SC and HC Judgments Online at MyNation

Judgments of Supreme Court of India and High Courts

Arvind Kumar Munka vs The Union Of India on 24 December, 2019

INTHEHIGHCOURTATCALCUTTA
CRIMINALREVISIONALJURISDICTION
APPELLATESIDE

Present:

TheHon’bleJusticeShivakantPrasad

CRM10075of2019

ArvindKumarMunka
-Vs.–

TheUnionofIndia

ForthePetitioner:Mr.SekharBasu
Mr.RajdeepMazumder
Mr.MayukhMukherjee
FortheU.O.I.:Mr.K.K.Maiti

HeardOn:16.12.2019
JudgmentOn:24.12.2019

ThisisanapplicationforbailunderSection439oftheCodeofCriminal

Procedure,1973onbehalfofthepetitionerwhohasprayedforhisenlargementon

bailonanyconditions.Thepetitionerhasbeenarraignedasanaccusedalongwith

otheraccusedpersonsinconnectionwiththeCaseNo.C3179of2019arisingout

ofV(12)75/AE/CGST/GR-VII/KOL-NORTH/2019underSections69readwith

Section132(1)oftheCentralGoodsandServicesTaxAct,2017,nowpending

beforethelearnedChiefJudicialMagistrate,Alipore.

ThepetitionercaseisthatheisaCharteredAccountantandhisofficeis

situatedatRoom2H,56MetcalfeStreet,Kolkata-700012andisnowayconnected

withtheinstantcaseandhasbeenfalselyarraignedasanaccusedonthe

allegationthatthepetitionerinconnivancewiththeotheraccusedpersons,
2

namely,SanjayKumarPandit,NagendraKumarDubeyaliasSandipDubey,and

Mr.VijayRajpuriyaalongwithotherpersonshadallegedlyissuedGSTinvoices

withoutanysupplyofthegoodstothebuyersoncommissionbasiscausinglossof

morethan98croresapproximately.

Itissubmittedthatthepetitionerwasarrestedandproducedon6.06.2019

beforetheLearnedChiefJudicialMagistrate,Alipore,whovideorderdated

6.06.2019

rejectedhisprayerforbailremandinghimtojudicialcustody,although,

hewasrenderinghiscooperationwiththeinvestigatingagencypriortohisarrest.

ThenthepetitionermovedanapplicationunderSection439Cr.P.C.forhisrelease

onbailbeforelearnedSessionsJudgeAlipore,butbyorderdated20.08.2019the

bailprayerwasrejectedonconsideringthenatureandmagnanimityofunlawful

actdonebytheaccusedpersonsincludingthepetitionerasrevealedfromthefinal

reportoftheinvestigatingagencyandonconsiderationthatthereshallhaveevery

possibilitytoinfluencethewitnesstodestroytheevidenceorevadetheprocessof

furtherinvestigationandtrial.

BeingaggrievedbytheorderofrejectionofapplicationunderSection439

Cr.P.C.,thepetitionerhasprayedforenlarginghimonbailonthegrounds,inter

alia,thatthelearnedCourtsbelowhavecommittedanerrorbynotgrantingbailon

61stdayintermsofSection167oftheCriminalProcedureCode;thelearnedChief

JudicialMagistratehasrecordedorderofdetentionofthepetitionerwithout

adheringtothedirectivesoftheHon’bleSupremeCourtinthecaseofArnesh

Kumar-Vs-StateofBiharAnrs,reportedin2014(8)SCC273aswellasthe

observationinthecaseofRiniJoharAnrs-Vs-StateofMadhyapradesh

Ors,reportedin2016(11)SCC703;thattheoffenceunderSection132ofCGST

Act,2017isbailable;andthatwithoutprevioussanctionbytheCommissionerfor

filingchargesheettheproceedingasawholeisrenderedotiose.
3

Mr.SekharBasulearnedSeniorAdvocateappearingforthepetitioner

submittedthatthepurposeofarrest,whenthepetitionerwascooperating,posesa

questionregardingthemaliciousintentoftheprosecutingauthoritybecausewhile

renderinghiscooperation,thepetitionerwascoercedintosigningseveralblank

documentsbytheinvestigatingagency.Itispointedoutthatoffencesunder

Section132(1)(a),(b)and(c)oftheCGSTAct,2017providesforamaximum

punishmentfor5yearsandistriablebythelearnedMagistrateofFirstClass.The

petitionerisincustodysince06.08.2019andnofurtherdetentioniswarranted.He

isnotaresponsiblepersoneitherasaproprietororapersonresponsibleforthe

runningofanyproprietaryconcernandnonoticewasissuedunderSection73of

theCGSTAct,2017andhasbeenfalselyentangledinthiscase.

