Khushnud Khan vs. State & Anr.

Held

The Court confirmed the interim bail granted to the petitioner on June 22, 2022, and disposed of the bail application. The decision was based on the petitioner's deposit of Rs. 14,08,23,364/- in the present case and Rs. 35,00,000/- concerning other proceedings initiated by the department. The Court explicitly stated that it was not commenting on the merits of the case. The confirmation of bail was subject to the petitioner furnishing a personal bond of Rs. 1,00,000/- with two sureties of like amount to the satisfaction of the learned Additional Metropolitan Magistrate/Duty MM. Specific conditions were imposed, including not leaving the country without prior permission of the trial court, intimating any change in residential address, appearing in court as and when required, joining the investigation when called, and providing and updating his mobile number to the Investigating Officer. The Court allowed and disposed of the application.

Facts

The petitioner, Khushnud Khan, sought regular bail under Section 439 of the Cr.P.C. for alleged offences under Section 132(1)(c) of the Central Goods and Services Tax Act, 2017. Initially, on June 22, 2022, the petitioner was granted interim bail upon depositing Rs. 5 crores. During the pendency of the bail application, the petitioner claimed to have deposited the entire alleged tax evasion amount of Rs. 14,08,23,364/- in the present case. Additionally, a sum of Rs. 35,00,000/- was deposited concerning other proceedings under the same Act. The petitioner stated readiness to join the investigation and affirmed compliance with interim bail conditions. The respondent revenue opposed the bail, citing the serious nature of the economic offence and ongoing investigations against the petitioner in other cases.

Key Issues

1. Whether the petitioner is entitled to regular bail under Section 439 of the Cr.P.C. for alleged offences under Section 132(1)(c) of the CGST Act, 2017, considering the deposit of the alleged tax evasion amount? Petitioner's arguments: The petitioner contended that he had deposited the entire alleged tax evasion amount of Rs. 14,08,23,364/- in the present case, along with Rs. 35,00,000/- in other related proceedings. He also submitted that he was ready to cooperate with the investigation and had not misused the liberty granted during interim bail. Reliance was placed on the fact of deposit as a mitigating factor for granting bail. Revenue's arguments: The respondent revenue opposed the bail application, arguing that the offence under Section 132(1)(c) of the CGST Act was serious in nature. They further submitted that there were several other cases being investigated against the petitioner, highlighting the gravity of the economic offence committed.