GST Facilitation Operator Diverts Client’s ₹1.29 Crore Entrusted to Clear GST Dues: Orissa HC denies Pre-arrest Bail [Read Order]

The Court has refused to grant pre-arrest bail to an operator of a GST (Goods and Services Tax) facilitation centre who is accused of diverting over ₹1.29 crore meant for payment towards the GST dues of a client firm.

The petitioner, Balidi @ Ballidi Chandra Sekhar had approached the Court seeking anticipatory bail in connection with G.R. Case No. 20 of 2025 pending before the learned S.D.J.M., Umerkote, arising out of Umerkote P.S. Case No. 09 of 2025, alleging offences under Sections 406, 420, 465, 468, 471, and 506 of the IPC read with Section 66(C) of the Information Technology Act.

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According to the prosecution, the petitioner, who was running a GST facilitation centre, allegedly misused his privileged access by diverting funds entrusted to him for clearing the informant’s statutory GST liabilities, instead transferring the amount to his own account as well as to the account of his mother.

While the petitioner’s counsel contested the exact quantum of the alleged defalcation, the State as well as the counsel for the informant strongly opposed the bail plea, pointing to documentary evidence from the GSTauthorities highlighting non-payment of dues for the period between April 2020 and March 2021.

The Court, considering the allegations, observed the wider ramifications of such financial misconduct on the tax administration system and cited the recent decision of the Supreme Court in Serious Fraud Investigation Office v. Aditya Sarda to reiterate that economic offences require strict scrutiny.

The Court dismissed the application for anticipatory bail, rescinding the previous temporary protection, and denied to extend the advantage of pre-arrest bail, noting that there was enough evidence in the record to substantiate the claims prima facie.

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