- In Mohisin Salimbhai Quereshi V. State Of Gujrat, 2022, under the Central Goods and Services Act of 2017, Justice Gita Gopi granted bail to an accused after observing that in deciding bail applications, the Court should undoubtedly take the delay in concluding the trial into account.
- In this instance, the applicant was placed in judicial custody under Section 69 of the CGST Act 2017 for creating a chain of bogus firms without a physical receipt through which he illegally received and utilized Input Tax Credit worth rupees 10.29 crores and supplied goods on fraudulent ITC to its customers. He was also denied bail under Section 437 of the CrPC and criminal miscellaneous application.
- The applicant's central claim was that he was arrested without any evidence. He stated that he was registered under the former VAT regime and the GST regime under Section 139, demonstrating that he was a tax-paying citizen and did not merely conduct his business on paper. It was further contended that the officers discovered stock containing iron scrap at the applicant's business premises during the de-sealing procedure, which was supported by legal and valid documents and invoices. Another claim was that the GST Act was a fiscal statute, and the purpose of the law was to provide a mechanism for recovering the amount owed to the government under Section 69 (1). The accused, thus, sought bail under Section 439 CrPC. However, it was contended by the Respondents' that the iron scrap in the applicant's shop premises lacked a stock register, as required by Section 35 of the CGST Act. It further claimed that attempts were also made to locate the central place of business, but the authorities could not find it. As a result, it was determined that this entity did not exist.
- The important statues to this case are mentioned below:
- Section 439 of the CrPC refers to the High Court's or Court of Session's special bail powers.
- The Central Goods and Services Act 2017 is an act to make provision for the Central Government to levy and collect tax on intra-State supply of goods or services or both, and for matters connected with or incidental to it.
- Section 132 of the CGST Act, 2017 talks about punishment for certain offenses is discussed under the Central Goods and Services Act.
- Section 120B of the IPC defines the punishment for criminal conspiracy.
- Section 69 of the CGST Act 2017 denotes the Commissioner's authority to arrest by order if he has reasonable grounds to believe that a person has committed the offenses.
- Section 437 of the Criminal Procedure Code states that a person arrested for committing a non-bailable offense without an officer's warrant may be released on bail.
- Section 139 of the Income Tax Act of 1961 contains several provisions relating to the late filing of various income tax returns.
- In a parallel case, Sanjay Chandra vs. CBI [2012 1 SCC 40], the applicant was accused of cheating and dishonestly inducing delivery of property and forgery for cheating using a forged document as genuine. The Hon'ble SC stated in this case that the delay in concluding the trial must be considered as a relevant factor in deciding bail applications.
- In another notable case, Kalyan Chandra Sarkar v. Rajesh Ranjan [(2005) 2 SCC 42], the Hon'ble Court stated that under the criminal laws of the country, a person accused of non-bailable offenses is liable to be detained in custody during the pendency of trial unless he is expanded on bail under law.
- In light of Section 138 of the CGST Act and the case as mentioned earlier, the Court stated that taking the provisions of law and the fact into account, the Commissioner was authorized to recover the due amount and propose for abatement of the litigation, and as the trial will take its own time to conclude, this Court finds this to be a fit case where it could exercise discretion could be in favor of the applicant.
- Therefore, the bail application was granted on the condition that a personal bond of rupees 1,000,000 and one surety of the same amount be provided.
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