# Peeyush Kumar Jain (In Jail) v. Union of India

- **Citation:** (2022) 9 ILRA 396
- **Court:** High Court of Judicature at Allahabad
- **Decided:** 2022-09-01
- **Case number:** Criminal Misc. 1st Bail Application No. 21223 of 2022
- **Bench:** Subhash Vidyarthi
- **Source:** https://unisonlegal.in/judgment/allahabad-high-court/peeyush-kumar-jain-in-jail-v-union-of-india-49037
- **Pages:** 12

## Headnote

(A) Criminal Law - Bail in economic
offences
-
The
Central
Goods
and
Services
Tax
Act,
2017
-
Section
74(7),132 (1) (a) r.w. Section 132 (1) (i)
& 132 (5), Section 138 - Compounding
of Offences - in determining whether to
grant bail, both the seriousness of the
charge
and
the
severity
of
the
punishment
should
be
taken
into
consideration - right to bail is not to be
denied merely because of the sentiments
of the community against the accused -
mere denial of bail by another High
Court on the facts of a particular case,
without laying down any proposition of
law, would not amount to a binding
precedent. (Para - 25,29,30)

Search on residential and official premises of
applicant by Officers
of DGGI
- Cash
amounting to Rs. 196.57 Crores seized -
recovery of 23 kilograms gold - handed over
to
Officers
of
Directorate
of
Revenue
Intelligence - applicant arrested - collectively
engaged in illicit supply of finished goods,
namely perfumery compounds - without
issuing any tax invoice and without payment
of GST - application for bail before trial court
- rejected - ground
- no reasonable
explanation - matter serious in nature - very
harmful to economic health of country -
granting bail in such a matter would be likely
to promote such type of modus-operandi in
evasion of tax. (Para - 3,4,7)
9 All. Peeyush Kumar Jain Vs. Union of India
397
(B) Criminal Law - basic jurisprudence
relating to bail in economic offences -
remains same - grant of bail is the rule
and refusal is the exception - to ensure
that accused has opportunity of securing
fair trial - not advisable to categorize all
the economic offences into one group and
deny bail on that basis - Even if the
allegation is one of grave economic
offence - not a rule that bail should be
denied in every case - no bar created in
relevant enactment passed by legislature
- nor does bail jurisprudence provide so.
(Para - 30)

HELD:-Offence alleged against applicant is
compoundable. Vague allegation that applicant
may tamper with evidence. No material to give
rise to a reasonable apprehension that applicant
will misuse his liberty to subvert justice or
tamper with the evidence or witnesses. Fit case
to grant bail to the applicant. (Para -22,31)

Bail application alowed. (E-7)

List of Cases cited:-

## Text

396 INDIAN LAW REPORTS ALLAHABAD SERIES
accordance with law, under Section 174-A
of the Indian Penal Code.

(6) The applicant shall remain
present, in person, before the trial court on
the dates fixed for (i) opening of the case,
(ii) framing of charge and (iii) recording of
statement under Section 313 Cr.P.C. If in
the opinion of the trial court default of this
condition is deliberate or without sufficient
cause, then it shall be open for the trial
court to treat such default as abuse of
liberty of her bail and proceed against her
in accordance with law.

(7) The party shall file computer
generated copy of such order downloaded
from the official website of High Court
Allahabad or certified copy issued from the
Registry of the High Court, Allahabad.

(8)
The
concerned
Court/
Authority/
Official
shall
verify
the
authenticity of such computerized copy of
the order from the official website of High
Court
Allahabad
and
shall
make
a
declaration of such verification in writing.

15. It may be observed that in the
event of any breach of the aforesaid
conditions, the court below shall be at
liberty to proceed for the cancellation of
applicant's bail.

16. It is clarified that the observations,
if any, made in this order are strictly
confined to the disposal of the bail
application and must not be construed to
have any reflection on the ultimate merit of
the case.
----------
(2022) 9 ILRA 396
APPELLATE JURISDICTION
CRIMINAL SIDE
DATED: ALLAHABAD 01.09.2022

BEFORE

THE HON'BLE SUBHASH VIDYARTHI, J.
Criminal Misc. 1st Bail Application No. 21223 of
2022

Peeyush Kumar Jain ...Applicant (In Jail)
Versus
Union of India ...Opposite Party

Counsel for the Applicant:
Sri Rahul Agarwal, Sri Malay Prasad, Ms.
Tanya Makker, Ms. Saloni Mathur, Sri
Piyush Kant Shukla, Sri Anurag Khanna (Sr.
Advocate)

