Patiala House Court in the case of Navneet Singh Versus Commissioner of Central Tax (GST)

Case Covered:

Navneet Singh

Versus

Commissioner of Central Tax (GST)

Facts of the Case:

Brief averments of the facts as per the bail application filed is that accused is Director of SPNN Business Services Pvt Ltd. and company is engaged in the business of providing strategic recruitment support in sectors like Ecommerce, Retail, Engineering, Media and Entertainment, FMCG & Logistics and applicant employs nearly 15000 individuals which provided delivery services to E-commerce companies and the present applicant is liable for the provision of monthly remuneration of 15000 individuals. On 12.03.2020, a search was conducted u/s 67 by CGST officers, and the summons was issued to Director Prateek Jha. On 03.02.2021 another search was conducted at the premises of the company and director Prateek Jha was arrested on 03.02.2021 and taken into judicial custody. The allegations in the remand application is that there is a mismatch in the returns which led to a shortfall in the payment of GST to the tune of 24,96,42,318/. As per the remand application, accused Prateek Jha was alone responsible for taking a final decision in the company and not the present accused. The summons was also sent to present the accused u/s 70 of CGST Act seeking his personal attendance to a tender statement and the documents. The applicant sought exemption on the ground that he had returned from international travel from Dubai on 07.02.2021 and was on mandatory home quarantine. The documents i.e. copy of the balance sheet and copy of form 26AS have already been supplied.

Observations:

In the present case, the allegations against the accused company are that they had collected the CGST from the clients of the company to the tune of 24.96 crores and not deposited the same with the government, thus committed offense u/s 132 CGST Act which is the non-bailable offense. Merely depositing of 7.7 crores does not in any manner drop the offense in the bailable category. As far as the allegations against the present accused are concerned, he is the director of the company who is also responsible for the affairs of the company, and the matter is yet to be investigated by him. The huge economic loss to the exchequer is caused and this practice appears writ large in the business community. P&H High Court in Vikas Goel Vs DDGST, 2019 (18) GSTL 590 = 2019 (8) TMI 166 – PUNJAB AND HARYANA HIGH COURT found the offense of using bogus billing adjusting the amount without any actual transportation to the tune of 80 crores is very serious thus not inclined to release the accused even on regular bail. The Apex court also upheld the judgment of P.V. Ramanna reddy case passed by the Hon’ble High Court of Telangana as the offense as committed u/s 132 not dependent upon adjudication proceedings. Merely on the basis of the fact that the department has the power to arrest no apprehension can be inferred at this stage when the department admittedly saying that they have not even thought of arresting the accused. The co-accused is still in custody and has not released on bail. The bonafide of the department cannot be doubted at this stage. Therefore, the present application of anticipatory bail is dismissed.

The Decision of the Court:

Application disposed of accordingly.

Copy of the order be given dasti. Order be uploaded on Delhi District Courts website.

Read & Download the full Decision in pdf: