Bail Appln./2381/2021
2021 Latest Caselaw 2286 Gua

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GAHC010150052021




                           THE GAUHATI HIGH COURT
  (HIGH COURT OF ASSAM, NAGALAND, MIZORAM AND ARUNACHAL PRADESH)

                    Bail Application No. 2381 Of 2021


          Shri Vikas Bansal,
          Aged 35 years,
          Son of Janak Raj Bansal,
          Proprietor of M/s Bansal Associates,
          Resident of H. No. 55,
          Kabra Bhawan,
          Near Phool Bagan,
          Machkhowa, Guwahati-781001


                                                 ----- Petitioner/Accused

                   -VERSUS-
          The Union of India,
          Central Goods and Service Tax Department,
          Represented by Standing Counsel, G.S.T.


                                                 ----- Respondent


                           BEFORE
             Hon'ble Mr. Justice Hitesh Kumar Sarma


          Advocates for the Petitioner     :: Mr. D. Sahu, Advocate,
                                              Mr. S.K. Singh, Advocate,
                                              Mr. V.K. Chopra, Advocate,
                                              Mr. S. Patowary, Advocate.
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             Advocate for Respondent     :: Mr. S.C. Keyal, Senior Standing
                                            Counsel, CGST

             Date of hearing             :: 21.09.2021.

             Date of Order               :: 23rd September, 2021.



                                       ORDER (cav)

This is an application, filed under Section 439 of the Cr.PC. seeking

bail of the accused-petitioner, namely, Sri Vikas Bansal, in connection with

GST Case No. CGST/DGGI/INV/GST/2337/2021 for contravention of

Sections 132(1)(b)/132(1)(c)/132(1)(f), punishable under Section

132(1)(i) of the Central Goods and Services Act, 2017 (hereinafter referred to

as "CGST Act").

[2] Heard Mr. D Sahu, learned counsel for the petitioner. Also heard

Mr. SC Keyal, learned Senior Standing Counsel, CGST for the respondent.

[3] It has come out from the facts of this case that one Amit Kumar,

proprietor of Maruti Traders having GSTIN-18AKGPK7676Q1Z4, and his

accomplice Sri Sourav Bajoria, proprietor of M/s Bajoria Associates, Swaroopa

Bhawan, Ground Floor, Near AG Bus Stop, Guwahati were arrested by the

competent authority under the CGST Act in connection with GST Case No.

CGST/DGGI/GST/1928/2021, under Section 132(5) of Central Goods and Service

Act, 2017.

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[4] During the investigation of the said GST Case No.

CGST/DGGI/GST/1928/2021, the authorities under the CGST Act had requested

the DGGI, Ludhiana Zonal Unit, to carry out follow up searches at the premises

of one of the suppliers to M/s Maruti Traders, namely, M/s Bansal Associates

(Legal Name-Vikas Bansal) having GST:03CEPPB5183L1ZA, shop No. 80, 81

cabin No. 18, 3rd floor, Deepak Complex, Gill Road, New Grain Market, Ludhiana,

Punjab-141003. Accordingly, search was conducted by the officers of DGGI,

Ludhiana Zonal Unit, on 14.07.2021 and no record of business transactions was

found at the declared premise. Later on, statement of Vikas Bansal (accused

petitioner), proprietor of M/s Bansal Associates was recorded in Ludhiana and

he stated that all his documents regarding his business transaction are kept in

his Guwahati office. The officers of DGGI Ludhiana Zonal Unit also seized his

mobile phone on 14.07.2021 and forwarded the same vide letter F. No.

IV(6)LdZU/INV/Maruti/75/2021-22, dated 19.07.2021 in sealed condition along

with the statement of the present petitioner and Panchnama drawn during

search along with other relevant documents.

[5] Thereafter summon was issued to the accused-petitioner

under CBIC-DIN-202108DEE00C3CEC, dated 17.08.2021 under Section 70 of the

CGST Act, and directed him to appear before the Senior Intelligence Officer on

23.08.2021. Accordingly, the accused-petitioner appeared before them on the Page No.# 4/15

said date and the mobile phone forwarded by DGGI, Ludhiana Zonal Unit,

belonging to the accused-petitioner, was opened and verified in his presence

and in presence of two independent witnesses under Panchnama, dated

23.08.2021. The said mobile phone contained large amounts of incriminating

documents and print-out records/documents of documents folder of the mobile

handset totalling to 537 pages were taken in the presence of the accused-

petitioner and Panchas. These records have also been signed and verified by the

accused-petitioner being the owner of the mobile handset. The statement of the

accused-petitioner was recorded on 23.08.2021 under Section 70 of CGST Act.

