Amit Bothra vs. Union Of INDIA Through Department Of Revenue Intelligence And Directorate General Of Goods And Servi

Held

The Court allowed the bail applications of the petitioners, Amit Bothra and Ashok Daga. While acknowledging the seriousness of the allegations and the arguments presented by both sides, the Court found that the case for granting bail was made out. The Court explicitly stated that it was not commenting on the merits of the case. The petitioners were directed to be released on furnishing a personal bond of ₹5,00,000/- each with sureties. Specific conditions were imposed, including cooperation with the trial, not tampering with witnesses, not committing further offences, and submitting passports to the Trial Court, with a prohibition on leaving India without prior permission. The Court retained the index of the file supplied by the respondent in sealed cover.

Facts

The petitioners, Amit Bothra and Ashok Daga, partners of M/s Vishnu Essence, were arrested in connection with a GST evasion case. The Directorate General of Goods and Services Tax Intelligence (DGGI) alleged that their firm clandestinely cleared Pan Masala worth ₹320 crores, evading GST amounting to ₹225 crores. This intelligence led to searches and seizures of goods and vehicles. The petitioners' statements, recorded under Section 70 of the GST Act, allegedly confessed to the evasion. The prosecution argued that the petitioners were involved in a syndicate with Kishore Wadhwani, the alleged kingpin, and supplied goods without invoices. The petitioners, however, claimed their firm was registered and paid GST regularly, and their statements were obtained under duress. They asserted that the dispute was a revenue matter and they had already deposited ₹7 crores. They also contended that the IPC sections added were malicious and procedural requirements for arrest were not followed.

Key Issues

1. Whether the petitioners are entitled to bail in connection with Crime No. 23/2020 registered under Section 132(1)(a)(i) of the GST Act and Sections 409, 467, 471, 120-B of the IPC? (Mixed question of law and fact, concerning Section 439 of Cr.P.C. and Section 132 of the GST Act). Petitioner's arguments: The petitioners argued that their statements were recorded under threat and pressure and were retracted. They asserted that the alleged tax evasion was a revenue matter and they had deposited ₹7 crores. They also contended that the IPC sections were added to harass them and that the procedure for arrest under Section 69 of the GST Act and Section 41A of Cr.P.C. was not followed. They relied on several Supreme Court and High Court judgments regarding bail and procedural fairness. Revenue's arguments: The revenue argued that the investigation was at a crucial stage and that clinching evidence indicated a modus operandi for clandestine manufacturing and sale of Pan Masala. They asserted that the petitioners had a proximate nexus with the syndicate and were not merely benefactors. They highlighted that the offence, involving GST evasion exceeding ₹5 crores, was cognizable and non-bailable as per Section 132(5) of the GST Act. They also cited judgments emphasizing the seriousness of economic offences and the need for proper investigation.