Counsel for the Opposite Party:
Sri Dhananjay Awasthi, Sri Digvijay Nath
Dubey

(A) Criminal Law - Bail in economic
offences
-
The
Central
Goods
and
Services
Tax
Act,
2017
-
Section
74(7),132 (1) (a) r.w. Section 132 (1) (i)
& 132 (5), Section 138 - Compounding
of Offences - in determining whether to
grant bail, both the seriousness of the
charge
and
the
severity
of
the
punishment
should
be
taken
into
consideration - right to bail is not to be
denied merely because of the sentiments
of the community against the accused -
mere denial of bail by another High
Court on the facts of a particular case,
without laying down any proposition of
law, would not amount to a binding
precedent. (Para - 25,29,30)

Search on residential and official premises of
applicant by Officers
of DGGI
- Cash
amounting to Rs. 196.57 Crores seized -
recovery of 23 kilograms gold - handed over
to
Officers
of
Directorate
of
Revenue
Intelligence - applicant arrested - collectively
engaged in illicit supply of finished goods,
namely perfumery compounds - without
issuing any tax invoice and without payment
of GST - application for bail before trial court
- rejected - ground
- no reasonable
explanation - matter serious in nature - very
harmful to economic health of country -
granting bail in such a matter would be likely
to promote such type of modus-operandi in
evasion of tax. (Para - 3,4,7)
9 All. Peeyush Kumar Jain Vs. Union of India
397
(B) Criminal Law - basic jurisprudence
relating to bail in economic offences -
remains same - grant of bail is the rule
and refusal is the exception - to ensure
that accused has opportunity of securing
fair trial - not advisable to categorize all
the economic offences into one group and
deny bail on that basis - Even if the
allegation is one of grave economic
offence - not a rule that bail should be
denied in every case - no bar created in
relevant enactment passed by legislature
- nor does bail jurisprudence provide so.
(Para - 30)

HELD:-Offence alleged against applicant is
compoundable. Vague allegation that applicant
may tamper with evidence. No material to give
rise to a reasonable apprehension that applicant
will misuse his liberty to subvert justice or
tamper with the evidence or witnesses. Fit case
to grant bail to the applicant. (Para -22,31)

Bail application alowed. (E-7)

List of Cases cited:-

1. Dataram Singh Vs St. of U.P., (2018) 3 SCC
22

2. P. Chidambaram Vs C.B.I., (2020) 13 SCC
337

3. Satender Kumar Antil Vs C.B.I., 2022 SCC
OnLine SC 825

4. Nitin Verma Vs U.O.I. & anr., 2022 SCC
OnLine All 512

5. Paras Jain Vs U.O.I., Criminal Miscellaneous
Bail Application No. 21848 of 2022

6. Vimal Yashwantgiri Goswami Vs St. of Guj.,
R/Special Civil Application No. 13679 of 2019

7. Vimal Yashwantgiri Goswami Vs St. of Guj.,
2022 SCC OnLine Guj 713

8. Basudev Mittal Vs U.O.I. MCRC No. 3919 of 2022

9. Arvind Kumar Munka Vs U.O.I., CRM No.
10075 of 2019
(Delivered by Hon'ble Subhash Vidyarthi, J.)

1. Heard Sri Anurag Khanna, the
learned Senior Counsel assisted by Sri
Rahul Agarwal, Ms. Tanya Makker, Sri.
Malay Prasad, Ms. Saloni Mathur and Sri.
Piyush Kant Shukla, the learned counsel for
the applicant and Sri Dhananjay Awasthi
and Sri Digvijay Nath Dubey, the learned
Senior Standing Counsel for the Directorate
General of Goods and Services Tax
Intelligence (DGGI).

2. By means of the instant application,
the applicant is seeking his release on bail
in Criminal Case No. 7646 of 2022 in the
Court of learned Special Chief Judicial
Magistrate
(Economic
Offences)
/
Additional
Metropolitan
Magistrate-III,
Kanpur Nagar, arising out of a complaint
filed in respect of offence under Section
132 (1) (a) read with Section 132 (1) (i) and
132 (5) of the Central Goods and Services
Tax Act, 2017.

3. Briefly stated, the facts of the case
are that on 22-12-2021 the Officers of the
DGGI started making a search on the
residential and official premises of the
applicant at Kannuaj and Kanpur, which
continued till 28-12-2021. Cash amounting
to Rs. 196.57 Crores was seized from the
applicant's premises besides recovery of 23
kilograms gold, which was handed over to
the Officers of the Directorate of the
Revenue Intelligence. The applicant was
arrested on 26-12-2021.

4. On 22-02-2022, the DGGI filed a
complaint before the learned Special Chief
Judicial Magistrate (Economic Offences) /
Additional
Metropolitan
Magistrate-III,
Kanpur Nagar against the applicant seeking
his
prosecution
and
punishment
for
committing the aforesaid offences. It has
398 INDIAN LAW REPORTS ALLAHABAD SERIES
been stated in the complaint that the
applicant is one of the partners in the firm
M/S Odochem Industries and he used to
operate and manage two proprietorship
concerns namely Odosynth Inc., (of which
the applicant's wife Smt. Kalpana Jain is
the proprietor) and M/S Flora Naturale (of
which Smt. Vijay Laxmi Jain, wife of Sri
Ambrish Kumar Jain is the proprietor) and
it was revealed during investigation that the
aforesaid firms operated by the applicant
along with his brother Ambrish Kumar Jain
were collectively engaged in illicit supply
of finished goods, namely perfumery
compounds,
without
issuing
any
tax
invoice and without payment of GST.

