Final Order 5

Order Details: COPY OF JUDICIAL PROCEEDINGS
Pdf Text: IN THE COURT OF SPECIAL JUDGE (PC ACT) (ACB)-02,
ROUSE AVENUE DISTRICT COURTS, NEW DELHI
Presided Over by: Ashish Aggarwal, DHJS
Bail Applications No.197/2024, 204/2024, 209/2024 and 218/2024
State v Babita Sharma, Mukesh Kumar Saini, Surjeet Singh and Lalit Kumar
FIR No.5/2023
PS Anti-Corruption Branch
08.10.2024
ORDER
These are applications under Section 439 of Code of Criminal Procedure filed
by accused persons Babita Sharma, Mukesh Kumar Saini, Surjeet Singh and
Lalit Kumar.
Present : Sh. Manoj Kumar Garg, Ld. PP for State.
Sh. Kartik Jain, Ld. Counsel for accused Babita Sharma and Mukesh
Saini.
Sh. Shubh Goyal, Ld. Counsel for accused Lalit Kumar.
Ms. Meenakshi Sahu, Ld. Counsel for all accused persons appearing
through VC.
1. The applications for bail filed by accused persons Babita Sharma, Mukesh
Kumar Saini, Surjeet Singh and Lalit Kumar are proposed to be decided by
this common order.
2. The submissions advanced by the respective accused persons are outlined
below.
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Submissions made on behalf of accused Babita Sharma
3. On behalf of accused Babita Sharma, it has been urged that she is a law
abiding citizen who was working as GST officer with the Department of Trade
And Taxes, Government of NCT of Delhi; that in the year 2021, the
Department of Trade and Taxes implicated her by submitting a complaint
dated 30.11.2021 before different authorities including the Crime Branch and
the Anti-Corruption Branch of Delhi Police; that it is alleged that the applicant
had transferred 53 firms from Ward No.6 to Ward No.22 in connivance with
the co-accused persons soon after she got transferred by transfer order dated
26.07.2021 to the said ward; that allegedly the said transfer of firms was done
without conduct of physical verification; that the accused allegedly granted
GST refunds to ineligible firms to the tune of Rs.36.51 crores against exports;
that the applicant did not check the Bank Realization Certificate to ascertain
whether there was receipt of funds from exports; that Crime Branch registered
FIR No.18/2023 whereas PS Anti-Corruption Branch registered FIR
No.5/2023; that the fraud was detected when it was noticed that there had
been a sudden increase in grant of refunds as compared to previous terms;
that the firms were allegedly found to be non-existent at the given addresses;
that goods had allegedly not been supplied; that fake input tax credit had
allegedly been claimed and granted; that no verification of input tax credit had
allegedly been done; that there had been loss to the government exchequer.
4. It is stated in the application for bail of accused Babita Sharma that during the
investigation by Anti-Corruption Branch, the applicant cooperated with the
Investigating Officer; that there is no chance of the applicant fleeing from law
or tampering with evidence; that each firm allegedly involved in the present
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case was duly registered and had been subjected to a physical verification by
GST officers at the time of registration; that every such firm registered under
the provisions of the GST Act has to have a bank account number, and
therefore such firms cannot be said to be fake; that the applicant was not
involved in the process of registration of firms; that the refund was legitimately
allowed since the documentation was complete; that the documents were
supported by certificate of a Chartered Accountant; that the credentials and
digital signatures of the applicant were being used by Ms. Shweta Gupta,
Data Entry Operator who played an active role in approving GST refunds but
she was never interrogated by the Anti-Corruption Branch; that it is not the
case of the prosecution that the export did not take place; that at the relevant
time, it was not mandatory to obtain Bank Realization Certificate in case of
export of goods before initiating the refund claimed; that there is no money
trail or anything to indicate demand of money or acceptance of money from
any co-accused person which is necessary for invoking provisions of the
Prevention Corruption of Act, 1988; that incorrect provisions have been cited
in the FIR; that the allegations of wrongful sanction of refunds, registration of
firms and refund of input tax credit which are complained of in this case are
specific offences under the Delhi Goods and Service Tax Act, 2017 and
therefore the provisions of Prevention of Corruption Act, 1988 cannot be
invoked; that the applicant suffers from different ailments and that the
investigation is progressing at a slow pace.
5. The applicant has relied on judgments reported as Prabir Purkayastha v State
(NCT of Delhi) Crl. A. Diary No.42896/2023 dated 15.05.2024, Manish
Sisodia v Directorate of Enforcement (2024) SCC OnLine SC 1920, Ranjitsing
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Brahmajeetsing Sharma v State of Maharastra (2005) 5 SCC 294, P.
