Rs. 10cr GST ITC Fraud: Chhattisgarh HC Grants Bail to Accused Noting Prolonged Custody and Ongoing Trial [Read Order]

The Chhattisgarh High Court has granted bail to the accused, who was arrested for allegedly availing fraudulent Input Tax Credit (ITC) worth over ₹10 crore through non-genuine transactions under the CGST Act, 2017.

Mr. Vinay Kumar Tandan, the bail applicant is the authorised signatory of M/s Oviya Traders, fraudulently claimed ITC without any actual movement of goods, causing a substantial loss to the exchequer.

The authorities said that the suppliers' GST registrations had been revoked retroactively and that the company operated from nonexistent premises. It added that this showed an intentional fraud and factual concealment, which justified severe punishment under several CGST Act penal sections.

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Appearing for the applicant, counsel argued that applicant had been falsely implicated in a case that involved documentary evidence and tax mismatches, which were issues of record-keeping rather than criminal intent.

It was argued that his extending imprisonment was unnecessary because the evidence was all documentary and had already been seized, that he had cooperated completely throughout the inquiry, and that there was no pending custodial interrogation. The accused had been detained for an extended period of time since March 28, 2025, it was said, and similar bail precedents were given by the applicant’s counsel.

The State opposed the bail plea, submitting that the offence was a serious economic crime adversely affecting government revenue, involving bogus firms and fake invoices. The prosecution argued that granting bail could hamper the wider investigation and undermine deterrence against GST fraud.

Chief Justice Ramesh Sinha heard both sides and noted that the trial would take longer to finish because the petitioner had already served an important amount of time in jail. The bench decided that further imprisonment wasn't necessary at this time, despite noting that the complaint had been filed and that more investigation was still ongoing.

Therefore, the Court issued bail with strict standards, such as a personal bond, two local sureties, and several undertakings to guarantee collaboration with the trial court. The applicant was specifically instructed to stay in person on important hearing dates and refrain from requesting adjournments in order to postpone proceedings; otherwise, the trial court may consider this to be abuse of bail.

Mr. Kishore Bhaduri, Advocate along with Mr. Harsh Dave, Advocate by the applicant and Mr. Maneesh Sharma, DSGI appeared for the department.

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