Facts of the Case

Basudev Mittal, proprietor of M/s Shree Sainath Enterprises, Raipur, was arrested on 30.03.2022 in connection with Crime No.178/GST/2021-22 registered at the Office of the Principal Commissioner, Central Excise and Central GST, Raipur, for an offence punishable under Section 132(1)(c) of the Central Goods and Services Tax Act, 2017. His first bail application was dismissed on merits on 15.07.2022 (MCRC No.3919/2022). The applicant remained in custody thereafter, and the trial had still not commenced by the time of the present application. He was granted ad-interim bail twice — on 28.08.2023 and again on 26.09.2023 — each for a period of one month, solely to enable medical treatment, supported by medical documents placed before the Court. Having completed that treatment and been remanded to custody, the applicant approached the High Court of Chhattisgarh with a second regular bail application under Section 439 CrPC.

Issues Involved

  1. Whether a second (repeat) bail application is maintainable for consideration on merits where the first bail application was already dismissed on merits and no material change in circumstances is shown.
  2. Whether prolonged pre-trial custody, non-commencement of trial, and health grounds justified grant of regular bail under Section 439 CrPC in a Section 132(1)(c) CGST Act prosecution.

Petitioner's Arguments

  • The applicant has been in judicial custody since 30.03.2022, and despite the passage of a considerable period after rejection of the first bail application, the trial has still not commenced.
  • The applicant is suffering from various diseases and had been granted ad-interim bail twice, in August and September 2023, specifically for medical treatment, evidencing the genuineness of his medical condition.
  • On these facts, the applicant sought release on regular bail.

Respondent's Arguments

  • The applicant was involved in procuring fake invoices from fake and fictitious firms, thereby availing ineligible input tax credit and committing fraud on the exchequer.
  • The applicant had already been released on ad-interim bail for over two months to undergo treatment, and had in fact completed that treatment, so no further indulgence was warranted.

Court Order/Findings

  • Since the earlier bail application had been dismissed on merits, and no change in circumstances since that dismissal was demonstrated, the Court declined to entertain the repeat bail application.
  • The Court did not find the completion of the applicant's earlier medical treatment, granted through two rounds of ad-interim bail, to constitute a fresh ground warranting regular bail.
  • The second bail application was accordingly dismissed.

Important Clarification

  • A successive bail application in a GST prosecution under Section 132 will not be entertained on merits merely by reiterating custody duration or trial delay already considered at the first bail stage; the applicant must point to a genuine change in circumstances since the earlier rejection.
  • Ad-interim bail granted specifically for a limited medical purpose, once availed and the purpose fulfilled, does not by itself convert into a ground for regular bail.

Sections Involved

  • Section 132(1)(c), CGST Act, 2017 — offence of availing input tax credit using invoices or bills without actual supply of goods or services.
  • Section 439, Code of Criminal Procedure, 1973 — special powers of High Court/Sessions Court regarding bail.

Decision – In Favour of

Department. The second bail application was dismissed, and the applicant's custody in the Section 132(1)(c) CGST Act prosecution continued.

Related Case Laws

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

Case Details

Court: High Court of Chhattisgarh, Bilaspur
Case No.: MCRC No.4793 of 2023
CNR: Not available
Coram: Rajani Dubey, J.
Decision Date: 06-11-2023
Disposal Nature: Second bail application dismissed

Link to Download the Order

Download the full judgment (PDF)

Disclaimer

This content is shared strictly for general information and knowledge purposes only. Readers should independently verify the information from reliable sources. It is not intended to provide legal, professional, or advisory guidance. The author and the organisation disclaim all liability arising from the use of this content. The material has been prepared with the assistance of AI tools.