5. It has further been stated in the
complaint that in his voluntary statement
recorded
on
25-26.12.2021,
06-0708.01.2022 and 05.02.2022 under Section
70 of the CGST Act, 2017, the applicant
had admitted having made illicit supply of
perfumery compounds by the aforesaid
firms and he had offered to pay Rs. 52
Crores towards his tax liability along with
the applicable interest and penalty and that
he has managed purchase of raw materials
required for manufacturing of perfumery
compounds without accounting for in the
books and without payment of GST, but he
has not disclosed the names and particulars
of the buyers and sellers of the aforesaid
firms.

6. As per the complaint averments,
the amount of GST evasion far exceeds Rs.
500 lakhs prescribed under Section 132 (1)
(i) of the Act and the offence committed by
the applicant is punishable for a term which
may extend to five years.

7. On 02-03-2022, the applicant filed
an application before the learned Trial
Court for being released on bail and on 0502-2022, the Trial Court passed an order
rejecting the bail application on the ground
that the applicant is an active partner in all
the three firms; that more than Rs. 196.58
Crores cash was seized from the applicant's
premises; that the financial records of the
firms showed different liability of tax than
seized amount of cash and no reasonable
explanation was provided for the huge
amount of cash seized; that the applicant
has neither denied the ownership of the
searched premises nor did he deny
possession of the huge amount of the cash;
that the matter is serious in nature and is
very harmful to the economic health of the
country and granting bail in such a matter
would be likely to promote such type of
modus-operandi in evasion of tax.

8. On 04-04-2022, the applicant filed
an application before the Sessions Judge
seeking his release on bail, and the learned
Sessions Judge rejected the bail application
by means of an order dated 28-04-2022 on
similar grounds.

9. It has further been stated in the
affidavit that the applicant is suffering from
multiple illnesses like double vision,
glaucoma, insomnia, hypertension, anxiety
and blood pressure for which he is
undergoing treatment.

10. The DGGI has filed a counter
affidavit stating that during the searches
conducted at the business and residential
premises of the firms operated by the
applicant along with his family members,
unaccounted cash of Rs.196,57,02,539/-
has been seized; that the applicant has
admitted that the amount seized is the sales
proceed of the goods clandestinely supplied
by him without payment of tax and the
applicant has paid Rs. 54.09 crores towards
GST liability along with interest and
9 All. Peeyush Kumar Jain Vs. Union of India
399
penalty as per his own calculation, but as
the investigations are still in progress,
DGGI is yet to ascertain the final tax
liabilities under Section 74 (7) of the CGST
Act, 2017.

11. It has further been stated in the
counter affidavit that the department has
recovered
several
fake
invoices
and
fictitious
LRs
(transport
documents)
evidencing clandestine supplies of taxable
goods. Additionally, 23 Kgs of Gold
bullions believed to be having foreign
origin markings, have also been recovered
from the residential premises of the
applicant and separate proceedings have
been initiated against the applicant in
respect thereof under the provision of the
Customs Act, 1962.

12. In the rejoinder affidavit filed on
behalf of the applicant it has been stated
that the alleged ''voluntary statement' of the
applicant had been obtained by the DGGI
under duress and coercion and it was not
voluntary and that the applicant is a person
of clean antecedents and he is not a
habitual offender.

13. The rejoinder affidavit further
contains an averment that after the
applicant's firm paid the tax and interest,
the DGGI has released the goods that had
been seized from the applicant's premises.

14. The rejoinder affidavit further
contains that the prosecution complaint had
been filed way back on 22-02-2022 and yet
even the charges have not been framed till
date and there appears to be no likelihood
that the trial will commence soon.

15. It has further been stated in the
rejoinder affidavit that in the counter
affidavit filed by the DGGI before the Trial
Court, it was categorically stated that since
the applicant has not made any payment of
tax, the plea of the applicant cannot be
entertained. Now the applicant has paid the
amount of tax along with interest and
penalty, the DGGI is pleading that the
voluntary payment of tax has no impact on
the present proceedings, which stand is
clearly and afterthought and a mischievous
and deliberate attempt to keep the applicant
incarcerated.

16. Regarding the DGGI's contention
that it is yet to ascertain the tax liability of
the assessment, it has been stated in the
rejoinder affidavit that the assessment
proceedings (which typically start with the
issuance of a show-cause notice) have not
even been initiated till date.

