Baldeep Singh Sapra Vs State (Directorate General of GST Intelligence) (Supreme Court of India)
The case arose from allegations that the petitioner, a director of a company, fraudulently availed Input Tax Credit (ITC) through a chain of firms allegedly issuing invoices without actual movement of goods, causing a loss of approximately ₹30.21 crore to the State exchequer. The Directorate General of GST Intelligence (DGGI) conducted searches at the petitioner’s residence and business premises in May 2025 and subsequently arrested him under Sections 132(1)(b), 132(1)(c), 132(1)(i), and 135(5) of the CGST Act, 2017. The petitioner sought bail before the Punjab and Haryana High Court.
Before the High Court, the petitioner challenged the prosecution on several grounds, including alleged procedural irregularities during search and seizure, the claim that the searched premises did not belong to him, alleged non-service of grounds of arrest, detention exceeding 24 hours, absence of prior notice, completion of investigation, and the documentary nature of the evidence. The respondent opposed bail, alleging that the petitioner had created fake firms and used goods-less invoices to avail wrongful ITC, resulting in substantial loss to the revenue.
The High Court examined various Supreme Court decisions concerning bail in economic offences, including cases under the CGST Act. It noted that the offences were triable by a Judicial Magistrate, carried a maximum punishment of five years, the investigation had been completed, nothing remained to be recovered from the petitioner, and there was no material indicating that the petitioner would tamper with evidence, influence witnesses, or evade trial if released. The Court also observed that the trial was unlikely to conclude in the near future and that continued detention would not serve any useful purpose. Taking these factors cumulatively into account, the High Court granted bail. However, it imposed several conditions, including a requirement that the petitioner furnish a security bond equal to the amount claimed by the complainant as tax and penalty.
