Facts of the Case

The petitioner, Amit Kaushik, sought regular bail under Section 439 Cr.P.C. in FIR No.405 dated 24.10.2020, registered at Police Station Faridabad Central under Sections 420, 467, 468 and 471 IPC (Sections 201 and 120-B IPC added later), on a complaint by the Excise and Taxation Officer alleging that M/s A.S. Enterprises (GSTIN 06BWTPA3969E1ZA) was fraudulently registered and operated to avail bogus Input Tax Credit through paper transactions without actual movement of goods, in contravention of Section 132(1)(b)/(c) of the HGST Act, 2017, causing an alleged loss of Rs.2,05,79,076/- to the exchequer. The petitioner was arrested on 29.09.2022, nearly two years after registration of the FIR; charges under the IPC provisions were framed on 02.03.2023, and an earlier bail plea had been dismissed on 08.02.2023.

Issues Involved

  1. Whether the petitioner, in custody for over a year with the trial proceeding slowly, is entitled to regular bail.
  2. Whether an FIR invoking general IPC provisions is maintainable for conduct alleged to fall within Section 132 of the CGST/HGST Act, which prescribes its own special procedure.

Petitioner's Arguments

  • The petitioner was falsely implicated; the firm in question was owned by co-accused Ashok, to whom the petitioner was not even remotely related.
  • The alleged tax evasion of Rs.2,05,79,076/-, being below Rs.5 crore, did not warrant arrest under the CGST Act's own scheme.
  • Since the allegations concerned offences under Section 132(1) CGST/HGST Act, the FIR under general IPC provisions was not maintainable, relying on this Court's earlier order in CWP-1393-2021.
  • The petitioner had already been in custody for over a year, no assessment order or penalty had been finalised, and the trial — with six witnesses examined without incriminating material against him — was proceeding very slowly.

Respondent's Arguments

  • The petitioner caused huge loss to the Government exchequer as part of a systematic fraud along with co-accused, and such offences warranted serious treatment; bail should be opposed.

Court Order / Findings

  • The Court left the question of maintainability of the FIR under general IPC provisions, given the special CGST/HGST procedure, to be adjudicated by the Trial Court during trial, declining to decide it at the bail stage.
  • Keeping in view the petitioner's custody of more than one year, offences triable by a Magistrate, and the slow pace of trial, bail was granted, subject to furnishing bail/surety bonds to the satisfaction of the trial court.

Important Clarification

  • At the bail stage, a High Court will ordinarily decline to decide whether an FIR under general IPC provisions is barred where the alleged conduct also falls within Section 132 of the CGST/HGST Act, leaving that question to the trial court; prolonged custody exceeding a year, coupled with a slow-moving Magistrate-triable trial, remains a valid, independent ground for bail.

Sections Involved

  • Section 132(1), CGST Act 2017 / HGST Act 2017 — punishment for specified offences, including fraudulent availment of input tax credit without invoice.
  • Section 69, CGST Act 2017 — power to arrest.
  • Sections 420, 467, 468, 471, 201, 120-B IPC — cheating, forgery and criminal conspiracy, invoked in the parallel FIR.
  • Section 439, Cr.P.C. — power of the High Court/Sessions Court to grant bail.

Decision – In Favour of

The accused/petitioner — regular bail granted; no finding was recorded on the merits of the underlying GST fraud allegations or on maintainability of the IPC FIR, both of which were left open for trial.

Related Case Laws

No directly on-point case notes are currently published on this site.

Case Details

  • Court: High Court of Punjab and Haryana at Chandigarh
  • Case No.: CRM-M-47866-2023
  • CNR: Not available
  • Coram: Justice N.S. Shekhawat
  • Decision Date: 03-11-2023
  • Disposal Nature: Bail allowed

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