The Hon’ble High Court of Punjab and Haryana vide its order dated 25.05.2023 in the matter of Amrinder Singh Vs. State of Punjab in CRM-M-`38409 of 2021, ordered for release of the petitioner on bail considering the fact that maximum sentence that could be awarded was 5 years and also the co-accused have already been granted the concession of bail.

The Petitioner filed the writ petition before the Hon’ble High Court praying for grant of regular bail under Section 439 Cr.PC in Complaint No. 15 of 2021 titled as State Vs. Vinod Kumar & Ors. registered on 12.05.2021 under Sections 132(1) (a), (b) & (c) of Central Goods & Services Tax Act, 2017 and Punjab Goods & Services Tax Act, 2017 filed before the Court of Sub Divisional Judicial Magistrate, Khanna, District Ludhiana.

Facts of the Case: –

• That an investigation into the business activities of firms under subject has revealed that a group of persons as mentioned below have colluded and connived with each other to make a network of fake firms and defraud the state exchequer.
• All these individuals i.e., 1) Vinod kumar, S/o S! Om Parkash Street, 1.0. 12, Amloh road, Khanna, Ludhiana. 2) Mr. Maninder Sharma, S/o Sh. Satya Varat Rattan, Street no. 1, ward no. 4, Nandi colony, Khanna, Ludhiana. 3) Mr. Harvinder Singh,S/o Sh. Sukhdev Singh H.No. 3660, Filli Gate Jagraon, Ludhiana. 4) Mr. Sandeep Singh,S/o Sh. Ikbal Singh Nabha Colony No. 01 Khanna, Ludhiana 5) Mr. Amarinder Singh,S/o Sh. Gurnam Singh H.No. 428, Uchha Vehra, GT road Khanna, Ludhiana 6) Mr. Sunny Mehta, S/o Sh. Kuldeep Mehta, H.No. C/18 St. No. 3 Jagat Colony Khanna, Ludhiana. 7) Mr. Sukhdev Singh S/o Sh. Kartar Singh, Shiva Tower Over Lock Road Near OBC Bank Ludhiana, have made a total of 40 firms and have evaded tax amounting to Rs. 122.28 Crores. The common Email-ids, Phone numbers and PAN cards have been used in all these firms to get the registrations and pass on the fraudulent Input tax Credit (ITC) to various beneficiary firms.
• Further, no tax has been ever paid in the inward supply chain of these firms and a mechanism has been devised by all these individuals to cover the movement of clandestine goods with fake invoices so that fraudulent ITC could be availed for adjustment against the output tax liability. The bank accounts given/uploaded at the GSTN Portal of these firms are different than the bank accounts through which money transaction has happened and even parallel and fake bank accounts have been opened to withdraw the cash in some of these firms.
• That huge cash has been collected/ withdrawn from the bank accounts by same and common persons. Different roles were assigned in this group of individuals amongst each other such as getting registration on the PAN of some individuals and cash withdrawals by some other persons of the group.
• The verification of inward supplies of these firms from the E-Way portal revealed that the inward supply chain of these firms is NIL at subsequent stages and these firms itself were also found to be non-existent at their registered place of business. Accordingly, a case for arrest of the following 7 persons has been granted by Commissioner of State Tax, Punjab.

It was submitted on the behalf of the petitioner that similarly situated co-accused of the petitioner, namely, Maninder Sharma, Vinod Kumar, Sunny Mehta and Sandeep Singh have been granted the concession of regular bail vide order dated 31.08.2022.  It was also submitted that the petitioner is in custody since 13.03.2021 and only the examination in chief of the complainant had taken place as against the total 63 prosecution witnesses yet to be examined, the petitioner was entitled to the concession of bail.

On the other hand, the factual position was not disputed on the behalf of the petitioner, and also the fact that the similarly situated co-accused of the petitioner have been granted the concession of regular bail.  However, it was contended that the serious nature of the allegations does not entitle the petitioner to the grant of bail.

Held: –

• • The Hon’ble Court after considering the submissions made and facts of the case, found that as per the complaint evasion of tax was Rs.122,28,94,629/- which has now increased to Rs.131,96,00,000/-. Further, the complaint in question was filed under Section 132(1) (a), (b) & (c) of Central Goods & Services Tax Act, 2017 and Punjab Goods & Services Tax Act, 2017 based on the detailed investigation conducted.
  • It was found by the Hon’ble Court that the grant or refusal of bail lies in the discretion of the Court, the discretion is to be exercised with regard to the facts and circumstances of each case. However, bail is not to be denied to satisfy the collective sentiments of a community or as a punitive measure.

• It was observed by the Hon’ble Court that in economic offences involving the IPC or Special Acts or cases triable by Magistrates once the investigation is complete, final report/complaint filed and the triple test is satisfied then denial of bail must be the exception rather than the rule. However, this would not prevent the Court from granting bail even prior to the completion of investigation if the facts so warrant.
• The Hon’ble Court considering the fact that the petitioner was arrested on 13.03.2021 and is in custody ever since, in a case where the maximum sentence that could be awarded was 05 years, the further incarceration of the petitioner is not required, more so when his co-accused have been granted the concession of regular bail vide order dated 31.08.2022.
• The Hon’ble Court in view of the above Circumstances and without commenting on the merits of the case, held that the further incarceration of the petitioner would be wholly unnecessary.

The Hon’ble Court with the above findings, allowed the writ petition and ordered for release of Petitioner Amrinder Singh son of Gurnam Singh subject to the satisfaction of the Trial Court concerned, which would be at liberty to impose any stringent conditions that it deems appropriate. Further, the Petitioner is directed to surrender his passport before the Trial Court or furnish an affidavit in case he does not possess any passport.  If any attempt whatsoever is made by the petitioner and/or his family members/friends to contact/threaten/intimidate any of the witnesses of the case, the State/complainant shall be at liberty to move an application for cancellation of bail granted vide this order.