Safiya Malik

The High Court of Jharkhand has granted anticipatory bail to a tax practitioner accused of facilitating the registration of a firm under the Goods and Services Tax (GST) framework using allegedly fraudulent documentation. The petitioner approached the court to avoid arrest, assuring cooperation with the ongoing investigation. The court allowed the application, imposing specific conditions to ensure compliance with the legal process.

The petitioner has been charged with offenses under Sections 406 (criminal breach of trust), 420 (cheating), 468 (forgery for the purpose of cheating), 471 (using forged documents as genuine), and 120B (criminal conspiracy) of the Indian Penal Code, as well as Sections 132(1)(b), 131(1)(e), and 132(1)(l) of the Jharkhand Goods and Services Tax Act. The allegations stem from claims that the petitioner, acting as a tax practitioner, assisted in registering a proprietary firm with the GST system using invalid and vague documents. It is alleged that the firm was registered to evade significant amounts of government taxes.

In his submission to the court, the petitioner contended that his role was confined to assisting in the registration process and did not extend to verifying the authenticity of documents provided by the client. He further stated that all documents were subsequently taken by a representative of the firm following the registration. The petitioner’s counsel argued that the allegations of misuse of Input Tax Credit (ITC) pertained solely to the co-accused and that there was no evidence linking the petitioner to any financial benefits or fraudulent activities.

The petitioner referred to his professional standing as a tax practitioner and advocate, submitting that he posed no risk of evading and expressed willingness to cooperate fully with the investigation. He also assured the court of his willingness to furnish sufficient security and adhere to any conditions imposed. His counsel submitted, “The petitioner undertakes to cooperate with the investigation of the case and appear before the Investigating Officer as and when noticed.”

Opposing the application, counsel for the state and the opposite party argued that the petitioner’s role, although indirect, was instrumental in enabling the alleged tax evasion. They stated the seriousness of the charges, noting the potential financial implications for the government. They urged the court to deny the application, emphasizing the need to ensure the investigation’s integrity.

After considering the arguments, the court noted that the petitioner’s involvement appeared limited to facilitating the GST registration process. It observed that no direct allegations were made against the petitioner regarding the misuse of ITC or the receipt of financial benefits. The court further recorded that the petitioner’s assurances to cooperate with the investigation and provide security reduced concerns about his potential to obstruct the investigation.

In its order, the court stated: “Considering the submissions of the counsels and the facts as discussed above, I am of the opinion that it is a fit case where the above-named petitioner be given the privilege of anticipatory bail.”

The court granted anticipatory bail to the petitioner with the following conditions. The petitioner is required to surrender or face arrest within six weeks from the date of the order. He must deposit a cash security of ₹50,000 and furnish a bail bond of ₹25,000, supported by two sureties of the same amount. The petitioner must cooperate with the investigation, comply with notices issued by the Investigating Officer, and provide his mobile number and a copy of his Aadhar card to the court. The court further ordered that the petitioner must not change his mobile number during the pendency of the case. These conditions were imposed in addition to those outlined under Section 438(2) of the Criminal Procedure Code.

The court stated that granting anticipatory bail did not absolve the petitioner of the need to cooperate with the legal process. The court’s directive included the statement: “The petitioner will cooperate with the investigation of the case and appear before the Investigating Officer as and when noticed by him.”

Case Title: Satya Prakash Singh v. The State of Jharkhand & Anr.

Case Number: A.B.A. No. 2096 of 2024

Bench: Justice Anil Kumar Choudhary

[Read/Download order]