MADHAV GOPALDAS SHAH Versus STATE OF GUJARAT
GST
2019 (3) TMI 655 – GUJARAT HIGH COURT – 2019 (23) G. S. T. L. 466 (Guj.)
GUJARAT HIGH COURT – HC
Dated:- 5-3-2019
R/CRIMINAL MISC. APPLICATION NO. 1665 of 2019
GST
MR. A.Y. KOGJE, J.
For The Applicant (s) : MR ND NANAVATY, LEARNED SENIOR ADVOCATE WITH MR CHETAN K PANDYA (1973)
For The Respondent (s) : MR DM DEVNANI, APP And RULE SERVED BY DS (65)
ORAL ORDER
1. This application is filed by the applicant under Section 439 of the Code of Criminal Procedure, 1973 for regular bail in connection with File No. CCST/ADENF/FSU-7/MadhavArrest/2018-19/B.4 & AC/U- 6/Arrest/2018-19/B.5811 of the office of the Chief Commissioner of State Tax, Flying Squad Unit-7, Gujarat State Ahmedabad for the offence punishable under Sections 69(1) of the Gujarat Goods and Services Tax Act, 2017 and Central Goods and Services Tax Act, 2017.
2. Learned advocate appearing on behalf of the applicant submits that considering the nature of off
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as narrated in the case papers, which can be recorded as under:
” Involvement of Applicant
Mr. Prakashsinh Udavat obtained GST number in the name of Om Enterprise in March, 2018 and bogus bills amounting to Rs. 106.40 crores have been issued till July, 2018. As per the statement of Mr. Prakashsinh, only bogus bills have been issued in this entire case. No actual physical transfer of goods or transaction has been carried out. He has stated in the statement u/s 70 that this scam has been committed by Mr. Hitendra Shah and Madhav Shah. Thus, active involvement of Mr. Madhav Shah and Hitendra Shah has been found in this scam. Hitendra Chandrakant Shah has been arrested on 26.12.2018 and produced before this Ld. Court with production memo vide file no. AC/U-6/ARREST/2018-19/B and presently, accused Hitendra Shah is under judicial custody.
Mr. Hitendra Shah obtained registration no. 24075605012 under the VAT Act as the partner in Pashwanath Engineering. This registration number was
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ashsinh Udavat has obtained other registration number in the name of Avi Enterprise at the same address of the business wherein also bills worth huge amount of 79.15 crores have been issued. There is a full possibility of involvement of Madhav Shah and Hitendra Shah therein also. All the facts can be exposed only at the end of complete investigation.
In the case of Om Enterprise, registration number was obtained on 28/03/2018, and Prakashsinh Udavat, Madhav Shah and Hitendra Shah have generated bogus bills for crores of rupees on the same day. Upon examination of entries of bank accounts, after obtaining registration number and generating billing for crores of rupees on the same day, Rs. 49,44,000/- has been transferred to J. Jitendrakumar & Company by Om Enterprise on 29/03/2018 on the next day. Om Enterprise has not supplied anything to J. Jitendrakumar. It is noteworthy that proprietor of J. Jitendrakumar was Mr. Hitendra Shah. Its registration number was 24080101042 under VAT la
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these four firms were obtained by Madhav Shah for reversing the entries from S.K. Enterprise to Parshwanath Engineering. Moreover, upon asking Hitendra Shah as to whose proprietary firm this S.K. Enterprise is, he stated that management of this firm was being done by the accused Madhav Shah. Thus, the accused Madhav Shah is doing management of proprietary firm of third person for billing activity. Moreover, in respect of the above-stated four firms, whose bank statements were found from the place of Hitendra Shah, the said Hitendra Shah further accepts that the accused Madhav Shah was doing management of the said four firms. Thus, it is proved from the statement of Hitendra Shah that Madhav Shah was associated with billing of above-stated four firms.
Out of the four bank statements found from the house of Hitendra Shah, one is of Shivay Enterprise. Besides aforesaid cases, direct involvement of accused Madhav Shah has been revealed in case of this businessman. Shri Tushar Rajubhai M
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e number and E-mail ID. The G.S.T. Number of Shivay Enterprise was obtained by two accused persons Hitendra Shah and Madhav Shah on 07/12/2017. And in the aforesaid case, the turnover of sale of Rs. 173.58 crores was mentioned by both these accused persons in the G.S.T.R-1 Statements for the period of total ten months from December-2017 to September-2018. In which the amount of due tax is 21.12 crores. Thus, the loss of Rs. 21.12 crores has been caused to the Government treasury by Madhav Shah in the case of Shivay Enterprise in addition to the previously mentioned cases.
The two probable addresses of Mr. Madhav Shah which have been available are (1) 1, Green City, Bopal and (2) Kirtisagar Apartment. On both these addresses, the inspection of the site was conducted on 21/12/2018. But, during the inspection, the above addresses were not found correct. During the above search, as we contacted Mr. Madhav Shah through mobile, he replied in an evasive manner and did not remain present. M
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at and present accused namely Madhav Shah in collusion with other persons set up firms in the name of economically backward persons, obtained GST number, misused the said numbers and obtained input credit illegally for invoices of stock worth crores of rupees without actual physical transaction and caused huge loss to government revenues. Wherein, aforementioned three firms namely Om Enterprise, Avi Enterprise and Shivay Enterprise are included. Moreover, accused Madhav Shah has admitted in his statement that he has also committed billing scam in Parshvanath Engineering and S.K. Enterprise besides aforementioned three firms.
Further, accused Madhav Shah has stated detailed facts about commission he had received in lieu of billing scam.”
V) Considering the aforesaid, the role of the applicant appears to be restricted to a limited extent as compared to the co-accused;
VI) Considering the period of incarceration and the maximum sentence that can be imposed;
VII) Learned Addition
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dabad on executing a personal bond of Rs. 10,000/= (Rupees Ten Thousand Only) with one surety of the like amount to the satisfaction of the trial Court and subject to the conditions that he shall;
(a) not take undue advantage of liberty or misuse liberty;
(b) not act in a manner injurious to the interest of the prosecution;
(c) surrender passport, if any, to the lower Court within a week;
(d) not leave the State of Gujarat without prior permission of the Sessions Judge concerned;
(e) mark presence before the concerned Police Station once of every English calendar month for a period of six months between 11.00 a.m. and 2.00 p.m.;
(f) furnish the present address of his residence to the Investigating Officer and also to the Court at the time of execution of the bond and shall not change the residence without prior permission of this Court;
8. The authorities will release the applicant only if he is not required in connection with any other offence for the time being. If breac
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