[6] It also appears from the complaint that Amit Kumar, the

accused in GST Case No. CGST/DGGI/GST/1928/2021, had stated before the

Senior Intelligence Officer of the CGST that M/s Bansal Associates, Punjab and

M/s Bansal Associates, Haryana did not supply coal to him and he had only

received fake bills issued from the said units of M/s Bansal Associates and such

statements of said Amit Kumar have been subscribed by the present petitioner

in his statement, recorded under Section 70 of the CGST Act.

[7] I have perused the petition and the annexures furnished

therewith. The learned Senior Standing Counsel, CGST, Mr. Keyal has submitted

that he is ready with the records of the case and has also produced the same in

the Court.

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[8] On perusal of the entire materials on record, it is found that in

his statement, recorded under Section 70 of the CGST Act, the petitioner has

subscribed to the statement of aforesaid Amit Kumar made before the Senior

Intelligence Officer of the CGST. It has also come out from his statement that

whatever coal he had purchased from Coal Importers of Gujarat and Punjab

were sold within the State of Punjab and Haryana to various small

manufacturers without issuing GST invoices and such transactions were not

reflected in the books of accounts although a part of such sale of coal in Punjab

and Haryana was done under proper GST. The purchase documents covering

the goods supplied/sold in Punjab and Haryana without issuance of GST invoices

were used for generating fake GST invoices issued in the name of M/s Bansal

Associates, Guwahati and to various other customers directly which includes Sri

Amit Kumar also without supply of any goods covered under such invoices.

[9] It has also come out from the materials on record that the

State GST, Assam conducted a raid at the declared business premises of M/s

Bansal Associates in Guwahati on 19.08.2021 and seized all documents,

including computers, mobile, etc. He had also informed the State GST, Assam

that his firm M/s Bansal Associates is already under investigation by DGGI,

Guwahati Zonal Unit. The CGST authority, on verification of the materials

collected against the petitioner during the course of investigation, found that the Page No.# 6/15

petitioner had evaded GST of Rs. 15,05,99,941/-. The 2151 e-way bills issued

were also found to be bogus and the vehicles declared in those e-way bills

involving tax of Rs. 7 crores had never carried any goods from

Gujarat/Haryana/Ludhiana to Guwahati as claimed.

[10] It has further come out from the materials so far collected that

the petitioner had made statement under Section 70 of the CGST Act admitting

the allegations made against him in the instant case. On perusal of the

statement so recorded under Section 70 of the CGST Act, it appears that the

petitioner has made incriminating statement while answering the questions put

to him. The answers indicate that he has co-operated with the investigation of

the case.

[11] It has also come out from the materials on record as well as

from the statement made by the accused-petitioner in the instant petition by the

petitioner that he had appeared before the CGST authority in compliance to the

summon. He did not evade the appearance before the CGST authority. After his

appearance, however, the CGST authority arrested him.

[12] Mr. Sahu, learned counsel for the accused-petitioner has

submitted that the petitioner has been fully co-operating with the investigation

of the case and no further custody of the petitioner has been sought for by the

CGST authority for the purpose of further investigation of the case. It has Page No.# 7/15

further been submitted that the co-accused of this accused-petitioner have been

granted default bail by the learned court below in connected cases as the

complainant/CGST authority failed to complete the investigation and lay offence

report within the statutory period of 60 (sixty) days.

[13] This Court records that the learned Senior Standing Counsel,

CGST, Mr. Keyal has subscribed to the fact that co-accused persons have been

granted default bail by the learned court below.

[14] Mr. Sahu, learned counsel for the petitioner has also further

submitted that the statement given before the CGST authority by the accused-

petitioner under Section 70 of the CGST Act was extracted by the said authority

and it was not voluntary on the part of the accused-petitioner for which he has

filed an application before the learned Chief Judicial Magistrate, Kamrup

(Metro), Guwahati for retraction of his such statement. But, the fact remains

that the statement claimed to have been made by the accused-petitioner was

implicating himself. Section 70(1) and 70(2) of the CGST Act reads as follows:-

"70 (1) The proper officer under this Act shall have power to summon any person whose attendance he considers necessary either to give evidence or to produce a document or any other thing in any inquiry in the same manner, as provided in the case of a civil court under the provisions of the Code of Civil Procedure, 1908 (5 of 1908).

(2) Every such inquiry referred to in sub-section (1) shall be deemed to be a Page No.# 8/15

"judicial proceedings" within the meaning of section 193 and section 228 of the Indian Penal Code (45 of 1860)."

It appears from the provisions of Section 70(2) of the CGST Act

that the inquiry made under Section 70(1) of the said Act is deemed judicial

proceedings.

[15] That being so, the statement of the accused-petitioner was

recorded under Section 70 of the CGST Act and the retraction of the same

would definitely be considered by the appropriate court at appropriate stage. Be

that as it may, the position as of now is that the petitioner not only made

statement under Section 70 of the CGST Act but he made implicating statement.

It also appears from such statement that he has co-operated with the

investigation and there is no allegation that he has not co-operated with the

investigation of the case.

[16] The learned counsel for the petitioner has referred to a decision

of the Hon'ble Supreme Court of India in the case of Jagan Mohan Reddy vs.

Central Bureau of Investigation, reported in (2013) 7 SCC 439 and

particularly paras 34 and 35 thereof, which are quoted below:

"34. Economic offences constitute a class apart and need to be visited with a different approach in the matter of bail. The economic offences having deep- rooted conspiracies and involving huge loss of public funds need to be viewed seriously and considered as grave offences affecting the economy of the Page No.# 9/15

country as a whole and thereby posing serious threat to the financial health of the country."

"35. While granting bail, the court has to keep in mind the nature of accusations, the nature of evidence in support thereof, the severity of the punishment which conviction will entail, the character of the accused, circumstances which are peculiar to the accused, reasonable possibility of securing the presence of the accused at the trial, reasonable apprehension of the witnesses being tampered with, the larger interests of the public/State and other similar considerations."

[17] This Court has also taken into consideration the decision rendered

by the Hon'ble Supreme Court of India in the case of P. Chidambaram vs.

Directorate of Enforcement, reported in (2020) 13 SCC 791 and

particularly para 16 thereof. The said para is quoted below for convenience of

consideration of the parameters laid down therein at a later stage of this order:-

"16. Though we have heard the matter elaborately and also have narrated the contention of both sides in great detail including those which were urged on the merits of the matter we are conscious of the fact that in the instant appeal the consideration is limited to the aspect of regular bail sought by the appellant under Section 439 of the Cr.PC. While stating so, in order to put the matter in perspective it would be appropriate to take note of the observation made by us in the case of this very P. Chidambaram v. CBI, Criminal Appeal No. 1603 of 2019 which reads as hereunder:

"21. The jurisdiction to grant bail has to be exercised on the basis of Page No.# 10/15

the well-settled principles having regard to the facts and circumstances of each case. The following factors are to be taken into consideration while considering an application for bail:

(i) the nature of accusation and the severity of the punishment in the case of conviction and the nature of the materials relied upon by the prosecution;

(ii) reasonable apprehension of tampering with the witnesses or apprehension of threat to the complainant or the witnesses;

(iii) reasonable possibility of securing the presence of the accused at the time of trial or the likelihood of his abscondence;

(iv) character, behaviour and standing of the accused and the circumstances which are peculiar to the accused;

(v) larger interest of the public or the State and similar other considerations.

"22. There is no hard-and-fast rule regarding grant or refused to grant bail. Each case has to be considered on the facts and circumstances of each case and on its own merits. The discretion of the court has to be exercised judiciously and not in an arbitrary manner."

[18] This Court has also taken note of the submission that no leniency

be shown to the accused-petitioner while considering the prayer the offences

being economic in nature. This Court has also considered the decision rendered

by the Hon'ble Supreme Court of India in the case of Nimmagadda Prasad Page No.# 11/15

vs. Central Bureau of Investigation, reported in (2013) 7 SCC 466, and

particularly paras 23, 24 and 25 thereof. The said paras are quoted herein below

for convenience of consideration:

"23. Unfortunately, in the last few years, the country has been seeing an alarming rise in white-collar crimes, which has affected the fibre of the country's economic structure. Incontrovertibly, economic offences have serious repercussions on the development of the country as a whole. In State of Gujarat vs. Mohanlal Jitamalji Porwal and Anr. (1987) 2 SCC 364 this Court, while considering a request of the prosecution for adducing additional evidence, inter alia, observed as under:-

"5.....The entire community is aggrieved if the economic offenders who ruin the economy of the State are not brought to book. A murder may be committed in the heat of moment upon passions being aroused. An economic offence is committed with cool calculation and deliberate design with an eye on personal profit regardless of the consequence to the community. A disregard for the interest of the community can be manifested only at the cost of forfeiting the trust and faith of the community in the system to administer justice in an even-handed manner without fear of criticism from the quarters which view white-collar crimes with a permissive eye unmindful of the damage done to the national economy and national interest."