Mr.Basufurthersubmittedthattheinstantprosecutionhasbeenlodged

withoutthesanctionoftheCommissionercontrarytomandateprovidedunder

Section134ofCGSTAct.TheCommissionerhasonlyauthorizedtheInvestigating

OfficertoarrestunderSection69readwithSection132(1)oftheCGSTActbuthas

notgrantedSanctionunderSection134oftheCGSTActandassuchtheinstant

prosecutionisnotmaintainableandpreciselyraisedthefollowingpointsgermane

totheapplicationforbail:-

1)WhetherthelearnedTrialCourthascommittedanerrorbynotgrantingbail

on61stdayintermsofSection167oftheCriminalProcedureCode?

2)WhetherthedirectionmadeinthecaseofArneshKumar-Vs-Stateof

BiharAnrs,reportedin2014(8)SCC273aswellastheobservationinthecase

ofRiniJoharAnrs-Vs-StateofMadhyapradeshOrs,reportedin2016

(11)SCC703isrequiredtobecompliedwith?

4

3)WhethertheoffencesmentionedunderSection132oftheCGSTAct,2017is

bailable?

4)WhethertheCommissionercanissuetheorderforarrestonthebasisof

commitmentofoffencebythepetitioner?

5)WhetheranyprevioussanctionhasbeenissuedbytheCommissionerfor

filingChargeSheethasnotbeendisclosed?

Onthepointno.1,itisarguedthatthelearnedMagistratehasfailedto

comprehendthesignificanceandpurportofSection167(2)SectionoftheCodeofCriminal

Procedure,therebyactinginamannerwhichannulstherudimentaryrequirements

stipulatedinSection167(2)oftheCodeofCriminalProcedurewhichprovidesthat

theMagistratetowhomanaccusedisforwardedunderthissectionmay,whether

hehasorhasnotjurisdictiontotrythecase,fromtimetotime,authorisethe

detentionoftheaccusedinsuchcustodyassuchMagistratethinksfit,foraterm

notexceedingfifteendaysinthewhole;andifhehasnojurisdictiontotrythecase

orcommititfortrial,andconsidersfurtherdetentionunnecessary,hemayorder

theaccusedtobeforwardedtoaMagistratehavingsuchjurisdiction.

Plainreadingoftheprovisionallowsthatapersonmaybeheldincustodyof

thepoliceforaperiodof15daysontheordersofaMagistrateandthelearned

Magistrateisempoweredtoauthorizedetentionoftheaccusedincustodypending

investigationforanaggregateperiodof90daysincaseswheretheinvestigation

relatetooffencepunishablewithdeath,imprisonmentforlifeorimprisonmentfor

notlessthan10yearsormoreandinothercasestheperiodof60dayshasbeen

kept.

Mr.BasureliedonadecisionincaseofHussainaraKhatoonandOrs.

reportedin(1980)1SCC108toarguethatinthelandmarkjudgementSupreme
5

CourthascastaboundendutyupontheMagistratetopointouttoanundertrial

abouthisindefeasiblerightbeingaccrued,providedtheinvestigationisnot

concludedwithinthestipulatedperiodandthatanaccusedisentitledofbeing

releasedonbailifheisreadytofurnishthebail.Reliancetoobservationinpara

[email protected]aRam

reportedinAIR2014SC3036hasbeenplacedtosubmitthattheaccused

acquiresstatutoryrightofhisreleaseonbailindefaultofsubmissionofcharge

sheetbytheInvestigatingOfficeron60daysofjudicialcustody.Ithasbeen

preciselyheldthatifthecharge-sheetisfiledsubsequenttotheavailingofthe

indefeasiblerightbytheaccused,thenthatrightwouldnotstandfrustratedor

extinguishedand,therefore,ifanaccusedisentitledtobereleasedonbailby

applicationoftheprovisotosub-section(2)ofSection167Cr.P.C.,makesthe

applicationbeforetheMagistrate,buttheMagistrateerroneouslyrefusesthesame

andrejectstheapplicationandthentheaccusedmovesthehigherforumandwhile

thematterremainspendingbeforethehigherforumforconsiderationacharge

sheetisfiled,theso-calledindefeasiblerightoftheaccusedwouldnotstand

extinguishedthereby,andontheotherhand,theaccusedhastobereleasedon

bail.

