Back
IN THE HIGH COURT OF DELHI AT NEW DELHI
Rajnish Bhatnagar, J.
Saurabh Mittal - Appellant
Versus
Union Of India, Department Of Revenue & Ors. - Respondents
CRL.M.C. 644/2022
Decided On : 11-02-2022
Criminal Proceedings - Jurisdiction - [Section 482 Cr.P.C.] - [CGST Act, 2017] - [Section 50, Section 69, Section 70, Section 132] - The court dismissed the petition and disposed of the application, finding no flaw in the territorial jurisdiction of the proceedings being carried out by the Respondent No. 3 in F. No. DGGI/INT/INTL/1402/2021 at Ghaziabad Regional Unit. The court held that the summons for appearance issued under Section 70 of the CGST Act and the authorization for arrest issued under Section 69 (1) of the CGST Act do not fall within the ambit of the definition of 'Criminal Proceedings' as criminal proceedings commence only after the launch of prosecution. The court also emphasized that the powers bestowed upon the officers appointed under numerous tax enactments for search and arrest are intended to aid, assist, and provide support to their main purpose of levying and collecting taxes and duties. The court further stated that the investigation is at a nascent stage and involves fraud of approximately Rs 350 crores, and around 200 firms are involved in placing fraudulent Input Tax Credit. The court found that the petitioner is not entitled to any relief from the court due to the serious allegations and the possibility of hampering the investigation.
Fact of the Case:
The petitioner filed a petition under Section 482 Cr.P.C. seeking various reliefs, including quashing the action of the Respondents, transfer of inquiry/investigation, and protection from coercive action. The case involved allegations of evasion of GST through fraudulent activities, leading to searches, seizures, and arrests. The petitioner raised issues of forum-hunting, arbitrary exercise of powers, and lack of material evidence connecting him to the alleged transactions.
Finding of the Court:
The court dismissed the petition and disposed of the application, finding no flaw in the territorial jurisdiction of the proceedings being carried out by the Respondent No. 3 in F. No. DGGI/INT/INTL/1402/2021 at Ghaziabad Regional Unit. The court held that the summons for appearance issued under Section 70 of the CGST Act and the authorization for arrest issued under Section 69 (1) of the CGST Act do not fall within the ambit of the definition of 'Criminal Proceedings' as criminal proceedings commence only after the launch of prosecution. The court also emphasized that the powers bestowed upon the officers appointed under numerous tax enactments for search and arrest are intended to aid, assist, and provide support to their main purpose of levying and collecting taxes and duties. The court further stated that the investigation is at a nascent stage and involves fraud of approximately Rs 350 crores, and around 200 firms are involved in placing fraudulent Input Tax Credit. The court found that the petitioner is not entitled to any relief from the court due to the serious allegations and the possibility of hampering the investigation.
Issues: The issues raised in the case included forum-hunting, arbitrary exercise of powers, lack of material evidence connecting the petitioner to the alleged transactions, and the petitioner's entitlement to protection from coercive action by the respondents.
Ratio Decidendi: The court held that the summons for appearance and the authorization for arrest under the CGST Act do not fall within the ambit of the definition of 'Criminal Proceedings' and emphasized that the investigation is at a nascent stage and involves serious allegations of fraud. The court found that the petitioner is not entitled to any relief from the court due to the serious allegations and the possibility of hampering the investigation.
Final Decision: The court dismissed the petition and disposed of the application, finding no flaw in the territorial jurisdiction of the proceedings being carried out by the Respondent No. 3 in F. No. DGGI/INT/INTL/1402/2021 at Ghaziabad Regional Unit. The court found that the petitioner is not entitled to any relief from the court due to the serious allegations and the possibility of hampering the investigation.
JUDGMENT
Exemption allowed, subject to all just exceptions.
The application stands disposed of.
