Ranjit Singh vs. State Of Haryana

Held

The High Court held that the condition imposed by the Additional Sessions Judge requiring the petitioner to deposit the outstanding GST liability of Rs. 1,94,78,017/- along with interest as a condition for bail was onerous and liable to be set aside. The Court noted that the Additional Sessions Judge had correctly identified the offense as potentially non-bailable due to the amount involved, but erred in imposing such a condition. The Court relied on several Supreme Court judgments, including Sreenivasulu Reddy, Sandeep Jain, Sheikh Ayub, and Shyam Singh, which set aside similar conditions requiring deposit of large sums for bail as unreasonable and violative of the right to liberty under Article 21 of the Constitution. The Court observed that while the seriousness of the charge is a consideration, it is not the sole test for refusing bail, and the principle of 'bail is the rule, jail is the exception' must be followed. The Court found that the condition suffered from the vice of unreasonability and could not stand judicial scrutiny. The bail bonds of Rs. 50 lakhs were reduced to Rs. 25 lakhs in the form of immovable property, and the condition of payment of the outstanding liability was set aside. The other conditions for bail were to remain intact.

Facts

The petitioner, Ranjit Singh, sought to quash a condition imposed by the Additional Sessions Judge, Panipat, while granting him bail. The condition required him to furnish bail bonds of Rs. 50,00,000/- with one surety of like amount and to pay an outstanding GST liability of Rs. 1,94,78,017/- along with interest for his firm, M/s Maa Karni Yarns. The petitioner argued that these onerous conditions effectively denied him bail as he could not afford to pay the amount. The State contended that the complaint filed under the Haryana Goods & Services Tax Act, 2017, was pending, and the petitioner was involved in floating bogus firms and supplying fake invoices, causing a significant loss to the State Exchequer. The amount in dispute was Rs. 1,94,78,017/-.

Key Issues

1. Whether the condition imposed by the Additional Sessions Judge, Panipat, requiring the petitioner to deposit an outstanding GST liability of Rs. 1,94,78,017/- along with interest as a condition for bail, is legally permissible and reasonable under Section 438 of the Cr.P.C. and the principles of bail? Petitioner's arguments: The petitioner contended that the condition was onerous and practically denied him bail, violating the presumption of innocence. He argued that the order prejudged his guilt by directing recovery of the amount before a competent court had made a finding. He relied on the Supreme Court judgment in Sumit Mehta Vs. State of N.C.T. of Delhi, which held similar deposit conditions for bail to be unwarranted. Respondent's arguments: The State justified the condition, stating that a complaint under the Act was pending and the petitioner was involved in serious economic offenses, including floating bogus firms and causing a loss of over Rs. 5 crores, making the offense non-bailable under Section 132(1)(l)(i) and Sub-section (5) of the Act. The State argued that the condition would protect the interest of the Exchequer and the prosecution.