Rajesh Kumar Dudani vs. State Of Uttarakhand

Held

The Court held that the applicant was not entitled to anticipatory bail. The Court considered the gravity of the offence, which involved generating fake and forged invoices to claim Input Tax Credit (ITC), and the implications for the country's economy. The Court noted the categorical details of dubious transactions provided by the respondent no.2, including the routing of money through different accounts and the applicant's own accounts and his wife's account. The non-cooperative attitude of the applicant during the inquiry, including evasive answers to questions about vehicle capacity and location, and his failure to respond to specific questions about his knowledge of certain entities, were also significant factors. The Court referenced Supreme Court judgments in *P.V. Ramana Reddy* and *Siddharam Sitlingappa Mhetre*, emphasizing that anticipatory bail is not an absolute right and depends on the facts and circumstances of each case, including the nature and gravity of the accusation, the applicant's role, and the possibility of tampering with evidence. The Court found the allegations to be grave and the applicant's conduct during the inquiry to be unsatisfactory, leading to the dismissal of the anticipatory bail application.

Facts

The applicant, Rajesh Kumar Dudani, running Suryanchal Furnitech and M/s Doon Trading Company, sought anticipatory bail after being summoned under Section 70 of the Central Goods and Services Tax Act, 2017. He had previously appeared before the authorities and claimed to have cooperated, providing approximately one thousand documents. The applicant argued that the investigation also involved a company not belonging to him, that the alleged offence was bailable under Section 132(4) of the Act as the amount did not exceed Rs. 500 Lakhs, and that the respondent no.2 had not obtained the necessary permission from the Commissioner under Section 69 of the Act for arrest. The respondent no.2 contended that the applicant was involved in a planned evasion of tax, using fake invoices and generating significant tax liabilities through a credit ledger during the COVID-19 pandemic. The respondent alleged a nexus with 18 firms, three of which belonged to the applicant, and highlighted discrepancies in vehicle load capacities and vehicle movements across states.

Key Issues

1. Whether the applicant is entitled to anticipatory bail in light of the allegations of tax evasion and the use of fake invoices under the Central Goods and Services Tax Act, 2017, specifically concerning Section 70 and Section 132 of the Act? 2. Whether the applicant's non-cooperation during the inquiry and evasive answers to specific questions regarding the transportation of goods and vehicle locations warrant denial of anticipatory bail? Petitioner's Arguments: The applicant argued that the alleged offence was bailable under Section 132(4) of the Act, as the total amount did not exceed Rs. 500 Lakhs. He also contended that the respondent no.2 had not obtained the required permission from the Commissioner under Section 69 of the Act before contemplating arrest. Reliance was placed on cases like *Directorate General of GST Intelligence (DGGI) Vs. Lupita Saluja* and *Tarun Jain Vs. Directorate General of GST Intelligence (DGGI)*, suggesting that custodial interrogation is not always required in such matters. Revenue's Arguments: The respondent no.2 argued that the applicant was involved in a planned tax evasion scheme, utilizing fake invoices to claim Input Tax Credit (ITC). They presented evidence of discrepancies in vehicle load capacities and movements, and stated that the applicant's firms were part of a nexus of fake firms. The respondent also alleged that the applicant was non-cooperative during the inquiry and provided evasive answers.