A person can’t be detained indefinitely in case of evasion of GST if investigation is pending; SC grants bail

Case Details: Paresh Nathalal Chauhan v. State of Gujarat - [2022] 135 taxmann.com 42 (SC)

Judiciary and Counsel Details

• • Sanjay Kishan Kaul and M. M. Sundresh, JJ.
  • D.N. Ray, Chetan Pandya, Dillip Kumar Nayak, Ms. Disha Ray, Advs. and Mrs. Sumita Ray, AOR for the Petitioner.
  •  S.V. Raju, Ms. Aastha Mehta, Ms. Sairica Raju, Advs. and Deepanwita Priyanka, AOR for the Respondent.

Facts of the Case

The petitioner was in custody for 25 months out of a total period of 5 years for which a person can be sentenced under GST for evasion of tax. He contended that proceedings arising from evasion of GST were preceded by search operation where the officer occupied house for more than a week with lady members present. It filed bail application before the Apex Court as investigation is still pending.

Supreme Court Held

The Honorable Supreme Court observed that the petitioner has been in custody for 25 months out of a total period of 5 years for which he can be sentenced. The allegation against him was that he played an important role in execution of the scam and that confidential investigation was still under way in order to identify these persons and the role played in the execution of the scam. The investigation is still stated to be pending though complaint has been filed. He can’t be indefinitely detained in custody more so having already undergone a period of 25 months of custody when he can be sent behind bars for maximum five years. It is almost 50% of the sentence. In view of the aforesaid facts and circumstances, the Apex Court held that bail would be granted on terms and conditions to the satisfaction of the trial court.