CRL.M.C. 644/2022 and CRL.M.A. 2746/2022
1. The present petition under Section 482 Cr.P.C. has been filed by the petitioner with the following prayers:
a) Quash the action of the Respondents in case F. No. DGGI/INT/INTL/1402/2021 whereby Respondent No. 3 has embarked upon inquiry investigation which is beyond its zonal jurisdiction;
b) As an alternative as well as supplement to the above prayer (a), directions may be issued for transfer of such inquiry/investigation from Ghaziabad Regional Unit to Respondent No. 2 DGGIHQ Delhi or Delhi Zonal Unit;
c) Hold and declare that the territorial jurisdiction of the proceedings being carried out by the Respondent No. 3 in F. No. DGGI/INT/INTL/1402/2021 vests with the courts at Delhi;
d) Quash and set aside the Summons dated 07/02/2022 and 02/02/2022 issued against the Petitioner as the same have been actuated with malice;
e) Issue appropriate writ(s), order(s) or direction(s) to the Respondents in furtherance of the observations; order(s) and direction(s) issued by the Hon'ble Supreme Court inter alia, vide Order dated 02.12.2020 passed in SLP (Crl.) No. 3543 of 2020 titled as 'Paramvir Singh Saini vs. Baljit Singh & Ors.' to the effect that all proceedings carried out by Respondent no. 1 & 2 including those in relation to the recording of statements etc. in terms of the Notice (s)/ Summon (s) issued under Section 50 PMLA in ECIR MBZO-1/66/2021 to be audio/video graphed in the presence of Petitioner's lawyer at a visible distance (beyond audile range) inter-alia by way of installation of appropriate CCTV cameras.
f) Pass any order or further order (s) which your lordship may deem fit and proper in the interest of justice.
2. Issue notice. Learned counsel for respondent no.1, learned senior standing counsel for respondents no. 2 & 3 and learned senior SPP appears on advance notice and accepts notice
3. The brief facts of the case are that pursuant to some intelligence received that a group of unscrupulous persons in collusion with some custom house agents (CHAs) are actively involved in evasion of GST by making exports from some non-existent firms, Senior Intelligence Officer, Director General of GST, Ghaziabad Regional Unit (Respondent No. 3) commenced inquiry and carried out certain searches at the purported premises of one M/s Heritage International at Delhi. On 27.11.2021, search was carried out at the office premises of Saurabh Mittal (Petitioner herein), wherein documents related to the firms of petitioner being M/s Akula Exports and M/s Vistar Exports were seized. It was alleged that one Tinku Yadav is the mastermind involved in the creation of numerous fake firms and a huge amount of fraudulent Input Tax Credit has been availed and the said Tinku Yadav was arrested on 29.11.2021. In his statement before the authorities, Tinku Yadav claimed that he worked under the directions of Satish Jain and Govind Sharma. In January 2022, statements of Satish Jain and Govind Sharma were recorded wherein they further claimed that the petitioner along with certain other persons was involved in the creation of bogus firms. On 25.01.2022, based on the statement of Satish Jain and Govind Sharma, searches were conducted again at the premises of the petitioner and subsequently summons were issued to both, the petitioner as well as his father under Section 70 CGST Act, 2017, pursuant to which the Petitioner and his father duly appeared andthough the petitioner was allowed to go back, the father of the petitioner Yogesh Mittal was arrested under Section 69 of CGST Act, 2017. On 26.01.2022, father of the petitioner was produced before the Learned Special Duty Magistrate, Meerut when the respondent filed its remand application seeking judicial custody. It is alleged that from a perusal of the remand application, the Petitioner became aware of the nature of accusations levelled against him and his father. Petitioner's fa
The summons for appearance and the authorization for arrest under the CGST Act do not fall within the ambit of the definition of 'Criminal Proceedings', and the court emphasized that the investigatio....
The court ruled that the Circular and Section 6(2)(b) of the CGST Act do not prevent multiple jurisdictions from conducting unified investigations when necessary, reaffirming the court's discretion t....
Section 6(2)(b) of the CGST Act and the Circular dated 05.10.2018 have limited application and are not a bar to multiple search operations and summons issued by multiple agencies in certain circumsta....
Summons under Section 70 CGST Act for inquiry needs no 7-day notice; voluntary attendance and compliance do not amount to detention, precluding compensation claims.
Summons issued under Section 70 CGST Act are part of an inquiry and do not amount to the initiation of legal proceedings, requiring adherence to procedural safeguards.
Illegality in arrest proceedings under the Central Goods and Services Tax Act requires strict adherence to statutory safeguards, including explicit 'reasons to believe' about the occurrence of the al....
An indispensable Tool for Legal Professionals, Endorsed by Various High Court and Judicial Officers
Please visit our Training & Support
Center or Contact Us for assistance
Scan Me!
India’s Legal research and Law Firm App, Download now!
For Daily Legal Updates, Join us on :
Back to top
