GST Evasion: Patiala Court Denies Anticipatory Bail to Person Accused of Forming Dummy Directors & Manufacturing & Supplying Goods Without Invoice

Person accused of creating dummy directors, manufacturing, and supplying clandestine without bill has been denied Anticipatory Bail by the Patiala House Court.

Krishnakant Pandey, the applicant/accused, claims that the accused/statements applicant’s have already been recorded on several occasions, though he claims that the statements were recorded under such circumstances that the application/accused had no choice but to sign the statements or face immediate arrest.

The department, on the other hand, claims that the Agency is having trouble conducting the investigation in this matter because, despite numerous notices, the accused company’s workers, agents, and directors have failed to appear or cooperate with the investigation. He has stated that the accused persons have confirmed that the Directors on record are merely dummy Directors and that the accused persons were in charge of the company’s operations.

Even the statement stated that all of the activity was carried out on the accused persons’ orders, and that all proceeds from the clandestine sale were paid straight to the accused persons. It was also mentioned that there is a web of small businesses dealing with comparable goods and items, all of which are owned by the applicants/accused persons, and the entire network is used for clandestine manufacturing and delivery of goods without any bill or invoice.

While dismissing the application, the ADJ Harjyot Singh Bhalla held that the current case involves clandestine manufacturing and sale, which is covered under Section 132 (1). (a). Despite the fact that the sentence and status of the case are the same in cognizable and non-bailable crimes, the evidence in both categories of cases must be distinct. Because they require the filing of a return, evidence in the case of an offence under subsection (1) (b) and (c) must be documentary and also available in the form of returns submitted. Section 132 (1) (a) refers to a circumstance in which there are no bills or invoices and the proof must be mostly ocular. Given that such evidence would have to be provided by employees and others engaged in the manufacturing, transit, and sale of the goods, it is possible that the accused will exert influence, causing the inquiry to be hampered.

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