Lakshya Agarwal S/O Shri Krishna ... vs Dggi Jaipur Zonal Unit
2022 Latest Caselaw 2069 Raj/2

        HIGH COURT OF JUDICATURE FOR RAJASTHAN
                    BENCH AT JAIPUR

     S.B. Criminal Miscellaneous Bail Application No. 20392/2021

Lakshya Agarwal S/o Shri Krishna Kumar Agarwal, Aged About
25 Years, R/o 5- Indra Nagar Bhord Bulandshahar At Present R/o
Flat No. 504, Golf City Plot No. 8 Sector 75 Noida U.p ( Accused
Is In Central Jail, Jaipur)
                                                                            ----Petitioner
                                        Versus
1.       Dggi Jaipur Zonal Unit, Jaipur ( Union Of India)
2.       State Of Rajasthan, Through P.p.
                                                                      ----Respondents

For Petitioner(s) : Mr.Sandeep Singh Hora with Mr.Daksh Pareek & Mr.Arjun Singh For Respondent(s) : Mr.Kinshuk Jain

HON'BLE MR. JUSTICE FARJAND ALI

Judgment / Order

08/03/2022

The instant criminal misc. bail application has been

submitted on behalf of the accused-petitioner Lakshya Agarwal,

who is in custody in connection with case no.

DGGI/INV/GST/2371/2021-Gr-B registered at DGGI for the

offences under Sections 132 (1)(b), (C )(h), (L) read with Section

(5) of CGST Act, 2017.

Briefly stated the facts of the case are that the petitioner has

been arrested in the aforesaid matter on 19.11.2021 by

Intelligence Officer, Office of the Principal Commissioner, ADG,

Directorate General of GST Intelligence, Jaipur Zonal Unit, Jaipur

in exercise of powers under Section 69 of the CGST Act, 2017. The

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petitioner has been sent to judicial custody vide order dated

20.11.2021 under the order passed by the learned Chief

Metropolitan Magistrate, (Economic Offences), Jaipur. Since his

regular bail application filed under Section 439 CrPC has been

dismissed by the learned Addl. Sessions Judge No.9, Jaipur, he

preferred this bail application before this court.

Mr.S.S.Hora, learned counsel for the petitioner submits that

entity of the accused petitioner is located at Metal Rod Enterprises

which is registered under GST Act as per rules and which is

working regularly after getting registered in June 2021. It is

submitted that no illegal act has ever been committed by the

petitioner. It is further submitted that all the goods were

purchased by the petitioner with the same entity for which GST

number was registered. Goods worth Rs. 22,29,62,924.00 were

purchased by the petitioner's entity from the registered entities.

The copper goods were purchased as per the rules by paying

requisite tax of Rs.4,01,33,326.28 while at the same time, the

GST entries were made according to the rules and only thereafter

the e-way bill was issued by the GST department for

transportation. Thus, he submits that GST has been paid by the

petitioner properly.

Arguing further, Mr.Hora submits that only after the payment

is made, the GST department issued the e-way bill and then only

the goods were transported. The prescribed form G.S.T.R.3B and

GSTR-1 were issued by the Tax Department. The forms and tax

were submitted to the department as per the prescribed time by

filling the GSTR-1 and on the basis of Form No.3B and R1

submitted by the buying entity to the department, the accused

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entity became entitled to get an input tax credit as per rules. As

per him, the petitioner's entity has made purchases from various

entities for a total of Rs.22,2962,924/- from June 2021 till date

and the petitioner has paid Rs.4,01,33,326.28 on the purchase @

18% to the supplier as per rules. It is submitted that the

department's contention regarding entities being fake is not

sustainable as the same has been made in accordance with the

rules. It is submitted that the department has distorted the facts

based on false and fabricated grounds because all the suppliers

are duly registered under GST Act and GST number had been

issued by the GST Department after verifying all the KYC and

other necessary documents required as per GST Act for

registration.

Arguing further, learned counsel submits that the matter

pertains to Economic Offences, serious questions regarding the

truthfulness/genuineness of the allegations have been raised for

which it is alleged that the petitioner has made

evasions/defalcation. The maximum punishment which could be

inflicted upon the accused if after trial he would be convicted;

would be five years of imprisonment with fine. The enquiry/trial of

the matter is likely to take long time and no useful purpose would

be served by keeping the petitioner behind the bars till disposal of

the case.

