Case Law Details

Case Name : Yogender Singh Vs. State of Haryana (Court of Anil Kaushik, Gurugram)
Appeal Number : CIS No. BA 870 of 2021
Date of Judgement/Order : 12/11/2021
Related Assessment Year :
Courts : District Court

Yogender Singh Vs. State of Haryana (Court of Anil Kaushik, Gurugram)

Facts- Appellant claimed that he is a victim of high handedness of the Intelligence Officers and is languishing in custody since 23.10.2021. It is argued that the applicant has nothing to do with the accused firms i.e. M/s Lalaji Enterprises and M/s Hemu Overseas and has been falsely implicated in the present case by the officials. The allegation against the accused are that few signed and unsigned documents of the said firms were found in his office. It has been specifically submitted that the applicant is doing accounting for various firms, including aforesaid firms and few documents were in the office premises but the officials falsely planted various documents to bring some credibility to their false story. Even prima facie no offence whatsoever has been committed by the applicant.

Conclusion- This court is of considered view that the present accused does not deserves to be released on bail. It is settled preposition of law that economic offences in itself are considered to be gravest offence against the society at large and hence are required to be treated differently in the matter of bail. It seems that the entire community would aggrieve if the economic offenders who ruin the economy of the State are not brought to book as such offences affects the very fabric of democratic governance and probity in public life. Further, if a murder committed in the heat of moment upon passing being aroused, the economic offence is supposed to be committed with cool calculation and deliberately with an eye on personal profit regardless of the consequence of the community. A disregard for the interest of the community can be manifested only at the cost of forfeiting the trust and faith of the community in the system to administer justice in an even handed manner without fear of criticism from the quarters which view white collar crimes with a permissive eye unmindful of the damage done to the national economy and national interest.

FULL TEXT OF THE JUDGMENT/ORDER 

Vide this Order, I shall dispose of the regular bail application under section 437 Cr.P.C filed by accused Yogender (hereinafter referred to as applicant).

(Brief Facts)

2. Briefly stated the facts of the bail application are that applicant is a victim of high handedness of the Intelligence Officers and is languishing in custody since 23.10.2021. The applicant has nothing to do with the accused firms i.e. M/s Lalaji Enterprises and M/s Hemu Overseas in any manner whatsoever nor does he have any connection with any of the transaction of business of the said firms. The applicant has been falsely implicated in the present case by the officials. The allegation against the accused are that few signed and unsigned documents of the said firms were found in his office. It has been specifically submitted that the applicant is doing accounting for various firms, including aforesaid firms and few documents were in the office premises but the officials falsely planted various documents to bring some credibility to their false story. Even prima facie no offence whatsoever has been committed by the applicant.

Bail to person accused of wrongful availment of ITC not granted

2.1 It has been admitted by the DGGI that the aforementioned firms are not connected to accused in any manner who purchased goods from the applicant, thereafter allegedly sold such goods to other parties or have issued invoices for such goods to other parties who have incorrectly claimed input tax credit of such tax or have applied for refund of such ITC (Input Tax Credit) on account of exports. Precisely, there is no allegation of any evasion of tax by DGGI against the applicant and DGGI has not made any arrests for persons who have allegedly claimed input tax credit/refund of tax and have only arrested applicant who was fully cooperating with the DGGI in investigation.

2.2 The applicant remained associated in the interrogation and inquiry of the present case as and when required and directed by the concerned officials. The entire set of documents including the ledger account, invoices, payment of GST were duly shown and submitted to the concerned Inquiry Officers but the concerned Officers conducted a biased inquiry and falsely implicated the applicant in the present case.

2.3 It has been further submitted that that, as per the application for Judicial Remand, the DGGI has failed to submit as to how the applicant has committed an offence 132(1)(b), (1)(c) & 1 of Central Goods and Services Act, 2017 (hereinafter referred to as 132 of CGST, Act). In the application for remand, the DGGI has falsely claimed that alleged recovered invoices are fraudulent & such modus operandi has caused liability for Government for Rs.13.01 Crores, when the case does not involve demand of a single Rupee from the applicant. If anyone has to be booked it could only be the proprietor or partners of the firms.

