The Supreme Court in its recent judgement has set aside an order imposing pre-deposit of bank guarantee as a condition for bail.
Makhijani Pushpak, the appellant was arrested based on the complaint filed by the Superintendent (Prevention) of Central GST and Central Excise, Vadodara, for the offences punishable under Sections 69, 132(1)(a) of the Central Goods and Services Act, 2017 (CGST).
The appellant made an application under Section 437 of the Code of Criminal Procedure, 1973 for seeking bail before the Court of Chief Judicial Magistrate, Vadodara. The bail was granted subject to the condition that the appellant submits a bank guarantee of an amount of Rs.3 crores, along with certain other conditions.
Aggrieved by the imposition of condition for deposit of bank guarantee, as a pre-deposit for bail, the appellant approached the High Court which came to be disposed of by the order dated 12.01.2023 whereby the High Court modified the condition of furnishing bank guarantee of an amount of Rs.3 crore by reducing it to Rs.1.5 crore.
It was observed that the pre-condition of deposit of an amount or furnishing a bank guarantee has been the subject matter of consideration in several cases, wherein the condition of the pre-deposit has been held to be bad.
In Subhash Chouhan Vs. Union of India[2023 TAXSCAN (SC) 111] andAnatbhai Ashokbhai Shah Vs. State of Gujarat &Ors, the Court has set aside orders passed by the High Court imposing a condition of deposit while granting bail to the appellants therein.
The Additional Solicitor General appearing for the Union of India/State in the case of Subhash Chouhan Vs. Union of India had admitted on record that such a condition cannot be imposed while granting bail.
The Supreme Court Bench comprising of Justice Krishna Murari and Justice Ahsanuddin Amanullah held that “pre-condition of furnishing bank guarantee imposed by the High Court is not liable to be sustained and is hereby set aside.”
The Apex Court also upheld the rest of the conditions imposed for the grant of bail by the Chief Judicial Magistrate which were upheld by the High Court and directed to release the applicant on bail.
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