Chidambaram v Directorate of Enforcement (2020) 13 SCC 791, Siddharth v
State of Uttar Pradesh & Another (2022) 1 SCC 676, Statender Kumar Antil v
Central Bureau of Investigation & Anr. (2022) 10 SCC 51, Arnesh Kumar v
State of Bihar & Anr. (2014) 8 SCC 273, Joginder Kumar v State of U. P. &
Ors. (1994) 4 SCC 260, Mohammed Zubair v State of NCT of Delhi & Ors.
2022 SCC OnLine SC 897, Kalvakuntla Kavitha v Directorate of Enforcement
SLP (Criminal) No.10778 of 2024 dated 27.08.2024; Sanjay Chandra v
Central Bureau of Investigation (2012) 1 SCC 40 and Dheeraj Wadhawan v
Central Bureau of Investigation Bail Appln. No.2040 of 2024 dated
09.09.2024.
6. Written submissions were filed by Ld. Counsel for accused Babita Sharma on
13.09.2024. It is stated in the written submissions that there was no necessity
to arrest the accused. Other submissions made in the written submissions
are only a repetition of the contents of the bail application.
7. After conclusion of arguments on 13.09.2024, on 17.09.2024, Ld. Counsel for
accused Babita Sharma filed additional submissions. It is stated in the
additional submissions that the arrest memo does not make out a case for
arrest of the accused. Reliance was placed on the judgment reported as
Arvind Kejriwal v CBI Criminal Appeal No.3816 of 2024 dated 13.09.2024.
Submissions made on behalf of accused Mukesh Kumar Saini
8. It is stated in the application for bail filed on behalf of accused Mukesh Saini
that the said accused is one of the directors in a company namely S. Satyam
Aviation Pvt. Ltd. which is involved in freight forwarding; that prior to
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registration of the present FIR Mr. Harshit Saini nephew of the applicant was
arrested by the crime branch for involvement in operational activity of alleged
non-functional firms; that he was granted bail by the Ld. Chief Metropolitan
Magistrate; that provisions of the Prevention of Corruption Act, 1988 were
later invoked; that the applicant filed an application for anticipatory bail which
was disposed of with directions that prior notice of ten days is to be given to
the applicant for resuming investigation in FIR No.05/2023 of Anti-Corruption
Branch; that the applicant was summoned on different dates and he appeared
before the Investigation Officer; that the investigation of the Anti-Corruption
Branch is shoddy; that there is a tax invoice which supports the fact that
export had taken place; that the company of the applicant had only provided
cargo services to exporters for air transportation of goods to their respective
destination countries for which airway bills were issued and has nothing to do
with the alleged wrongful claim of GST refund; that it is not possible that
export would not have taken place; that every export of goods takes place
only after complying with the procedures of law and is adequately regulated
by the Customs Department; that the firms cannot be said to be fake since
they were verified at the time of their registration as per provisions of law; that
since refund is granted after verifying the export documents; that the applicant
has deep roots in society and is unlikely to abscond.
9. The applicant relied on the judgment reported as Sanjay Chandra v Central
Bureau of Investigation (2012) 1 SCC 40 and other judgements which were
cited in support of the bail application of accused Babita Sharma.
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Submissions made on behalf of accused Surjeet Singh
10. It is stated in the application for bail of accused Surjeet Singh that the
applicant has nothing to do with the refunds that were claimed and were
granted; that on 30.11.2021, a complaint was received in the Anti-Corruption
Branch relating to irregularities in sanction and disbursal of GST refunds; that
the acts were allegedly done by Smt. Babita Sharma, GSTO, Ward No.22
during the period from 27.07.2021 to 23.09.2021; that the applicant has not
been named in the FIR; that on 19.7.2024, applicant was summoned to join
the investigation on 20.7.2024; that another notice u/s 160 CrPC dated
09.08.2024 was sent to applicant seeking presence in the ACB office on
12.08.2024 for investigation; that the accused was arrested on the 12.08.2024
at 6 pm on the alleged grounds of providing blank goods receipts to the
accused persons involved in running fake firms which were allegedly taking
GST Refunds from the GST department in which these goods receipts were
allegedly used in creating forged e-way bills; that allegedly the applicant
received payments in cash and in account from the alleged firms; that there is
no need for the applicant to be kept in custody.
11. Reliance is placed on judgments reported as State of Maharashtra v Nainmal
Punjaji Shah & Anr. (1969) 3 SCC 904, Manubhai Ratilal Patel v State v
Gujarat (2013) 1 SCC 314, State Rep. By Inspector of Police & Ors. v N. M. T.
Joy Immaculate (2004) 5 SCC 729, Prabir Purkayastha v State (NCT of Delhi)
(2024) SCC OnLine SC 934, D. K. Basu v State of West Bengal (1997) 1 SCC
416, Sanjay Chandra v CBI (2012) 1 SCC 40, Maghavendra Pratap Singh v
Chhattisgarh (2023) SCC OnLine SC 486, Arvind Kejriwal v CBI (2024) SCC
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OnLine SC 2550, Sheila Sebastian v R. Jawaharaj & Anr. (2018) 7 SCC 581
and R. Vasudevan v CBI (2010) SCC OnLine Del 130 and other decisions.