2.4 It has been further submitted that applicant has only been arrested by alleging he has facilitated the fake ITC but no wrongful gain or benefit to the applicant has been alleged. The applicant cannot be held culpable in any manner in this case as he was in no way involved in the affairs of the company. The accused also deserves the concession of bail under the guidelines laid down by Honorable Apex court in cases “ARNESH KUMAR VS. STATE”. The case of the accused is squarely covered by the guidelines of the above said judgments.

2.5 It has been further submitted that nothing is left to be recovered from the custody of the accused and the entire case is based on documentary evidences which are already in possession of the complainant and the concerned departments and the said record is beyond tampering. Thus, the further detention of the accused is of no useful purpose. All the witnesses are government officials and beyond the control, influence and pressure of the accused. Thus, nothing can be
tampered or no witness can be pressurized by applicant, if he be released on bail. Hence, the prayer for allowing the bail application of applicant.

(Reply)

3. Notice of the bail application was given to complainant/DGGI who filed reply opposing the bail application contending that during the course of an intelligence, various fake firms who have availed and passed on fake input tax credit on the strength of goods-less invoices namely M/s LalJi Enterprises and M/s Hemu Overseas, were found non-functional/ non-existent at their registered principle place of business.

3.1 During the course of search, at business premises of M/s JMD & Associates, belonging to the accused, addressed at, 206, K.S. Complex, Opp. Mini Secretariat, Haily Mandi Road, Patudi, Gurugram, Haryana, various incriminating material related to investigation were resumed in front of the accused. These resumed documents included signed, unsigned invoices of M/s Lal Ji Enterprises and M/s Hemu Overseas, Signed and unsigned cheque (without details of beneficiary), filled and blank weighing bridge receipts, filled and blank transporter bilties, ATM cards of proprietors of the firms and many more documents.

3.2 Statement of the accused was recorded on 23.10.2021 wherein he admitted that he used to prepare invoices, transport bilties, weighment receipt of M/s LalJi Enterprises and M/s Hemu Overseas and from his statement it so emerged:

(i) Both supplier (M/s Hemu Overseas) and recipient (M/s Lalji Enterprises) are paper companies wherein no commercial activity has taken place & has been created for the sole purpose of passing on fraudulent ITC,

(ii) Hemu Overseas has supplied ITC of Rs. 13.84 crore out of which 5.02 cr has been availed by M/s Lalji Enterprises.

(iii) Proprietors of the firms M/s Lalji Enterprises is a dummy proprietor who did not appear before the officers and has become untraceable, which indicate malafide intent.

(iv) That the accused incriminating as documents found in possession of especially blank weighment slips and bilties of transporter which have been used to forge records of Lalji Enterprises & Hemu Overseas. Furthermore, he has misrepresented himself as CA.

(v) The documents found in the possession of the accused are in the form of forged documents which have been used to file fraudulent returns and to provide evidence to fake supplies from non-existent said entities.

3.3 It has been further submitted that above named accused has committed offences under Sec 132(1)(b)&(c) of CGST Act, 2017 in so much as he has been found in possession of fraudulent invoices (unsigned sale & purchase invoices) alongwith forged supporting documents (transport & weighment slips) for the purpose of availing of and passing on fraudulent ITC amounting to Rs. 13.01 crores from M/s Lalji Enterprises, availing fraud ITC of 5 crores from Hemu Overseas in M/s Lalji Enterprises and passing on ITC of Rs. 13.84 Crores from M/s Hemu Overseas, as total ITC passed on by M/s Hemu Overseas i.e. 13.84 crores is completely fraud on account of it being a paper Company. The accused has also been facilitating the fake ITC being passed on from M/s Hemu Overseas in M/s Lalji Enterprises and hence is also culpable under Section 132(1)(1) of CGST Act, 2017.

3.4 Further it has been submitted that the applicant has categorically admitted that fake and forged documents were being used by him actively to file fake returns and show evidence of fake supply of goods. The that proprietor didn’t turn up for cooperating in the evidence also gives credence to the fact that the firms were fake and all the supplies against which returns were filed were also fake.

