Rs. 8 Crores GST- ITC Scam: Andhra Pradesh HC Dismisses Revision Petition Seeking Police Custody for TDP Leader's Son [Read Order]

The Andhra Pradesh High Court inclined to interfere with the Order passed by the Magistrate denying the police custody of the son of TDP leader on Rs. 8 crores Goods and Services Tax ( GST ) - Input Tax Credit ( ITC ) scam.

The Petitioner, State of Andhra Pradesh filed a criminal revision petition  under Sections 397 and 401 of the Criminal Procedure Code, seeking to annul an Order dated 06.03.2024. The petition challenged the decision made by the 1st Additional Chief Metropolitan Magistrate, regarding the grant of police custody to the accused in Rs. 8 Crores GST-ITC scam.

The prosecutor enlisted the alleged fraudulent activities, including the creation of shell companies, submission of forged documents, and diversion of government funds.

The petitioner, represented by Y.L. Shivakalpana Reddy, Standing Counsel-cum-Special Public Prosecutor, argued for the necessity of police custody for further interrogation of the accused, who was allegedly involved in fraudulent practices resulting in substantial financial losses to the state exchequer. The accusations ranged from conspiracy and forgery to the diversion of funds earmarked for developmental projects in Amaravati.

However, the Magistrate, after considering the arguments from both sides, rejected the petition for police custody. The decision was based on the assertion that the Central GST Department had already completed its investigation and that the grounds presented in the petition were insufficient to warrant police custody.

The state/petitioner, dissatisfied with the decision, filed the revision petition, submitting the severity of the offence and the need for a thorough investigation. The prosecution stressed the financial nature of the offence and also highlighted the necessity of custodial interrogation to disclose hidden facts.

Conversely, the defence, represented by B. Adinarayana Rao, contended that the allegations lacked substance and that the investigation conducted by the Directorate General of Goods and Services Tax Intelligence (DGGI) had already addressed many aspects of the case. The defence argued against the necessity of police custody, highlighting procedural and contractual aspects.

Considering both sides, the bench of Justice T. Mallikarjuna Rao found no illegality in the Magistrate's decision and upheld the dismissal of the petition for police custody.

The High Court added that “Having not disputed the detailed report of the committee, it is now somewhat difficult to appreciate the contention of the Petitioner/Complainant that the diversion of Government funds by Avexa through the shell companies has to be investigated.”

To Read the full text of the Order CLICK HERE

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