Submissions made on behalf of accused Lalit Kumar
12. It is stated in the application for bail of accused Lalit Kumar that the applicant
is innocent; that there is delay of about two years in registration of FIR; that
the applicant has clean antecedents; that the son of the applicant is suffering
from anxiety; that the only allegation against the applicant is that he had
provided blank e-way bills and challans; that the only material against the
applicant is that a sum of Rs.74,000/- was received in the account of the
applicant; that the applicant is not likely to influence witnesses or tamper with
evidence; that there is no need of custodial interrogation.
13. Reliance is placed on judgments reported as Sanjay Chandra v CBI 2012 (1)
SCC 40 and Arnesh Kumar v State of Bihar (2014) 8 SCC 273.
Submissions made on behalf of State
14. Reply to the abovesaid applications has been filed separately by the
Investigating Officer. The submissions made regarding each of the accused
persons are individually set out below.
Reply to bail application of accused Babita Sharma
15. In the reply to the bail application of accused Babita Sharma, the Investigating
Officer has stated that the said accused had sanctioned GST refunds of about
Rs. 36.5 Crores to fake firms in the year 2021. It is stated that she was found
guilty of the aforesaid acts in the Vigilance Report. It is revealed that
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investigation has disclosed that the bogus firms had received refunds of
approximately Rs.54.5 Crores. The firms are stated to have shown fake
purchases. It is stated that the business has not been running in reality and it
is only on documents that a pretense is put up. It is further stated that 96
firms showed purchase and sale of items for which they were not registered
with the GST Department. It is further stated in the reply that these firms had
purchased items from different firms which too were bogus. Thus in all 208
"Associated Firms" surfaced. Most of the firms got their names cancelled in
the records of the GST Department.
16. It is further stated in the reply that refund was rotated through Bank accounts
of the said firms; that e-way bills used for transporting items were also found
to be forged; that in reality there had been no movement of goods; that
original goods receipt books containing forged receipts were seized; that the
material had not been transported as was revealed by the owners and drivers
of vehicles; that 23 firms out of 96 were controlled by accused Mukesh Saini,
his family members and their employees; that 7 of the 23 firms had showed
export of medicines and medical devices amounting to Rs.30 Crores; that
GST refund was taken against 24 shipping bills belonging to 7 firms; that
these were refunds sanctioned by Smt. Babita Sharma; that no BRC was
issued in any of the exports; that it was the duty of Smt. Babita Sharma to
check for Bank Realization Certificates; that share and purchase of goods
amounting to Rs.176.67 crores were shown by forged invoices; that there has
been a huge loss to the Government Exchequer; that the applicant had
approved migration of bogus firms on her transfer without checking even a
single parameter; that all the accused persons acted in connivance with each
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other; that documents are being screened; that investigation is at a crucial
stage and more evidence is surfacing each day; that a number of witnesses
are coming forward; that the applicant can influence witnesses and can
hamper investigation.
Reply to bail application of accused Mukesh Saini
17. In the reply to the application for bail of accused Mukesh Saini, the
Investigating Officer has repeated the submissions made in the reply that was
submitted to the application for bail of accused Babita Sharma. In addition, it
is stated accused Mukesh Kumar Saini is Director of a company which had
provided various services to 7 bogus firms; that the said firms sought undue
GST refunds; that the said firms did not have Bank Realization Certificates;
that it is the company of the applicant that was the actual recipient of the
refund so obtained through one of the bogus firms by the name of M/s
Sadhna Pharma Industries; that GST refund taken by three other firms was
also routed to the company of the applicant; that witnesses / victims have
named the applicant as one of the persons who was exploiting them and
using their names for fraudulent activity; that co-accused persons have also
named the applicant as being involved in forgery; that co-accused persons
who were dealing with accounts have also disclosed the role of the applicant.
Reply to bail application of accused Surjeet Singh
18. In the reply filed by the Investigating Officer to the application for bail of
accused Surjeet Singh, the Investigating Officer has again repeated the same
submissions. In addition, it is mentioned in the reply that accused Surjeet
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Singh is owner of Shree Nath Green Parcel Service; that the office of the
accused is adjacent to office of accused Raj Singh; that the applicant, in
connivance with accused Raj Singh, was involved in creating e-way bills; that
goods receipt books have been examined; that the owners / drivers of
vehicles whose numbers are mentioned on the bills have denied carrying the
material referred to in the bills which shows that the bills were forged to seek
GST refund; that the applicant has received cash and online payments; that
there is ample material to show the involvement of the applicant and the
existence of a conspiracy between the applicant and his co-offenders.
