Pre-Arrest Bail Denied in ₹1.6 Cr ITC Fraud for Non-Cooperation | HC
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- Last Updated on 30 June, 2025
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Case Details: Vansh Jain vs. Additional Directorate General of GST Intelligence - [2025] 175 taxmann.com 696 (Punjab & Haryana)
Judiciary and Counsel Details
- Mahabir Singh Sindhu, J.
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Aman Bansal, Adv. for the Petitioner.
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Sourabh Goel, Ms Geetika Sharma & Kush Goyal, Advs. for the Respondent.
Facts of the Case
The petitioner was registered under GST as the sole proprietor engaged in the business of trading. He was alleged to have fraudulently availed Input Tax Credit (ITC) amounting to ?1.60 crore on the strength of fake invoices without any actual supply or receipt of goods or services. The investigation by the Directorate General of GST Intelligence revealed that the ITC was claimed from multiple non-existent or fraudulently registered suppliers. Despite being granted interim protection by a co-ordinate bench, the petitioner failed to respond to three notices issued prior to the order and one thereafter. He sought pre-arrest bail under Section 482 of the Bharatiya Nagarik Suraksha Sanhita (BNSS), claiming to be a sleeping partner with no role in the alleged transactions and attributing day-to-day operations to a co-accused. However, the Revenue demonstrated that he was actively engaged as the registered proprietor and the sole controller of the firm.
High Court Held
The Hon’ble High Court held that the petitioner had deliberately evaded the legal process by not appearing for investigation despite multiple opportunities and had misused the interim protection granted to him. The Court noted that custodial interrogation was necessary to unearth the full extent of the fraudulent availment of ITC, which involved a network of 22 fictitious or non-compliant suppliers. Given the prima facie evidence of his proprietorship and active role in the affairs of the firm, as well as his non-cooperation with authorities, the Court concluded that the petitioner was not entitled to pre-arrest bail. Consequently, the petition was dismissed in favour of the Revenue.
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