Akshay Dinesh Patel vs. Commissioner Of Central Goods And Services Tax

Held

The Court allowed the application for regular bail. The Court considered that the applicant had been in jail since December 23, 2019. The allegation against the applicant was wrongful availment and passing on of input tax credit, an offence punishable under Section 132(1)(b) of the CGST Act, 2017. The Court noted that for the alleged transaction, the respondent department could pursue departmental action for penalty recovery. The applicant's willingness to deposit Rs. 25 lakh within 8 weeks of release and cooperate with the investigation was also a significant factor. The Court also took into consideration the law laid down by the Apex Court in Sanjay Chandra Vs. Central Bureau of Investigation. The applicant was ordered to be released on bail upon executing a personal bond of Rs. 10,000 with one surety, subject to several conditions, including not misusing liberty, not acting prejudicially to prosecution, surrendering passport, not leaving India without permission, marking presence at the police station, and furnishing an undertaking to deposit Rs. 25 lakh. The Court clarified that the trial court should not be influenced by the prima facie observations made in this order.

Facts

The applicant, Akshay Dinesh Patel, filed an application under Section 439 of the Code of Criminal Procedure, 1973, for regular bail. The bail was sought in connection with an offence registered vide F.No.IV/16-25/PI/Zikshoo/Impex/2019-20/Gr.VI, issued by the Inspector of CGST & CE, Commissioner of Central Goods & Service Tax, Gandhinagar. The offence is punishable under Section 132(1)(b) of the CGST Act, 2017. The applicant had been in jail since December 23, 2019. The allegation against the applicant is that he wrongly availed input tax credit and passed it on to a buyer. The applicant's counsel submitted that the applicant was willing to deposit Rs. 25 lakh before the respondent within 8 weeks of his release and would cooperate with the investigation.

Key Issues

1. Whether the applicant is entitled to regular bail under Section 439 of the CrPC, considering the nature and gravity of the alleged offence under Section 132(1)(b) of the CGST Act, 2017, which pertains to wrongful availment and passing on of input tax credit? Petitioner's Arguments: The petitioner argued that considering the nature of the offence, they should be enlarged on regular bail with suitable conditions. They also submitted that for the alleged transaction, it is open for the respondent department to take departmental action for recovery of penalty. Furthermore, the applicant expressed willingness to deposit Rs. 25 lakh and cooperate with the investigation. Revenue's Arguments: The respondent-State, through the learned APP, opposed the grant of regular bail, citing the nature and gravity of the offence.