Safiya Malik

The Madhya Pradesh High Court Indore Bench has dismissed a writ petition seeking the quashing of an FIR registered against the petitioner under various sections of the Indian Penal Code (IPC) in connection with allegations of tax evasion and fraudulent transactions. The matter was heard by Division Bench of Justice Vivek Rusia and Justice Gajendra Singh, who observed that "we do not find any ground to interfere with the investigation which is going on against the present petitioner."

The petitioner had also challenged the constitutional validity of Section 132(6) of the Central Goods and Services Tax Act, 2017 (CGST Act). The court held that "there is absolutely nothing in the Writ Petition to suggest that Section 132(6) is being misused and hence liable to be declared unconstitutional."

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The petitioner, proprietor of M/s Elora Tobacco Company Limited, approached the court under Article 226 of the Constitution of India, seeking the quashing of FIR No. 88/2021 dated February 10, 2021, registered at Police Station Tukoganj, Indore. The FIR was lodged under Sections 420, 467, 468, 471, and 120-B of the IPC.

The investigation was initiated by the Directorate General of GST Intelligence (DGGI), Bhopal Zonal Unit, in June 2020, revealing alleged tax evasion amounting to Rs. 2000 crore from July 2017 to June 2020. The petitioner was arrested on June 15, 2020, under Section 69 of the CGST Act for committing an offense under Section 132(1)(a).

The petitioner was previously granted bail by the High Court in M.Cr.C. No. 26653 of 2020, related to a separate FIR (Crime No. 23/2020), which involved similar charges under the CGST Act and the IPC. The petitioner contended that the present FIR amounted to a second FIR for the same offense, which was impermissible under the law.

The petitioner relied on judicial precedents, including T.T. Antony v. State of Kerala (2001) 6 SCC 181, Amitbhai Anilchandra Shah v. Central Bureau of Investigation (2013) 4 SCC 348, and Krishna Lal Chawla v. State of Uttar Pradesh (2021) 5 SCC 435, arguing that no second FIR can be registered for the same set of facts. It was submitted that "when Crime No.23/2020 has already been registered under Section 132(1)(a)(i) of the CGST Act r/w Sections 409, 467, 471, 120-B of the IPC, then this second FIR has wrongly been registered."

The respondents, including the State of Madhya Pradesh and officials from the GST Department, opposed the petition. It was contended that "the present FIR has nothing to do with the crime registered under the provisions of the CGST Act." The government submitted that the FIR was based on independent allegations of "forgery and cheating on the premises of Dabang Dunia Press by these two accused persons, not under the GST."

The investigation revealed that fraudulent tax invoices were generated in the name of M/s Dabang Dunia Publication Private Limited (DDPL), which is linked to the petitioner. The GST authorities collected 904 invoices related to advertisements purportedly published in Dainik Dabang Dunia, but a cross-verification with the newspaper’s soft copy showed that "no such advertisement was found in the soft copy published during the period April 2016 to January 2020."

The court recorded that "the petitioner has fabricated a large number of tax invoices to show on record vide circulation of Dabang Dunia." It observed that "GST evasion of Rs.500 crore is said to have been adjusted in the sale of Dabang Dunia by showing the artificial sale of one lakh copies per day, whereas the actual sale was five to eight thousand."

Regarding the challenge to Section 132(6) of the CGST Act, the court held that "this provision only puts an embargo on the registration of complaints without permission from the Commissioner. This provision is in favor of the person protecting him from registration of a false complaint without approval from the Commissioner CGST, therefore, in our considered opinion, this provision cannot be held ultra vires."

The court noted that the FIR contained allegations of "money laundering by publishing this newspaper," and the GST Department had collected evidence showing that fake invoices were used to account for unaccounted money. It was recorded that "the GST Authorities also found various fake invoices to transform black money into white."

The court also examined the pace of the investigation and inquired why it had not been completed. The Officer in Charge (OIC) submitted that "a large number of forged invoices have been found related to so-called private persons and companies who gave advertisements to the petitioner’s newspaper are worth crores of rupees and it is being very difficult to contact each of them as most of them are fake." The court directed that "the investigation be completed within two months and the final report be prepared positively."

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The court dismissed the writ petition, stating: "In view of the aforesaid observations, the Writ Petition stands dismissed. No order as to costs."

It further directed the investigating authorities to conclude the pending inquiry within a specified time frame, stating: "Let the investigation be completed within two months and the final report be prepared positively."

Advocates Representing the parties:

For the Petitioner: Shri Abhinav Malhotra

For the Respondents: Shri Amit Rawal, Government Advocate for the State of Madhya Pradesh and Shri Prasanna Prasad, Counsel for the GST Department

Case Title: Kishore Wadhwani v. The State of Madhya Pradesh & Ors.
Neutral Citation: 2025:MPHC-IND:7008
Case Number: W.P. No. 40019 of 2024
Bench: Justice Vivek Rusia, Justice Gajendra Singh

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