Hemant Kumar Singhal S/O Ashok Kumar Singhal vs. Union Of INDIA

Held

The Court allowed the bail applications. The reasoning appears to be primarily based on the petitioners' contentions regarding the limited scope of their alleged involvement under Section 132(1)(f) of the CGST Act, which carries a maximum punishment of six months. The Court did not explicitly delve into the arguments regarding economic offences being a separate class but implicitly favored the petitioners' submissions on the nature of their alleged offenses. The ratio decidendi is that if the alleged offense, even if proven, carries a maximum sentence of six months, and the petitioner has been in custody for a significant period (three months in Hemant Kumar Singhal's case) without evidence of more serious offenses like creating fake bills or availing ITC, bail should be granted. The operative directions are that the petitioners shall be released on bail upon furnishing a personal bond of Rs. 5,00,000/- with two sureties of Rs. 2,50,000/- each. Additionally, they are required to surrender their passports and not leave India without prior court permission.

Facts

These are bail applications filed under Section 439 of the Cr.P.C. by Hemant Kumar Singhal and Pankaj Garg. The case against them was registered for offences under Section 132(1)(b), (c), and (f) of the Central Goods and Services Tax Act, 2017 (CGST Act). The prosecution involves allegations related to the creation of 38 fake firms and input tax credit (ITC) amounting to approximately 6 crores. Hemant Kumar Singhal claims his involvement is limited to Section 132(1)(f) of the CGST Act, with a maximum punishment of six months, and that he has not created fake bills or availed/passed on ITC. He has been in custody for three months. Pankaj Garg, a petrol pump owner, contends that his mobile number was used in the registration of S.L. Trading Company, and he has lodged an FIR regarding the misuse of his documents. He argues there is no evidence of him availing ITC or producing fake bills.

Key Issues

1. Whether the alleged actions of the petitioners fall under Section 132(1)(f) of the CGST Act, which carries a maximum punishment of six months, thereby warranting bail? 2. Whether economic offences, due to their nature involving deep-rooted conspiracies and significant loss of public funds, require a different approach to bail applications compared to other offences? Petitioner's Arguments: Counsel for the petitioners argued that their case, at most, falls under Section 132(1)(f) of the CGST Act, with a maximum sentence of six months. They contended that Hemant Kumar Singhal has not created fake bills or availed ITC, and has been in custody for three months. Pankaj Garg asserted that his documents were misused, for which he filed an FIR, and there is no evidence of him availing ITC or producing fake bills. They relied on the Supreme Court's decision in Sanjay Chandra vs. CBI. Respondent's Arguments: Learned counsels for the Union of India opposed the bail applications, arguing that economic offences constitute a separate class requiring a different bail approach due to their deep-rooted conspiracies and substantial loss of public funds, affecting the nation's economy. They cited P.V. Ramana Reddy vs. UOI.