Sunil Agarwal S/O Shri Ramprakash Agarwal vs. Union Of INDIA

Held

The Court allowed the bail application. The primary reasoning was based on the totality of facts and circumstances, particularly the fact that the alleged offence is triable by a Magistrate with a maximum sentence of five years. The Court also considered that a co-accused had been granted bail by a coordinate bench of the High Court much earlier. Furthermore, the Court took into account the observation made by the Hon'ble Supreme Court in the case of 'Vineet Jain' regarding granting bail unless extraordinary circumstances exist. The Court noted that the complaint had already been submitted and that the trial would likely take considerable time to conclude. The period of custody of the petitioner was also a significant factor. The Court explicitly stated that these observations were made solely for the purpose of deciding the bail application and would not impact the trial of the case. The petitioner was directed to furnish a personal bond and two sureties to the satisfaction of the learned Trial Court, with the stipulation to appear on all subsequent dates of hearing.

Facts

The petitioner, Sunil Agarwal, is seeking bail in a case registered under Section 132(1) of the Central Goods and Services Tax Act, 2017. The Directorate General of GST Intelligence (DGGI) alleges that the petitioner was involved in wrongfully obtaining Input Tax Credit (ITC) amounting to Rs. 15,31,11,083/-. It is further alleged that invoices were received without actual goods being supplied, and one such invoice was issued to M/s Kaizen Organics, where the petitioner is a Director, leading to an ITC claim of Rs. 16,76,18,863/-. The Department attributes both amounts to companies in which the petitioner is a Director. The petitioner was arrested after 30 months of the complaint's registration and has been in custody since May 15, 2025. A co-accused, Vikas Bajoria, has already been granted bail.

Key Issues

1. Whether the petitioner is entitled to bail under Section 483 of BNSS, considering the nature of the alleged offence under Section 132(1) of the CGST Act, 2017, and the maximum sentence prescribed for an offence triable by a Magistrate (which is five years)? Petitioner's arguments: The petitioner contends that the allegations are bald and that the offence is triable by a Magistrate with a maximum sentence of five years. He highlights that he was arrested after 30 months and that a co-accused has been granted bail. He relies on a Supreme Court observation in 'Vineet Jain versus Union of India' suggesting bail unless extraordinary circumstances exist. He also points out no criminal antecedents, the submission of the complaint, and the anticipated delay in trial, arguing further custody is unnecessary. Respondent's arguments: The respondent (Union of India through DGGI) opposes the bail application, arguing that the deposition of evaded tax demonstrates culpability. They contend that economic offences constitute a distinct class and the petitioner does not deserve bail. They cite several Supreme Court judgments, including 'Nimmagadda Prasad vs. Central Bureau of Investigation' and 'Serious Fraud Investigation Office vs. Nittin Johari & Anr.', to support their plea for dismissal.