Additional Submissions on behalf of State
19. The Investigating Officer filed additional submissions titled “Subsequent
Report”. It was stated in the Report that the addresses of Proprietors /
Partners pertaining to firms connected to the arrested accused persons have
been found to be bogus; that efforts are on to trace the addresses; more
evidence is likely to appear regarding the involvement of accused persons;
the accused persons are likely to hamper investigation, if released, and the
accused persons may influence the persons who they have been exploiting
for executing their designs.
Reply to bail application of accused Lalit Kumar
20. In the reply to the application for bail of accused Lalit Kumar, the investigation
officer has reiterated the submissions made regarding the other accused
persons. Additionally, it is mentioned in the reply that accused Lalit Kumar is
owner of M/s. Kumar Motors Transport Company; that accused Lalit Kumar
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knowingly and intentionally, in connivance with accused Raj Singh, provided
blank goods receipts for creating forged e-way bills; that goods receipt books
have been examined; that the owners / drivers of vehicles whose numbers are
mentioned on the bills have denied carrying the material referred to in the bills
which shows that the bills were forged to seek GST refund; that the applicant
has received cash and online payments in his account from the firms that
were indulging with fraudulent activity; that there is ample material to show the
involvement of the applicant and the existence of a deep-rooted conspiracy
between the applicant and his co-offenders; that the applicant will influence
witnesses and hamper investigation, if released.
Analysis
21. I have gone through the record. I have heard arguments advanced by Ld.
Public Prosecutor and by Ld. Counsels for accused persons.
22. Before dealing with the bail applications, it would be appropriate to restate the
criteria in the backdrop of which applications for bail are to be tested. There
are a number of judgments that have set out the factors to be considered by
Courts while deciding an application for bail. Mentioning every such judgment
will only add to prolixity. I shall, therefore, refer only to the decision of
Prasanta Kumar Sarkar v. Ashis Chatterjee, (2010) 14 SCC 496 as a case in
point. In that case, it was held as follows:
“It is well settled that, among other circumstances, the factors to be borne in
mind while considering an application for bail are:
(i) whether there is any prima facie or reasonable ground to believe that the
accused had committed the offence;
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(ii) nature and gravity of the accusation;
(iii) severity of the punishment in the event of conviction;
(iv) danger of the accused absconding or fleeing, if released on bail;
(v) character, behaviour, means, position and standing of the accused;
(vi) likelihood of the offence being repeated;
(vii) reasonable apprehension of the witnesses being influenced; and
(viii) danger, of course, of justice being thwarted by grant of bail.”
23. I shall now examine the prayer for bail of the applicants in the context of the
aforesaid determinating factors.
24. I am required to first examine whether there is ground to believe that the
accused persons may have committed the alleged offences. In other words, it
needs to be ascertained whether the accusation is well founded, or whether
the applicants have been falsely implicated in the case.
25. The case of the Investigating Officer has its genesis in the complaint relating
to refunds sanctioned by Smt. Babita Sharma which then manifested into the
FIR. The complaint pointed out that Smt. Babita Sharma was transferred from
Ward 6 to Ward 22. 53 firms applied for migration to Ward 22. A majority of
these firms were with Smt. Babita Sharma only earlier, in Ward 6. Most of
these requests were immediately approved by Smt. Babita Sharma.
26. Huge sums of money were found to have been sanctioned as GST refund to
various firms during a short period of time. The firms were found to be non-
existent and non-functional on the ground.
27. The police investigation revealed large scale fraudulent activity. It was noticed
that many different firms were actually being controlled by a handful of
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persons. It was noticed that firms were existing only on paper and there was
no business activity being undertaken; that fake purchases had been shown
on paper; that exports were fake and money had not been received; that
forged invoices have been generated; that forged e-way bills had been
created to show transportation of products which had actually not been
transported; that money was rotated between various firms so as to eventually
reach the hands of those who were actually controlling the firms through
proxies who had no inkling that their names were being misused. The
applicants are shown to have been benefited from the aforesaid transactions.
The money trail is being traced. So far it has been shown that the ill-gotten
money swindled out of government treasury was eventually reaching the
hands of the accused persons. Having regard to the case diaries, the money
trail, the statements of different persons recorded during investigations and
other material which has been collected during investigation, I find that indeed
a prima facie case does exist showing involvement of the accused persons
named above in commission of the alleged offences. Prima facie this does not
appear to be a case where the police has foisted a false case on the accused
persons. It cannot be a mere coincidence that when Smt. Babita Sharma got
transferred to another Ward, these firms followed her to the new ward of
posting; that this migration was approved by Smt. Babita Sharma in record
time; the said migration was not preceded by any shifting of business activity.