IncaseofSectionRajnikantJivanlalPatelAnr.vsIntelligenceOfficer

NarcoticControlBureauNewDelhireportedin(1989)3SCC532ithasbeen

observedthattherighttobailunderSection167(2)proviso(a)isabsolute.Itisa

legislativecommandandnotCourt’sdiscretion.Iftheinvestingagencyfailstofile

chargesheetbeforetheexpiryof90/60days,asthecasemaybe,theaccusedin

custodyshouldbereleasedonbail.Atthatstage,meritsofthecasearenottobe

examined.Infact,theMagistratehasnopowertoremandapersonbeyondthe

stipulatedperiodof90/60days.Hemustpassanorderofbailandcommunicate

thesametotheaccusedtofurnishtherequisitebailbonds.
6

AFullBenchdecisionincaseofSectionUdayMohanlalAcharyavsStateOf

Maharashtrareportedin(2001)5SCC453hasbeenreferredandrelianceis

placedonmajorityviewoftheHon’bleApextourgethattheaccusedisentitledto

statutorybailandaslongasthemajorityviewoccupiesthefielditisabinding

precedent.Thatapart,ithasbeenfollowedbyathree-JudgeBenchinSayed

Mohd.AhmadKazmicase[(2012)12SCC(Cri)488]whichisbasedonthree-

JudgeBenchdecisioninUdayMohanlalAcharyacase[(2001)5SCC453:

2001SCC(Cri)760]andcontendedthattheprinciplelaidincaseofPragyna

SinghThakurcase[(2011)10SCC445:(2012)1SCC(Cri)311]doesnotstate

thecorrectprincipleoflaw.

InrebuttalMr.K.K.Maitysubmittedthattherightofanaccusedtobe

releasedonbailafterexpiryofthemaximumperiodofdetentionisprovidedunder

Section167oftheCodeofCriminalProcedure.Section167dealswithpowerofthe

policetoinvestigateincriminaloffencewhichstartswithlodgingofinformationin

cognizablecasesunderSection154ofCr.P.C.andultimatelyculminatein

submissionofreportoncompletionofinvestigationunderSection173ofCr.P.C.

ThelearnedMagistrateisempoweredtotakecognizanceoftheoffenceonthebasis

offinalreport/chargesheetfiledbeforetheMagistratebutwhenfinalreportis

submitted,thecustodyoftheaccusedisnolongerrequiredtobedealtwithunder

Section167oftheCr.P.C.Itisarguedthatthedisputeregardingdefaultbailhas

beendealtwithbytheHon’bleSupremeCourtinthecaseofUdayMohanLal

Acharya-Vs-StateofMaharashtrareportedin(2001)AIR(SCW)1500wherein

thecaseofSanjayDuttreportedin1994AIR(SCW)3857wasconsideredandit

wasobservedthattheindefeasiblerightforgrantofbailontheexpiryoftheinitial

periodof180daysforcompletingtheinvestigationortheextendedperiod

prescribedbySection20(4)(bb)ofTADAasheldinHitendraVishnuThakurisa

rightoftheaccusedwhichisenforceableonlyuptothefilingoftheChallanand
7

doesnotsurviveforenforcementontheChallanbeingfiledintheCourtagainst

him.Inthiscontextitissubmittedthatadmittedlythepetitionerwasarrestedon

06.06.2019andonthesamedatethepetitionerwasproducedbeforethelearned

ChiefJudicialMagistratebutafterconsideringthegravityofthecase,remanded

thepetitionertoJudicialCustody.On61stdayfromthedateofarrestabail

applicationwasmovedon06.08.2019andtheverydatetheprosecutionhadfiled

thechargesheet.SothelearnedCJMbyitsorderdated06.08.2019rejectedprayer

forbailholdingthatthedefaultbaildoesnotariseandanapplicationunder

Sectionsection439oftheCodewasalsorejectedbythelearnedSessionJudgebythe

impugnedorder.

