Facts of the Case

This is a combined order in MCRCA Nos. 243 and 244 of 2023 before the High Court of Chhattisgarh at Bilaspur, on applications under Section 438 CrPC for anticipatory bail filed by Nidhan Singh Kushwaha, an Assistant Director (Horticulture), and Satish Jindal, proprietor of M/s Jai Gurudev, in connection with Crime No. 39/2023 registered under Sections 409, 420, 120B and 34 IPC. This is essentially a fraud/subsidy-misappropriation case, with an allegation touching on GST non-deposit, not a case adjudicating any GST liability. The FIR was based on a departmental enquiry alleging that, under a NABARD-sponsored National Agriculture Development Scheme for constructing Shed Net Houses/Green Houses and Pack Houses/Poly Houses, a subsidy of about Rs.107.178 lakh was withdrawn irregularly, with payment for work billed by one firm (M/s Kishan Agrotech) actually being routed to the proprietor of another firm (M/s Jai Gurudev), and only one net house constructed for a farmer despite billing by two firms. The FIR alleged the applicants had, in a fraudulent manner, also committed irregularity by not depositing GST collected in the account of the Central and State Governments.

Issues Involved

  1. Whether the applicants were entitled to anticipatory bail given the nature of the subsidy-fraud and non-deposit-of-GST allegations.
  2. Whether the prosecution had demonstrated any quantifiable loss caused to the Government or its beneficiaries.

Petitioner's Arguments

  • No loss had been caused to the Government or its beneficiaries, since subsidy for only one shed was released and deposited directly into beneficiaries' accounts, who then placed orders with the concerned firms.
  • M/s Jai Gurudev had in fact paid GST for the year 2020, as reflected in a letter from the Director (Horticulture) and its GST returns, refuting the allegation of GST non-payment.
  • The FIR did not specify how much loss had been caused or in what manner the applicants had defrauded the State or its beneficiaries.

Respondent's Arguments

  • The State and the objector opposed the bail applications, though when asked, the objector's counsel could not demonstrate the quantum of loss caused to the State by the subsidy release, nor produce any letter sent to the GST authorities for recovery against the alleged defaulter.
  • The State submitted that no information from the GST authorities was available in the case diary, and none was gathered even in the departmental enquiry report.

Court Order / Findings

  • Considering the nature of the accusation and the quality of evidence — including the absence of any demonstrated loss figure and the absence of any GST-authority input in the case diary or the departmental enquiry — the Court was inclined to extend the benefit of Section 438 CrPC to both applicants.
  • Anticipatory bail was granted to both applicants, subject to a personal bond of Rs.50,000/- with one surety each and standard conditions, including availability for interrogation, non-inducement of witnesses, and non-involvement in similar offences.

Important Clarification

The Court did not adjudicate whether GST was, in fact, paid or evaded — the order records only that the investigating agency had not gathered any GST-related evidence to support the allegation, which weighed in favour of granting anticipatory bail. No finding was recorded on GST liability itself; the substantive question of subsidy fraud remains to be examined at trial.

Sections Involved

  • Section 438, Code of Criminal Procedure, 1973
  • Sections 409, 420, 120B and 34, Indian Penal Code, 1860

Decision – In Favour of

In favour of the applicants to the extent of grant of anticipatory bail; the underlying allegations of subsidy fraud and non-payment of GST remain untested and were not decided on merits.

Case Details

Court: High Court of Chhattisgarh at Bilaspur
Case No.: MCRCA No. 243 of 2023 and MCRCA No. 244 of 2023
Coram: Justice Deepak Kumar Tiwari
Date: 2 May 2023

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