HC grants bail to person accused of claiming Fake ITC of Rs 9.97 crores on a personal bond of Rs 100000

The Delhi High Court in the matter of  PULKIT Vs. STATE has been granted bail  to individual accused of illegally claiming an input tax credit (ITC) under the CGST Act, who has already spent 9 months in custody.

Pulkit, the petitioner, is seeking bail for the crime of forming a number of false corporations in order to cheat the government. The defendants are charged with creating phoney bank accounts and providing false phone numbers and email addresses.

The Coram  found out that, “According to the FIR, Saraswati Enterprises, of which Sanjay Garg is the proprietor, cheated and defrauded the government, resulting in a loss of Rs. 9.97 crores. Saraswati Enterprises was the employer of the applicant.

According to the chargesheet, the allegation of fraudulent transactions causing loss to the government was based on transactions between August 27 to November 22, 2017. The mobile numbers and email addresses used for verification at the time of GST registration were investigated when the addresses were discovered to be bogus. One of the cell numbers used in the registration as well as the bank account opening was discovered to be in the applicant’s name.

The applicant claimed that he had only been employed by Shubham Khandelwal since early 2018, and that the applicant’s mobile number had been switched to his name after the transactions in question had already occurred. The registration of the suspect accounts and the creation of the bank account with the mobile number occurred prior to the number being transferred to the current applicant. Investigation of the transactions with Saraswati’s purchasers revealed that Shubham Khandelwal was the one who supplied the bills and accepted payments in Saraswati’s account, according to the chargesheet.

According to the Status Report, the applicant was involved in a comprehensive and well-planned plot to create phoney companies using false identities in order to fabricate spurious invoices and claim an unlawful input tax credit to the government’s prejudice. The applicant is not entitled to a bail hearing.

The court noted that the status report made no mention of the applicant’s prior criminal history, nor did it contain any evidence that he was a flight risk. Since 14.07.2021, the applicant has been in detention for nearly nine months.

The material, the court noted, was mostly documentary and had already been presented to the trial court. As a result, the possibilities of the applicant tampering with the evidence are slim.”

The High Court Ruled Out that, “the applicant is admitted to bail in connection with FIR No. 263/2018 dated 24.12.2018 registered at Police Station Economic Offences Wing, subject to the following conditions:-

a. The applicant will furnish a personal bond in the sum of Rs. 1,00,000/- with two sureties of the like amount, one of which will be from a blood relative of the applicant, to the satisfaction of the Trial Court.

b. The applicant will remain resident at the address mentioned in the memo of parties [House No. 321/29, Gali No. 6, Dev Nagar, Sonipat, Haryana].

c. The applicant will inform the Investigating Officer and the Trial Court in advance of any change in his residential address.

d. The applicant will appear on each and every date fixed before the Trial Court.

e. The applicant will give his mobile numbers to the IO and ensure that the mobile numbers are kept operational and reachable at all times.

f. The applicant will not directly or indirectly tamper with evidence or try to influence any of the prosecution witness in the case. In case the same is established, the bail granted to the applicant shall stand cancelled forthwith.

The Judgment was made by Hon’ble Mr. Justice Prateek Jalan.

The Petitioner was represented by Mr. Sunil Dalal and Respondent was represented by Mr. Amit Chadha.

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