Aman Kumar Agrawal vs. Union Of INDIA

Held

The Court, while hearing the bail application, considered the facts and circumstances, the nature of allegations, and the submissions advanced. It was noted that although the prosecution alleged the applicant's involvement in issuing fake invoices and wrongful availment of Input Tax Credit, the determination of the actual tax liability was yet to be adjudicated, and no final assessment had been made. The Court also acknowledged that the applicant had been in custody since December 20, 2025, the investigation had substantially progressed, relevant documents and electronic evidence had been seized, and no further custodial interrogation appeared necessary. Furthermore, the Court observed that the alleged offences were triable by a Magistrate and carried a maximum punishment of up to five years. Without commenting on the merits of the case, the Court found itself inclined to grant regular bail to the applicant. The applicant was directed to furnish a personal bond of Rs. 1,00,000/- with one solvent surety to the satisfaction of the concerned Court. The bail order was to remain in force until the disposal of the case.

Facts

The applicant, Aman Kumar Agrawal, has filed a bail application before the Chhattisgarh High Court. He was arrested on December 20, 2025, in connection with a case registered by the Directorate General of GST Intelligence (DGGI), Zonal Unit Raipur. The prosecution alleges that the applicant committed an offence under Section 132(1)(b) of the CGST Act, 2017, by fraudulently availing Input Tax Credit (ITC) through the issuance of fake invoices amounting to ₹8,57,15,507/-. The investigation revealed the generation of fake e-way bills and invoices in the names of various entities, despite no actual supply of goods. The applicant was previously arrested by the State Goods and Services Tax Department on June 10, 2025, for similar alleged offences.

Key Issues

1. Whether the essential ingredients to constitute an offence under Section 132(1)(b) of the CGST Act, 2017, are present against the applicant, considering the absence of a final assessment of tax liability and the stage of proceedings? (Mixed question of law and fact) 2. Whether the applicant's continued detention is warranted and not violative of his constitutional rights, given that the determination of tax liability, quantum of punishment, and the alleged offence's nature are dependent on a due assessment which has not been conducted? Contentions of the Applicant: - The applicant is innocent and falsely implicated, with no connection to the alleged offence. - Essential ingredients for an offence under Section 132(1)(b) are absent, and no prima facie case is made out. - The quantum and nature of punishment depend on tax liability determination, which requires assessment, not yet done. - The applicant, as a partner of a newly established firm, had no occasion to file returns prior to arrest, causing no loss to the exchequer. - No nexus exists with other alleged firms, and their acts cannot be attributed to him. - Arrest procedures under Arnesh Kumar and Satender Kumar Antil were not followed. - Offences are ordinarily bailable, compoundable, and aimed at revenue recovery, not punitive detention, citing Vineet Jain vs. Union of India. - Alleged recovery from an accountant and statements under Section 70 are inadmissible and do not establish direct involvement. - Investigation is complete, complaint filed, and no further custodial interrogation is needed. Contentions of the Non-applicant (Revenue): - The applicant is the mastermind and key conspirator in a well-organized economic offence involving fake firms and invoices, fraudulently passing ITC worth ₹72 crores. - The applicant, with a co-accused, created fake entities, procured SIM cards for GST registration, and controlled the entire operation, as evidenced by seized electronic data, WhatsApp chats, and bank transactions. - Incriminating material like SIM cards, login credentials, and digital data establishes involvement under Section 132(1)(b), (c), and (f) of the CGST Act. - The offence is grave, premeditated, and has serious economic impact, citing State of Gujarat vs. Mohanlal Jitmalji Porwal and Y.S. Jagan Mohan Reddy vs. CBI. - The applicant is a habitual offender, having committed similar offences after being enlarged on bail. - The offence under Section 132(1)(b) is non-compoundable, and notice is not a pre-condition for arrest under Section 69. - Investigation is ongoing, and there's a likelihood of tampering with evidence, influencing witnesses, or absconding.