Bail cannot be denied based solely on pending investigations of co-accused; each case must be evaluated individually, considering the right to a speedy trial as a fundamental right.

JUDGMENT :

HARPREET SINGH BRAR, J.

1. This common order shall dispose of both the above mentioned petitions as they arise from a similar factual matrix. However, for the sake of brevity, the facts are taken from CRM-M-8675-2025.

2. The present petition is preferred under Section 483 of Bharatiya Nagarik Suraksha Sanhita, 2023 seeking regular bail in the case stemming from complaint No. DGGI/INT/INTL/939/2024-GrE-O/O ADG-DGGI-ZU- LUDHIANA (Annexure P-3) filed under Sections 132 (1)(b) of the Central Goods and Service Tax Act, 2017 (hereinafter ‘CGST Act’) and punishable under Section 132 (1)(b) and 132(1)(c) of the same.

3. In pursuance of order dated 01.05.2025, the following have supplied their respective affidavits:

1) Jitendra Jorwal, IAS, Taxation Commissioner, Department of Taxation, Punjab.

2) Anju, Deputy Director, DGGI, Chandigarh Zonal Unit.

3) Devika Rani, Deputy Director, DGGI, Gurugram Zonal Unit.

The same as taken on record.

FACTUAL BACKGROUND

4. Briefly, the facts, as alleged, are that an information was received from the Financial Investigation Unit in form of a Suspicious Transaction Report(STR) indicating substantial cash withdrawals to the tune of Rs. 4,938.63 crore, from two branches of the IFSC Bank- Ambala Cantt and Panchkula. It was further revealed that petitioner-Amit Kumar Goyal withdrew Rs.262.4 crore in cash from 08 bank accounts while his brother petitioner-Manish Kumar withdrew Rs.455.02 crore from 11 bank accounts. The petitioners herein created 27 fake firms, 02 of which were under the name of Amit Kumar Goyal while the remaining 25 were established by fraudulently obtaining IDs of other persons, though connected to the mobile number and email of Amit Kumar Goyal. On 08.10.2024, a search was conducted under Section 67 (2) of the CGST Act at four locations in Mandi Gobindgarh and Zirakpur and a number of documents pertaining to fake GST billing as well as various electronic devises were recovered. On investigation, it was concluded that the petitioners issued forged and fabricated GST invoices worth approximately Rs.700 crore and availed input tax credit amounting to approximately Rs.107 crore based on the same.

CONTENTIONS

5. Learned Senior counsel for Manish Kumar contends that GST registration of most of the firms created by the petitioner(s) was cancelled as their principal place of business was found non-operational. However, the physical verification reports were not provided to the petitioner. The petitioner was coerced into making a statement admitting his guilt which led to his arrest on 09.10.2024. The seized electronic devices underwent forensic examination without the consent of the petitioner. Further, the notice under Section 73 , 74 of the CGST Act was served at a belated stage, after filing of the present petition, which vitiates prosecution under Section 132 of the CGST Act. Additionally, the Central Board of Indirect Taxes and Customs (CBIC) vide Circular No. 171/03/2022-GST dated 06.07.2022 has clarified that tax liability, in terms of Section 7 of the CGST Act, shall not be imposed if the accused is merely involved in issuing invoices. Another circular by the CBIC, bearing No. 01/2025-GST dated 13.01.2025 mandates explaining the grounds of arrest to the accused, which the respondent officials failed to abide by in the present case. Further, the authorisation for arrest under Section 69 of the CGST Act has been granted in a mechanical manner, without duly appreciating the material available against the petitioner. Furthermore, the petitioner has been in custody since his arr