Person accused of wrongfully availing Input Tax Credit refused Bail by Gurugram Court

The applicant has been arrested on suspicion of facilitating the fake Input Tax Credit [ITC]. Notice of the bail application was given to the complainant/DGGI, who filed a reply opposing the bail application, contending that during the course of intelligence, various fake firms, namely M/s LalJi Enterprises and M/s Hemu Overseas, who had availed and passed on fake input tax credit on the strength of goods-less invoices, were found non-functional/ non-existent at their registered principle place of business.

During the course of the search, various incriminating materials related to the investigation were resumed in front of the accused at the business premises of M/s JMD & Associates, located at 206, K.S. Complex, Opp. Mini Secretariat, Haily Mandi Road, Patudi, Gurugram, Haryana. Signed and unsigned invoices from M/s Lal Ji Enterprises and M/s Hemu Overseas were among the resumed documents. Signed and unsigned cheques (without beneficiary information), filled and blank weighing bridge receipts, filled and blank transporter bills, ATM cards of the firm’s proprietors, and many other documents

The accused has committed offences under Section 132(1)(b)&(c) of the CGST Act, 2017 in that he was found in possession of fraudulent invoices (unsigned sale & purchase invoices) along with forged supporting documents (transport & weighment slips) for the purpose of availing and passing on fraudulent ITC amounting to 13.01 crores from M/s Lalji Enterprises, availing fraud ITC amounting to 5 crores from Hemu Overseas. The accused has also been facilitating the fake ITC being passed on from M/s Hemu Overseas in M/s Lalji Enterprises and hence is also culpable under Section 132(1)(1) of CGST Act, 2017.

Further, it has been submitted that the applicant   has categorically admitted that fake and forged documents were being used by him actively to file fake returns and show evidence of a fake supply of goods. That proprietor didn’t turn up for cooperating in the evidence also gives credence to the fact that the firms were fake and all the supplies against which returns were filed were also fake.

The offence committed falls under Section 132(1) (b) of CGST Act, 2017 and the same is non bailable and cognizable in terms of Section 132(5).

The court is of the considered view that the present accused does not deserve to be released on bail.

It is settled preposition of law that economic offences in itself are considered to be gravest offence against the society at large and hence are required to be treated differently in the matter of bail. It seems that the entire community would aggrieved if the economic offenders who ruin the economy of the State are not brought to book as such offences affects the very fabric of democratic governance and probity in public life. Further, if a murder committed in the heat of moment upon passing being aroused, the economic offence is supposed to be committed with cool calculation and deliberately with an eye on personal profit regardless of the consequence of the community. A disregard for the interest of the community can be manifested only at the cost of forfeiting the trust and faith of the community in the system to administer justice in an even handed manner without fear of criticism from the quarters which view white collar crimes with a permissive eye unmindful of the damage done to the national economy and national interest.