Akshat Jain VS Union of India

Heard Sri G.S. Chaturvedi, learned Senior Counsel, assisted by Ms. Somya Chaturvedi and Mr. Somesh Khare, representing the applicant, as well as Sri Dileep Chandra Mathur, learned counsel for the opposite parties—Union of India and Senior Intelligence Officer, DGGI, Gurugram Zonal Unit. The material available on record has been thoroughly reviewed.

The present application seeks anticipatory bail for the applicant in relation to Summons/Notice No. 4197, dated 21.12.2020, issued under Section 70 of the Central Goods and Services Tax Act, 2017, by respondent no. 2. This request is made during the pendency of the trial of the current case.

Prior notice of this bail application was served to the office of the Government Advocate. According to Chapter XVIII, Rule 18 of the Allahabad High Court Rules, this anticipatory bail application is now being heard. It has been determined that granting further time to the learned A.G.A, as per Section 438(3) Cr.P.C. (U.P. Amendment), is not necessary.

The pleadings within the present anticipatory bail application have been duly considered.

Heard Sri G.S. Chaturvedi, learned Senior Counsel, assisted by Ms. Somya Chaturvedi and Mr. Somesh Khare, learned counsel for the applicant, and Sri Dileep Chandra Mathur, learned counsel for the opposite parties – Union of India and Senior Intelligence Officer, DGGI, Gurugram Zonal Unit, and reviewed the material available on record.

This application seeks anticipatory bail for the applicant in relation to Summons/Notice No. 4197, dated 21.12.2020, issued under Section 70 of the Central Goods and Services Tax Act, 2017, by respondent no. 2, during the pendency of the trial.

Prior notice of this bail application was served in the office of the Government Advocate, and in accordance with Chapter XVIII, Rule 18 of the Allahabad High Court Rules, this anticipatory bail application is being heard. Additional time for the learned A.G.A as per Section 438 (3) Cr.P.C. (U.P. Amendment) is not required.

According to the pleadings in the anticipatory bail application, the applicant anticipates arrest in the investigation conducted by respondent no. 2, wherein Summons/Notice No. CBIC-DIN202012DNN1000000DDCB, dated 21.12.2020, was issued under Section 70 of the Central Goods and Services Tax Act, 2017 by respondent no. 2 (Annexure No. 1).

The applicant claims that the offense under which he has been charged does not fall under Section 438 (6) of Cr.P.C., 1973. The facts on record indicate that the applicant is the Director of M/s Mahavir Transmission Ltd. (referred to as the “Company”), which is engaged in the manufacturing and supply of electrical conductors, aluminum scrap, and aluminum ingots, and has been operational for the last 25 years. The company has gained a reputable standing in the industry and has not been involved in any tax or other offenses. Since the implementation of the C.G.S.T. Act, 2017, the applicant’s company has paid Rs. 85 crores in G.S.T. in cash (excluding ITC Credit), and its customers include major government-appointed contractors such as L&T, Reliance Infra, Delhi Transco Limited, Tata Power Limited, Uttar Pradesh Power Corporation, and Power Grid Corporation of India.

The applicant further claims that details about the company’s operations and tax payments have been elaborated in paragraphs 9, 10, 11, and 12 of the application, which are not recounted here to avoid unnecessary details. The applicant argues that the company’s consistent compliance with tax regulations and substantial G.S.T. payments demonstrate their legitimate business practices and negate any basis for arrest.

Overall, the applicant seeks protection from arrest, highlighting his company’s long-standing compliance with tax laws and contributions to the industry, as well as questioning the applicability of the charges under the cited legal provisions.

In the case at hand, learned Senior Counsel Sri G.S. Chaturvedi, assisted by Ms. Somya Chaturvedi and Mr. Somesh Khare, represented the applicant, while Sri Dileep Chandra Mathur represented the Union of India and the Senior Intelligence Officer from the Directorate General of GST Intelligence (DGGI), Gurugram Zonal Unit. The court reviewed the available material.

The application under consideration seeks anticipatory bail for the applicant concerning Summons/Notice No. 4197 dated 21.12.2020, issued under Section 70 of the Central Goods and Services Tax (CGST) Act, 2017, by respondent No. 2, pending the trial of the case.