3.5 The Proprietor on paper, i.e. Mr Sammy, was contacted and was requested to join investigations but inspite being only two kms away and in spite of repeated request he did not turn up. As such, investigations are still pending and various other persons involved in this fraud are yet to be examined. The offence committed falls under Section 132(1) (b) of CGST Act, 2017 and the same is non bailable and cognizable in terms of Section 132(5).

3.6 It has been further submitted that investigation in the matter is still under way and is likely to take some more time as many other evidences are to be gathered and documents are to be recovered and examined. Finally, the prayer for dismissal of bail application of accused has been dismissed.

(Arguments)

4. It has been argued by learned counsel for applicant Sh. Prashant Yadav, Advocate that no offence under Section 132 of CGST Act is made out against the applicant/accused Yogender. He maintained that Section 132 of CGST Act is applicable on a person who commits or causes to commit the offence under Section 132 of CGST Act and thereafter, retains the benefit arising out of those acts or omissions. But in this case the applicant is just an employee, in the capacity of Chartered Accountant. he was being paid his remuneration for the services rendered by him. The bare. purpose of Section 132 of CGST Act is to punish those who avoid paying GST and thereafter, retains its proceeds also. But it simply does not make a service rendered by some professional like Lawyer or Chartered Accountant punishable, if he does not retain the benefit of GST offences. He further argued that if this high headedness of CGST official is accepted and applicant Yogender Singh is allowed to languish in jail then that would amount to mis-use of process of law and would render miscarriage of justice as Yogender Singh has certain privileges attached to him being in a fiduciary relationship with his client who might have committed this offence but the applicant being a Chartered Accountant in no way is connected and associated with the crime allegedly perpetrated by his employer. So, the provision under Section 132 of CGST Act cannot be said to be applicable against him. He has prayed that applicant be granted concession of bail.

5. On the other hand, it has been argued by learned counsel for complainant that investigation in this case is still under way and the accused has played an active role in commission of crime under Section 132 of CGST Act and he should not be released on bail in this case. He has relied upon case laws titled as Umesh Verma Vs. State”, Bail Application No. 3500/2021, decided on 26.10.2021 (Delhi High Court), “SFIO Vs. Nitin Johari & Anr” Crl. Appeal No. 1381/2019 dated 12.9.2019 (SC), “Ram Narain Popli Vs. CBI” AIR 2003 SCC 3257 (SC), “State of Gujrat Vs. Mohanlal Jitamalji Porwal” (AIR 1987 1321 (Telangana High Court), “Mohammed Yunus @ Mohamed Yunus Khan Vs. State of Rajasthan”, 2020 (34) G.S.T.L. 59 (Raj.), “Shailesh Rajpal Vs. Commissioner” 2020 (32) G.S.T.L. 336 (M.P.).

6. After hearing both the parties and gone through the case file very carefully, this court is of considered view that the present accused does not deserves to be released on bail. It is settled preposition of law that economic offences in itself are considered to be gravest offence against the society at large and hence are required to be treated differently in the matter of bail. It seems that the entire community would aggrieved if the economic offenders who ruin the economy of the State are not brought to book as such offences affects the very fabric of democratic governance and probity in public life. Further, if a murder committed in the heat of moment upon passing being aroused, the economic offence is supposed to be committed with cool calculation and deliberately with an eye on personal profit regardless of the consequence of the community. A disregard for the interest of the community can be manifested only at the cost of forfeiting the trust and faith of the community in the system to administer justice in an even handed manner without fear of criticism from the quarters which view white collar crimes with a permissive eye unmindful of the damage done to the national economy and national interest. Reliance in this regard can be taken from the “State of Gujarat Vs. Mohanlal Jitamalji Porwal” (1987) 2 SCC 364. Same view was taken by Hon’ble Supreme Court of India in case titled as “Ram Narain Popli Vs. CBI” AIR 2003 SCC 3257.

7. Besides this, this court is of considered view that if accused is released on bail then there are likely chances of him to jump bail.

Hence, without commenting on the merit of the case, the bail application moved by applicant Yogender Singh stands dismissed.

8. Needless to say that nothing hereinabove observed shall construed my opinion on the merit of the case.

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