Santosh Wadhwani Vs Directorate General of Goods And Service Tax (Chhattisgarh High Court)
The applicant filed a bail application under Section 483 of the Bharatiya Nagarik Suraksha Sanhita in connection with an alleged offence under Section 132(1)(c) of the CGST Act, 2017. The prosecution alleged that the applicant fraudulently availed Input Tax Credit (ITC) amounting to ₹11.44 crore through fake invoices without actual supply of goods, involving multiple non-existent firms. It was further alleged that the applicant controlled the transactions and was the ultimate beneficiary of the scheme.
The applicant contended that he was falsely implicated, that no final tax liability had been determined through assessment proceedings, and that the case was based entirely on documentary evidence already provided. He argued that procedural safeguards were not followed, including proper specification of grounds of arrest, and that custodial interrogation was unnecessary as investigation was complete and complaint had been filed. It was also submitted that offences under the CGST Act are compoundable and carry a maximum punishment of five years.
The prosecution opposed bail, stating that the applicant orchestrated a large-scale economic offence causing significant loss to the exchequer. It relied on GST records, banking transactions, and statements indicating that the transactions were fictitious and involved no actual movement of goods. The prosecution also alleged non-cooperation by the applicant and stated that further investigation was ongoing.