Per contra, learned counsel appearing for the GST

Department has vehemently opposed the bail plea made by the

counsel for the petitioner by submitting that there are serious

allegations in respect of commission of offence under the Penal

provisions of GST Act. As per him, fake invoices of Rs.72.0 crores

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are alleged to be made by the accused, therefore, he should be

kept behind the bars. The counsel also supplied some orders of

the Coordinate Bench wherein the bail plea of different accused

related to the GST matters were rejected in other cases.

Heard learned counsel for the petitioner, learned counsel

appearing for the GST Department, perused the order impugned,

and other material made available on record.

It is well-nigh settled that the provisions of bail are neither

punitive nor preventive in nature. The gravity of the offence and

the severity of punishment alone is not a factor to be considered

while adjudicating the bail plea. There are several other aspects

which are required to be considered simultaneously with the

gravity of nature i.e. if there is any apprehension that if the

accused will be released on bail, he would hamper the prosecution

evidence or would flee from justice or would not be readily

available for the trial or otherwise hamper the course of smooth

trial. Neither any apprehension has been shown by the counsel for

the respondent nor any material has been made available from

which an inference can be drawn regarding the aforesaid

apprehension. The seriousness of the allegations or the availability

of the material in respect thereof are not the only considerations

for declining the bail. The case in which the petitioner is seeking

bail is exclusively triable by the court of Magistrate. The case

pertains to economic offence. The duped amount or tax evasion is

fixed and calculated. The same is not directly affecting the

individuals of society. The alleged amount can be recovered by

initiating suitable proceeding. There is no fetter of law if criminal

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prosecution and recovery proceeding are allowed to run

simultaneously, since criminal proceeding is being launched to

punish the culprit suitably and civil proceedings are to levy or

recover the loss incurred. As per Section 137 of the Act, the

company and every person responsible for the business and

conduct of the company are vicariously liable. Company/Firm has

not been made accused in this case. Calculated amount with

interest are recoverable from the company/firm. Every case has a

distinct feature; bail is a matter of discretion, ofcourse the same

should be exercised judicially. The bail orders submitted by

counsel for the respondent are not applicable on the peculiar facts

of this case. It could be presumed that the trial is not likely to be

concluded within the reasonable time. If after trial, on the basis of

evidence adduced on record, the offence would be found proved

and the accused will be convicted still thereafter he will be given

an opportunity to be heard on the point of sentence since it is

mandatory. While hearing on the point of sentence, the trial judge

may take into consideration the other aspects which are not

related to the facts of the case such as physical and mental

condition of the accused, his social background, economic

condition of his family, his ailment, age, dependency of other

person upon him and his criminal antecedents besides the other. It

is only after considering the submissions on point of sentence, the

trial Judge would then pass an order to sentence the accused

suitably. The provisions of Section 360 and 361 of the CrPC as

well as provisions contained in Secs. 3 & 4 of the Probation of

Offenders Act could also be taken resort of by convicting Judge. At

this primary stage, it cannot be assumed that the petitioner would

surely be convicted and would be sentenced for the maximum

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period of sentence provided by the law since the same would be

pre-mature. It is well settled that the pre-conviction detention is

not warranted by law. The petitioner is behind the bars in this

matter since 19.11.2021. It is also well settled that at pre-

conviction stage, there is presumption of innocence. The object of

keeping the person in custody is to ensure his availability to face

the trial and to receive the sentence that may be passed. The

detention is not supposed to be punitive or preventive; thus this

court is of the considered view that since the accused is

languishing in judicial custody, his further incarceration would not

serve any fruitful purpose. Thus, this court deems it appropriate to

enlarge the petitioner on bail.

Accordingly, the bail application under Section 439 Cr.P.C. is

allowed and it is ordered that the accused-petitioner Lakshya

Agarwal S/o Krishna Kumar Agarwal shall be enlarged on bail

provided he furnishes a personal bond in the sum of Rs.50,000/-

with two sureties of Rs.25,000/- each to the satisfaction of the

learned trial Judge for his appearance before the court concerned

on all the dates of hearing as and when called upon to do so.

(FARJAND ALI),J

SANDEEP RAWAT /205

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