Uttarakhand High Court
Shri Mukesh Kumar Tyagi vs State Of Uttarakhand And Others on 10 June, 2022
Author: Ravindra Maithani
Bench: Ravindra Maithani
HIGH COURT OF UTTARAKHAND AT NAINITAL
Anticipatory Bail Application No. 16 of 2020
Shri Mukesh Kumar Tyagi ........Applicant
Versus
State of Uttarakhand and others ........Respondents
Present:-
Mr. Rohit Arora and Mr. Lalit Sharma, Advocates for the
applicant.
Mr. V.K. Jemini, Deputy Advocate General with Ms. Meena
Bisht, Brief Holder for the State/respondent no.1.
Mr. Shobhit Saharia, Advocate for respondent nos.2 and 3.
With
Anticipatory Bail Application No. 17 of 2020
Smt. Sangeeta Mukesh Tyagi ........Applicant
Versus
State of Uttarakhand and others ........Respondents
Present:-
Mr. Rohit Arora and Mr. Lalit Sharma, Advocates for the
applicant.
Mr. V.K. Jemini, Deputy Advocate General with Ms. Meena
Bisht, Brief Holder for the State/respondent no.1.
Mr. Shobhit Saharia, Advocate for respondent nos.2 and 3.
Hon'ble Ravindra Maithani, J. (Oral)
Since common question of law and facts are involved in these two anticipatory bail applications, they are decided by this common order.
2. Both the applicants are the Directors of M/S BST Textile Mills Private Limited, IIE, Pantnagar, SIDCUL, District Udham Singh Nagar (for short, "BST"). They were 2 issued summons under Section 70 of the Central Goods and Services Tax Act, 2017 (for short, "the GST Act"). Both the applicants seek quashing of summons as well as search made of their premises on 03.09.2020. They seek anticipatory bail under Section 438 of the Code of Criminal Procedure, 1973 (for short, "the Code").
3. Heard learned counsel for the parties and perused the record.
4. The case, as revealed from the record, is that the GST Intelligence received information of gross irregularities, committed by the BST. A preliminary enquiry was initiated. It was found that Input Tax Credit (for short, "ITC") to the tune of ` 10 to 15 Crores were availed by the BST on the basis of invoices, which were forged and fabricated; supply of goods was shown on the papers by generating forged e-bills, a paper trail was prepared. It is, thereafter, the applicants were issued summons under Section 70 of the GST Act. Admittedly, the applicants did not appear pursuant to the summons instead according to the learned counsel appearing for the applicants, they replied the summons. The anticipatory bail applications were moved, which were rejected by the court of Sessions Judge. This Court, on 28.11.2020, 3 directed the applicants to appear before the respondent no.3, Senior Intelligence Officer, GST Intelligence, New Delhi on 01.12.2020.
5. It is submitted on behalf of the applicants that pursuant to the directions of this Court the applicants appeared, as directed.
6. This Court may like to note that today, the anticipatory bail applications are finding their disposal almost after two years. It is much delayed disposal. The anticipatory bail applications should have been decided much earlier but, then the Court leaves it as it.
7. Learned counsel for the applicants would submit that the applicants are bonafide in their conducts. The applicants have been following the GST laws. After the directions of the Court, the applicants appeared before the authorities; initially when summons were received by the applicants, they duly replied the summons to the authority.
8. Learned counsel would submit that the applicants may not be held responsible for the act, which was beyond their reach. It is argued that if the supplier is absconding, the applicants may not, in any manner, be 4 held responsible. The applicants have been cooperating with the authorities. It is two years since last time notices were issued, thereafter notices were not issued. Therefore, it makes out a case for anticipatory bail.
9. Learned counsel appearing for the GST Intelligence/respondent nos.2 and 3 would submit that the applicants have committed gross irregularities; they have created paper trail so as to take undue ITC benefits to the tune of ` 10 to 15 Crores; the internal investigation of the department found gross irregularities; the further interrogation of the applicants is necessary to investigate this matter so as to reveal the truth; the applicants needs to be confronted with the documents filed by them; the documents were forged; photographs of drivers, offices etc. were manipulated. Therefore, it is argued that it is not a case fit for anticipatory bail.
