IMPORTANT POINT
The court established that in cases of economic offences, while the gravity of the allegations is significant, the presumption of innocence and the nature of evidence must also be considered when deciding bail applications.

JUDGMENT

M.S. Sahoo, J.

The petition under section 439, Cr.P.C. has been filed by the petitioner challenging the order dated 22.08.2023, rejecting the prayer for bail by the petitioner passed by learned Special Judge (CBI) Court-I-cum-Addl. Sessions Judge, Bhubaneswar in BLAPL No. 1443 of 2023 arising out of the order dated 11.07.2023 passed by learned S.D.J.M., Bhubaneswar pertaining to 2(c) CC No. 61 of 2023 (F. No. DGGI/BbZU/07/GST/2023 dated 11.07.2023) for the offences alleged against the petitioner under section 69 of Central Goods and Service Tax Act, 2017 (for short 'the Act'), read with Sections 132(1)(b), 132(1)(c), 132(1)(f) of the Act rejecting the prayer of the petitioner for bail.

2. Heard Mr. R.P. Kar, learned Senior Counsel appearing for the petitioner instructed by Mr. S. Tibrewal & Mr. Rahul Raheja, advocates. The learned senior counsel advanced arguments at length supporting the prayer for bail.

3. On behalf of the investigating agency, Mr. Mohapatra, learned Senior Standing Counsel, Director General, GST was heard in extenso along with Mr. Avinash Kedia, learned Junior Standing Counsel, CGST & Customs, Orissa High Court, Cuttack.

Pleadings :

4. Apart from considering the averments made in the petition filed by the petitioner, this Court has considered the case compilation filed by the petitioner along with memo dated 17.10.2023 and the written note of submission and compilation of the judgment/orders relied upon by the learned counsel for the petitioner filed on 02.11.2023. The opposite party have filed their response/objection to the petition in the form of an affidavit dated 16.10.2023 sworn to by the Senior Intelligence Officer on behalf of Directorate General of Goods and Services Tax Intelligence, Bhubaneswar Zonal Unit and further additional affidavit dated 01.11.2023 has been filed on behalf of the opposite party along with written notes of submission on behalf of the opposite parties and a compilation of relevant provisions and judgments filed on 2.11.2023.

Prosecution Report :

5. Investigation Report/complaint dated 8.9.2023 registered as 2(c) CC No. 61 of 2023 was filed before the learned Sub-divisional Judicial Magistrate, Bhubaneswar in the form of a complaint for an offence punishable under section 132 of the Act read with section 132 of the Orissa GST Act, 2017 and section 20 of the IGST Act, 2017, which indicates the following :

5.1 That certain registered entities having GSTIN (Goods and Services Tax Identification Number) are nonexistent at their registered premises. The supply chain and physical verification at the premises of supplier of the firms is also non-existent at their registered premises. Presumably, the entities having GSTIN and their supplier entity, have been created to pass on and avail 'Input Tax Credit' under the GST regimen (for short 'ITC') to defraud government exchequer. The details of vehicle numbers mentioned on the eWay bills generated for purported supply were verified and found to be non-existent. It is alleged that the fictitious entities have shown export of goods in their GST returns, however, they have never actually received any goods from the alleged supplier. There is no movement of any vehicle for transportation of the alleged goods. It is alleged, the exports declared are all bogus and fake. The ITC received from the Government is misuse of benefits extended by the Government to exporters.

5.2 The bank accounts where the ITC has been credited have been verified from the banks and the ITC has been received in the bank accounts.

5.3 It has been stated in the complaint before the learned S.D.J.M. that searches were conducted in the premises as per the office address of the firms and it was found that there were no goods in those premises. The statement of the accused persons i.e. present petitioner along with accused no.2 named in the complaint were recorded under section 70 of the CGST Act, 2017. The chat contained in the mobile phone of the accused persons were veri