Case Law Details
Dheeraj Saini Vs Union of India (Allahabad High Court)
Allahabad High Court granted bail to accused involved in evading Input Tax Credit by creating fake firms since the main accused has been released on bail and the applicant has no criminal history.
Facts- The officers of D.G.G.I., Meerut Zonal Unit received an information that a racket is indulged in creation of fake firms and issuance of bogus bills and invoices without any supply of goods and services. Therefore, a search operation was conducted on 15.5.2023 at the residence, office and other related premises of one Deepak Kumar. It was found that 44 non-existent / non-operational firms were created and controlled by the said Deepak Kumar. He availed ineligible input tax credit (ITC) to the tune of Rs. 123.38 Crores in these firms and further passed on ineligible ITC of Rs. 141.18 crores from these non-existent / non-operational firms without supply of any goods.
Evidence collected during investigation revealed that Dheeraj Soni, the present applicant, was working with the said Deepak Kumar and running his secret office from where incriminating digital devices and records have also been seized. Accordingly, present bail application has been filed by the applicant – Dheeraj Saini seeking bail u/s. 132(1) (b), 132(1)(c) read with Section 132(1)(i) of C.G.S.T. Act, 2017
Conclusion- Held that the nature of the offence, the punishment and the material available on record, the fact that the applicant has no criminal history to his credit and the fact that co-accused Deepak Kumar having more serious role has been released on bail by the coordinate Bench of this Court, and without expressing any opinion on the merits of the case, the Court is of the view that the applicant has made out a case for bail. The bail application is allowed.
FULL TEXT OF THE JUDGMENT/ORDER OF ALLAHABAD HIGH COURT
1. This bail application has been filed by the applicant – Dheeraj Saini seeking bail in Case No. 633 of 2023 under Sections 132(1) (b), 132(1)(c) read with Section 132(1)(i) of C.G.S.T. Act, 2017, D.G.G.I./ GRU Kaushambi, Ghaziabad.
2. Brief facts of the case, as culled out from the record, are that the officers of D.G.G.I., Meerut Zonal Unit received an information that a racket is indulged in creation of fake firms and issuance of bogus bills and invoices without any supply of goods and services. Therefore, a search operation was conducted on 15.5.2023 at the residence, office and other related premises of one Deepak Kumar, who was the mastermind of the said racket and during search incriminating records were found and seized from the said places which clearly indicated that he was managing and controlling issuance of bogus invoices without supply of concomitant goods. It was found that 44 non-existent / non-operational firms were created and controlled by the said Deepak Kumar. He availed ineligible input tax credit (ITC) to the tune of Rs. 123.38 Crores in these firms and further passed on ineligible ITC of Rs. 141.18 crores from these non-existent / non-operational firms without supply of any Evidence collected during investigation revealed that Dheeraj Soni, the present applicant, was working with the said Deepak Kumar and running his secret office at Shop No. 11, GDA Market, Vivekanand Nagar, Ghaziabad from where incriminating digital devices and records have also been seized. The applicant played an active role with Deepak Kumar in ineligible GST availment of Rs. 123.18 Crores in their 44 fake firms and further passing on fraudulent ITC of Rs. 141.18 crores. He himself shown as the Proprietor of M/s Galaxy Trading Company wherein he knowingly availed and passed on ineligible ITC of Rs. 6.4 crores and Rs. 3.4 crores respectively without concomitant receipt of goods. Statements of the applicant under Section 70 CGST Act were recorded wherein he admitted his role in making of fake firms, fake billing, and total modus operandi. He also admitted that being proprietor of M/s Galaxy Trading Company, he has availed fake ITC of Rs. 6.4 crores and passed on fake ITC of of Rs. 3.4 crores.
3. Heard Shri Rizwan Ahmad, learned counsel for the applicant, Shri Parv Agrawal learned counsel for the D.G.G.I. and perused the record.
4. It is submitted by learned counsel for the applicant that nothing was recovered from the possession of the present applicant and on the basis of alleged confession made by the co-accused persons only, present complaint was filed against the applicant and some others. It is also submitted that applicant was an employee in the office of Deepak The said Deepak Kumar obtained Aadhar Card, Pan Card, Voter ID Card, photograph, etc. of the applicant in lieu of job / employment and the applicant was posted at the office of Deepak Kumar at Shop No. 11, GDA Market, Vivekanand Nagar, Ghaziabad on the instructions of Deepak Kumar. There is no device to establish that present applicant created fake firms and passed the ITC. It is also submitted that no liability of G.S.T. has been assessed till now.
5. It is further submitted that till date penalty or taxes have not been ascertained as per the mandate of the said Act. It is also submitted that offences, as alleged, are punishable up-to five years imprisonment and are compoundable. The applicant has no criminal history to his credit. He has been in jail since 12.7.2024. It is also submitted that in case the applicant is released on bail, he will not misuse the liberty and is ready to cooperate in the trial. Lastly, it is submitted that co-accused Deepak Kumar having a role more serious than that of the present accused / applicant has been granted bail by the coordinate Bench of this Court on 8.8.2023 vide Criminal Misc. Bail Application No. 31185 of 2023.
6. Per contra, learned counsel appearing for the D.G.G.I. vehemently opposed the prayer for bail and contended that the applicant was involved in evading the Input Tax Credit by creating fake firms. There is a confessional statement of the accused/ applicant recorded by the authorities which is relevant in order to trace out any device by using which shell firms were created. During search, incriminating digital devices and records have been seized. The applicant was actively participating in the operation of fake registration and billing of firms along with co-accused Deepak Kumar. It is further submitted that in the case of co- accused Deepak Kumar notice was not issued to him whereas in the present case notice has already been issued to the present applicant. It is also submitted that it is a case where fake companies of a large number have been created and about Rs. 155 crores are involved. In case, applicant is released on bail he will again indulge in similar activities and may misuse the liberty of
7. I have considered the rival submissions made by the learned counsel for the parties and have gone through the entire record
8. Having regard to the entire facts and circumstances of the case, the nature of the offence, the punishment and the material available on record, the fact that the applicant has no criminal history to his credit and the fact that co-accused Deepak Kumar having more serious role has been released on bail by the coordinate Bench of this Court, and without expressing any opinion on the merits of the case, the Court is of the view that the applicant has made out a case for bail. The bail application is allowed.
9. Let the aforesaid applicant be released on bail on furnishing a personal bond and two heavy sureties each in the like amount to the satisfaction of the court concerned subject to following conditions:
(i) The applicant will not tamper with the evidence during the
(ii) The applicant will not pressurize/ intimidate the prosecution
(iii) The applicant will appear before the trial court on the date fixed, unless personal presence is exempted.
(iv) The applicant shall not commit an offence similar to the offence of which he is accused, or suspected, of the commission of which he is suspected.
(v) The applicant shall not directly or indirectly make any inducement, threat or promise to any person acquainted with the facts of the case so as to dissuade him from disclosing such facts to the Court or to any police officer or tamper with the evidence.
(vi) The applicant shall not indulge in any criminal and anti- social activity.
(vii) The applicant shall surrender his passport, if any, to the concerned Trial Court forthwith and shall not leave the country without previous permission of the Court.
10.In case of breach of any of the above conditions, the prosecution shall be at liberty to move bail cancellation application before this Court.
11. It is made clear that the submissions / observations made in this order are only for deciding the bail application. The trial Court while deciding the matter finally shall not be influenced with the same.
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