Read Order: Rajesh Mittal v. State of Haryana 

Monika Rahar

Chandigarh, February 14, 2022: While dealing with a tax evasion matter where the accused was behind the bars for 32 months, the Punjab and Haryana High Court has granted the benefit of regular bail to the accused concerned in light of a Supreme Court decision as also in view of the petitioner’s assertions to the effect that the entire wrongful tax credit amount was discharged by the recipient taxpayer firm and there was no loss to the State exchequer. 

The petition placed before the Bench of Justice Harsimran Singh Sethi was for the grant of regular bail in complaint case registered under Section 132 of Haryana Goods and Service Tax Act, 2017 read with Section 20 of the Integrated Goods and Service Tax Act, 2017 against the petitioner, and pending in the Court of Additional Chief Judicial Magistrate, Panipat. 

It was the case of the petitioner’s counsel that the sentence which can be imposed upon the petitioner, even if the petitioner was convicted of the offence, was a maximum of five years, whereas, the petitioner was behind the bars for the last 2 years and 08 months, which is more than the half of the maximum sentence, which could be awarded to the petitioner if convicted. The Counsel also submitted that as the allegations made against the petitioner were yet to be proved and he prayed for the release of the petitioner on bail during the course of the trial. 

On the other hand, the State counsel submitted that the allegations alleged against the petitioner were very serious in nature and the petitioner was a habitual offender as he was involved in another FIR although on similar allegations. The counsel conceded to the fact that the allegation alleged against the petitioner was of evading goods and service tax and the petitioner was behind the bars for the last 02 years and 08 months.

At the outset, the court made reference to a Supreme Court decision titled Paresh Nathalal Chauhan v. The State of Gujarat and Another, Crl. Appeal No.164-165/2022 wherein the Apex Court while dealing with a tax evasion case, held that the accused cannot be indefinitely detained in a custody and granted the concession of regular bail where the accused had undergone custody for a period of 25 months

Regarding the factual background of the case, the Court observed that the allegations alleged against the petitioner were yet to be proved and in case, those allegations were proved, the petitioner could be sentenced to undergo imprisonment for a maximum period of five years and that during the course of the trial itself, the petitioner underwent custody for the last 02 years and 08 months. 

Thus, considering the facts and circumstances of the case, as also the fact that the custody period as was undergone by the bail applicant in the case before the Supreme Court in Paresh Nathalal’s Case(supra) was also less, the High Court found substance in the case of the petitioner. Also, the fact the trial was likely to take some time owing to COVID-19 restrictions, was taken into consideration by the Court. 

Thus, without commenting upon the merits of the case, the trial Court/ Duty Magistrate was directed to put appropriate conditions upon the petitioner so as to ensure that the petitioner would not flee the trial.

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