Chhattisgarh HC grants Bail to person accused of Wrongfully availing ITC without Actual Supply of Goods [Read Order]

The Chhattisgarh High Court has granted bail to a person accused of Wrongfully availing Input Tax Credit (ITC) without actual supply of goods.

During search and investigation at the premises of M/s J.R. Traders, Proprietor of which is Shri Vipin Tanna, non-applicant found that said firm is being managed and controlled by applicant Rohan Tanna as authorized signatory. Similarly, another firm is created by applicant Rohan Tanna in the name of M/s Abhishek Marketing in which applicant Rohan Tanna is partner of 80%, whereas applicant Abhishek Pandey is also active and working partner of 20%. 

It also revealed that both applicants through fake input tax credit invoices, without actual supply of goods, facilitated recipients with fraudulent and irregular input tax credit affecting collection of GST. During search it also revealed that other firms, which are recipients of benefits based on fraudulent and irregular input tax credits, are M/s Mishra Trading Company, M/s Sun Imperia, M/s Bhupen Traders, M/s Shree Ji Traders, M/s Ishant Trading, M/s Aarsh Global. Names and identities of Proprietors of firms and their credentials have been used and further controlled said firms by getting them registered with the GST Department. 

Mr. Harshwardhan Parganiha, learned counsel for applicant Rohan Tanna submitted that proceedings initiated by non-applicant Department are not in accordance with law because without making assessment of amount of any fraudulent transaction of input tax credit, non- applicant entered into premises and office of M/s JR Traders, Raipur, Proprietor of which is father of applicant. It is also pointed out that as per case of the non-applicant itself, the applicant is not the Proprietor of M/s JR Traders, he has nothing to do with the business of his father. Applicant is engaged in doing a professional course, he is also doing part time accountancy work from which he is having some source of earning and it is that amount which is deposited in bank account of applicant. There is no transfer/deposit of any amount in his bank account through any alleged commercial dealing. Applicant is falsely implicated in aforementioned case. Allegation of creating false input tax credit invoices is absolutely false and baseless. Applicants produced necessary bills to substantiate purchases made on behalf of the firm. 

The single bench of Justice Parth Prateem Sahu directed that applicants shall be released on regular bail on their furnishing a personal bond in the sum of Rs.1,00,000/- with one surety in the like sum to satisfaction of trial Court concerned on the conditions that they shall appear before the trial Court concerned regularly on each & every date unless exempted from appearance; they shall not, in any manner, tamper with prosecution witnesses; and if applicants are found involved in similar offence in future, it will be open for the State to apply for cancellation of bail.

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