The Chhattisgarh High Court rejected the bail applicantion to a person alleged of making forged firms to avail illegal benefits of Input Tax Credit.
Based on GST Intelligence report, a non-applicant started investigation, during course of investigation it revealed that M/s Manoj Enterprises, Raipur had never made any kind of purchase from any entity, it is non-existent firm at the registered address. It further revealed that applicants have formed forged firms in Chhattisgarh, Jharkhand, Madhya Pradesh, West Bengal and Maharashtra; availed illegal benefits of input tax credits and thereby caused loss of Rs.258 Crore approximately to the government ex-chequer during financial years 2018-19, 2019- 20 & 2020-21. Applicants were arrested by the non-applicant Department on 25.1.2021. After part investigation, complaint case was filed before the Court of Magistrate on 25.3.2021. Application for grant of bail filed by applicants before the Court below came to be rejected vide order dated 13.8.2021.
Mr. B.P. Sharma, counsel for applicants, Paritosh Kumar Siingh would submit that applicants have created firms for which registration is not mandatory. Allegation of non-applicant based on statements of some persons alleged to have been recorded during investigation that firms created by applicants are not in existence, in itself is not sufficient to hold that firms created by applicants are non-existent. Before filing of complaint or concluding investigation, applicants were illegally arrested on 25.1.2021. Non-applicant instead of filing a charge sheet, submitted a complaint under Section 200 CrPC which clearly indicates that the procedure adopted by the non-applicant Department is clear abuse of process of Court and abuse of process of law.
The single bench of Justice Parth Prateem Sahu held that offence committed under Section 132 (1) of the Act of 2017 is made compoundable under Section 138 of the Act of 2017, subject to deposit of amount assessed. Present is not the case where applicants being businessmen in the course of their business inadvertently committed any offence as defined under Section 132 (1) (b) (c) of the Act of 2017. From the documents collected by the non-applicant Department during investigation and the contents of complaint filed by non-applicant, it is apparent that applicants with intention to commit economic crime, created fictitious firms in a planned manner.
“Hence, I do not find present to be a fit case where applicants should be enlarged on regular bail, more so when it is the stand of non- non-applicant Department that investigation is in furtherance at different zones of the Department,” the court said.
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