17. Sri. Anurag Khanna, the learned
Senior Advocate for the applicant has
submitted that the offences alleged carry a
minimum punishment of six months'
imprisonment and a maximum of five
years' imprisonment and the offence is
compoundable, which indicates that the
offence is not grave. Moreover, mere
gravity of the offence cannot be a ground to
deny bail. He has further submitted that the
applicant has already paid a sum of
Rs.54.09 Crores towards tax, interest and
penalty and he has undertaken to deposit
the amount of any additional liability
whereas the Department is yet to ascertain
his tax liability. He has further submitted
that since the applicant has already
deposited the amount of tax, interest and
penalty and the DGGI has seized the cash
amount of Rs. Rs.196,57,02,539/-, the
interest of the Revenue as well as that of
the public at large is protected; that the
applicant has already spent more than 8
months in jail and during this period the
department has not sought his custodial
400 INDIAN LAW REPORTS ALLAHABAD SERIES
interrogation, which shows that his custody
is not at all required. He has further
submitted that investigation against the
applicant stands completed and the trial is
yet to commence and that the applicant
cannot be kept in custody on the ground
that investigation against the suppliers of
the raw materials to the applicant and the
buyers of the applicant is still pending.

18. Sri. Khanna has also submitted
that the applicant does not have a passport
and, therefore, he has not a flight risk. He
has further submitted that the entire
evidence in the present case is documentary
in nature, which is already in possession of
the department and the statement of the
applicant has already been recorded and,
therefore, there is no possibility of the
applicant tampering with any evidence and
moreover, a mere apprehension of the
applicant tampering with the evidence is
not a ground to deny bail to the applicant.

19. Before proceeding to decide the
prayer for grant of bail, it would be apt to
have a look at the following relevant
statutory provisions contained in Section
132 and 138 of the Act: -

132. Punishment for certain
offences.-- (1) Whoever commits, or causes
to commit and retain the benefits arising
out of, any of the following offences,
namely:--

(a) supplies any goods or services
or both without issue of any invoice, in
violation of the provisions of this Act or the
rules made thereunder, with the intention to
evade tax;
* * *

(ii) receives or is in any way
concerned with the supply of, or in any
other manner deals with any supply of
services which he knows or has reasons to
believe are in contravention of any
provisions of this Act or the rules made
thereunder;
* * *

shall be punishable--

(iii) in cases where the amount of
tax evaded or the amount of input tax credit
wrongly availed or utilised or the amount
of refund wrongly taken exceeds five
hundred lakh rupees, with imprisonment
for a term which may extend to five years
and with fine;
* * *

(3) The imprisonment referred to in
clauses (i), (ii) and (iii) of sub-section (1) and
sub-section (2) shall, in the absence of
special and adequate reasons to the contrary
to be recorded in the judgment of the Court,
be for a term not less than six months.

(4)
Notwithstanding
anything
contained
in
the
Code
of
Criminal
Procedure, 1973 (2 of 1974), all offences
under this Act, except the offences referred to
in sub-section (5) shall be non-cognizable
and bailable.

(5) The offences specified in clause
(a) or clause (b) or clause (c) or clause (d) of
sub-section (1) and punishable under clause
(i) of that sub-section shall be cognizable and
non-bailable.
* * *

138. Compounding of offences.--
(1) Any offence under this Act may, either
before or after the institution of prosecution,
be compounded by the Commissioner on
payment, by the person accused of the
offence, to the Central Government or the
State Government, as the case be, of such
compounding amount in such manner as may
be prescribed:

Provided that nothing contained in
this section shall apply to--

(a) a person who has been
allowed to compound once in respect of
any of the offences specified in clauses (a)
9 All. Peeyush Kumar Jain Vs. Union of India
401
to (f) of sub-section (1) of Section 132 and
the offences specified in clause (l) which
are relatable to offences specified in
clauses (a) to (f) of the said sub-section;

(b) a person who has been allowed
to compound once in respect of any offence,
other than those in clause (a), under this Act
or under the provisions of any State Goods
and Services Tax Act or the Union Territory
Goods and Services Tax Act or the Integrated
Goods and Services Tax Act in respect of
supplies of value exceeding one crore rupees;

(c) a person who has been accused
of committing an offence under this Act which
is also an offence under any other law for the
time being in force;

(d) a person who has been
convicted for an offence under this Act by a
court;

(e) a person who has been accused
of committing an offence specified in clause
(g) or clause (j) or clause (k) of sub-section
(1) of Section 132; and

(f) any other class of persons or
offences as may be prescribed:

Provided
further
that
any
compounding allowed under the provisions of
this section shall not affect the proceedings, if
any, instituted under any other law:

Provided also that compounding
shall be allowed only after making payment
of tax, interest and penalty involved in such
offences.

(2) The amount for compounding
of offences under this section shall be such as
may be prescribed, subject to the minimum
amount not being less than ten thousand
rupees or fifty per cent. of the tax involved,
whichever is higher, and the maximum
amount not being less than thirty thousand
rupees or one hundred and fifty per cent. of
the tax, whichever is higher.