All of this shows prior meeting of minds – existence of a conspiracy and a
nexus between the controllers of the firms and the public servant. It also does
not appear to be a coincidence that the firms were engaged in businesses
which did not pertain to their original terms of registration; that the owners and
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drivers of trucks by which the goods were allegedly transported denied the
transportation having taken place; that invoices are found to be fabricated;
that after export, the money was not received back due to which the
applicants did not have Bank Realization Certificates (BRC). All of this cannot
be a result of human error or a mere breach of contract on the part of the
person who imported the products. On the contrary, there appears to be a
ploy to dodge the legal requirement and devise a subterfuge to take undue
advantage of the norms created to provide refund of GST which has been
paid. If the transportation would have taken place through genuine e-way bills
and GR books and if in respect of perhaps one consignment of export, the
money had not been received, it could be understood that the importer may
have defaulted in payment. However, in this case, large sums of money have
not been received and yet the applicant claimed refund of GST. All the
circumstances taken together show existence of prior design, underhand
dealings and racketeering. The Government has been cheated of crores of
Rupees and private entities have decamped with tax payers’ money. The trust
reposed in public servants of safeguarding treasury funds has been breached.
The money hopping from one account to another shows a crafty design of
hoodwinking agencies and showing the ill-gotten money to be a legitimate
freight earning. The transporters had lent their hand to aid the aforesaid acts
by providing GR books and e-way bills. The transporters have also received
financial benefits for this. They actively aided the forgery of documents that
qualify as “valuable security” as defined under Section 30 of IPC. The forgery
is punishable under Section 467 of IPC which is punishable with
imprisonment for life. It cannot be said that the GST officer and the
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transporters have legitimately and charitably assisted the other offenders
while the latter were rampantly cheating the government and decamping with
government funds. This is not a case of negligence where a BRC was not
produced and GST refund was irregularly sanctioned. The case is about
fabrication of bills, fake exports, mis-declaration to the government, false
claims being made and the claims being knowingly allowed as part of a larger
conspiracy. Since accused Babita Sharma is part of the conspiracy (denoted
by migration of the firms alongside the transfer of the public servant which she
hastily allowed) and she allegedly had knowledge that the claim is fraudulent
and false, and she still went ahead and aided this act by granting the refund,
the absence of a mandate to check for BRC is inconsequential. I find that
there is, in the case diaries and the police file, sufficient material to show the
involvement of all the applicants in commission of the offences.
28. The other factor to be considered is the nature and gravity of the accusation
and severity of the punishment. The offences are of forgery of valuable
security, cheating, making of false claims, criminal conspiracy and of
corruption. The offences are punishable with imprisonment for life. It is not a
mere solitary offence that has been committed. Similar offences have been
committed by the accused persons by entering into distinct conspiracies over
long spans of time. The offences, by nature, involve deception, trickery and
artful design and speak of manipulation and evasion.
29. The accused persons have committed serious economic offences, that too
not once but repeatedly. Economic offences have been held to be a distinct
class for the purpose of deciding bail applications and it has been consistently
laid down for such offences bail should not be granted as a matter of course.
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30. In the case of Y.S.Jagan Mohan Reddy v C.B.I 2013 (7) SCC 439, the Hon’ble
Supreme Court observed as under:
“Economic offences constitute a class apart and need to be visited with a
different approach in the matter of bail. The economic offence having deep
rooted conspiracies and involving huge loss of public funds needs to be
viewed seriously and considered as grave offences affecting the economy of
the country as a whole and thereby posing serious threat to the financial
health of the country.”
31. Given the severity of punishment and the extent to which the evidence is in
the course of being collected, there are chances that the accused persons
may, if released on bail, abscond in order to avoid the trial and to avoid the
prospect of receiving punishment. The accused persons have not shown
themselves to have adequate reason to remain in the jurisdiction of this Court
and to continue to face trial. Given the nature of the offence, the disingenuity
in the documents, the crafty manner of commission of the crime, it cannot be
trusted that the accused persons would not flee.
32. The offences in question comprising of corruption, forgery and cheating tell a
tale of easy money and there is a risk of such acts becoming an insidious
habit which is difficult to shake. Those who have sacrificed their integrity and
have compromised their moral values in the pursuit of short term rewards are
unlikely to be able to suppress their cravings. Given the temptation and the
fact that the accused persons are already, allegedly, in the habit of committing
such acts, they may continue to, directly or indirectly, indulge in commission of
similar offences in future, if released on bail.
33. The witnesses identified so far in the case would include employees of the
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Department of Trade and Trades who may be colleagues and subordinates of
accused Babita Sharma. Other witnesses would include persons whose
names were placed on the front by accused Mukesh Kumar Saini and his
associates. These are persons who were allegedly exploited by accused
Mukesh Kumar Saini and his associates. Accused Mukesh Kumar Saini and
his family members are stated to have taken advantage of the circumstances
of these poor persons and the latter are made to sign various documents. The
drivers and owners of transport vehicles would also be competent witnesses.
