Prabin Jha Vs Union of India (Gauhati High Court)
In the case of Prabin Jha vs. Union of India, the Gauhati High Court granted bail to an individual arrested for allegedly issuing fake invoices and passing ineligible Input Tax Credit (ITC) of approximately ₹30.89 crore under the Central Goods and Services Tax (CGST) Act, 2017. The court’s decision was based on several procedural non-compliances by the GST authorities, highlighting the need for strict adherence to legal safeguards, even in economic offenses.
The petitioner’s counsel argued that the arrest was made on a mere suspicion and in a mechanical manner, without proper investigation. A significant point raised was that the CGST Act is not a complete legal code for search, seizure, and arrest, and therefore, the provisions of the Code of Criminal Procedure (Cr.P.C.) and the newly enacted Bharatiya Nagarik Suraksha Sanhita (BNSS), 2023 must also be followed. The petitioner’s counsel cited Supreme Court precedents, including the Radhika Agarwal vs. Union of India case, which affirmed that Cr.P.C. provisions apply to GST arrests unless specifically excluded. The petitioner also highlighted the authorities’ failure to issue a notice under Section 41A of the Cr.P.C., a mandatory procedure for offenses punishable with a maximum of up to seven years in prison, as stipulated in the landmark Arnesh Kumar vs. State of Bihar judgment.
