The Bombay High Court refused Anticipatory Bail to a person accused of wrongfully Claiming Input Tax Credit (ITC) without giving payment to the supplier.
The Complainant, Mahendra R. Parmar is the owner of M/s. Esjaypee Mercantile Global Pvt. Ltd. This company does the trading in dry fruits and spices on, wholesale basis in the Agricultural Produce Market Committee. One Sarfaraz Jaliyawala (co-accused), a broker in Agricultural Produce was known to the informant – Mahendra M. Parmar. In March 2020, co-accused Sarfaraz introduced Mahendra to the Applicant and informed him that Applicant requires a large number of cloves. The applicant is also a trader in spices under the name and style of M/s. Bansal Traders. The complainant agreed to supply cloves to the Applicant. At the relevant time, Complainant’s goods (cloves) were stocked at All India Storage and Warehousing situated at Navi Mumbai. The complainant sent an e-mail to Cold Storage and Warehousing and asked Warehouse Manager to transfer 100 bags of cloves worth Rs.22,90,842/- to the Applicant’s firm. Yet by another email Warehousing Manager was asked to transfer 200 bags of cloves worth Rs.51,30,777/- to the Applicant’s firm. After which, the Cold Storage and Warehousing Services Provider transferred 300 bags of cloves to the Applicant’s firm- namely M/s. Bansal Traders. On 4th March 2020, 150 bags of cloves were delivered at the godown of Sarfaraz (co-accused) at Spice Market Premises. The second lot of 150 bags of cloves were delivered on 5th March 2020 to Sarfaraz at his godown.
The applicant has argued that it had claimed Input Tax Credit nor there is another material on record to even suggest that 300 clove bags were delivered to Sarfaraz at the instance of Applicant. Mr. Kadam argued that the godown of Sarfaraz is situated within the limits of the Market Committee but corresponding details of entry of trucks in the market yard on the alleged date of delivery of cloves were not found. Mr. Kadam y relied on extract produced by the Market Committee to contend that two trucks had not entered the Market Yard on the alleged date of delivery of cloves to Sarfaraz. Mr. Kadam argues that CGST Authority has certified that Applicant has not claimed Input Tax Credit against Invoices and, therefore, it is contended that Applicant has been implicated in the false case.
It has been argued that Applicant is a reputed businessman and his presence for the Investigation can be secure by imposing suitable conditions. Mr. Kadam, therefore, seeks pre-arrest bail on these grounds.
The single-judge bench of Justice Sandeep K. Shinde held that evidence collected in the course of the investigation, prima facie, shows Complainant delivered the goods to Sarfaraz at the instance of the Applicant and after delivery, he denied Complainant’s claim and refused to pay him. Facts of the case constitute an offense of cheating and, therefore, application deserves no consideration.
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