On payment of such compounding
amount as may be determined by the
Commissioner, no further proceedings
shall be initiated under this Act against the
accused person in respect of the same
offence and any criminal proceedings, if
already initiated in respect of the said
offence, shall stand abated.

20. A bare perusal of the aforesaid
provisions leave no room to doubt that that
the offences alleged carry a minimum
punishment of six months' imprisonment
and
a
maximum
of
five
years'
imprisonment and Section 138 of the Act
provides that the offence is compoundable.

21. Although the learned Counsel for
the DGGI have contended that the
applicant is also accused of committing
offence under the Customs Act and the
present case falls under clause (c) of the
Proviso appended to Section 138 and it is
not compoundable, but the aforesaid
submission appears to be misconceived.
For the aforesaid clause to be attracted, the
person should have been accused of
committing an offence under this Act which
is also an offence under any other law for
the time being in force. The allegations
against the applicant which amount to an
offence under the Customs Act, are not an
offence under this act and vice versa and,
therefore, clause (c) of the Proviso
appended to Section 138 is not attracted in
the present case.

22. The learned Counsel for the
DGGI have also submitted that the
applicant has not disclosed the names and
particulars of his suppliers of raw material
and, therefore, he is not co-operating in
investigation and thereby he appears to
have committed the offence under Section
132 (1) (k) of the Act. However, the
complaint
mentioned
the
accusations
against the applicant only under Section
132 (1) (a) read with Section 132 (1) (i) and
402 INDIAN LAW REPORTS ALLAHABAD SERIES
132 (5) and there is no accusation for
committing an offence under Section 132
(1) (k) of the Act. Therefore, I am of the
view that the offence alleged against the
applicant is compoundable.

23. The law regarding grant of bail
has been explained in numerous decisions
of the Hon'ble Supreme Court and it will be
apt to refer to a few of the relatively recent
judgments on the subject. In the case of
Dataram
Singh v.
State
of Uttar
Pradesh, (2018) 3 SCC 22, the Hon'ble
Supreme Court was pleased to reiterate the
law of bail in the following words:--

"2. A fundamental postulate of
criminal jurisprudence is the presumption
of innocence, meaning thereby that a
person is believed to be innocent until
found guilty. However, there are instances
in our criminal law where a reverse onus
has been placed on an accused with regard
to some specific offences but that is another
matter and does not detract from the
fundamental postulate in respect of other
offences. Yet another important facet of our
criminal jurisprudence is that the grant of
bail is the general rule and putting a
person in jail or in a prison or in a
correction home (whichever expression one
may wish to use) is an exception.
Unfortunately,
some
of
these
basic
principles appear to have been lost sight of
with the result that more and more persons
are being incarcerated and for longer
periods. This does not do any good to our
criminal jurisprudence or to our society.
* * *

5. The historical background of
the provision for bail has been elaborately
and lucidly explained in a recent decision
delivered in Nikesh Tarachand Shah v.
Union of India [(2018) 11 SCC 1] going
back to the days of the Magna Carta. In
that decision, reference was made to
Gurbaksh Singh Sibbia v. State of Punjab
[(1980) 2 SCC 565] in which it is observed
that it was held way back in Nagendra v.
King-Emperor [AIR 1924 Cal 476] that
bail is not to be withheld as a punishment.
Reference was also made to Emperor v.
Hutchinson [AIR 1931 All 356] wherein it
was observed that grant of bail is the rule
and refusal is the exception. The provision
for bail is therefore age-old and the liberal
interpretation to the provision for bail is
almost a century old, going back to
colonial days."

24. In P. Chidambaram v. CBI,
(2020) 13 SCC 337, the Hon'ble Supreme
court reiterated the following principles for
grant of bail: -

"21. The jurisdiction to grant bail
has to be exercised on the basis of the wellsettled principles having regard to the facts
and circumstances of each case. The
following factors are to be taken into
consideration
while
considering
an
application for bail:

(i) the nature of accusation and
the severity of the punishment in the case of
conviction and the nature of the materials
relied upon by the prosecution;

(ii) reasonable apprehension of
tampering
with
the
witnesses
or
apprehension of threat to the complainant
or the witnesses;

(iii) reasonable possibility of
securing the presence of the accused at the
time of trial or the likelihood of his
abscondence;

(iv) character, behaviour and
standing
of
the
accused
and
the
circumstances which are peculiar to the
accused;

(v) larger interest of the public or
the State and similar other considerations.
9 All. Peeyush Kumar Jain Vs. Union of India
403

25. In a recent decision in the case of
Satender Kumar Antil v. Central Bureau
of Investigation, 2022 SCC OnLine SC
825, the Hon'ble Supreme Court has
summarized
and
reiterated
the
law
regarding grant of bail in economic
offences, as laid down in its earlier
decisions, in the following words:--

