Facts of the Case

This is a criminal law order, not a GST ruling. The applicant, Milind Jagannath Rane, a Director of Siddhi Wastetogreen Ltd. (a composting business), sought anticipatory bail apprehending arrest in Crime No. 65 of 2023 registered at Sion Police Station, Mumbai, for offences under Sections 406, 420, 465, 467, 468 and 471 read with Section 34 of the Indian Penal Code, 1860.

The complainant, Smt. Mana Rasik Shah, Director of M/s. Green Practices Pvt. Ltd. (an eco-friendly Ganesh idol manufacturer), had engaged the applicant to collect waste from societies for a 15% commission. In June 2020, the applicant allegedly represented that he had secured a contract from the Municipal Corporation of Greater Mumbai to set up a biogas plant at Bhandup, projecting monthly profits of Rs. 9,00,000, and sought an investment of Rs. 2,70,00,000. The complainant agreed to purchase machinery for the venture, sharing 50% of profits, and paid a total of Rs. 2,70,10,270 to three purported vendors — Smaranika Enterprises, Madar Enterprises, and Daksh Enterprises — based on invoices forwarded by the applicant.

Investigation revealed that no contract had in fact been awarded to the applicant, no land had been allotted, and no machinery was ever delivered. The three “vendors” were found not to deal in such machinery at all (one sold medical instruments; two were scrap dealers), and the invoices in their names were allegedly forged. Money paid by the complainant to these vendor accounts was found to have been transferred — after deduction of GST — to the applicant's company, Siddhi Wastetogreen Ltd., and then to his personal account. The GST deduction is mentioned only as one step in this fund-trail; it is not the subject of any tax dispute in this order.

Issues Involved

  1. Whether the applicant made out a case for anticipatory bail under Section 438 of the Code of Criminal Procedure, 1973.
  2. Whether the material on record disclosed a prima facie case of cheating and forgery against the applicant.

Petitioner's Arguments

  • The applicant apprehended arrest and sought protection under Section 438 CrPC.
  • Counsel argued the case be considered on the touchstone of the ingredients required for anticipatory bail, given the nature of the allegations and the applicant's cooperation with the investigation.

Respondent's Arguments

  • The State, represented by the learned APP, along with the Investigating Officers and counsel for the intervenor (the complainant company), opposed the bail application.
  • It was submitted that the FIR and material on record — including a letter from the Municipal Corporation confirming no contract had been awarded — prima facie showed the applicant had induced the complainant into paying multiple vendors on false representations, using forged and fabricated invoices.

Court Order / Findings

  • The Court found that the material on record, including statements of the alleged vendors and the Corporation's letter, prima facie indicated the applicant was involved not only in cheating but also in forging and fabricating documents.
  • The intention to cheat appeared, prima facie, to exist from the inception of the transaction.
  • Considering the nature of the offence and the supporting material, the Court held this was not a case warranting exercise of discretion under Section 438 CrPC.
  • The anticipatory bail application was dismissed.

Important Clarification

This order carries no GST law holding. The reference to a GST deduction is incidental — it appears only as one link in tracing where the complainant's money went after being paid to fictitious vendors. The case turns entirely on allegations of cheating and forgery under the Indian Penal Code, and the Bombay High Court's refusal of anticipatory bail rests on the prima facie strength of that criminal case, not on any tax question.

Sections Involved

  • Indian Penal Code, 1860 — Sections 406, 420, 465, 467, 468, 471 read with Section 34
  • Code of Criminal Procedure, 1973 — Section 438

Decision – In Favour of

The application was decided against the applicant/accused. The Bombay High Court dismissed the anticipatory bail application, finding a prima facie case of cheating and forgery, and holding it unsuitable for the exercise of discretion under Section 438 CrPC.

Case Details

Court: High Court of Judicature at Bombay, Criminal Appellate Jurisdiction
Case No.: Anticipatory Bail Application No. 2301 of 2023
Neutral Citation: 2023:BHC-AS:23673
Coram: Justice Anuja Prabhudessai
Date of Order: 18 August 2023

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