GST Fraud: SC stays payment of Rs. 25 crores as bail condition for the prime accused

Mar4,2021 #GST Fraud #SUPREME COURT


Supreme Court issued notice and stayed the bail condition imposed by the Bombay High Court to pay a total of Rs. 25 crores on the prime accused of Rs. 122 crore GST fraud case.

The bench of Justices Rohinton Fari Nariman and Hrishikesh Roy passed the notice in an appeal filed by businessman Daulat Samirmal Mehta challenging the bail condition directing him to pay Rs. 10 crores and Rs 15 crores to bring about his release.

The plea in Supreme Court mentioned that Bombay High Court, despite admitting that his “arrest was not justified”, passed an order for him to pay Rs. 25 crores.

The plea contends that the appellant has been subjected to “such harsh conditions” even when he had spent 26 days in custody for an offense which is punishable with imprisonment for five years.

The petition contends that inflicting unreasonable and exorbitant conditions for bail is in contravention with Article 21 of the Constitution of India.

The 64-year-old businessman was arrested by the Directorate General of Central Goods and Service Tax for an alleged fraud.

His companies, Twinstar Industries, and Originet Technologies face allegations of fraudulently availing and utilizing ineligible input tax credit (ITS) of Rs. 122.6 crores based on counterfeit invoices.

The appellant has contended that his companies have not committed any fraud as they are not liable to pay GST. The appellant has claimed that no goods have been supplied by the appellant or the companies and GST is paid only when goods are supplied.

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