The directors of the company were granted anticipatory bail by the Gujarat High Court (HC) panel of Judge Umesh A. Trivedi on the grounds that the company had already been dissolved and the FIR had been filed lately. The HC stated that FIR cannot be lodged for recovery of taxes.
The Sales Tax department filed an FIR with the Valsad Rural Police Station for crime punishable under Sections 406 and 420 of the Indian Penal Code as well as Sections 85(1)(d), 85(1)(g), 86(1), and 86(2) of the Gujarat Value Added Tax Act, 2003, the applicant filed a bail application under Section 438 of the Criminal Process Code (Cr.P.C.).
It was alleged by the sales tax department that the company has to owe more than Rs 180 crores of sales tax dues to the government.
The sessions court denied the applicant’s request for anticipatory bail on the grounds that it was an economic offence and that the company has to pay more than Rs. 180 crores of sales tax dues to the state government. The applicant’s lack of cooperation with the investigation was the other factor. Consequently, the High Court application.
The bench took into consideration the contentions of the applicant that as a Director of the company which was wound up under the section 433 and 434 of the Companies Act, 1956 on February 11, 2021, and that the current FIR was filed on February 5, 2022, immediately before the competent Court issued the order of winding up, which is not appropriate.
Also, it was submitted by the counsel of the applicant that the co-accused of the case i.e. another Director, maybe a lady accused and mother of the applicant, is already granted anticipatory bail. The same should be allowed to this applicant without any hesitation.
Conversely the counsel of the respondents asserted that without entering into the validity of the prosecution for the offence under “the Act, 2003” as also IPC, once the company has evaded huge tax liability, the applicant being its Director may not be granted an order of anticipatory bail.
Also to the response assertion on the case of the lady co-accused, the respondent counsel added that she had claimed that the present applicant is administering the affairs of the company and therefore, the said order cannot be pressed into service for claiming parity.
With a personal bond of Rs. 10,000/- (Rupees Ten Thousand Only) and one surety, the single bench of Gujarat HC approved the anticipatory bail. The conditions stated that the Investigating Officer would be at liberty to ask for remand if he felt it was appropriate and just, and the Magistrate would make a merit-based decision.
The bench has however made it clear that the applicant, even if remanded to police custody, shall be immediately released after such term of police detention, subject to other requirements of this anticipatory bail judgement.
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