The Jaipur Bench of Rajasthan high Court has refused to grant bail to Input Tax Credit (ITC) amounting to 10.87 crores, on the basis of forged transactions and also manipulated the bills showing transportation of goods from Delhi to Jaipur.
The bench of Justice Praveer Bhatnagar has observed that the seizure of the fake rubber stamps of the transport company, fake E Bills purported to be demonstrated as transportation of scrap from Delhi to Jaipur coupled with the statement of the transport company owner, stating the actual route through which his truck has moved on such dates, the report of the concerned authority confirming the non-existence of the firms from whom the petitioner had received so-called scrap affirmatively validates that petitioner fraudulently caused loss to the government revenue by claiming input tax credit in tune to 10.67 crores.
The bench relied on the decision of the Supreme Court in the matter of Y.S. Jaganmohan Reddy Vs. Central Bureau of Investigation, and categorically held that the economic offences are to be dealt with iron hands as such offences are committed with cool calculation and deliberate design and they affect the economic fabric of the whole country.
The petitioner was arrested under Section 132(1)(C), (f)& (H) of the GST Act of 2017. The matter is exclusively triable by the Magistrate, and the maximum punishment prescribed under Section 132 of the Act of 2017 is 5 years. There is no chance of interfering or tampering with the evidence as most witnesses are public servants. The chargesheet against the petitioner has already been produced, and the trial of the case may take considerable time.
The petitioner contended that the arrest memo shows that written reasons were not furnished to the petitioner in the present matter.
It was alleged against the petitioner that he falsely availed Input Tax Credit to Rs.10.87 crores.
The petitioner contended that in contrast, the CGST Portal itself shows that firms from which the petitioner received the scrap were registered on the CGST Portal. The department has not filed any complaints against these firms. The statement of the petitioner recorded under Section 70 of the GST Act, 2017 is also under coercion and cannot be read against the petitioner as, at the time of recording of the statement of the petitioner, the petitioner was under arrest.
The petitioner contended that the petitioner’s statements were not recorded at the petitioner’s house but in the Department’s office.
The department has contended that the petitioner has caused the Department a loss of Rs.10.87 crores by availing of fake Input Tax Credit without receiving any scrap or goods. On investigation, all the firms were found to be non-existent, and the petitioner had received scrap from the fake non-existent firms. Upon investigation, it was found that the petitioner, to avail of the fake Input Tax Credit, also forged the E-way Bill of the so-called Transport Company.
The court refused to grant bail on the ground that the material collected by the department prima facie exhibits that the petitioner was fraudulently profited from the ITC based on sham bills obtained or procured in the name of non-existing firms.
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Case Details
Case Title: Vineet Jain Versus Union Of India
Case No.: S.B. Criminal Miscellaneous Bail Application No. 14999/2024
Date: 24/01/2025
Counsel For Petitioner: Adv. Mr. Pankaj Ghiya, Adv. Mr. Mayank Vyas, Adv. Mr. Nikhil Sharma, Adv. Ms. Paridhi Jain
Counsel For Respondent: Sr. GST Counsel Mr. Chandra Shekhar Sinha, Adv. Mr. Mayank Kanwar