Inrespectofpointno2,Mr.BasureliedincaseofSectionUnionOfIndiavsArviva

Industries(I)Ltd.reportedin(2014)3SCC159tocontendthatthepetitioner

shouldnotbedeprivedofhislibertyandbereleasedonbailonanyconditionin

drawingmyattentiontotheobservationthatarrestinvolvesdeprivationoflibertyof

apersonarrestedandthereforeinfringesthebasichumanrightofliberty.Personal

libertyisoneofthecherishedobjectsoftheIndianConstitutionanddeprivationof

thesamecanbeinaccordancewithlawandinconformitywiththeprovisions

thereof,asstipulatedunderSectionArticle21oftheConstitutionandfurthersubmitted

thatintheinstantcase,eventhoughtheoffencestipulatesamaximumtermof

imprisonmentuptofiveyears,yet,noneofdirectionsenshrinedinpara11ofthe

decisionincaseofSectionArneshKumarvsStateofBihar(supra)hasbeenadhered

theretowhichreadsthus:

“Ourendeavourinthisjudgmentistoensurethatpoliceofficersdonot
arrestaccusedunnecessarilyandMagistratedonotauthorisedetention
casuallyandmechanically.Inordertoensurewhatwehaveobserved
above,wegivethefollowingdirection:

AlltheStateGovernmentstoinstructitspoliceofficersnotto
automaticallyarrestwhenacaseunderSection498AoftheIPCis
8

registeredbuttosatisfythemselvesaboutthenecessityforarrestunder
theparameterslaiddownaboveflowingfromSection41,Cr.P.C.

Allpoliceofficersbeprovidedwithachecklistcontainingspecifiedsub-
clausesunderSection41(1)(b)(ii).

Thepoliceofficershallforwardthechecklistdutyfiledandfurnishthe
reasonsandmaterialswhichnecessitatedthearrest,while
forwarding/producingtheaccusedbeforetheMagistrateforfurther
detention.

TheMagistratewhileauthorisingdetentionoftheaccusedshallperuse
thereportfurnishedbythepoliceofficerintermsaforesaidandonlyafter
recordingitssatisfaction,theMagistratewillauthorisedetention.

Thedecisionnottoarrestanaccused,beforwardedtotheMagistrate
withintwoweeksfromthedateoftheinstitutionofthecasewithacopy
totheMagistratewhichmaybeextendedbytheSuperintendentofpolice
ofthedistrictforthereasonstoberecordedinwriting.

NoticeofappearanceintermsofSection41AofCr.P.C.beservedonthe
accusedwithintwoweeksfromthedateofinstitutionofthecase,which
maybeextendedbytheSuperintendentofPoliceoftheDistrictforthe
reasonstoberecordedinwriting.

Failuretocomplywiththedirectionsaforesaidshallapartfromrendering
thepoliceofficersconcernedliablefordepartmentalaction,theyshallalso
beliabletobepunishedforcontemptofCourttobeinstitutedbeforeHigh
Courthavingterritorialjurisdiction.

Authorisingdetentionwithoutrecordingreasonsasaforesaidbythe
judicialMagistrateconcernedshallbeliablefordepartmentalactionby
theappropriateHighCourt.”

Thusitiscontendedthatthepetitionerwasneitherservedwithanotice

underSectionsection41AoftheCodenordidthelearnedMagistraterecordhis

satisfactionwithregardtothearrestwhileremandingthepetitionertocustody

whichisevidentfromtheorderdated06.06.2019andfurtherplacedreliancein

caseofRiniJoharAnr.(supra)tosubmitthattheHon’bleApexCourthas

takenasternviewwithregardtonon-compliancetothedirectionsincaseof

ArnishKumar(supra).

