Sumit Gupta Alias Sumit Kumar Gupta vs. Union Of INDIA Represented By Shri Dinesh Kumar, Intelligence Officer

Held

The Court granted bail to the petitioner. The Court considered that the petitioner has been in custody for approximately nine months. It also noted that the offences alleged under the CGST Act, 2017, are punishable with a maximum sentence of five years. Furthermore, the Court acknowledged the petitioner's submission that the material evidence is electronic in nature and therefore cannot be tampered with. The Court also took into account that co-accused in similar cases, Amit Gupta and Gyan Chandra Jaiswal, had been granted bail by Coordinate Benches of this Court. Based on these facts and circumstances, the Court found it inclined to enlarge the petitioner on bail.

Facts

The petitioner, Sumit Gupta, is accused in Complaint Case No. 1280 of 2024, arising from File No. DGGI/INV/GST/2538/2023-Gr E-O/o ADD-DGGI-RU-JAMSHEDPUR. He is alleged to be the mastermind behind creating fake companies involved in passing inadmissible Input Tax Credit (ITC) amounting to approximately ₹522.91 crore, causing a significant loss to the government exchequer. The offences are registered under Section 132 of the CGST Act read with Section 20 of the IGST Act and various sections of the Indian Penal Code. The petitioner's earlier bail application was rejected by a Coordinate Bench of this High Court, and a Special Leave Petition filed before the Supreme Court was withdrawn. The petitioner has been in custody for approximately nine months.

Key Issues

1. Whether the petitioner has been falsely implicated in the case, and if the offences under the Indian Penal Code are made out, considering the maximum punishment for CGST Act offences is five years? 2. Whether the petitioner is entitled to bail, given his custody period, the nature of evidence (electronic), and the fact that co-accused have been granted bail? The petitioner argued that he has been falsely implicated and that no offence under the Indian Penal Code is made out, despite cognizance being taken under certain IPC sections. He contended that the maximum punishment under the CGST Act is five years and that the material evidence being electronic cannot be tampered with. He relied on the Supreme Court decision in Ratnambar Kaushik v. Union of India. The revenue (Union of India) opposed the bail prayer, citing direct allegations of the petitioner's involvement in creating fake companies for passing inadmissible ITC.