The Allahabad High Court recently granted bail to a businessman accused of availing of and passing input tax credit worth over Rs 32 crore by allegedly setting up fictitious companies.
Granting bail to the accused, Dhiraj Nath Gupta, Justice Sameer Jain observed in the order on October 16, that the prosecution’s case rested on documentary evidence, lending weight to the argument of the accused that the trial will take a considerable amount of time.
“Considering the fact that entire case of the prosecution is based on documentary evidence, the argument advanced by learned counsel for applicant that trial will take considerable period of time, cannot be ruled out,” the court observed.
The accused had sought bail in the case registered under sections 132(1)(b), 132(1)(C), 132(1)(i) of Central Goods and Services Tax (CGST) Act, 2017. His counsel, Pankaj Kumar Shukla, submitted that the allegations of forming shell companies to avail input tax credit of about Rs 32 crore and passing the same, were false.
It was further submitted that all the alleged offences are triable by the magistrate and the maximum possible punishment for all the alleged offences is five years. He stated that no further detention of the accused was required as the investigation was completed.
On the other hand, the counsel appearing for the Directorate General of GST Intelligence (DGGI), contended that the accused is a dishonest businessman and had availed input tax credit of over Rs 32 crore through fraud. Awasthi, however, could not dispute the other argument on facts submitted by Shukla.
Referring to several judgments passed by the Supreme Court in similar cases, the court granted bail to the accused. “Considering the facts and circumstances of the case discussed above and observation made by Apex Court, in my view, applicant is entitled to be released on bail,” the bench held.
