Bail Granted Under Section 132 RGST as Investigation Was

Bail Granted Under Section 132 RGST as Investigation Was Complete and Custodial Interrogation Was Unnecessary

Issue

Whether an accused partner arrested under Section 132(1) of the RGST Act for alleged GST evasion of ~₹10 crores is entitled to bail under Section 483 of BNSS, 2023, when investigation is complete and the complaint has been filed.

Facts

Arrest & Charges: The petitioner, a partner in a firm that commenced business on October 31, 2025, was arrested on March 24, 2026, by DGGI Jaipur for alleged offences under Section 132(1) of the RGST/CGST Act.
Alleged Evasion: The Department alleged that the firm supplied lead ingots and batteries worth ~₹53.16 crores without invoices to eight entities between January 23, 2025, and February 18, 2026, causing alleged GST evasion of ~₹10 crores.
Prior Application: An earlier bail application filed by the petitioner was rejected.
Present Application: The petitioner filed an application under Section 483 of the Bharatiya Nagarik Suraksha Sanhita, 2023 (BNSS) seeking bail.
Status of Investigation: Investigation stood completed, and the formal complaint was filed before the competent court.
Defect in Assessment: The Department’s GST assessment rested solely on certain recovered invoices without a proper assessment of the actual value of the goods.

Decision

Completion of Investigation: Since the complaint was already filed before the competent forum, no further custodial interrogation or recovery from the petitioner was required.
Nature of Offence: The alleged offences are triable by a Magistrate and carry a maximum statutory punishment of five years.
Judicial Precedent: Co-ordinate Benches of the High Court had granted bail under similar circumstances in comparable GST evasion cases.
Grant of Bail: Considering that custodial interrogation was unnecessary and the trial would take considerable time, the bail application was allowed, and the petitioner was directed to be released subject to specified conditions [Paras 10 and 11].
The matter was decided in favor of the assessee.

Key Takeaways

No Pre-Trial Detention Post-Complaint: Once investigation is complete and a complaint is filed under Section 132 of the GST Act, continued custody becomes punitive rather than investigative, justifying the grant of bail.
Magisterial Trial & Sentence Ceiling: GST offences punishable up to five years and triable by a Magistrate favor the grant of bail when the accused is not a flight risk and custodial interrogation is no longer required.
Proper Valuation Required: Preliminary allegations of evasion based merely on seized invoices without a formal statutory assessment of transaction value weaken the case for continued pre-trial detention.

HIGH COURT OF RAJASTHAN

Jitendra Yadav

State of Rajasthan

Ravi Chirania, J.

S.B. Criminal Miscellaneous Bail Application No. 8672 of 2026

JULY 1, 2026

Ranjan Mehta, Jaideep Malik, Navin Kumar Yadav and Keshav Khandelwal for the Petitioner. Amit Punia, PP and Kinshuk Jain, Sr. Standing Counsel for the Respondent.

ORDER

1. The instant bail application has been filed under Section 483, B.N.S.S., 2023 by the petitioner -Jitendra Yadav S/o Mali Ram Yadav, who was arrested on 24.03.2026 by Directorate General of GST (Intelligence) (DGGI), Japur in connection with Case No. DGGI/INV/GST/528/2026-Gr F-O/o ADG DGGI-ZU-Jaipur, against the offences punishable under Section 132(1) of the Rajasthan Goods and Services Act, 2017 (hereinafter referred to as ‘RGST, 2017’), after his bail application was rejected by the Additional Sessions Judge No.9, Jaipur Metropolitan-II vide order dated 07.05.2026.

2. Mr. Ranjan Mehta, learned counsel, submitted that the petitioner is a partner in a firm, namely M/s Alpha Pigment, having GSTIN No.08ACLFA7018B1ZN, which commenced its business operations with effect from 31.10.2025. It is also submitted that the respondent-Department registered a case against the petitioner alleging supply of goods without issuing invoices, and clandestine removal of goods in violation of Section 132(1) of RGST Act, 2017. Counsel further argued that the respondent have alleged that the petitioner supplied lead ingots and batteries worth approximately Rs. 53,16,70,780/- to eight firms without proper invoices and without payment of GST during the period from 23.01.2025 to 18.02.2026.