"66. What is left for us now to
discuss are the economic offences. The
question for consideration is whether it
should be treated as a class of its own or
otherwise. This issue has already been
dealt with by this Court in the case of P.
Chidambaram
v.
Directorate
of
Enforcement, (2020) 13 SCC 791, after
taking note of the earlier decisions
governing the field. The gravity of the
offence, the object of the Special Act, and
the attending circumstances are a few of
the factors to be taken note of, along with
the period of sentence. After all, an
economic offence cannot be classified as
such, as it may involve various activities
and may differ from one case to another.
Therefore, it is not advisable on the part of
the court to categorise all the offences into
one group and deny bail on that basis.
Suffice it to state that law, as laid down in
the following judgments, will govern the
field:--

Precedents

-P. Chidambaram v. Directorate
of Enforcement, (2020) 13 SCC 791:

23.
Thus,
from
cumulative
perusal of the judgments cited on either
side including the one rendered by the
Constitution Bench of this Court, it could
be deduced that the basic jurisprudence
relating to bail remains the same inasmuch
as the grant of bail is the rule and refusal is
the exception so as to ensure that the
accused has the opportunity of securing
fair trial. However, while considering the
same the gravity of the offence is an aspect
which is required to be kept in view by the
Court. The gravity for the said purpose will
have to be gathered from the facts and
circumstances
arising
in
each
case.
Keeping in view the consequences that
would befall on the society in cases of
financial irregularities, it has been held
that even economic offences would fall
under the category of "grave offence" and
in such circumstance while considering the
application for bail in such matters, the
Court will have to deal with the same,
being sensitive to the nature of allegation
made against the accused. One of the
circumstances to consider the gravity of
the offence is also the term of sentence
that is prescribed for the offence the
accused is alleged to have committed.
Such consideration with regard to the
gravity of offence is a factor which is in
addition to the triple test or the tripod test
that would be normally applied. In that
regard what is also to be kept in
perspective is that even if the allegation is
one of grave economic offence, it is not a
rule that bail should be denied in every
case since there is no such bar created in
the relevant enactment passed by the
legislature nor does the bail jurisprudence
provide so. Therefore, the underlining
conclusion is that irrespective of the
nature
and gravity
of
charge,
the
precedent of another case alone will not
be the basis for either grant or refusal of
bail though it may have a bearing on
principle. But ultimately the consideration
will have to be on case-to-case basis on
the facts involved therein and securing the
presence of the accused to stand trial.

-Sanjay Chandra v. CBI, (2012) 1
SCC 40:

"39. Coming back to the facts of
the present case, both the courts have
refused the request for grant of bail on two
404 INDIAN LAW REPORTS ALLAHABAD SERIES
grounds : the primary ground is that the
offence alleged against the accused persons
is very serious involving deep-rooted
planning in which, huge financial loss is
caused to the State exchequer; the
secondary ground is that of the possibility
of the accused persons tampering with the
witnesses. In the present case, the charge is
that of cheating and dishonestly inducing
delivery of property and forgery for the
purpose of cheating using as genuine a
forged document. The punishment for the
offence is imprisonment for a term which
may extend to seven years. It is, no doubt,
true that the nature of the charge may be
relevant, but at the same time, the
punishment to which the party may be
liable, if convicted, also bears upon the
issue. Therefore, in determining whether
to grant bail, both the seriousness of the
charge and the severity of the punishment
should be taken into consideration.

40. The grant or refusal to grant
bail lies within the discretion of the court.
The grant or denial is regulated, to a large
extent, by the facts and circumstances of
each particular case. But at the same time,
right to bail is not to be denied merely
because
of
the
sentiments
of
the
community against the accused. The
primary purposes of bail in a criminal
case are to relieve the accused of
imprisonment, to relieve the State of the
burden of keeping him, pending the trial,
and at the same time, to keep the accused
constructively in the custody of the court,
whether before or after conviction, to
assure that he will submit to the
jurisdiction of the court and be in
attendance thereon whenever his presence
is required. xxxxxxxxx

46. We are conscious of the fact
that
the
accused
are
charged
with
economic offences of huge magnitude. We
are also conscious of the fact that the
offences alleged, if proved, may jeopardise
the economy of the country. At the same
time, we cannot lose sight of the fact that
the investigating agency has already
completed investigation and the chargesheet is already filed before the Special
Judge, CBI, New Delhi. Therefore, their
presence in the custody may not be
necessary for further investigation. We are
of the view that the appellants are entitled
to the grant of bail pending trial on
stringent conditions in order to ally the
apprehension expressed by CBI."