All these witnesses are amenable to the influence of the accused persons. It
is possible that the accused persons, if released on bail, try to exert their
influence over the witnesses since the accused persons are in a position of
dominance. There are also chances that the accused persons may threaten
the witnesses or try to cause harm to the witnesses so as to dissuade the
witnesses from testifying against them.
34. It may be noted that already the Department of Trade and Taxes has been
withholding information about commission of such offences and the said
information has not been provided despite the investigating officer requesting
for it repeatedly. It cannot be lost sight of that the relevant witnesses were not
produced in the departmental inquiry which was launched against accused
Babita Sharma. Once applicant Babita Sharma is released, she may enjoy
greater patronage of the Department of Trade and Taxes and she may
succeed in having clinching documents removed from the office and prevent
them from reaching the hands of the investigating officer. The release of Ms.
Babita Sharma may contribute to the critical documents being concealed or
destroyed.
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35. In case the accused persons are left at large, there are grave chances of
justice being throttled by such unprincipled, devious means being adopted by
the accused persons. It will not be possible for the Court to keep close tabs
on the activities of the accused persons once they are released on bail, and
therefore imposition of conditions will not be able to prevent this from
occurrence.
36. The offence has been committed in a brazen manner which shows scant
regard and respect for rules and shows that the applicants would not hesitate
in short-changing the government of huge sums of money inspite of the
existence of auditory checks. Either those checks were only on paper or the
applicants were aware of flaws in those mechanisms which the applicants
exploited to their favour, by joining hands with accountants and other
unknown persons.
37. Having considered the factors relevant for grant of bail, I am afraid I do not
find that either of the applications for bail pass the muster.
38. I also do not find force in the contentions of Ld. Counsel for accused persons.
39. It has been argued by Ld. Counsel for accused persons that the firms cannot
be bogus since they were subjected to a physical verification by GST officers
at the time of registration and were having a bank account. It is still to be seen
whether the aforesaid verification was correctly carried out or whether the said
exercise was a sham. Investigating is pending and this aspect may be looked
into by the investigating officer. It is possible that when the working of the
Department of Trade and Taxes is scrutinized, many skeletons start falling out
of the closet. The mere fact that the earlier verification may be superficially
carried out is no reason to let the offences that have been exposed, be
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covered up. Also, a firm may be bogus even while having a bank account. The
real test is whether the entity is indeed engaged in business which it claims to
be carrying out, or whether it is only a pretense put out on papers. Also, in this
case, in the detailed arguments that were advanced, Ld. Counsel has not
shown any reason to migrate to the other ward on the transfer of Ms. Babita
Sharma which clearly shows that the accused persons were in cahoots with
each other, the objective of which was to swindle government funds.
40. That the documents submitted for obtaining GST refunds were supported by
certificate of a Chartered Accountant is no defence since the accountants
have also been shown to be in connivance with the abovenamed accused
persons. It is not a case where all the abovenamed accused persons were
unaware of the facts and they acted solely on the advise and facts disclosed
by the accountants having been misled by the latter.
41. Accused Babita Sharma has tried to shift the blame on to Ms. Shweta Gupta,
Data Entry Operator by insinuating that the credentials and digital signatures
of accused Babita Sharma were being used by Ms. Shweta Gupta. When a
statutory responsibility is cast upon a government servant, he or she cannot
be permitted to wash his or her hands off the matter by sharing passwords
and digital signatures with another employee. If this was to be permitted, any
government servant would freely indulge in corrupt activity through proxies
and then plead innocence by pointing fingers at the persons with whom they
share the password. No circular or instructions has been shown to establish
that the duty to sanction the refund was of Ms. Shweta Gupta instead of Ms.
Babita Sharma. The raising of this plea itself shows that the applicant Babita
Sharma only wants to mislead the investigation in order to escape
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responsibility.
42. The contention of Ms. Babita Sharma that there is no money trail to indicate
demand of money or acceptance of money from any co-accused person
cannot be accepted since investigation is pending and the money chain is still
being looked into. In fact, if the applicant is released on bail, this vital link may
go missing and there will be detriment to the investigation.
43. Regarding the ailments of applicant Babita Sharma, this Court has already
passed directions for her medical treatment. After that, Ms. Babita Sharma
had approached the Hon’ble High Court of Delhi. The Hon’ble High Court of
Delhi, by order dated 02.09.2024 in WP (Crl.) 2683/2024 directed that she
may be treated at a hospital which can treat her ailments and that special care
be taken of her dietary requirements. That being so, the ailments had been
adequately taken care of and this cannot be made a ground for seeking
regular bail. As and when the situation so demands, the applicant may apply
for interim bail.
