Arun Sharma S/O Late Shri Shyam Sunder Sharma vs. Union Of INDIA

Held

The Court allowed all three bail applications. The Court noted that the alleged offences under the CGST Act, 2017, are cognizable and the charge sheet has been filed. It acknowledged that the trial is likely to take time, and it is not disputed that the petitioners have been accused of a 'cognizable offence'. The Court considered the fact that the main accused has not yet been arrested. The Court also took into account the bail orders passed in favour of co-accused Dayal Chand and Bhokhan Sahay, where their roles as proprietors or partners were not established, and other circumstances were considered. While acknowledging that the bail application of Megnath Saini was rejected by a coordinate bench, the Court distinguished that case by noting that Saini was a proprietor/partner of various firms and was accused of tax evasion/defalcation. The Court found that the petitioners' applications were fit for consideration for bail, without commenting on the merits of the case. The Court directed that upon furnishing a personal bond of ₹5 lakh and two sureties of ₹2.5 lakh each to the satisfaction of the trial court, and provided there is no other case against them, the petitioners Arun Sharma, Sunil Kumar, and Harish Kumar Jain shall be released on bail.

Facts

The petitioners, Arun Sharma, Sunil Kumar, and Harish Kumar Jain, filed separate bail applications under Section 439 of the Code of Criminal Procedure. They were arrested in connection with Case No. IV(06)115/AE/JPR/2020, registered for offences under Section 132(1)(b) & (c) read with Section 132 of the Central Goods and Services Tax Act, 2017. The petitioners argued that the alleged offences are punishable with imprisonment ranging from six months to five years and fall under the category of 'cognizable offences'. They contended that they are merely employees drawing a salary of ₹10,000 and not proprietors or partners. The main accused, Mukesh Yada, has not yet been arrested, while the petitioners have been arrested without cause. The petitioners also pointed out that bail applications of co-accused, Dayal Chand and Bhokhan Sahay, were allowed by this Court on May 18, 2021, and May 4, 2021, respectively. They further submitted that the Supreme Court has clarified the considerations for bail in economic offences. The petitioners also argued that due to the COVID-19 pandemic, many businesses are unable to pay taxes, and their actions should not be considered tax evasion. They stated that the offences are cognizable and the charge sheet has been filed. The petitioners have been in custody for a considerable period, and the trial is likely to take time.

Key Issues

1. Whether the petitioners are entitled to bail considering the nature of the alleged offences under the CGST Act, 2017, and the fact that the main accused is still at large? 2. Whether the petitioners' role as mere employees, drawing a salary, is a relevant factor in granting bail, especially when compared to the alleged involvement of proprietors or partners? 3. Whether the ongoing COVID-19 pandemic and its impact on businesses can be considered a mitigating factor in granting bail for alleged tax evasion? Petitioner's Arguments: - The petitioners are employees earning a salary and not proprietors or partners. - The main accused has not been arrested, while the petitioners have been arrested without cause. - Bail applications of co-accused with similar circumstances have been allowed. - The Supreme Court's guidelines for bail in economic offences should be followed. - The current economic situation due to COVID-19 makes it difficult for businesses to pay taxes, and their actions should not be categorized as tax evasion. - The petitioners have been in custody for a long time, and the trial is likely to be delayed. - One petitioner's son is 100% disabled, and he himself is undergoing treatment for a kidney ailment. Respondent's Arguments: - The petitioners are accused of tax evasion amounting to approximately ₹5 crore. - The bail application of one Megnath Saini was rejected by a coordinate bench on June 29, 2021. - Therefore, the petitioners' bail applications should also be rejected.