Regular Bail granted in GST offence as investigation complete and complaint filed

Issue

Whether an applicant accused of GST offences (under Section 132) is entitled to regular bail when the investigation is complete, the complaint (charge-sheet) has been filed, and the evidence is primarily documentary.

Facts

The Accusation: The applicant was arraigned in an FIR/Case by DGGI Surat for alleged GST offences (likely involving tax evasion/fake invoices).
Current Status:
- The applicant sought bail before the filing of the charge-sheet initially.
- However, during the pendency of the bail application, the investigation was completed and the complaint was filed before the Trial Court.
Nature of Evidence: The allegations were based on documents, and all relevant records had already been seized by the authorities.

Decision

Custody Not Required: The High Court held that since the investigation is complete and the complaint is filed, further custodial detention is unnecessary for the purpose of investigation.
Documentary Evidence: As the case relies on documentary evidence which is already in the custody of the Department, there is little risk of the accused tampering with it.
Civil Recovery: The Court observed that the Department can independently pursue adjudication proceedings for the recovery of tax dues. Bail should not be denied merely to enforce recovery.
Flight Risk Managed: The apprehension that the accused might abscond can be managed by imposing strict conditions.
Ruling: The applicant was enlarged on Regular Bail subject to stringent terms, including:
- Executing a bond.
- Surrender of passport.
- Restriction on traveling out of Gujarat.
- Monthly marking of presence before the authority.

Key Takeaways

“Bail, not Jail”: In economic offences, once the investigation is over and the complaint is filed, courts generally lean towards granting bail because pre-trial detention is not meant to be punitive.

Recovery is Civil: The power of arrest under Section 69 is for investigation, not for recovering tax. If the Department wants money, they must attach property or pass an adjudication order, not keep the person in jail indefinitely.

HIGH COURT OF GUJARAT

Sajjad Salimali Bhimani

State of Gujarat^*

Nikhil S. Kariel, J.

R/CRIMINAL MISAPPLICATION (FOR REGULAR BAIL – BEFORE CHARGESHEET) NO. 22081 of 2025

NOVEMBER 19, 2025

Punit B. Juneja for the Applicant. Tirth Nayak and Ms. Divyagna Jhala, Addl. Public Prosecutor for the Respondent.

ORDER

1. Heard learned Advocate Mr. Punit Juneja on behalf of the applicant learned Additional Public Prosecutor Ms. Divyangna Jhala on behalf of the respondent no.1-State and learned Advocate Mr. Tirth Nayak on behalf of respondent no. 2-original complainant.

2. The present applicant who has been arraigned as accused has preferred this application under Section 483 of the Bharatiya Nagarik Suraksha Sanhita, 2023 for enlarging the applicant on Regular Bail in connection with FIR being File NO. DGGI/INT/INTL/781/2025– Gr 1 registered with DGGI, INT Intelligence Officer, Surat for the offence punishable under Sections 132(1)(B), 132)1)9C) OF THE Central Goods and Services Tax Act before filing of the charge-sheet.

3. Learned Advocate on behalf of the applicant would submit that considering the role attributed to the present applicant and nature of allegations levelled, this Court may consider releasing the applicant on regular bail. It is further submitted that since the charge-sheet is not filed no useful purpose would be served by keeping the applicant in jail for indefinite period. It is further contended that the applicant is ready and willing to abide by all the conditions that may be imposed by this Court if released on bail.

4. The present application is vehemently objected to by learned Additional Public Prosecutor by submitting that looking to the nature of offence, role attributed to the present applicant and since the charge-sheet has not been filed, this Court may not interfere at this stage.

5. This Court has heard learned Advocates for the respective parties and perused the FIR as well as order passed by learned Session Court as well as affidavit filed by the investigating officer before the learned Trial Court.

6. This Court has taken into consideration the law laid down by the Hon’ble Apex Court in the case of Sanjay Chandra v. Central Bureau of Investigation [2012] 1 SCC 40.

7. This Court has also considered the following aspects:

(i)

The fact of the investigation having been completed during pendency of the present application and whereas, the respondent no. 2 having filed the compliant before the concerned Trial Court.

(ii)

The fact that though very serious offences alleged to have been committed by the present applicant, yet, the same being documentary based and whereas all the documents having been seized by the investigating officer.

(iii)

The fact that it would be open to respondent no. 2 to initiate the adjudication process against the present applicant for recovery of the amount in question.

(iv)

Learned Advocate appearing for respondent no 2 laid apprehension that the applicant might abscond, could be allayed by imposing suitable conditions.

8. In the facts and circumstances of the case and considering the nature of the allegations made against in the First Information Report, without discussing the evidence in detail, prima facie, this Court is of the opinion that this is a fit case to exercise the discretion and enlarge the applicant on regular bail.

9. Hence, the present application is allowed. The applicant is ordered to be released on bail in connection with FIR being File No. DGGI/INT/INTL/781/2025– Gr 1 registered with DGGI, INT Intelligence Officer, Surat on executing a bond of Rs.1,00,000/- (Rupees One Lac only) with one surety of the like amount to the satisfaction of the trial Court and subject to the conditions that he shall;

[a]

not take undue advantage of liberty or misuse liberty;

[b]

not act in a manner injurious to the interest of the prosecution;

[c]

surrender passport, if any, to the lower court within a week;

[d]

not leave the State of Gujarat without prior permission of the Sessions Judge concerned;

[e]

Mark his presence before the Investigating Officer — respondent no. 1 once in a month for six months.

[f]

furnish the present address of residence to the I.O. and also to the Court at the time of execution of the bond and shall not change the residential address without prior intimation to the I.I.

10. The Authorities will release the applicant only if he is not required in connection with any other offence for the time being. If breach of any of the above conditions is committed, the Sessions Judge concerned will be free to take appropriate action in the matter.

11. Bail bond to be executed before the lower court having jurisdiction to try the case. It will be open for the concerned Court to delete, modify and/or relax any of the above conditions in accordance with law.

12. At the stage of trial, the trial court shall not be influenced by any observations of this Court which are of preliminary nature made at this stage, only for the purpose of considering the application of the applicant for being released on regular bail.

13. The application is allowed in the aforesaid terms. Rule is made absolute to the aforesaid extent. Direct service is permitted.