Karnataka HC grants Anticipatory Bail to Person alleged of Wrongful Availment of ITC [Read Order]

ITC - Wrongful Availment - Bail - Taxscan

The High Court of Karnataka granted the anticipatory bail to the petitioner alleged to have involved in fraudulent availment of Input Tax Credit (ITC) on the basis of invoices without actual supply of goods in contravention of Section 16 of the CGST Act and caused loss to the exchequer for Rs.9.05 crore approximately.

The petitioner, Hanumanthappa Pathrera Lakshmana filed the petition under Section 438 of the Code of Criminal Procedure, 1973 for granting anticipatory bail. The petitioner is the proprietor of M/s. Sri Om Traders, registered dealer under the provisions of the CGST Act and the SGST at Shivamogga, dealing in both ferrous and non-ferrous scrap. During his regular course of business, he has purchased goods from various registered and unregistered dealers and issued tax invoices as per law. He has collected the taxes and remitted to the Government as per the CGST and the SGST Act.

The respondent has issued a summon to appear before an Officer and prior to that on the same day, the respondent has conducted an inspection of the business premises and drawn a mahazar. Another notice issued by the respondent to appear before K. Venumadhava Reddy. The petitioner is ready to appear before the respondent and co-operate with the investigation. However, the respondent has already collected all the documents and completed their investigation and the petitioner has apprehended his arrest in the hands of the respondent for the offense punishable under Section 132(5) of the CGST Act.

The single-judge bench of Justice K. Natarajan granted the anticipatory bail to the petitioner alleged to have involved in fraudulent availment of Input Tax Credit (ITC) on the basis of invoices without actual supply of goods in contravention of Section 16 of the CGST Act and caused loss to the exchequer for Rs.9.05 crore approximately.

The court further imposed the conditions on the petitioner that he shall execution of a personal bond,  appear before the Authorized Officer within one week, not tamper with the prosecution evidence or any document directly or indirectly, the petitioner shall cooperate during the course of enquiry and petitioner shall not indulge in any similar offense.

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