of incarceration and the fact that accused is not required for any further custodial interrogation, which is otherwise also not possible as 15 days since arrest of accused have already passed, as well as no report of any previous involvement, accused is admitted in bail on his furnishing personal bond in the sum of Rs.1,00,000/- (Rupees One Lakh only), with one surety of equal amount, subject to following terms :
1. That accused shall not leave the country without permission of the court and shall also submit his passport in court as and when the physical hearing is permitted by Hon’ble High Court of Delhi.
2. That accused shall appear before investigating agency as and when required and will also co-operate in investigation.
3. That he shall attend the hearing in compliance of this order and bail bonds so executed.
4. That he shall not commit offence similar to the offence alleged in this case.
5. That he shall not do any act/omission to influence the witnesses.
Bail bonds not furnished. Copy of this order be given dasti.
4. It is certified that during virtual hearing of this matter, no disturbance was faced and virtual hearing has been done to the satisfaction of all stakeholders.
