Court refuses Bail to CA accused of Forgery and GST Evasion

The Delhi High Court in the matter of Aman Gupta v. State has refused the anticipatory bail of a Chartered Accountant who is an alleged offender and being charged with issuing fake invoices and e-way bills.

The case also involves offences covered by Section 467 r.w. 471 of the IPC, which is an economic offence resulting in a loss to the public exchequer.

Mr. Umang Garg, (here as the Complainant) the owner of M/s Ulagarasan Impex Pvt. Ltd., was arrested by the Directorate General of Goods and Services Tax Intelligence (DGGI), Gurugram on April 05, 2022 on suspicion of GST evasion through the use of bogus Input Tax Credit (ITC) claims.

The Complainant, on the other hand, was granted bail on April 19, 2022 after depositing INR 1 crore as GST. The Complainant stated that he had appointed CA Aman Gupta to audit his companies’ books of accounts for the last two years.

Initially, the Complainant filed a police complaint on May 30, 2022, followed by a FIR on September 4, 2022, alleging that the Applicant induced him to purchase goods through various firms, which the Applicant claimed were owned by known persons of his. The Complainant purchased goods from such firms and made regular tax payments as well as deposits of the said goods in various accounts existing under different names on the Applicant’s order. However, the Complainant later discovered that the aforementioned firms are bogus and non-existent.

Furthermore, the Complainant claimed that the Applicant and his associates defrauded him of INR 2,81,99,475 by forming fake, forged, and fabricated firms and receiving payments including GST in different accounts against the Complainant’s purchased goods but failing to deposit GST.

The Applicant applied for anticipatory bail before the Session court, which denied the first application on September 15, 2022.

Following that, the Applicant filed the next anticipatory bail application with the Hon’ble Delhi High Court.

The Applicant stated that it has never worked on the Complainant’s accounts/returns because the regular accounting and filing work was handled by the Complainant’s team of accountants.

The Applicant contended that there was no bar to filing a fresh anticipatory bail application because the Applicant was willing to deposit a sum of INR 75 lakhs and settle the matter with the Complainant and the current dispute is civil in nature, pertaining to money recovery, and criminal proceedings cannot be used to make money recoveries.

The Hon’ble Delhi High Court observed that the current case involves allegations of the Applicant issuing fake invoices and e-way bills for the purpose of GST evasion, which is an economic offence involving loss to the public exchequer. As a result, such offences must be taken seriously.

It should be noted that, given the overall facts and circumstances of the case, as well as the fact that the Applicant, the court believes that custodial interrogation of the Applicant is required.

The HC held that the allegations levelled against the Applicant were serious, involving forgery and GST evasion through the creation of false invoices issued by non-existent entities.

Hence, High Court rejected the anticipatory bail of the Applicant.

For Official Judgment Download PDF Given Below: