Department Failed To Prove Non-Existence Of Firms: Rajasthan High Court Grants Bail To Assessee Charged For Issuing Fake Invoices

The Rajasthan High Court granted bail to the assessee charged for issuing fake invoices to the firms on the ground that the department failed to prove that these firms are not in existence and their GST registration have been cancelled. The Bench of Justice Ganesh Ram Meena observed that “……there is nothing on record that who claimed how much input tax credit on the basis of alleged fake invoices said to have been issued by the accused”. In this case, the assessee/accused (petitioner) was charged for issuing fake invoices in names of nine fake firms which led to evasion of GST by claims of input tax credit on basis of such fake invoices. The assessee/accused has filed bail application under section 439 CrPC in connection with FIR registered for the offence punishable under section 132(1) (a), (f) (h) and (l) of the Central Goods and Service Tax Act, 2017. The assessee submitted that the offences in regard to evasion of tax upto Rs.5 crores is bailable and the person against whom there are allegations of creating fake firms has not been arrested so far and the investigation has been kept pending against him. In such circumstances, keeping the accused in custody for an indefinite period is unjustified. The bench looked into the complaint and observed that the addresses as mentioned in the GST registration of such firms is non-traceable and the proprietor of the firms could not be traced. “The Department has only stated that the proprietors of these firms are non-traceable but there is no conclusion by them that these firms are not in existence after making a proper verification and also, they have not come out with a fact that the GST registration of these firms have been cancelled,” added the bench. The bench noted that there is nothing on record that who claimed how much input tax credit on the basis of alleged fake invoices said to have been issued by the accused. The bench considered that the maximum punishment for the offences alleged against the accused is five years and the accused has already suffered the custody of more than seven months. The bench, after noting that the offences are compoundable and the trial of the case is likely to take time, released the accused on bail. In view of the above, the bench allowed the bail application. Case Title: Manoj Kumar Jain v. Union Of IndiaCitation: 2024 LiveLaw (Raj) 386 Case Number: S.B. Criminal Miscellaneous Bail Application No. 4191/2024 Counsel for Petitioner/ Assessee: Brahmanand Sandhu Counsel for Respondent/ Department: Ajatshatru Mina Click Here To Read/Download The Order

Department Failed To Prove Non-Existence Of Firms: Rajasthan High Court Grants Bail To Assessee Charged For Issuing Fake Invoices

Mehak Dhiman

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