Accused No.1 Granted Regular Bail as Investigation Is Complete

Accused No.1 Granted Regular Bail as Investigation Is Complete and Co-Accused Already Secured Similar Relief

Issue

Whether Petitioner/Accused No.1 is entitled to regular bail under Section 480 of the Bharatiya Nagarik Suraksha Sanhita, 2023, regarding alleged offences involving fake Input Tax Credit (ITC) under Section 132 of the CGST Act, 2017.

Facts

The FIR: Registered by the Anti-Evasion Wing, Medchal GST Commissionerate, Hyderabad (GEXCOM/AE/INV/GST/2502/2024-AE).
The Allegation: The Petitioner was accused of utilizing bogus invoices to claim fraudulent Input Tax Credit (ITC).
Custody Status: The Petitioner was arrested and had been in judicial custody since January 29, 2026.
Co-Accused Status: Accused No. 3, involved in the same matter, had already been granted bail by the competent court.
Procedural Stage: The investigation into the alleged GST fraud had reached completion.

Decision

Parity Maintained: The Court observed that since the co-accused (Accused No. 3) was already released on bail, the Petitioner was entitled to similar relief.
Custody Unnecessary: Given that the investigation was completed, the Court held that the continued incarceration of the Petitioner was no longer warranted.
Conditional Release: The Court allowed the criminal petition and granted regular bail subject to:
1. Execution of a personal bond with two sureties.
2. Mandatory periodic appearance before the respondent authorities until the charge sheet is filed.
3. Strict adherence to all statutory bail conditions.

Key Takeaways

Principle of Parity: If a co-accused with similar allegations is granted bail, the court is inclined to extend the same benefit to other accused individuals.
Investigation Completion: Once the investigation is finished, the “need for custody” diminishes, as there is less risk of the accused tampering with evidence or hampering the probe.
Statutory Compliance: Granting of bail in economic offences under the CGST Act is often tied to stringent conditions, such as regular reporting to authorities, to ensure the accused remains available for trial.

HIGH COURT OF TELANGANA

Pavan Madanlal

Superintendent of Central GST, Anti Evasion, Medchal GST Commissionerate, Hyderabad^*

Smt. K. SUJANA, J.

CRIMINAL PETITION No. 3776 of 2026

MARCH 23, 2026

ORDER

1. This Criminal Petition is filed under Sections 480 & 483 of the Bharatiya Nagarik Suraksha Sanhita, 2023 (for short ‘BNSS’) by the petitioner/Accused No.1 seeking to enlarge him on bail in connection with FIR No.GEXCOM/AE/INV/GST/2502/2024-AE of Anti Evasion Wing, Medchal GST Commissionerate, Hyderabad, registered for the offence punishable under Sections 132 (1)(b)(c), (f) and (I) read with Section 132 (1)(i) of the Central Goods and Service Tax Act, 2017.

2. Heard Sri Upadhyay Raghavender, learned counsel for the petitioner and Sri Dominic Fernandes, learned Senior Standing Counsel for CBIC, appearing for the respondent.

3. The allegation levelled against the petitioneraccused No.1 and others is that they availed fake ITC of Rs.21.89 crores by showing wrong bills. The petitioner was arrested on 28.01.2026 and remanded to judicial custody on 29.01.2026.

4. Learnsed counsel for the petitioner would submit that the petitioner is innocent of the offence alleged against him; that the offence alleged against the petitioner is bailable and cognizable, respondent authorities arrested the petitioner and wrongfully confined him; that accused No.3 was already granted bail by the learned trial Court; that as material part of investigation is already completed, further interrogation of the petitioner is not required in this case, and hence, he requested the Court to grant regular bail to the petitioneraccused No.1.

5. On the other hand, learned Senior Standing Counsel for CBIC appearing for the respondent opposed the same and would submit that the offence alleged against the petitioner is not under Section 132 (1)(i) of the Central Goods and Service Tax Act, 2017 (for short, ‘the Act,2017’) and it is under Section 132 (1)(f) and (l) of the Act, 2017, which is non-cognizable and non-bailable. On this aspect, the contention of learned counsel for the petitioner is not correct. He also further submits that investigation is not yet completed and at this stage, the petitioner is not entitled for grant of bail.

6. Considering the submissions made by both the counsel and on perusal of the material shows that the petitioner has been in judicial custody from 29.01.2026. Accused No.3 was already granted bail by the learned trial Court. Since investigation is already completed and incarceration of the petitioner in judicial custody from 29.01.2026, this Court deems it fit to grant regular bail to the petitioner/accused No.1 subject to the following conditions:

(i)

The petitioner-Accused No.1 shall execute a personal bond for a sum of Rs.25,000/- (Rupees Twenty Five Thousand only) with two sureties for a like sum each to the satisfaction of the learned Special Judge for Trial of Cases under Economic Offence, Nampally, Hyderabad.

(ii)

On such release, the petitioner-accused No.1 shall appear before the respondent authorities at 11:00 a.m. and 5:00 p.m., on every Wednesday till filing of charge sheet and thereafter, as and when required.

(iii)

The petitioner-Accused No.1 shall abide by the conditions stipulated in Section 437 (3) of Cr.P.C. (presently, Section 480 (3) of BNSS).

7. Accordingly, the Criminal petition is allowed.

Miscellaneous petitions, if any, pending shall stand closed.