The Punjab and Haryana High Court in the case of Jatinder Menro Versus State of Punjab granted anticipatory bail to accused uploading fake bills on GST Portal and wrongfully claiming Input Tax Credit (ITC) worth Rs. 25 Crores.
The bench of Justice Gurvinder Singh Gill has observed that the allegations as in the complaint under Section 132 of CGST Act and in the FIR are more or less overlapping and also that the allegations pertaining to raising of false bills for showing false transactions would specifically be covered under offences under CGST and also that the petitioners have remained behind bars for a substantial period in respect of a complaint under Section 132 of CGST Act and neither the petitioners are alleged to been on the run during these five years nor the police had chosen to arrest them ever since lodging of the FIR, this Court is of the opinion that it is a fit case for grant of anticipatory bail to the petitioners.
Table of Contents
Background
The FIR came to be lodged pursuant to a complaint made by Assistant Commissioner of Excise, against Sumit Kumar, Sammy Dhiman, Mandeep Dhiman, Sudhir Kumar Verma, Mukesh Gautam, Karan Kumar, Ravi Kaushal and Kushal Kumar alleging therein that the accused, in connivance with each other, had created fake forms and had forged and fabricated fake bills showing inter se transactions of sales and purchases and had uploaded the same on the portal of GST and had further sold the bills to the manufacturing firms at Mandi Gobindgarh and Ludhiana and had earned commission from the said firms and had thus caused loss to the Government to the tune of about Rs.25 crores by way of getting ‘Input Tax Credit’.
Accused Sammy Dhiman was arrested on 31.10.2023 and upon being interrogated, he disclosed that Avtarjit Singh, Komal Sharma had masterminded the fraud. He further disclosed that Mandeep Singh (petitioner) had created a false firm at Faridabad under the name and style of Shree Radha Krishan Steels, Faridabad and after obtaining Excise and VAT number had converted the same into GST.
It is further alleged that in the same manner Mandeep Singh along with Avtarjit Singh, Komal Sharma, Jatinder Menro had created 4 different firms at Delhi and Faridabad and after obtaining Excise and VAT numbers had shown fake stock of 15000 tonnes of iron/scrap with his bogus firm Shree Radha Krishan Steel, Faridabad. Pursuant to aforesaid disclosure statement, Avtarjit Singh, Komal Sharma, Jatinder Menro and Mandeep Singh came to be nominated as accused on 2.11.2024.
Thus, in nutshell, the allegations are that fraudulent claims of ‘Input Tax Credit’ (ITC) had been made on the basis of false documents and fictitious transactions by creating dummy firms which were actually not doing any business.
Arguments
The petitioners argued that the the petitioners had remained behind bars for more than one year and since the police never took any step to arrest the petitioners during the last 5 years in the instant FIR, necessarily indicating that custodial interrogation was not really required, the alleged recording of disclosure statement of co-accused Sammy Dhiman on 31.10.2023 or addition of offences under Sections 465, 467, 468, 471 IPC at this belated stage is nothing, but a ploy to falsely involve the petitioners in the case at this belated stage so as to throw them behind bars.
The petitioner contended that the petitioners are now sought to be arrested after almost 5 years apparently under the garb of offences punishable under the IPC which have been added in the month of November, 2023, which is nothing, but a misuse of the said provision particularly when the CGST Act and PGST Act are complete codes in themselves and there are specific provisions with regard to commission of offences by way of falsifying and forging record including bills etc. and in respect of which imprisonment may extend upto 5 years.
The department contended that prosecution for offences under IPC would not be barred merely on account of the fact that there is a special enactment under which such acts are also made punishable unless exclusion is either specifically provided for in special enactment or there is some ‘over-riding’ clause in the same. Having regard to the enormity of the offence and the colossal amount defrauded wherein the accused by means of raising false bills and showing fictitious transactions had availed of ‘Input Tax Credit’ to the tune of more than Rs.25 crores, no leniency is warranted and since the amount in question is yet to be recovered, their custodial interrogation would be required.
Conclusion
The court held that both the petitions, as such, are accepted and in the event of arrest, the petitioners be released on interim bail subject to their furnishing personal bonds and surety bonds to the satisfaction of Arresting/Investigating Officer.
However, the court directed that the petitioners shall join the investigation as and when called upon to do so and cooperate with the Arresting/Investigating Officer and shall abide by the conditions as provided under Section 438 (2) Cr.P.C.
Case Details
Case Title: Jatinder Menro Versus State of Punjab
Case No.: CRM-M-49906-2024 (O&M)
Date: 14.11.2024
Counsel For Petitioner: Preetinder Singh Ahluwalia
Counsel For Respondent: Japjot Singh
