Mumbai Sessions Court Denies Anticipatory Bail To Accountant In Alleged ₹20.30 Crore GST Fraud Case

Mumbai, June 30: Holding that the CGST Act does not confine criminal liability solely to directors or persons responsible for the management of a company, a sessions court has rejected the anticipatory bail plea of a 26-year-old accountant of a company under probe for alleged tax evasion to the tune of Rs 20 crore.

Court Cites Serious Economic Offence

Additional Sessions Judge P. A. Sable, while rejecting the anticipatory bail plea of the accountant, observed that, "The allegations pertain to a well-organised economic offence involving fraudulent availment and utilisation of Input Tax Credit amounting to approximately Rs 20.30 crore by generating fake invoices exceeding Rs 100 crore. Economic offences constitute a distinct class of offences affecting the financial and economic interests of the State and, therefore, deserve to be viewed with greater seriousness."

Twenty-six-year-old Ashutosh Pandey, a resident of Chhattisgarh, had approached the sessions court for anticipatory bail after his name cropped up during the investigation into alleged GST violations concerning M/s. SKDK Steels and M/s. Drishti Steel Company.

Pandey claimed that he is neither a director of these firms nor involved in the management or affairs of either company. According to him, he is merely employed as an accountant and support staff with M/s. Drishti Steel Company.

Court Rejects Bail Plea

Special Public Prosecutor S. R. Pathak contended that the investigation pertains to the fraudulent availment and utilisation of Input Tax Credit (ITC) and is not restricted to M/s. SKDK Steels Pvt. Ltd.

He submitted that statements of witnesses recorded during the course of the investigation reveal that buyer verification, transportation arrangements, maintenance of sales records, and OTP-based GST and banking-related transactions were being handled by the applicant.

The court, while rejecting his plea, observed that, "Although the applicant claims to be merely an accountant employed by the company, the material collected during investigation prima facie indicates a role extending beyond routine accounting or clerical functions."

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"The contention that the applicant is neither a director nor a person managing the affairs of the company, by itself, does not entitle him to the extraordinary relief of anticipatory bail. Section 132 (punishment and prosecution for tax evasion) of the CGST Act does not confine criminal liability solely to directors or persons responsible for the management of a company. Where the material collected during investigation prima facie discloses active participation in the commission or facilitation of the alleged offences, the applicant's status as an employee or accountant cannot, by itself, constitute a valid ground for extending pre-arrest protection," the court said.

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