(emphasis supplied)

26. In a recent decision of this Court
in the case of Nitin Verma versus Union
of India and another, 2022 Scc OnLine
All 512, this Court granted bail to a person
accused of committing offence under
Section 132 (1) (b) and 132 (1) (i) of the
CGST Act, 2017 where the allegation was
that the total invoice value of the fake
supplies made by the 126 bogus firms of
the accused was Rs. 691.35 Crores and the
total GST evasion involved in it is Rs.
100.30
Crores,
after
taking
into
consideration the legal position referred to
in the last preceding paragrahs, on the
following reasons: -

"28. Analyzing the facts of the
case in light of the law laid explained in the
case of Y. S. Jagan Mohan Reddy, Dataram
Singh and Satender Kumar Antil (Supra), it
has to be taken into consideration that (1)
the applicant has been implicated on the
basis of the statement of a co-accused
Chandra Prakash Kriplani, who has
already been granted bail by this Court; (2)
earlier, the applicant himself had been
granted anticipatory bail by this Court; (3)
the applicant has no criminal history; (4)
the department had initiated proceedings
on 31.12.2019 by issuing a summons under
9 All. Peeyush Kumar Jain Vs. Union of India
405
Section 70 of CGST Act and after
completion
of
the
investigation,
on
22.11.2021 the department has filed a
complaint in the Court of Special Chief
Judicial Magistrate, Agra and, therefore, it
cannot be said that now the applicant is in
a position to influence the investigation of
the case; (5) the applicant is languishing in
jail since 26-09-2021; (6) the maximum
punishment that can be imposed upon the
applicant is five years' imprisonment and
(7) the offence is compoundable as per the
provision contained in Section 138 of the
CGST Act, I am of the considered view that
the applicant is entitled to be released on
bail."

27. In Paras Jain versus Union of
India,
Criminal
Miscellaneous
Bail
Application No. 21848 of 2022, decided on
29-07-2022, wherein it was stated in the
counter affidavit that "from the analysis of
incriminating
material
recovered,
the
involvement of the applicant with 75 fake
firms was discovered. No one turned up in
response to the summons from 75 firms.
The aforesaid firms have availed fraudulent
I.T.C. Of Rs.5,28,91,94,250/-.", a coordinate Bench of this Court granted bail in
an offence under Section 132 (1) (b) of the
CGST Act, 2017, keeping in view the facts
that the applicant was in jail since 18-022022, he had no criminal history, the
offence is compoundable and the trial will
take a its own time to conclude.

28. The learned Counsel for the
DGGI have submitted that in the case of
Vimal Yashwantgiri Goswami versus
State
of
Gujarat,
R/Special
Civil
Application No. 13679 of 2019 decided on
20-10-2019, the Gujarat High Court had
declined to give any relief to the petitioner,
as
the
case
against
him
involving
allegations of GST evasion was found to be
serious in nature and the petitioners had not
offered to compound the offence. In the
aforesaid case, the relief sought by the
petitioner which was declined by the High
Court was stay of arrest of the petitioner.
However on 28-04-2022, the Gujarat High
Court has passed an order granting bail to
the
petitioner
Vimal
Yashwantgiri
Goswami versus State of Gujarat, in its
order reported in 2022 Scc OnLine Guj
713: -

"9. _ _ _Even, if the tax evasion is
taken more than 5 crores, the maximum
punishment which can be imposed is five
years. It is not disputed by the department
that if the tax evasion of the applicant is
less than Rs. 5 crores, then it will be a
bailable offence as per the provisions of
Section 132(1)(i) read with Sections 132(4)
and 132(5) of the Gujarat GST Act and the
Central GST Act, 2017. Considering the
aforesaid observations, the applicant has
carved out his case for grant of bail under
the provision of section 438 of the Cr.P.C."

29. The learned Counsel for the
DGGI have placed reliance upon a
judgment of the Chhattisgarh High Court in
the case of Basudev Mittal versus Union
of India, MCRC No. 3919 of 2022 decided
on 15-07-2022 and the decision dated 2412-2019 given by Calcutta High Court in
Arvind Kumar Munka versus Union of
India, CRM No. 10075 of 2019, in which
the High Courts had denied bail to the
accused. However, mere denial of bail by
another High Court on the facts of a
particular case, without laying down any
proposition of law, would not amount to a
binding precedent.

30. The position of law regarding
grant of bail which emerges from the
judgments of the Supreme Court referred to
406 INDIAN LAW REPORTS ALLAHABAD SERIES
above, is that the basic jurisprudence
relating to bail in economic offences
remains the same inasmuch as the grant of
bail is the rule and refusal is the exception
so as to ensure that the accused has the
opportunity of securing fair trial. It is not
advisable to categorize all the economic
offences into one group and deny bail on
that basis. One of the circumstances to
consider the gravity of the offence is the
term of sentence that is prescribed for the
offence the accused is alleged to have
committed. Even if the allegation is one of
grave economic offence, it is not a rule that
bail should be denied in every case since
there is no such bar created in the relevant
enactment passed by the legislature nor
does the bail jurisprudence provide so.
While considering the prayer for grant of
bail in any offence, including an economic
offence, the Court has to consider: -

(i) the nature of accusation and
the severity of the punishment to which the
party may be liable in the case of
conviction and the nature of the materials
relied upon by the prosecution;

(ii) reasonable apprehension of
tampering
with
the
witnesses
or
apprehension of threat to the complainant
or the witnesses;

(iii) reasonable possibility of
securing the presence of the accused at the
time of trial or the likelihood of his
abscondence;

(iv) character, behaviour and
standing
of
the
accused
and
the
circumstances which are peculiar to the
accused;

(v) larger interest of the public
or
the
State
and
similar
other
considerations.