This bail application was duly notified to the Government Advocate’s office, adhering to Chapter XVIII, Rule 18 of the Allahabad High Court Rules, which allows the anticipatory bail application to be heard without requiring further time for the Additional Government Advocate as per Section 438 (3) Cr.P.C. (U.P. Amendment).

The applicant fears arrest due to the investigation by respondent No. 2, who issued the summons under Section 70 of the CGST Act, 2017. The applicant is the Director of M/s Mahavir Transmission Ltd., a company engaged in manufacturing and supplying electrical conductors, aluminum scrap, and ingots for 25 years. The company has a commendable reputation and has not previously breached tax or other laws. Since the enactment of the CGST Act, 2017, the company has paid ₹85 crores in GST in cash, excluding Input Tax Credit (ITC). Their customers include major government contractors like L&T, Reliance Infra, Delhi Transco Limited, Tata Power Limited, Uttar Pradesh Power Corporation, and Power Grid Corporation of India.

On January 17, 2020, the respondent authorities searched the applicant’s corporate office in Noida, Uttar Pradesh. During this search, the applicant was served with a summons under Section 70 of the CGST Act, 2017, for providing a statement. The applicant, responsible for handling the company’s purchases, complied by providing necessary documents during the searches conducted on January 17, February 3, and February 13, 2020. The applicant assures that if granted interim protection, he will cooperate with the investigation, will not abscond, and will appear before the investigating officer as required.

The applicant’s counsel argued that a co-ordinate Bench of this Court had previously granted the applicant protection on January 28, 2021. This order stated that the applicant would not be arrested if he appeared before the proper officer for investigation and allowed both parties to exchange pleadings. Since then, both parties have exchanged and discussed their pleadings. In response to the summons issued on December 21, 2020, the applicant submitted relevant documents. A second summons was issued on January 17, 2021.

The case presented involves the applicant’s compliance with investigation procedures and his willingness to cooperate with authorities while seeking anticipatory bail to prevent arrest during the ongoing investigation.

In this case, the court heard from Senior Counsel G.S. Chaturvedi, along with Ms. Somya Chaturvedi and Mr. Somesh Khare, representing the applicant, and Dileep Chandra Mathur, representing the Union of India and the Senior Intelligence Officer of the Directorate General of GST Intelligence (DGGI), Gurugram Zonal Unit. The applicant seeks anticipatory bail in response to Summons/Notice No. 4197, dated 21.12.2020, issued under Section 70 of the Central Goods and Services Tax (CGST) Act, 2017, during the investigation process.

The application was duly notified to the Government Advocate’s office, and as per Chapter XVIII, Rule 18 of the Allahabad High Court Rules, it is being heard without granting additional time for the A.G.A under Section 438 (3) Cr.P.C. (U.P. Amendment).

The applicant, a director of M/s Mahavir Transmission Ltd., a company engaged in manufacturing and supplying electrical conductors and aluminum products for the past 25 years, is concerned about his potential arrest. The company has paid Rs. 85 crores in GST since the enactment of the CGST Act, 2017, with customers including major government contractors like L&T and Tata Power Limited.

The applicant’s counsel argued that the charged offense does not fall under Section 438 (6) of the Cr.P.C., 1973. The application details the company’s compliance with tax payments and the cooperation provided during the investigation. On 17.01.2020, authorities conducted a search at the company’s corporate office, leading to the issuance of a summons under Section 70 of the CGST Act. The applicant provided the requested documents during the searches and further investigations on multiple occasions.

The court noted that a co-ordinate bench had granted interim protection to the applicant on 28.01.2021, with the condition that he appears before the investigating officer. Both parties exchanged pleadings and were heard in detail. The applicant responded to the summons and provided relevant documents promptly.

Despite complying with investigation procedures, the applicant fears arrest due to the authorities’ behavior, prompting the anticipatory bail application. The court observed that the applicant has been cooperative, submitting replies and documents as required. Given this compliance, the court questioned the necessity of his personal presence, suspecting that the authorities might be intent on arresting him.

In summary, the court deliberated on the anticipatory bail application of the director of M/s Mahavir Transmission Ltd., who is concerned about arrest during a CGST investigation. Despite his cooperation and adherence to legal requirements, the applicant sought protection due to apprehensions about the authorities’ intentions. The court considered the details of the case, the applicant’s compliance, and previous interim protection orders while evaluating the necessity of personal appearances and the possibility of arrest.

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