Dhanraj Singhal S/O Late Shri Anandi Lal Agarwal vs. State Of Rajasthan

Held

The Court allowed the bail application, directing the release of the petitioner on bail. The Court considered the submissions of both counsels, the length of the petitioner's custody, the compoundable nature of the offences, the maximum sentence of five years, and the absence of criminal antecedents. However, the Court explicitly stated that it was not expressing any opinion on the merits of the case. The reasoning for granting bail was primarily based on the procedural aspects and the mitigating factors presented by the petitioner, such as the pendency of adjudication and the fact that other potentially involved entities were not yet accused. The ratio decidendi appears to be that in cases involving serious economic offences under GST, where adjudication is pending and other parties are not yet implicated, and the accused has undergone a significant period in custody without criminal antecedents, bail can be granted as a matter of discretion, without prejudice to the final outcome of the case. The operative direction was to release the petitioner on furnishing a personal bond of Rs. 1,00,000/- with two sureties of Rs. 50,000/- each, subject to compliance with Section 437(3) Cr.P.C.

Facts

The petitioner, Dhanraj Singhal, proprietor of Mahadev Trading Company, filed a bail application under Section 439 Cr.P.C. He was arrested in connection with Case File No.PS/CCT/2020/511 dated 31.01.2020 by the Assistant Commissioner, State Tax, Anti Evasion Circle, Commercial Tax Department, Kota, Rajasthan. The alleged offences are under Sections 132(1)(b) and (c) of the Rajasthan Goods and Services Tax Act, 2017, punishable under Section 132(1)(i) read with Section 132(5). The petitioner has been in custody since 05.02.2020. He contends he has been falsely implicated, adjudication for tax levy is pending, and although a notice for penalty has been issued, it remains unadjudicated. He also notes that 26 other firms allegedly involved in issuing invoices without goods have not been implicated as accused.

Key Issues

1. Whether the petitioner is entitled to bail under Section 439 Cr.P.C. given the pendency of adjudication proceedings and the fact that other implicated firms have not been made accused? The petitioner argued that he has been falsely implicated, adjudication for tax levy is yet to be made, and the penalty notice has not been adjudicated. He highlighted that 26 other firms are involved but not implicated. He also pointed to his custody period since 05.02.2020, the compoundable nature of the offences, the maximum punishment of five years, the pre-charge evidence stage, and his lack of criminal antecedents. He relied on Coordinate Bench judgments in 'Anup Ashopa Vs. Union of India' and 'Saurabh Chhajer Vs. State of Rajasthan & Anr.'. The respondent (State of Rajasthan) contended that there is substantial material indicating the petitioner's involvement in tax evasion amounting to Rs. 18 crores. They stated that investigations against the 26 firms are ongoing and the petitioner has not paid any amount towards the evaded tax, thus disentitling him to bail.