"24. While granting bail, the court has to keep in mind the nature of accusations, the nature of evidence in support thereof, the severity of the punishment which conviction will entail, the character of the accused, Page No.# 12/15

circumstances which are peculiar to the accused, reasonable possibility of securing the presence of the accused at the trial, reasonable apprehension of the witnesses being tampered with, the larger interests of the public/State and other similar considerations. It has also to be kept in mind that for the purpose of granting bail, the Legislature has used the words "reasonable grounds for believing" instead of "the evidence" which means the Court dealing with the grant of bail can only satisfy itself as to whether there is a genuine case against the accused and that the prosecution will be able to produce prima facie evidence in support of the charge. It is not expected, at this stage, to have the evidence establishing the guilt of the accused beyond reasonable doubt."

"25. Economic offences constitute a class apart and need to be visited with a different approach in the matter of bail. The economic offence having deep rooted conspiracies and involving huge loss of public funds needs to be viewed seriously and considered as a grave offence affecting the economy of the country as a whole and thereby posing serious threat to the financial health of the country."

[19] There is no dispute at the bar that the offence involved in this

case is compoundable. On perusal of the record, it is found that there is no

entry/note in the record after 06.09.2021, meaning thereby that no further

investigation is either carried out or recorded thereafter. In the meantime, the

accused-petitioner has been in custody for 30 (thirty) days, as on date.

[20] The decisions rendered by the Hon'ble Supreme Court of India,

referred to above, on a cumulative reading, make it appear to this Court that Page No.# 13/15

the offence in the instant case being an economic offence should be looked into

from a different perspective although at the same time Court should not lose

sight of the fact in respect of the right of the petitioner to get bail and court has

to balance between both these aspects. At the same time, in the light of the

above judgments, rendered by the Hon'ble Supreme Court, this Court also

needs to look into the severity of the punishment. This Court also cannot lose

sight of the fact that the petitioner has already been in custody for 30 (thirty)

days till date and that there is no instance in the record to indicate that further

custodial detention of the petitioner is essential for the purpose of further

investigation of the case.

[21] In the instant case, taking into account the alleged amount of

evasion of tax, the case falls under Section 132(1)(i) of the AGST Act and the

punishment prescribed for such an offence may extend to imprisonment for 5

(five) years and with fine.

[22] As per the materials on record, there is no indication that the

petitioner, if granted bail, is likely to evade the trial or there is an apprehension

of his tampering with the witnesses. On the other hand, this Court has also

taken note of the fact that he being a resident of the State of Assam, there is

every possibility of securing his presence at the time of trial. The maximum

punishment which can be imposed in this case is imprisonment for 5 (five) years Page No.# 14/15

and fine, and as such, the severity of punishment which conviction will entail

has also been taken into consideration, as mandated by Jagan Mohan Reddy

(supra).

[23] In view of the discussions above, in the considered view of this

Court, the accused-petitioner deserves to be granted bail.

[24] Accordingly, the accused-petitioner, named above, be released

on bail in connection with the abovementioned case on furnishing bail bond of

Rs. 1,00,000/- (one lakh) with two suitable sureties of the like amount, to the

satisfaction of the learned Chief Judicial Magistrate, Kamrup (Metro), Guwahati.

The direction for bail is further subject to the conditions that the

accused-petitioner:

(a) shall not leave the territorial jurisdiction of the learned Chief Judicial

Magistrate, Kamrup (Metro), Guwahati, without prior written permission

from him; who, in the event of granting permission to leave the

jurisdiction, shall pass a detailed reasoned order for his decision;

(b) shall deposit his Passport/visa, etc if any, in the court of the Chief

Judicial Magistrate, Kamrup (Metro), Guwahati;

(c) shall not hamper in the investigation or tamper with the evidence of Page No.# 15/15

the case;

(d) shall not, directly or indirectly, make any inducement, threat or

promise to any person acquainted with the facts of the case so as to

dissuade him from disclosing such facts to the Court or to any police

officer; and

(e) shall not contact, in any form any of the witnesses of this case.

[25] The learned Chief Judicial Magistrate, Kamrup (Metro), Guwahati

while releasing the petitioner on bail, shall be at liberty to put any other

appropriate condition(s) in addition to the conditions above, imposed by this

Court.

[26]               The petition stands disposed of accordingly.




                                                             JUDGE



Comparing Assistant