Keyur Dipakkumar Shah Dir. Of M/S. Dhara Pharmachem PVT. LTD And M/S.Dipna Pharmachem LTD. vs. State Of Gujarat

Held

The Court held that the applicant is entitled to be enlarged on regular bail. The Court considered the applicant's arrest date (January 21, 2026), the significant amount involved (Rs. 42,00,00,000/-) and the specific sections under which the allegations are made (wrongful availment of input tax credit under Section 132(1)(c) and passing of input tax credit without actual supply of goods under Section 132(1)(b)). The Court noted that the department has powers to invoke appropriate recovery and penalty procedures. It was also observed that the apprehension of the State could be allayed by imposing suitable conditions. The applicant's lack of prior antecedents and the maximum punishment of five years were also taken into account, referencing the Apex Court's decision in Sanjay Chandra v. Central Bureau of Investigation. Prima facie, the Court found it a fit case to exercise discretion and grant bail, subject to stringent conditions, including a bail bond of Rs. 1,00,000/-, surrendering passport, not leaving the State without permission, furnishing address, marking presence, and responding to notices. The trial court was cautioned not to be influenced by these preliminary observations.

Facts

The applicant, Keyur Dipakkumar Shah, filed an application for regular bail under Section 483 of the Bharatiya Nagarik Suraksha Sanhita, 2023. The application pertains to a case registered with the Additional Commissioner of State Tax (Enforcement), Ahmedabad, for alleged offences under Section 132(1)(b) and 132(1)(c) of the Central Goods and Services Tax Act, 2017, and Section 69 of the Gujarat Goods and Services Tax Act, 2017. The applicant was arrested on January 21, 2026. The allegations involve defrauding the department of approximately Rs. 42,00,00,000/-, specifically through wrongful availment of input tax credit and passing of input tax credit without actual supply of goods. A charge-sheet has been filed during the pendency of the bail application.

Key Issues

1. Whether the applicant, Keyur Dipakkumar Shah, is entitled to be enlarged on regular bail in connection with File No. ACST/ENF/FSU-5/KEYUR SHAH/2025-26/B.25, registered for offences under Section 132(1)(b) and 132(1)(c) of the CGST Act, 2017, and Section 69 of the Gujarat GST Act, 2017? Petitioner's Arguments: The applicant's counsel argued that considering the applicant's role and the nature of the allegations, he should be granted bail, as keeping him in jail indefinitely serves no useful purpose. The applicant is willing to abide by any conditions imposed by the Court. Revenue/State's Arguments: The State vehemently objected to the grant of bail, submitting that given the nature of the offence and the applicant's role, the Court should not exercise its discretion in favour of the applicant and should dismiss the application.