The Orissa High Court granted bail to a person accused of creating fictitious firms, availing bogus Input Tax Credit (ITC) worth Rs.117.25 crores.
The prosecution allegation is that the petitioner, Kashmir Kumar Agrawal claims to be the Director of a company named M/s. Madhusmita Steel Industries Pvt. Ltd. Rourkela, which is a fictitious entity. It is alleged that the petitioner effected purchase of goods worth Rs.100.44 crores and availed Input Tax Credit (ITC) of Rs.18.08 crores and passed on ITC worth Rs.19.78 crores against sale of Rs.109.88 crores. Thus, the total ITC availed and passed on by the accused in his individual capacity against the name of the said company comes to Rs.37.86 crores. However, there was neither any purchase nor sale of goods and that the transactions were made only on paper with a view to illegally avail ITC. Similarly, it is alleged that the petitioner acting in collusion with other persons created 17 fictitious firms and availed bogus ITC of Rs.117.25 crores on the basis of fake purchase invoices and passed on bogus ITC of Rs.130.78 crores on the basis of fake sale of goods both inside and outside the State of Odisha. In the process, the accused defrauded the exchequer to the tune of Rs.248.03 crores. Thus, the petitioner availed and passed on total ITC to the tune of Rs.285.89 Crores thereby, committing the offence under the aforementioned section of OGST Act.
The petitioner has submitted that even assuming that there is a prima facie case against the petitioner, fact remains that the prescribed punishment for the alleged offence is only five years and the accused has in the meantime stayed more than one year in custody. Since the prosecution report has already been submitted, there should be no impediment in directing release of the petitioner.
The single bench of Justice Sashikanta Mishra held that the petitioner has been successful in making out a good case for his release on bail. On the other hand, the prosecution has failed to satisfy the court as to how it would be prejudiced by grant of bail to the petitioner.
It is directed that the petitioner shall be released on bail by the court in seisin over the matter on such terms and conditions as may be imposed by it including the various conditions namely the accused shall not leave the territorial jurisdiction of Sundargarh district without leave of the court in seisin of the matter and he shall fully cooperate with the ongoing further investigation and make himself available as and when required for such purpose.
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