Itispointedoutthatonthescrutinyofthecomplaint,itwouldbeapparent

thatthepetitioneronthe29thofMay,2019,hadjoinedtheinvestigation,and

cooperatedwiththeinvestigatingagency,whichiswhyafterhisinterrogation,the

petitionerwasallowedtoleave.However,onceagaintheinvestigatingagency
9

summonedthepetitionerandaccordinglythepetitionerwenttotheInvestigating

Officeron06.06.2019onwhichdatehewasarrestedinamechanicalmanner,

withouthavinganyregardtothelawlaiddownbytheHon’bleApexCourt.Itis

furthersubmittedthatinspiteofthepetitionerjoiningtheinvestigation,and

renderinghiscooperationtotheinvestigatingagencyyethewasarrestedandsuch

conductmanifestthemaliciousdeterminationoftheinvestigatingagency.A

referencetoadecisionincaseofSidhharamSatlingappaMhetreVs.StateOf

Maharashtrareportedin(2011)1SCC694hasbeenreliedontoarguethatthe

conductoftheInvestigatingOfficerspeaksavolumesofarasthemalicious

intentionoftheinvestigatingagency.IthasbeenheldthatincaseswheretheCourt

isoftheconsideredviewthattheaccusedhasjoinedinvestigationandheisfully

cooperatingwithinvestigatingagencyandisnotlikelytoabscond,inthatevent,

custodialinterrogationshouldbeavoided.Inthesaidjudgmentthedirectionhas

beenlaiddowntothefollowingeffects-

“Incase,theStateconsiderthefollowingsuggestionsinproperperspective

thenperhapsitmaynotbenecessarytocurtailthepersonallibertyofthe

accusedinaroutinemanner.Thesesuggestionsareonlyillustrativeandnot

exhaustive.

1)Directtheaccusedtojoininvestigatingagency,thenonlytheaccusedbe

arrested.

2)Seizeeitherthepassportorsuchotherrelateddocuments,suchas,thetitle

deedsofpropertiesortheFixedDepositReceipts/ShareCertificatesofthe

accused.

3)Directtheaccusedtoexecutebonds.

10

4)Theaccusedmaybedirectedtofurnishsuretiesofnumberofpersonswhich

accordingtotheprosecutionarenecessaryinviewofthefactsoftheparticular

case.

5)Theaccusedbedirectedtofurnishundertakingthathewouldnotvisitthe

placewherethewitnessesresidesothatthepossibilityoftamperingof

evidenceorotherwiseinfluencingthecourseofjusticecanbeavoided.

6)Bankaccountsbefrozenforsmalldurationduringinvestigation.”

Thus,itisarguedthattheHon’bleApexCourthasloathedthearrestofthe

personwhenhehasjoinedtheinvestigation.

Contradictingthesubmissionthesaidcontention,Mr.Maityreferredtoa

decisionoftheHon’bleSupremeCourtinthecaseofP.V.RamanaReddy-Vs-

UnionofIndiareportedin2019(26)GSTLJ(175)SCwhereinithasbeen

categoricallyheldthatthoughSection69(1)ofCGSTAct,2017whichconferspower

upontheCommissionertoorderarrestofapersonforcognizableandnon-bailable

offencedoesnotcontainsafeguardincorporatedinSection41andSection41AoftheCode

ofCriminalProcedure,1973inviewofprovisionofSection70(1)ofthesaidAct

samemustbekeptinmindbeforearrestingaperson.However,Section41A(3)of

theCodeofCriminalProceduredoesnotprovideanabsoluteirrevocableguarantee

againstarrest.

TheHighCourtheldthattheenquirybytheGSTCommissionerunder

CentralGoodsandServicesTaxAct,2017isajudicialproceedingsandnota

criminalproceedings.Itwasheldthatifthereasonstobelievethataperson

committedanyoffenceunderclauses(a),(b),(c)or(d)ofSection132(1)ofCGST

Act,2017warrantinghisarrestthoughtfoundinthefilebutnotdisclosedinthe
11

orderauthorisingthearrest,thesameisenoughandisnotrequiredtoberecorded

inorderofauthorization.

AccordinglyMr.MaitycontendedthatSection41andSection41AofCr.P.C.has

beencompliedwithbyobtainingstatementsfromthepetitioneron22.05.2019,

30.05.2019and31.05.2019intermsofsaidprovisionoftheCGSTActwhichis

axiomaticfromtheChargeSheet.TheargumentsofthepetitioneristhatSection

70isnotparimateriawithSection41AofCr.P.C.butparimateriawithSectionsection91

oftheCr.P.C.TheprovisionofSection91ofCr.P.C.providesforsummonsto

producedocumentorotherthingwhereasSection70oftheCGSTActprovides

powertosummonpersonstogiveevidenceandproducedocuments.Therefore,the

saidSection70oftheCGSTAct,2017isnotparimateriawithSection91ofCr.P.C.

