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GST: Rajasthan HC grants bail to persons accused of wrongful availment of ITC by creating fake firms [Read Order]

GST - Rajasthan High Court - grants bail - persons accused - wrongful availment - ITC - Fake firms - Taxscan

The Rajasthan High Court granted bail to the person accused of wrongful availment of Input Tax Credit (ITC) by creating fake firms.

The petitioners, Sandeep Goyal and Rajesh Arora filed the petitions under Section 439 of Code of Criminal Procedure, 1973 seeking regular bail for offences under Sections 132(1) (b) (c) (d) (f) (i) and (l) read with Section 132 (1) (i) (iv) and read with sub-section (5) of the Central Goods and Services Tax Act, 2017.

The respondent has opposed the petitions and has submitted that allegations levelled against the petitioners were serious in nature. After thorough investigation of the case it transpired that the accused had created 75 fake firms and had issued GST invoices of taxable value of Rs. 1163,13,39,281 involving GST of Rs. 102,18,27,034 without any physical movement of goods.

The single judge bench of Justice Sabina held that although in the present case allegations levelled against the petitioners are serious in nature but the fact remains that the petitioners are in custody for the last more than two years and admittedly maximum punishment to be imposed on the accused, if convicted, is five years. Complaint in the present case was filed in the year 2018, whereas, the investigation has been concluded in July, 2020.

Therefore, the court said that it would be just and expedient to order release of the petitioners on bail.

“Petitioners be admitted to bail subject to each of them furnishing bail bond in the sum of Rs. 10,00,000 with one surety in the like amount to the satisfaction of the Trial Court,” the court directed.

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