Saurabh Mittal vs. Union Of INDIA, Department Of Revenue & Ors.

Facts

The petitioner, Saurabh Mittal, filed a petition under Section 482 Cr.P.C. challenging the inquiry and investigation initiated by the Director General of GST Intelligence (DGGI), Ghaziabad Regional Unit (Respondent No. 3). The investigation concerns alleged GST evasion through exports from non-existent firms, involving fraudulent Input Tax Credit (ITC). Searches were conducted at the petitioner's premises, and documents related to his firms, M/s Akula Exports and M/s Vistar Exports, were seized. The petitioner's father, Yogesh Mittal, was arrested under Section 69 of the CGST Act, 2017. The petitioner received summons dated 02.02.2022 and 07.02.2022 from Respondent No. 3. The petitioner argued that the investigation was beyond the zonal jurisdiction of Respondent No. 3, that the companies and suppliers under probe were registered in Delhi, and that no cause of action arose in Meerut where the proceedings were initiated. He also sought quashing of the summons, alleging malice, and requested audio/videography of proceedings.

Held

The Court held that it cannot go into the truth or falsity of the allegations or delve into disputed questions of fact when exercising jurisdiction under Section 482 Cr.P.C. The petitioner's defense, requiring evidence, must be adjudicated on merits during the inquiry/investigation. The Court found no material of sterling quality warranting invocation of Section 482 Cr.P.C. at the stage of summons issuance. Regarding territorial jurisdiction, the Court found no flaw in Respondent No. 3 carrying out proceedings at the Ghaziabad Regional Unit. The Court dismissed the prayer for audio/videography, stating that such directions are issued in special circumstances where a reasonable apprehension of coercion exists, which was not established by the petitioner. The Court noted that the petitioner failed to raise any reasonable basis to apprehend coercion. The Court also highlighted that the investigation is at a nascent stage, involves a fraud of approximately Rs 350 crores with around 200 firms, and that a bank official has leveled specific allegations against the petitioner regarding the opening of accounts for these firms. Therefore, the petitioner was not entitled to any relief.

Key Issues

1. Whether the inquiry/investigation initiated by the DGGI, Ghaziabad Regional Unit (Respondent No. 3) is beyond its zonal jurisdiction, and if so, whether the proceedings should be transferred to the DGGI HQ Delhi or Delhi Zonal Unit, as per Section 482 Cr.P.C. and principles of territorial jurisdiction. 2. Whether the summons dated 02.02.2022 and 07.02.2022 issued against the petitioner by Respondent No. 3 are actuated with malice and liable to be quashed under Section 482 Cr.P.C. 3. Whether the petitioner is entitled to directions for audio/videography of the inquiry/investigation proceedings, including recording of statements, in the presence of his lawyer at a visible distance, as per the Supreme Court's order in Paramvir Singh Saini vs. Baljit Singh & Ors. Petitioner's Arguments: The petitioner contended that Respondent No. 3 engaged in forum-hunting and abused its powers, choosing Meerut's jurisdiction despite the companies and suppliers being registered in Delhi, and no cause of action arising in Meerut. He argued that the summons were malicious and that his implication was based on inadmissible statements of co-accused without corroborative evidence, citing Haricharan Kurmi vs. State of Bihar. He also sought audio/videography of proceedings, citing apprehension of coercion. Respondent's Arguments: The respondents argued that the Court, under Section 482 Cr.P.C., cannot delve into disputed questions of fact or the truthfulness of allegations at this stage. They submitted that summons under Section 70 CGST Act are issued after inquiry initiation, and the Court should not interfere or grant stays on investigation. They also argued that directions for audio/videography are only granted in exceptional circumstances where a reasonable apprehension of coercion exists, which was not demonstrated by the petitioner.