44. Accused Babita Sharma cannot take advantage of being exonerated in
departmental proceedings since the inquiry report of her exoneration is based
on the fact that the relevant material was not even placed before the said
inquiring authority, as becomes instantly clear on perusal of the inquiry report
itself.
45. The contention of the accused persons that they can be prosecuted only
under the GST Act and not the Prevention of Corruption Act, 1988 is not
tenable. A similar contention has been shot down by Hon’ble Supreme Court
in the case of Monica Bedi v State of A. P. AIR 2011 SC (Crl.) 86. This issue
is not being dealt with in detail because it is a bail application which is under
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consideration.
46. On behalf of accused Mukesh Kumar Saini, it was contended that the
applicant had filed an application for anticipatory bail which was disposed off
with directions that prior notice of ten days is to be given to the applicant for
“re-commencing investigation in FIR No.05/2023” of Anti-Corruption Branch. I
have gone through order dated 19.07.2023. It has been directed by the order
that since investigation of FIR No.18/2023, PS Crime Branch has been kept in
abeyance, there was no apprehension of arrest in that FIR. It was directed
that ten days notice was to be given to the applicant in case investigation in
FIR No.18/2023 was to commence. This has been manipulated and portrayed
as if notice is to be given on re-commencing of investigation in the FIR of Anti-
Corruption Branch. It is unfortunate that factually incorrect submissions have
been made on behalf of the accused in order to secure bail.
47. Accused persons Surjeet Singh and Lalit Kumar have actively aided the
offence by providing e-way bills or the purpose of forgery. All the accused
persons have helped each other by divisions of role, fabricating of documents,
sharing of resources and helping to cover their tracks.
48. I do not find merit in the contention of the applicants that they are not in a
position to influence witnesses. The fact that the applicants have not
influenced any person after being arrested, is no assurance that after being
released on bail the applicants will not indulge in such conduct.
49. I have gone through the case diaries. There is ample material to show the
involvement of the applicants in commission of the alleged offences. There
are statements of many persons which have clearly spelled out the role
played by the applicants. The involvement of other offenders and also the
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beneficiaries of the transactions is being examined. The applicants, if
released on bail, can surely tip off their accomplices and the beneficiaries who
were allegedly in contact with them, and try to influence them or destroy
evidence.
50. The money which was illegally transferred is still to be recovered. Interest of
the State, and of the public, would be better served by declining the relief of
bail at this stage. In the case of Masroor v. State of U.P., (2009) 14 SCC 286,
the Hon’ble Supreme Court observed as follows:
“There is no denying the fact that the liberty of an individual is precious and is
to be zealously protected by the Courts. Nonetheless, such a protection
cannot be absolute in every situation. The valuable right of liberty of an
individual and the interest of the society in general has to be balanced. Liberty
of a person accused of an offence would depend upon the exigencies of the
case. It is possible that in a given situation, the collective interest of the
community may outweigh the right of personal liberty of the individual
concerned.”
51. The judgments cited by the accused persons are also not applicable.
52. The case of Prabir Purkayastha v State Crl. A. Diary No.42896/2023 dated
15.05.2024, relied upon by Ld. Counsel for accused is not applicable since it
has not been pointed out which mandate laid down in the said decision has
been violated. In the present case, as has already been observed in the
orders of remand, all the accused persons were provided with grounds of
arrest at the time when they were arrested. The specific reasons comprising
of the role played by the accused persons and the details which necessitated
their arrest have been spelled out. Copies of FIRs were provided to the
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accused persons. The accused persons were able to advance detailed
submissions through their counsel to resist the prayer for remand.
53. In the case of Manish Sisodia v Directorate of Enforcement 2024 SCC OnLine
SC 1920, bail had been granted on the ground that the trial had not
commenced despite eight months of the accused being in custody. In the
present case, there is no question of commencement of trial since
investigation itself is pending. Bail had been granted in that case on the
ground of delay in trial and I do not see any reason why Ld. Counsel for
accused has placed reliance on this judgment.
54. In the case of Ranjitsing Brahmajeetsing Sharma v State of Maharastra
(2005) 5 SCC 294, the practices to be adopted by the Court while dealing with
an application for grant of bail were laid down. It was held that at the stage of
dealing with a bail application, detailed examination of evidence and elaborate
documents on merit is not to be undertaken, but prima facie reasons are to be
disclosed to show that the Court has applied its mind to the allegations put
forth by the investigating agency. This judgment too does not show that the
case is fit for grant of bail.
55. In the case of P. Chidambaram v Directorate of Enforcement (2020) 13 SCC
791 too, the factors to be considered for grant of bail were outlined. The
decision does not help the accused persons. In that case it was held that
where there are no chances of tampering of evidence or influencing
witnesses, bail can be granted. It was laid down that in economic offences,
bail is not to be mandatorily declined in each and every case. In that case, bail
was granted since there was no possibility of tempering of evidence or
influencing of witnesses. That is not the case here.
