2019 (3) TMI 431 – KARNATAKA HIGH COURT – TMI – Bail application – offence punishable under Section 132 of Central Goods and Services Tax Act – it is alleged that petitioners have obtained Invoices from the Company of the respondent without delivery of the goods – Held that:- On reading of Sections 132, 138 and 139 of the G.S.T. Act, it is found that the maximum punishment provided under the Act is five years and fine and if that is taken into consideration, the magnitude of the alleged offence and it is not punishable with death or imprisonment for life. Even as per the said provision, the alleged offence is also compoundable with the Authority, who has initiated the said proceedings.
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The only consideration which the Court has to consider while releasing the petitioners on anticipatory bail is, that whether the petitioners can be secured for the purpose of investigation or for the purpose of trial – thus, by imposing stringent conditions if the petitioners are ordered to be re
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ade against the petitioners is that the petitioners have obtained Invoices from the Company of the respondent without delivery of the goods and thereby evaded payment of tax and they have committed an offence under Section 132 (1)(b) of G.S.T Act. 4.It is the submission of the learned senior counsel that earlier the summons has been issued by the respondent and as per summons, the petitioners attended and have given their statement and once insuch case when the witness has gone for giving the statement, he has been apprehended and taken to custody and as such, the petitioners will also apprehend that they are also likely to arrest. Though, they have now received the summons and in the event, they go to give their statement they may be apprehended, arrested and they may be taken into custody. It is his further submission that as per the G.S.T.Act, no such offence has been committed by the petitioners. Even the tax has been paid on the basis of the invoice raised and when once the tax ha
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respondent and it revealed that the issuance of fake invoices with outactual supply of goods has been done with an intention to enable other registered tax payers to fraudulently avail input tax credit and thereby they have caused huge loss to the economy of the country. He further submitted that if such false trading is allowed by obtaining fake invoices then under such circumstances, the economy of the country is going to be affected much and very purpose of the G.S.T.Act itself is going to be defeated. Further, by referring to Section 69 of G.S.T.Act, he submitted where the Commissioner has reasons to believe that a person has committed any offence specified in clause (a) or clause (b) or clause (c) or clause (d) of sub-section (1) of Section 132 which is punishable under clause (i) or (ii) of sub-section (1), or sub-section (2) of the said section, he may, by order, authorize any officer of central tax to arrest such person. In this regard the petitioners are not entitled to be re
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Act, or the rules made thereunder leading to wrongful availment or utilisation of input tax credit or refund of tax; (c) avails input tax credit using such invoice or bill referred to in clause (b); (d) collects any amount as tax but fails to pay the same to the Government beyond a period of three months from the date on which such payment becomes due; (e) evades tax, fraudulently avails input tax credit or fraudulently obtains refund and where such offence is not covered under clauses (a) to (d); (f) falsifies or substitutes financial records or produces fake accounts or documents or furnishes any false information with an intention to evade payment of tax due under this Act; (g) obstructs or prevents any officer in the discharge of his duties under this Act; (h) acquires possession of, or in any way concerns himself in transporting, removing, depositing, keeping, concealing, supplying, or purchasing or inany other manner deals with, any goods which he knows or has reasons to believe
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may extend to five years and with fine; (ii) in cases where the amount of tax evaded or the amount of input tax credit wrongly availed or utilised or the amount of refund wrongly taken exceeds two hundred lakh rupees but does not exceed five hundred lakh rupees, with imprisonment for a term which may extend to three years and with fine; (iii) in the case of any other offence where the amount of tax evaded or the amount of input tax credit wrongly availed or utilised or the amount of refund wrongly taken exceeds one hundred lakh rupees but does not exceed two hundred lakh rupees, with imprisonment for a term which may extend to one year and with fine; (iv) in cases where he commits or abets the commission of an offence specified in clause (f) or clause (g) or clause (j), he shall be punishable with imprisonment for a term which may extend to six months or with fine or with both. (2) Where any person convicted of an offence under this section is again convicted of an offence under this
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erm tax shall include the amount of tax evaded or the amount of input tax credit wrongly availed or utilised or refund wrongly taken under the provisions of this Act, the State Goods and Services Tax Act, the Integrated Goods and Services Tax Act or the Union Territory Goods and Services Tax Act and cess levied under the Goods and Services Tax (Compensation to States) Act. 138. Compounding of offences (1) Any offence under this Act may, either before or after the institution of prosecution, be compounded by the Commissioner on payment, by the person accused of the offence, to the Central Government or the State Government, as the case may be, of such compounding amount in such manner as may be prescribed: PROVIDED that nothing contained in this section shall apply to- (a) a person who has been allowed to compound once in respect of any of the offences specified inclauses (a) to (f) of sub-section (1) of section 132 and the offences specified in clause (l) which are relatable to offence
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ROVIDED ALSO that compounding shall be allowed only after making payment of tax, interest and penalty involved in such offences. (2) The amount for compounding of offences under this section shall be such as may be prescribed, subject to the minimum amount not being less than ten thousand rupees or fifty per cent. of the tax involved, whichever is higher, and the maximum amount not being less than thirty thousand rupees or one hundred and fifty per cent. of the tax, whichever is higher. (3) On payment of such compounding amount as may be determined by the Commissioner, no further proceedings shall be initiated under this Act against the accused person in respect of the same offence and any criminal proceedings, if already initiated in respect of the said offence, shall stand abated. 139. Migration of existing taxpayers (1) On and from the appointed day, every person registered under any of the existing laws and having a valid Permanent Account Number shall be issued a certificate of re
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nce is also compoundable with the Authority, who has initiated the said proceedings. The only consideration which the Court has to consider while releasing the petitioners on anticipatory bail is, that whether the petitioners can be secured for the purpose of investigation or for the purpose of trial. Under such circumstances, I feel that by imposing stringent conditions if the petitioners are ordered to be released on anticipatory bail, it would meet the ends of justice. 9. Under the similar facts and circumstances this Court in Crl.P.No.979/2019 connected with Crl.P.No.980/2019, after considering the issue has released the accused therein. In that light also the accused herein are entitled to be released on anticipatory bail. 10. In the light of the discussion held by me above, the petitions are allowed and petitioners- Mr. Shravan.A.Mehra and Mr. Anil.K.Mehra are ordered to be released on anticipatory bail in the event of their apprehension or arrest in O.R.No.40/2018-19 filed under
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