InreplyMr.BasuinvitedmyattentiontotermparimateriaasperBlacks

LawDictionary6theditionwhichmeans,ofthesamematter,onthesamesubject;

aslawsparimateriamustbeconstruedwithreferencetoeachotherandarguedthat

onareadingoftheaforesaiddefinitionofparimateriaitbecomesevidentthat

Section41AoftheCodeofCriminalProcedurecanbynostretchofimaginationbe

treatedasparimateriatoSection70oftheCGSTActandfurthersubmittedthaton

abarereadingoftheaforesaidsectionsitwouldbecomeabsolutelyclearthatthe

subjectmatterenvisagedintherespectivesectionsarenotthesameandthe

structuraledificeoftheaforesaidsectionsarecompletelydifferentfromone

another.InsteadSection70oftheCGSTActisparimateriatoSection91ofthe

CodeofCriminalProcedureasthesubjectmatterinSection70oftheCGSTAct

andSection90oftheCodeofCriminalProcedurearethesame.

IamoftheviewthatMr.Basureplyastoparimateriaprovisionhasbeen

answeredincaseofP.V.RamanaReddy(supra).Moreover,thecaseofRiniJhoar

isinpointofviolationofSectionArticle21oftheConstitutionofIndia.Inthepresentcase
12

violationofSectionArticle21doesnotandcannotariseasthepetitionerhaslosthis

defaultrightofbailon06.08.2019asonthesamedatetheprosecutionhadfiled

thechargesheetandthelearnedCourtconsideringthemeritsofthecaserejected

thebail.

Mr.MaitylearnedAdvocateappearingforUnionofIndiasubmittedinviting

[email protected]dra

KumarDubeyinconnivancewiththepetitionerisoperatingseveraltradingunits

andthepetitionerisalsooperatingtwocompaniesunderthenameandstyleM/S

AlvinaSuppliersPvt.Ltd.,andM/SVaidikaImpexPvt.Ltd.inconnivancewith

ShriBijayKumarAgarwalandShriRameshGiri.InthevoluntarystatementShri

NagendraDubeyinformedthathehasprovidedassistanceofvariousbusiness

personsundertheGSTLawsandprovidedtheirregistrationdetailstothe

petitionerandthepetitionerusedtopaythepersonsforthesame.Healsostated

thatthepetitionerwasengagedinissuingbillsorinvoicesinthenameofthe

businessconcernsorpersonsandpaymentagainstinvoicesarebeingtakencareof

bythepetitioner.Thisworkrelatedtomovementofgoodsissupervisedby

petitionerandoneSanjayPanditandasperNagendraDubey’sknowledgethere

wasnomovementofgoodsagainsttheinvoiceissuedandthepetitionerfiledthe

GSTReturnsoftheFirms.Pursuanttohisstatement,thebusinesspremisesofthe

petitionerwassearchedandonsearchvariousincriminatingdocumentswere

recoveredincludingPANCardsofnumerouspeople,BankChequeBooksof

differentBanks,BanksStatements,DigitalSignatureKeys,Stamp,seal,pen

drives,mobilehandset,ATMcardsofvariousBanks,invoices,mobileSIMcards

withthenamesofvariousFirms,Laptops,KacchaBillsetc.Italsorevealedon

investigationthatanotherpersonnamely,SanjayKumarPandithasissuedbillsto

variouspartiesfromM/s.AlvinaSuppliersPvt.Ltd.,andM/s.VaidikaImpexPvt.

Ltd.andfiledtheGSTReturnsonthedirectionofthepetitioner.Healsoadmitted
13

thattherewasnosupplyofgoodsorserviceincasesofbillsissuedbyhimandhe

justprintedthebillsandplacedthestampofthepartiesandsignedandissuedthe

billsandalsoadmittedaboutreceiptofhugecashrelatedtofakeinvoice

transactionandtheyusedcashcountingmachinetocountthecash.Thecashis

paidafterdeductingthecommissionbythepetitionertovariousparties.

