'Organized Crime' and 'Gangster' Not the Same: Allahabad HC Grants Bail to GST Fraud Accused [Read Order]
Allahabad HC grants bail to GST fraud accused Vineeta, ruling that pending economic offenses alone don’t justify the invocation of the Gangster Act.
![Organized Crime and Gangster Not the Same: Allahabad HC Grants Bail to GST Fraud Accused [Read Order]](https://www.taxscan.in/wp-content/uploads/2025/04/GST-Fraud-_-Accused-TAXSCAN.jpg "Organized Crime and Gangster Not the Same: Allahabad HC Grants Bail to GST Fraud Accused [Read Order]")
In a recent ruling, the Allahabad High Court granted bail to an accused in a large-scale GST fraud case, while observing that ‘organized crime’ and ‘gangster’ charges require different thresholds for their application. The court held that merely having pending economic offense cases does not automatically justify invoking the U.P. Gangster and Anti-Social Activities (Prevention)...
In a recent ruling, the Allahabad High Court granted bail to an accused in a large-scale GST fraud case, while observing that ‘organized crime’ and ‘gangster’ charges require different thresholds for their application. The court held that merely having pending economic offense cases does not automatically justify invoking the U.P. Gangster and Anti-Social Activities (Prevention) Act, 1986.
Vineeta was booked under Section 2/3 of the Gangster Act in Case Crime No. 173 of 2024, based on three earlier FIRs where she was accused of participating in a syndicate that allegedly claimed fraudulent Input Tax Credit (ITC) worth over Rs. 26,452 crore through fake GST registrations.
Although Vineeta had already secured bail from the Supreme Court in the three predicate FIRs under Sections 420, 467, 468, 471, and 120-B IPC, she was later booked under the Gangster Act, citing these same offenses as the basis.
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The applicant’s counsel argued that the Gangster Act case was registered only to frustrate the relief granted by the Supreme Court and that the predicate offenses, which are still pending trial, did not involve violence, threat, or coercion, as typically required under gangsterism laws.
The applicant's counsel further argued that there was no recovery from her, no direct transactions linked to her, and no criminal antecedents apart from these cases. They relied on Supreme Court judgments, including Data Ram Singh v. State of U.P. and Satyendra Kumar Antil v. CBI, to support the argument for bail in cases where the trial is pending and charges are yet to be proven.
The State opposed the bail plea, arguing that the fraud was of a serious magnitude and amounted to organized crime. It argued that the Gangster Act was applicable even for economic offenses of such scale, regardless of the absence of violent conduct.
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A single bench led by Justice Ashutosh Srivastava observed that Vineeta had been granted bail in the underlying IPC cases and that those offenses, being triable by a Magistrate, did not meet the high threshold required for invoking the Gangster Act.
The court referred to a recent Supreme Court ruling in Jay Kishan & Others v. State of U.P., which clarified that pending cases alone, especially when not yet adjudicated, do not automatically warrant action under gangster laws unless the offenses clearly reflect the degree of threat, coercion, or disturbance to public order intended under the Act.
The court held that invoking the Gangster Act in this case, based solely on pending GST fraud allegations, was premature and not sufficiently justified at this stage. The court allowed Vineeta’s bail application with standard conditions
To Read the full text of the Order CLICK HERE
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