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Bail can be granted on GST evasion, when investigation is complete

ABSTRACT

In the proceedings commenced under Section 132 of the Central Goods and Services Tax Act, 2017 before the High Court, the petitioner submitted an application for bail. The claims against the petitioner concerned the transportation of unmanufactured tobacco, and it was claimed that such procurement was for the clandestine manufacture and supply of zarda without payment of leviable duties and taxes. The application was denied by the Rajasthan High Court. As a result, the petitioner petitioned the Supreme Court for special leave.

Case: Ratnambar Kaushik Vs. Union of India.

Date: 05.12.2022

Bench: Justice A.S. Bopanna and Justice Hima Kohli

FACTS:

The petitioner is alleged to have committed the offence under Sections 132(1)(a),(h),(k), and (l) of the Central Goods and Services Tax Act of 2017.On behalf of the Respondent, Additional Solicitor General Balbir Singh told the court that the petitioner had clandestinely transported raw unmanufactured tobacco brought from Gujarat by 7 trucks weighing 90,520 kgs, which would have been used in the clandestine manufacture and supply of chewing tobacco without payment of leviable duties and tax. It was further alleged that during the investigation, 287 additional trucks filled with raw unmanufactured tobacco were transported and that tax of amount of Rs. 15,57,28,345/- would have been levied rather than Rs.10,30,824/- as claimed by the petitioner.

The petitioner contended that such claims against him were frivolous and had been contrived to allege that the petitioner had committed a cognizable and non-bailable offence, hence preventing bail from being granted. The Apex Court noted that the case was before the Trial Court and that all of the asserted claims were to be established based on evidence presented before the Trial Court. As a result, any observation on merits, if offered, would prejudice the parties’ position. The Supreme Court noted that the investigation was completed, a chargesheet was submitted, and the petitioner had already been imprisoned for more than four months.

The court also observed that “in a case of the present nature, the evidence to be tendered by the respondent would essentially be documentary and electronic. The ocular evidence will be through official witnesses, due to which there can be no apprehension of tampering, intimidating or influencing.”

HELD:

As a result, the petitioner was granted bail subject to the Trial Court’s requirements, and the Court ordered the petitioner to deposit his passport.

Written by Amruthavarshini, a Student at Jindal Global Law School

 

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