Paritosh Kumar Singh Alias Diwakar Choudhary vs. Senior Intelligence Officer

Held

The High Court allowed the second bail application, granting regular bail to the applicants. The Court acknowledged the seriousness of the economic offences alleged, involving a loss of approximately Rs. 258 Crores. However, it emphasized that the applicants had been in custody for about 23 months and could not be indefinitely detained pending trial, especially since the maximum sentence under Section 132 of the GST Act is five years. The Court noted that charges had not yet been framed and that the investigation concerning the applicants was complete, as confirmed by the non-applicant. Citing Supreme Court decisions in Sandeep Goyal and Paresh Nathalal Chauhan, which granted bail considering the period of detention and the stage of proceedings, the Court found it inclined to grant bail. The applicants were directed to furnish a personal bond of Rs. 1,00,000/- each with one local surety, with conditions to appear regularly before the trial court, not tamper with witnesses, and that their bail could be cancelled if involved in similar offences in the future. The Court explicitly stated it was not entering into the merits of the case.

Facts

The applicants, Paritosh Kumar Singh and others, are in custody since January 25, 2021, in connection with a case registered by the Directorate of GST Intelligence for offences under Section 132(1)(b) and (c) of the Goods and Services Tax Act, 2017. The Directorate alleges that the applicants formed forged firms across multiple states, availed illegal input tax credits, and caused a loss of approximately Rs. 258 Crores to the government exchequer during the financial years 2018-19, 2019-20, and 2020-21. A complaint case was filed on March 25, 2021, and their previous bail application was rejected on August 13, 2021. This is their second bail application. The applicants argue that no documents directly connect them to the alleged offence and that there has been a delay in framing charges. The Directorate contends that voluminous documents show their prima facie involvement and that investigation is complete.

Key Issues

1. Whether the applicants are entitled to regular bail, considering their period of detention and the stage of the trial, under Section 439 of the Code of Criminal Procedure, 1973, in light of Section 132 of the Goods and Services Tax Act, 2017? Petitioner's arguments: The applicants' counsel argued that the non-applicant department has not provided any documents directly linking the applicants to the alleged offence, with the complaint documents being procedural. They highlighted that charges have not yet been framed despite the applicants being in custody since January 25, 2021, indicating a delay in trial. Reliance was placed on Supreme Court decisions regarding bail in cases with significant detention periods and delayed trials. Non-applicant's arguments: The Directorate of GST Intelligence opposed the bail application, stating that the allegations of creating fake firms and causing a loss of Rs. 258 Crores are serious. They argued that the applicants' first bail application was rejected on merits and that voluminous documents demonstrate their prima facie involvement. They also noted that Applicant No. 1 admitted to availing input tax credits in his statement under Section 70 of the GST Act and that investigations into beneficiaries are ongoing. The Directorate confirmed that the investigation concerning the present applicants is complete.