10. During the course of hearing, reference has been made to the judgment in the case of P.V. Ramana Reddy vs. Union of India, Writ Petition No. 4764 of 2019 and connected matters, as decided by the Hon'ble Telangana High Court. In the case of P.V. Ramana Reddy, Hon'ble Telangana High Court had discussed the provisions of Section 69, 70, 132 of the GST Act as well as 5 the scope of Article 226 of the Constitution of India and Section 41A and other provisions of the Code. In fact, reference to the judgment in the case of P.V. Ramanna Reddy, which subsequently reached to the Hon'ble Supreme Court (P.V. Ramana Reddy vs. Union of India and others, (2021)2 SCC 784) has also been made in the case of Union of India vs. Sapna Jain Jain and others, (2021)2 SCC 782.
11. In the case of P.V. Ramana Reddy (supra), the Hon'ble Telangana High Court discussed the scope of Article 226 of the Constitution of India and observed as hereunder:-
"47. Once it is found that Article 226 of the Constitution of India can be invoked even in cases where Section 438 Cr.P.C. has no application (in contrast to cases such as those under the SC/ST Act where it stands expressly excluded) and once it is found that the limited protection against arrest available under Sections 41 and 41A Cr.P.C. may be available even to a person sought to be arrested under Section 69(1) of the CGST Act, 2017 (though the necessity to record reasons in the authorization for arrest may not be there), it should follow as a coronary that the writ petitions cannot be said to be not maintainable.
48. That takes us to the next question as to whether the petitioners are entitled to protection against arrest, in the facts and circumstances of the case. We have already indicated on the basis of the ratio laid down by the 6 Constitution Bench in Kartar Singh and the ratio laid down in Km. Hema Mishra that the jurisdiction under Article 226 of the Constitution of India to grant protection against arrest, should be sparingly used. Therefore, let us see prima facie, the nature of the allegations against the petitioners and the circumstances prevailing in the case, for deciding whether the petitioners are entitled to protection against the arrest. We have already extracted in brief, the contents of the counter affidavits. We have summarized the contents of the counter affidavits very cautiously with a view to avoid the colouring of our vision. Therefore, what we will now take into account on the facts, will only be a superficial examination of facts."
12. In the case of Sapna Jain (supra) in para 3 referred the judgment of the Hon'ble Supreme Court in the case of P.V. Ramana Reddy (supra) as hereunder:-
"3. As the respondent-accused have been granted the privilege of pre-arrest bail by the High Court by the impugned orders [Sapna Jain v. Union of India, 2019 SCC OnLine Bom 13064] , [Chandraprakash Labhchand Sanklecha v. Union of India, 2018 SCC OnLine Bom 21184] , at this stage, we are not inclined to interfere with the same. However, we make it clear that the High Courts while entertaining such request in future, will keep in mind that this Court by order dated 27-5-2019 passed in P.V. Ramana Reddy v. Union of India [P.V. Ramana Reddy v. Union of India, (2021) 2 SCC 784] had dismissed the special leave petition filed against the judgment and order [P.V. Ramana Reddy v. Union of India, 2019 SCC 7 OnLine TS 3332] of the Telangana High Court in a similar matter, wherein the High Court of Telangana had taken a view contrary to what has been held by the High Court in the present case."
13. Undoubtedly, liberty of an individual is one of the most precious rights. The bail makes a balance between the right of an individual and societal interest. In a catena of decisions, the Hon'ble Supreme Court has laid down the guidelines, as to what would be the consideration in the matters of anticipatory bail. In Siddharam Sitlingappa Mhetre vs. State of Maharashtra and others, (2011)1 SCC 694, the Hon'ble Supreme Court further culled up the factors that may be considered while considering anticipatory bail applications (It has also been referred to in the case of Sushila Aggarwal and others vs. State (NCT of Delhi) and another, 2020 SCC OnLine SC
98). It is as hereunder:-
"112. The following factors and parameters can be taken into consideration while dealing with the anticipatory bail:
(i) The nature and gravity of the accusation and the exact role of the accused must be properly comprehended before arrest is made;
(ii) The antecedents of the applicant including the fact as to whether the accused has previously undergone 8 imprisonment on conviction by a court in respect of any cognizable offence;
(iii) The possibility of the applicant to flee from justice;
(iv) The possibility of the accused's likelihood to repeat similar or other offences;
(v) Where the accusations have been made only with the object of injuring or humiliating the applicant by arresting him or her;
(vi) Impact of grant of anticipatory bail particularly in cases of large magnitude affecting a very large number of people;
(vii) The courts must evaluate the entire available material against the accused very carefully. The court must also clearly comprehend the exact role of the accused in the case. The cases in which the accused is implicated with the help of Sections 34 and 149 of the Penal Code, 1860 the court should consider with even greater care and caution because overimplication in the cases is a matter of common knowledge and concern;
(viii) While considering the prayer for grant of anticipatory bail, a balance has to be struck between two factors, namely, no prejudice should be caused to the free, fair and full investigation and there should be prevention of harassment, humiliation and unjustified detention of the accused;
(ix) The court to consider reasonable apprehension of tampering of the witness or apprehension of threat to the complainant;
(x) Frivolity in prosecution should always be considered and it is only the element of genuineness that shall have to be considered in the matter of grant of bail and in the event of there being some doubt as to the genuineness of the prosecution, in the normal course of events, the accused is entitled to an order of bail."