Thepetitioneron29.05.2019appearedintermsofsummonsunderSection

70ofCGSTAct,andtenderedhisstatement.Headmittedthatauditfile,PANCard,

DigitalSignatureforfilingdocuments,ChequeBooksofparties,GSTInvoicesofthe

partiesarekeptinhisofficeandthathehadissuedbillstovariouspartiesfrom

M/s.AlvinaandM/s.Vaidika.InthistwocompaniesGSTBillsforITC(InputTax

Credit)hasbeengivenfromvariousfirm.Healsoadmittedthathedidnotregister

anypartiesasmentionedintheChargeSheetandinvoiceswereissuedforgoods

andservicebuttherewasnomovement/supplyofgoodsorservicesincasesof

Billsissuedbyhimwithoutmovementofgoodsorservice.Themannerofpayment

againstinvoicesisRTGS.RTGSgivenbypartiesgoestoanotheraccountand

againstRTGStheyreceivedcashwhichwasreturnedtopartiesafterdeductingthe

commission.Theykeptabout1%ofthecommissionbecausetheyhadmade

arrangementsofthepartiestotakebillsfromM/s.AlvinaandM/s.Vaidika.

Therefore,primafacieonthebasisofdocumentaryevidencethepetitioneralong

withotherpersonshavecausedahugelosstotheGovernmentExchequer

amountingtoRs.141,76,46,639/-.Soobviously,theCommissionerhasreasonto

believethatthepetitionerhascommittedoffenceunderSection132oftheCGST

Act,2017andassuchauthorizedtheconcernedofficertoarrestthepetitioner

underSection69oftheCGSTAct.

IhaverespectfullygonethroughtheFullBenchdecisionincaseofUday

MohanAcharya(supra)inrespectofindefeasiblerightforbeingreleasedonbailin
14

defaultinfilingchallan/finalreport/chargesheetwithinprescribedtime.Inthe

citeddecision,theaccusedwasremandedtojudicialcustodybyorderofthe

Magistrateon17.6.2000inacaseinstitutedagainsthimunderSections406and

Section420oftheIndianPenalCodereadwithMPIDAct.Sotheperiodof60daysforfiling

ofchargesheetwascompletedon16.8.2000.Onthenextdayon17.8.2000,an

applicationforbeingreleasedonbailwasfiledallegingthatnonfilingofchallan

within60daysentitlestheaccusedtobereleasedonbailunderprovisotoSection

167(2)oftheCodeofCriminalProcedurebuttheMagistratehadrejectedthebail

concludingthatthesaidprovisionwasnotapplicabletocasespertainingtoMPID

Act.Inthecitedcasethecharge-sheetwasfiledon30thAugust,2000.

Inmyhumbleopinion,ratioofdecisionisnotwellnighwithinthefactsand

circumstancesoftheinstantcaseastheaccusedpetitionerwasremandedin

custodyafterhisarreston6.6.2019andbailapplicationwasfiledon6.8.20019,

i.e.,onthesamedayofsubmissionofFinalreport,ergo,indefeasiblerightunder

provisotoSection167(2)oftheCodeofCriminalProcedureforreleaseofthe

petitionerindefaultinfilingchallanwithinprescribedtimedoesariseinviewofthe

ConstitutionBenchdecisionoftheHon’bleSupremeCourttotheeffectthatthe

indefeasiblerightaccruingtotheaccusedinsuchasituationisenforceableonly

priortothefilingofthechallananddoesnotsurviveorremainenforceableonthe

challanbeingfiled,ifalreadynotavailedof.

Asregardspointnos.3,4and5,Mr.Basuadvertedtotheprovisionof

Section132oftheCGSTAct,2017contendingthatoffenceallegedisbailablein

natureforthereasonthatprimafaciethereisallegationofattempttoissuefake

invoiceswithoutthesupplyofgoodsorservicesasthepetitionerisbyprofessiona

CharteredAccountantwhoonlyworksforthecompaniesashisclients.Itispointed

outthatprecedingtheapplicationofSection134oftheCGSTAct,istheprovisionsof
15

lawcontainedinSection132(6)oftheAct,whichenjoinsthatapersonshallnotbe

prosecutedforanyoffenceunderthissectionexceptwiththeprevioussanctionof

theCommissioner.

