Calcutta HC grants Bail to GST Defaulters [Read Order]

The Calcutta High Court, last week granted bail to the GST defaulters who evaded tax by using fake invoices.

The petitioners, Sanjay Kumar Bhuwalka and Neeraj Jain were arrested on 12.05.2018 due to their involvement in the business of generating and selling of fake tax invoices to various entities without supplying the underlying goods or services, thereby facilitating irregular availment and utilization of input tax credit by such entities to whom such fake invoices were issued.

The High Court, in July, granted bail to the petitioners had imposed certain conditions such as furnishing bond of the sum of Rs. 50,00,000/- each on condition to deposit of Rs. 39 crore to the Government Exchequer through the competent authority with direction to appear before the I.O./Authority holding investigation to assist the investigating machinery.

The said order was further modified by order dated July 12, 2018 to the extent that the petitioners be enlarged on bail by furnishing personal recognition bond of Rs. 10 lakh each and on further condition to deposit of the evaded amount respectively.

They are still in custody and they have not been able to be released on bail by furnishing bond with the conditions as imposed by the order dated July 12, 2018.

Justice Shivakant Prasad noted that the GST Authority and their Investigating Officer has failed to submit charge sheet against the petitioners and even no extension of time to complete the investigation has been sought for by them.

“In respectful consideration of the principles laid down in the cited decisions and further in view of latest decision of the Hon’ble Apex Court that the courts cannot extend the investigation period under Section 167 of the Code of Criminal Procedure, this Court is pleased to relax the conditions of bail imposed by this Court’s order dated July 12, 2018 so as to enable their release on bail as they have statutory right to be released and further bearing in mind the principles as to presumption of innocence and the right of liberty guaranteed under Article 21 of the Constitution of India and accordingly the petitioners be released on furnishing personal bond of Rs. 50,00,000/- each to the satisfaction of learned Additional Chief Judicial Magistrate, Sealdah,” the Court said.