14. The court of Sessions rejected the anticipatory bail application of the applicants. In the anticipatory bail 9 rejection order, the court of Sessions had extracted the prosecution case as hereunder:-
"..........The prosecution placed on record the list of fake and non existent suppliers, which as per applicants supplied goods to them, which are as below:-
GSTIN of Supplier Legal Name of Trade name supplier 06GJEPS2317PIZP Manpreet Singh Shri Sidhi Vinayak Traders 06AEZPK3647QIZG Manoj Kumar Kandi Kartar Cotton Trader 06FUUPK5841QIZJ Ravi Kumar Garg Cotton Traders 06EOBPK4747DIZ3 Sandeep Kumar MTLAKH RAJ SANDEEP KUMA 06CIBPDS523NIZ5 Dharmender Shri Jagannath Traders As per prosecution above stated firms and suppliers did not exist from the inception, from whom the applicants claim that they had received supply of goods."
15. During the course of arguments, learned counsel for the GST Intelligence referred to the counter affidavit filed by the respondent no.3. Under the caption, "Brief Facts of the case", paragraph 10 (viii), reads as under:-
"10(viii). That the applicant is one of the Spinning Mills engaged in receiving goods (cotton bales/fiber) from the Ginners or traders without invoices, whereas the invoices received by the Applicant showing purchase of cotton 10 are provided on the letter head of firms/entities which have been found to be non-existent during the investigations conducted by the office of Respondents. Hence, the Applicant was found to be utilizing irregular and ineligible Input Tax Credit (ITC) on the strength of such invoices raised by fake and non-existent firms.
Based on this specific input, the office of Respondents conducted searches at the manufacturing unit of the Applicant situated at Rudrapur, Uttarakhand and Registered/ Corporate office premises situated at Mumbai on 03.03.2020 in furtherance of investigation."
16. In the same counter affidavit under the caption of parawise reply reference has been made to para 6 (xix to xx and xxv). The Court refrains to reproduce these paragraphs, as such. In paragraphs 6 (xix to xx) inter alia it records that that on 03.09.2020, a search was concluded in the premises of the applicants and Panchnama was prepared; initially statements of the applicant Mukesh Kumar Tyagi was recorded, which was duly signed by him and it is at his request, the another date for investigation was fixed for 07.09.2020, of which, 11 notices were issued to him but, thereafter, he did not appear and further notices were issued. Paragraph 6 (xxv) of the counter affidavit under parawise reply inter alia records that, "the fake/non-existent supplier firms of the applicants were in fact creating paper trail by way of issuing fake/bogus invoices.................................". According to the counter affidavit of respondent nos.2 and 3 the applicants have not been joining the investigation on the one pretext or the other.
17. The allegations against the applicants are pertaining to undue taking advantage or ITC by fake and fabricated documents. Gravity of offence, need for interrogation, repeat offence, tampering with evidence are also some of the considerations, which weigh in the mind of the Court at the stage of considering anticipatory bail application. The allegation against the applicant are much serious. According to the GST Intelligence, preliminary investigation confirms the allegations, which needs to be further investigated. In view of these facts and circumstances, this Court is of the view that the applicants are not entitled to anticipatory bail. Accordingly, the anticipatory bail applications are liable to be rejected.
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18. Both the anticipatory bail applications are rejected.
(Ravindra Maithani, J.) 10.06.2022 Sanjay