Gujarat HC Grants Bail in ₹63 Crore Fake GST ITC Case After Investigation Completed

Ramakant Pal Vs State of Gujarat & Anr. (Gujarat High Court)

Gujarat HC Grants Bail in Rs.63 Crore Fake GST ITC Case After Investigation Completed

The Gujarat High Court considered an application under Section 483 of the Bharatiya Nagrik Suraksha Sanhita, 2023 seeking regular bail in Complaint Case No. 173676 of 2026 dated 27.05.2026. The complaint was filed by the Senior Intelligent Officer, GST Intelligence, Ahmedabad Zonal Unit, against the directors of M/s. WLTPE (M/s. Yoke Payment India Private Limited) for alleged offences under Sections 32(1)(b), 31(c), 332(1)(i), and 332(5) of the Central Goods and Services Tax Act, 2017, read with Section 210 of the BNSS, 2023, and Sections 134 and 132(6) of the CGST Act, 2017.

According to the complaint, the applicant, a director of the company engaged in providing E-Top Up services, was alleged to have participated in a systematic fraud involving issuance of fake invoices without actual supply of E-Top Up services. The department alleged that fake invoices with a taxable value of Rs.351.19 crore were issued to 18 beneficiary companies, resulting in fraudulent input tax credit of Rs.63.21 crore. Searches were conducted, statements were recorded pursuant to summons, and it was alleged that the applicant organised a tax evasion scheme causing substantial loss to government revenue.

On behalf of the applicant, it was submitted that he had been in custody since April 2026, substantial cash, electronic gadgets, and the company’s e-ledger had already been seized, the investigation had concluded, the complaint had been filed, and further custody would serve no purpose. It was also submitted that early disposal of the case was unlikely.

The department opposed bail, contending that there was a prima facie case, that the alleged offence was an economic offence, that the applicant was the mastermind of the scheme, and that larger public interest required rejection of the application.

The High Court observed that the department had secured financial stakes during the investigation and seized the relevant computer gadgets and e-ledger. It noted that the applicant had remained in custody since April 2026, the prosecution case rested on documentary evidence, there was no likelihood of early disposal of the criminal case, and the maximum prescribed sentence for the alleged offences was five years. The Court held that there was no need for further detention and granted regular bail.

The applicant was directed to execute a personal bond of Rs.1,00,000 with one surety of the like amount and comply with conditions including not misusing liberty, not acting against the prosecution’s interests, surrendering his passport within one week, not leaving India without prior permission, furnishing and not changing his residential address without permission, and cooperating in the trial without seeking unnecessary adjournments. The Court clarified that its observations should not be treated as an opinion on the merits of the case.

FULL TEXT OF THE JUDGMENT/ORDER OF GUJARAT HIGH COURT

1. Heard learned Senior Counsel Mr.G.M. Joshi assisted by Mr.Samir Gogda, learned advocate, and learned Standing Council Mr.Tirth Nayak, and learned APP Mr.Pranav Dhagat for the respective parties.

2. Prayer in this application filed under Section 483 of the Bharatiya Nagrik Suraksha Sanhita, 2023 is for grant of regular bail to the applicant Raman Kantpal, arising out of complaint case no.173676 of 2026, dated 27.05.2026, titled as Senior Intelligent Officer, GST Intelligent, Ahmedabad Zonal Unit Vs. Bhavik Sahani, Director of M/s.WLTPE (M/s.Yoke Payment India Private Limited) and Shri Ramakant Pal, Director of the same company, filed under Section 32(1)(b) and Section 31(c) of the Central Goods and Services Tax, 2017, read with Section 332(1)(i) and Section 332(5) of the Central Goods and Services Tax, 2017 read with Section 210 of the BNSS, 2023, read with Section 134 and 132(6) of CGST Act, 2017.

3. Brief facts giving rise to file present application are as under:

3.1 The applicant is the Director of the M/s. WLTPE, having registered office at Delhi and company is engaged in providing E-Top up services for which, GST registration was provided under HSN.

3.2 It is alleged that the company and its Director were engaged in the systematic and well orchestrated fraud involving by issuance of fake invoices without any underline supply of e-top up services to pass on fraudulent input tax credit to 18 beneficiary companies.

3.3 Accordingly, after due approval of the competent authority, the searches were conducted and on summons, the statement of the applicant and others were recorded. It was revealed that the applicant and other Directors have fraudulently issued fake invoice for taxable value of Rs.351.19 crores (ITC Rs.63.21 crores) to 18 beneficiary companies without actual underline supply of e-top up services. It was further revealed that the applicant executed and organized systemic tax evasion scheme, causing substantial loss to the government revenue, whereby committed an offences under the provisions of the CGST Act 2017 and other offences as referred above.

4. Mr. G.M. Joshi, learned Senior Advocate has submitted that since April-2026, the applicant is in jail. The authority has seized the substantial cash amount along with the all the gadgets as well as the e-ledger and therefore, the investigation is over and complaint is filed and further custody would not serve any purpose and having regard to the contempt of punishment and remote possibility of early disposal of the case, the applicant may be enlarged on bail imposing appropriate conditions.

5. Opposing the prayer of the bail, learned Standing Council Mr.Tirth Nayak, reiterating the contents of the affidavit in reply, it is contended that there is a prima facie case for commission of the offence by the applicant herein and the offence being an economical offence and the applicant being a mastermind of the offence and considering the larger public interest, no case is made out for exercising judicial discretion and the application may be dismissed.

6. In the facts of the present case, during the investigation, the department was secured some financial stake and also have seized the computer gadgets and e-ledger of the company. Since April-2026, the applicant is in jail and there are no chances of early disposal of the criminal case filed by the department. The maximum sentence as provided in the alleged offence is five years. The case of department rests on the documentary evidence. There is no need for further detention of the applicant. In such circumstances, I am of the considered opinion that the applicant is entitled to be released on bail.

7. Hence, the bail application is allowed and the applicant is ordered to be released on regular bail in connection with the complaint case no.173676 of 2026, dated 27.05.2026 (File No.DGGI/INV/FUP/ 40/2026-Gr.A, pending before the Chief Judicial Magistrate, Ahmedabad, on executing a personal bond of Rs.1,00,000/- (Rupees One Lakh only), with one surety of the like amount to the satisfaction of the learned Trial Court and subject to the conditions that he shall:

8. The authorities shall release the applicant if he is not required in connection with the any other offence. If breach of any above condition is committed, the Court concerned shall take appropriate action or issue warrant against the applicant. The bail bond to be executed before the learned trial Court having jurisdiction to try the case. It will be open for the sessions judge concerned to delete, modify and/or relax any of the above conditions, in accordance with law. Nothing stated hereinabove, shall tantamount to the expression of any opinion on the merits of this case. Direct Service is permitted.