Superintendent (AE) Vs Virbhadrasinh Pratapsinh Chauhan & Anr. (Gujarat High Court)
Issue: Whether depositing ₹90 lakh in the electronic cash ledger, without debiting it through Form GST DRC-03, amounts to compliance with bail conditions requiring deposit with the government.
Background
The Superintendent (AE), Central GST & Central Excise, Gandhinagar, filed an application before the Gujarat High Court seeking cancellation of bail granted to respondent no. 1, Virbhadrasinh Pratapsinh Chauhan. The respondent was accused of financial irregularities and non-compliance with GST provisions, allegedly resulting in a loss to the government exchequer.
An FIR was lodged on 2 September 2024, following which the respondent was apprehended. During the bail proceedings, the coordinate bench of the High Court noted that the accused had already deposited ₹60 lakh and undertook to deposit another ₹90 lakh within seven days. Based on this assurance, bail was granted on 25 October 2024 with the express condition that ₹90 lakh must be deposited within the stipulated period.
The Superintendent later alleged that the accused failed to comply with this condition since the ₹90 lakh was merely credited to his company’s electronic cash ledger and not actually transferred to the government via Form GST DRC-03. The applicant contended that such a deposit remained under the control of the taxpayer and could be utilized or withdrawn, thereby failing to satisfy the bail condition.