A prayer for bail is not to be
denied merely because of the sentiments
of the community are against the accused.
The primary purposes of bail in a
criminal case are to relieve the accused of
imprisonment, to relieve the State of the
burden of keeping him, pending the trial,
and at the same time, to keep the accused
constructively in the custody of the court,
whether before or after conviction, to
assure that he will submit to the
jurisdiction of the court and be in
attendance thereon whenever his presence
is required.

31. Having considered the facts and
submissions made in light of the law laid
down by the Hon'ble Supreme Court in
various
cases,
which
has
been
summarized in the preceding paragraphs
and keeping in view that: -

(i) the offences alleged carry a
minimum punishment of six months'
imprisonment and a maximum of five
years' imprisonment and that the offences
are compoundable, which indicates that
the offences are not grave;

(ii) The applicant has already
paid a sum of Rs. 54.09 Crores towards
tax, interest and penalty and he has
undertaken to deposit the amount of any
additional liability;

(iii) the Department is yet to
ascertain the applicant's tax liability;

(iv)
the
amount
of
Rs.196,57,02,539/- seized by the DGGI
from the applicant's premises is still lying
with the Department and, therefore, the
interest of the Revenue as well as that of
the public at large is protected;

(v) the applicant has already
spent more than 8 months in jail and
during this period the department has not
sought his custodial interrogation, which
shows that his custody is not at all
required;

(vi) the trial is yet to commence;
9 All. Smt. Somwati & Ors. Vs. N.I.C.L. & Ors.
407

(vii) the applicant has no previous
criminal history and he has already been
granted bail in the case under the Customs
Act;

(viii) the applicant does not hold
a passport and, therefore, he is not at a
flight risk;

(ix)
Besides
a
mere
vague
allegation that the applicant may tamper
with the evidence, no material is there to
give rise to a reasonable apprehension that
the applicant will misuse his liberty to
subvert justice or tamper with the evidence
or witnesses;

I find it a fit case to exercise this
Court's discretion of granting bail to the
applicant.

32. Let the applicant - Peeyush
Kumar Jain be released on bail in
Criminal Case No. 7646 of 2022 in the
Court of the Special Chief Judicial
Magistrate
(Economic
Offences)
/
Additional
Metropolitan
Magistrate-III,
Kanpur Nagar, arising out of the complaint
filed by DGGI in respect of offence under
Section 132 (1) (a) read with Section 132
(1) (i) and 132 (5) of the Central Goods and
Services Tax Act, 2017, on his furnishing a
personal bond of Rs.10,00,000/- and two
reliable sureties each of the like amount to
the satisfaction of the court concerned
subject to following conditions:-

(i) The applicant will not tamper
with the evidence during the trial.

(ii)
The
applicant
will
not
influence any witness.

(iii) The applicant will appear
before the trial court on the date fixed,
unless his personal presence is exempted,
in which case he will appear through his
Counsel.

(iv) The applicant will not,
directly
or
indirectly,
make
any
inducement, threat or promise to any
person acquainted with the facts of the case
so as to dissuade him from disclosing such
facts to the Court to any police officer or
tamper with the evidence.

33. In case of breach of any of the
above conditions, the prosecution shall be
at liberty to move an application before this
Court seeking cancellation of the present
order bail.
----------
(2022) 9 ILRA 407
APPELLATE JURISDICTION
CIVIL SIDE
DATED: ALLAHABAD 04.08.2022

BEFORE

THE HON'BLE DR. KAUSHAL JAYENDRA
THAKER, J.

FAFO No. 80 of 2000

Smt. Somwati & Ors.
 ...Appellants/Claimants
Versus
N.I.C.L. & Ors.
 ...Respondents/Opposite Parties

Counsel for the Appellants:
Sri R.K. Porwal, Sri P.K. Mukerjee

Counsel for the Respondents:
Sri Y.K. Saxena, Sri Alok Sharma, Sri Alok
Singh, Sri P.K. Sinha

A. Civil Law - Motor Vehicle Act, 1988Section
176-Enhancement
of
compensation-deceased was 56 years and
he was a Principal in Inter CollegeTribunal awarded a sum of Rs. 3,29,500/-
together with interest @ 12% per annum
as compensation but not granted future
loss of income-the deceased was survived
by
five
dependents-By
applying
the
multiplier
of
9,
the
total
loss
of
dependency is assessed Rs.12,42000/-
Thus, the claimants held entitled for