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56. In the case of Siddharth v State of Uttar Pradesh and Anr (2022) 10 SCC 51,
it was laid down by the Hon’ble Supreme Court that an investigating officer
does not have to necessarily arrest the accused before filing the charge-
sheet. This judgment is not applicable to the facts of the case.
57. Also, the judgment of Satender Kumar Antil v CBI SLP (Crl.) 5191/2021 dated
11.07.2022 does not buttress the case of the accused/applicants. In that
case, the Hon’ble Supreme Court stressed that the provisions of Section 41
and 41A of Code of Criminal Procedure must be complied with. In the present
case, Section 41(1)(b) is not applicable since the offence is punishable with
imprisonment of over seven years. Section 41A is also not applicable since,
clearly, this is not a case where “The arrest of the person would not be
required under the provisions of Section 41(1)”.
58. The decision of Arnesh Kumar v State of Bihar & Anr. (2014) 8 SCC 273, is
also similarly not applicable since the facts of the case attract the offence
under Sections 467 of IPC because forgery of valuable security has been
alleged and the said offence is punishable with upto imprisonment for life.
59. In the case of the State of Bihar and Anr vs Amit Kumar @ Bachcha Rai
(2017) 3 DLT(CRL) 860, the Hon’ble Supreme Court held as follows:
“When the seriousness of the offence is such mere fact
that he was in jail for however long time should not be the
concern of the Courts. We are conscious of the fact that
the accused is charged with economic offences of huge
magnitude and is alleged to be the kingpin/ring leader.
xxx
“Although there is no quarrel with respect to the legal
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propositions canvassed by the learned counsels, it
should be noted that there is no straight jacket formula for
consideration of grant of bail to an accused. It all
depends upon the facts and circumstances of each case.
The Government's interest in preventing crime by
arrestees is both legitimate and compelling. So also is the
cherished right of personal liberty envisaged under
Article 21 of the Constitution. Section 439 of The Code of
Criminal Procedure, 1973, which is the bail provision,
places responsibility upon the courts to uphold
procedural fairness before a person’s liberty is abridged.
Although ‘bail is the rule and jail is an exception’ is well
established in our jurisprudence, we have to measure
competing forces present in facts and circumstances of
each case before enlarging a person on bail.
We are of the considered opinion that the case of Sanjay
Chandra (supra), as relied upon by learned counsel for
respondent, is distinguishable from the case at hand as
the charges in that case carried a maximum punishment
for a term which may extend to seven years. In the
present case, charge sheet has been submitted, inter
alia, for the offences under section 409, 465, 467, 468,
471, 188, 201, 212 and 120B of Indian Penal Code, 1860
and Section 8[6], 9[7], 13 (1)(c)/(d) read with 13(2)of
Prevention of Corruption Act, 1988. Therefore the case of
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Sanjay Chandra (supra) provides no assistance for the
respondent herein.
We are also conscious that if any undeserving candidates
are allowed to top exams by corrupt means, not only will
the society be deprived of deserving candidates, but it will
be unfair for those students who have honestly worked
hard for one whole year and are ultimately disentitled to a
good rank by fraudulent practices prevalent in those
examinations. It is well settled that socio-economic
offences constitute a class apart and need to be visited
with a different approach in the matter of bail. Usually
socio-economic offence has deep rooted conspiracies
affecting the moral fiber of the society and causing
irreparable harm, needs to be considered seriously.”
60. The Hon’ble Supreme Court thereby distinguished its decision in the Sanjay
Chandra case (supra) which has been relied upon here too. It has been noted
that Sanjay Chandra case would have no application where the offence is
punishable with imprisonment of more than seven years.
61. Moreover, perusal of the Sanjay Chandra decision itself shows that in that
case bail was granted only because investigation had been completed and
charge-sheet has been filed. In that case, there was no contention of the
State that the accused persons could tamper with evidence. In this case, this
has been specifically urged by State in order to resist the grant of bail. Thus,
the decision of Sanjay Chandra does not help the applicants. Other
judgments cited by accused persons are also similarly not applicable.
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62. For the abovestated reasons, I do not deem it fit to grant bail to the applicants
at this stage. All four applications for bail moved by accused Babita Sharma,
Mukesh Kumar Saini, Surjeet Singh and Lalit Kumar are hereby dismissed.
63. Nothing stated hereinabove shall be construed as an observation on merits.
The observations are prima facie in nature and based on the material placed
before the Court.
64. Copy of the order be given to Ld. counsel for accused persons. Another copy
shall be sent to the IO.
(Ashish Aggarwal)
Special Judge (PC Act)(ACB)-02
Rouse Avenue District Courts, New Delhi
08.10.2024
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