3. Learned counsel submitted that on the basis of search, as conducted, respondent alleged to have collected certain invoices pertaining to a period when the firm was not even registered, have counted those invoices against the petitioner’s firm and on that basis, have calculated the alleged non-payment of the GST. Learned counsel further submitted that the alleged violations are seriously objected. He further submitted that lead ingots allegedly sold by the firm were taken out from the scrap batteries and the alleged valuation carried out by the Department is superficial/arbitrary. Learned counsel further added that the Department has incorrectly assessed the turnover of the petitioner’s firm by treating it as a large commercial concern having enormous turnover, whereas the facts are otherwise.

4. In his concluding submissions, learned counsel relied upon certain judgments, wherein Courts, while dealing with similar allegations, granted bail considering several grounds including the long incarceration of the accused, the filing of the complaint, the offences are triable by Magistrate and carry maximum punishment for a term of five years. In view of the above, learned counsel prayed that the bail application filed by the petitioner may be allowed.

5. Per contra, Mr. Kinshuk Jain, Senior Standing Counsel for the CGST Department, strongly opposed the bail application. He submitted that there has been a serious violation of the provisions of GST Act, 2017, as the complaint clearly discloses evasion of GST amounting to approximately Rs.10 crores due to illegally supplying lead ingots through various illegal invoices without payment of the requisite GST. Therefore, in terms of the law as settled by the Hon’ble Apex Court, the allegations are serious in nature and the offences are punishable under the provisions of GST Act. Hence, the present petitioner does not deserve to be enlarged on bail.

6. Heard learned counsel for the parties and perused the material available on record.

7. This Court has considered the fact that the allegations against the petitioner pertain to non-payment of GST amounting to approximately Rs. 10 crores, in violation of Section 132 (1) of the RGST Act 2017. This Court further noted that the petitioner was arrested on 24.03.2026 and after completion of the investigation, the respondent Department has already filed charge-sheet in the form of a complaint before the concerned Court and no further interrogation or recovery is stated to be required from him.

8. This Court also noted that the petitioner’s firm is alleged to have sold the lead ingots taken out from scrap batteries and supplied to various firms. During the course of hearing, this Court specifically asked learned counsel for the respondent regarding the interrogation conducted by them with respect to the basis of GST assessment, its calculation and the non payment of the same. However, it was stated that on the basis of certain invoices as recovered, they have made their assessment and have calculated the alleged amount pertaining to non-payment of GST.

9. Be that as it may.

10. After considering the aforesaid facts and circumstances, including the fact that the offences alleged against the petitioner are triable by Magistrate, punishable for a maximum term of five years’; absence of proper assessment of the value of the goods in question for which violation under the provisions of RGST Act, 2017 as alleged; the Co-ordinate Benches have granted bail in similar circumstances; moreso, that the investigation has already been completed in the present case; the complaint has already been filed and no further judicial custody and interrogation of the petitioner is required, this Court is inclined to enlarge the petitioner on bail.

11. Accordingly, this bail application is allowed and it is directed that accused-petitioner Jitendra Yadav S/o Mali Ram Yadav shall be released on bail in connection with Case No. DGGI/INV/GST/528/2026-Gr F-O/o ADG DGGI-ZU-Jaipur, provided he executes a personal bond in a sum of Rs.1,00,000/-along with two sound and solvent sureties of Rs.50,000/- each to the satisfaction of the learned trial Court for his appearance before that Court on each and every date of hearing and whenever called upon to do so till the completion of the trial.

12. The petitioner is further directed not to take undue advantage of liberty. It is made clear that the observations as made by this Court in the bail application will have no bearing on the trial of the case.