Prolonged Custody Justifies Bail in GST Evasion Case | HC

Case Details: Mukul Sharma vs. Commissioner - [2025] 180 taxmann.com 780 (Allahabad)

Judiciary and Counsel Details

• Sameer Jain, J.
• Abhinav Gaur, Ankit Shukla, Arvind Srivastava, Mohd. Rashid Siddiqui & Shodan Singh for the Applicant.
• Dhananjay Awasthi for the Respondent.

Facts of the Case

The applicant, filed a bail application in a complaint case alleging GST evasion through the use of fake firms and fictitious supplies. The investigation into the matter had concluded, and the complaint had been filed, with the prosecution case relying primarily on documentary evidence. At the time of the application, the applicant had been in custody for approximately one and a half years, while the trial in the court below remained pending. It was submitted that continued incarceration for such a prolonged period was unjustified and contended that, given the completion of investigation and the documentary nature of evidence, bail should be granted. The matter was accordingly placed before the High Court.

High Court Held

The High Court held that although the allegations were serious, the offences were cognizable, non-bailable, triable by a Magistrate, and carried a maximum penalty of five years with fine. The court observed that the applicant had already undergone prolonged incarceration, the investigation had concluded, and the case primarily rested on documentary evidence, indicating that trial would take considerable time. It was further held that the presumption of innocence applied, and bail could not be refused. Accordingly, the bail application of the applicant was allowed under Section 69, read with Section 132 of the CGST Act/Uttar Pradesh GST Act.

List of Cases Referred to

• Ratnambar Kaushik v. Union of India (2023) 2 SCC 671 (para 11)
• Vineet Jain v. Union of India [2025] 174 taxmann.com 139/99 GSTL 129 (SC) (para 13).