Thelegislativeintentasstemmingfromtheaforesaidsectionisclear,

distinctandleavesnothingtosuppositionexceptthattheauthoritywhois

empoweredtointerferewiththelibertyofapersonbyissuinganorderofarreston

reasonablebeliefaboutnecessityofarrestunderSection69(1)oftheCGSTAct,is

alsostatutoryobligatedtodecide,albeitonlogicalassessmentoffacts,thatthe

personconcernedistobe’prosecuted’.Suchrequirementof’sanction’mustbe

evidentfromtherecordsandastheindispensableprocedureoflawmandates,

mustbebackedbyreasonswhichareprimafacieintelligentlyacceptable.Thus,it

iscontendedthatnodocumentreflectingcompliancewithSection132(6)and

Section134oftheCGSTActhasbeenplacedbeforethisHon’bleCourttoshowthe

Sanctionofthecommissionertoprosecutethepetitioner.SothelearnedMagistrate

Courtisbarredfromtakingcognizanceoftheoffenceinacasewherenovalid

sanctionhasbeenobtainedunderSection132(6)oftheCGSTAct.

Mr.Maity,onthecontrary,submittedthattheoffencecommittedbythe

petitioneriscognizableandnon-bailableandreliedonadecisionoftheHon’ble

PunjabandHaryanaHighCourtinthecaseofVikasGoel-Vs-DeputyDirector,

DirectorateGeneralofGSTIntelligence,Gurugram,reportedin2019(28)

GSTL(590)whereinithasbeenheldthatissuanceofbogusinvoices/billswithout

actualsale/transportationofgoodsandderivingwrongbenefitofmorethan80/-

croresonaccountofsuchpapertransactionbeingeconomicoffenceofhuge

magnitudeandseriousinnature,thepetitioner,whowasthemainaccusedwas

notentitledtoregularbail.

16

InthepresentcaselosscausedtoGovernmentExchequeramountstoRs.

141,76,46,639/-.Thereforeinsuchahugeeconomicoffenceheshouldnotbe

enlargedonbail.

Mr.BasureferredtoadecisionincaseofSectionSanjayKumarBhuwalkavs

UnionofIndiareportedin2018(362)ELT568(Cal)andsubmittedthatthis

Hon’bleCourthadenlargedthepetitionersonbailonconditionontheprincipleof

lawthatgrantofbailisaruleandrejectionisanexceptionandinrespectful

considerationoftheprincipleslaiddownintheciteddecisionandfurtherinviewof

latestdecisionoftheHon’bleApexCourtthatthecourtscannotextend

investigationperiodunderSection167oftheCodeofCriminalProcedure.

Accordingly,thisCourtwaspleasedtorelaxtheconditionsofbailimposedbythis

Court’sorderdatedJuly12,2018soastoenabletheirreleaseonbailastheyhave

statutoryrighttobereleasedandfurtherbearinginmindtheprinciplesasto

presumptionofinnocenceandtherightoflibertyguaranteedunderSectionArticle21of

theConstitutionofIndia.

TheciteddecisionwasauthoredbythisCourtholdingthatinregardto

Section134and138ofCGSTAct,theobjectandreasonofthisActisobviouslyto

realizetherevenuetothegovernmentexchequerandbearinginmindtheprovision

ofcompoundingnatureoftheoffenceunderSection138oftheAct,thisCourt

relaxedthebailconditiontodepositRs.39CroretotheGovernmentExchequer

but,inparticular,onthefindingthattheprosecutingagencyhadfailedand

neglectedtosubmitfinalreport/chargesheetagainstthepetitionersandevenno

extensionoftimetocompletetheinvestigationwassoughtforbythem.Therefore,

thebailprivilegewasgrantedinfavourofthepetitionersinthecitedcaseadhering

totheprincipleslaiddownbytheHon’bleApexCourtinrespectofprovisoto

Section167(2)oftheCodeofCriminalProcedure.Thus,Ifindthatthejudgmentin
17

caseofSanjayKumarBhuwalka(supra)isdistinguishablefromthefactsand

circumstancesoftheinstantcase.

Forthereasonsstatedaboveandinconsiderationofthegravityofthe

economicoffenceandbearinginmindtheprinciplelaiddownincaseofP.V.

RamannaReddy(supra),thepetitionerisnotentitledtobeenlargedonbail,

however,thepetitionerisatlibertytoapproachtheauthorityforcompoundingof

theoffenceunderSection138ofCGSTAct.

Accordingly,theCRM10075of2019isherebydismissed.

UrgentcertifiedphotocopyofthisJudgment,ifappliedfor,besuppliedtothe

partiesuponcompliancewithallrequisiteformalities.

(SHIVAKANTPRASAD,J.)

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