Gauhati High Court
Page No.# 1/14 vs Union Of India on 3 April, 2025
Page No.# 1/14
GAHC010067102025
2025:GAU-AS:3994
THE GAUHATI HIGH COURT
(HIGH COURT OF ASSAM, NAGALAND, MIZORAM AND ARUNACHAL PRADESH)
Case No. : Bail Appln./963/2025
PRABIN JHA
S/O. SRI ARUN JHA @ ARUN KUMAR JHA, R/O. HOUSE NO. 25, KUNDIL
NAGAR, P/S. BASISTHA, GUWAHATI-781029, DIST. KAMRUP (M),
ASSAM.KAMRUP METRO
VERSUS
UNION OF INDIA
REP BY SENIOR INTELLIGENCE OFFICER DIRECTORATE GENERAL OF
GOODS AND SERVICES TAX INTELLIGENCE GUWAHATI ZONAL UNIT
GUWAHATI
Advocate for the Petitioner : MR. D BORA, MR. N MAHAJAN,MR. P K DAS,MR. A
CHAUDHURY,MR. B K MAHAJAN
Advocate for the Respondent : SC, GST,
Page No.# 2/14
BEFORE
HONOURABLE MRS. JUSTICE MITALI THAKURIA
ORDER
Date : 03.04.2025
Heard Mr. H. R. A. Choudhury, learned Senior Counsel assisted by Mr. A.
Chaudhury, learned counsel for the petitioner. Also heard Mr. S. C. Keyal, learned
Standing Counsel, GST for the respondent/Union of India.
2. This is an application under Section 483 of BNSS, 2023 praying for grant of
bail to the accused/petitioner, who has been arrested in connection with Case
No. DGGI/INT/INTL/259/2025, under Section 132(5) of the Central Goods &
Services Tax Act, 2017.
3. The petitioner side has filed an additional affidavit to bring some
documents on record and the respondent side also filed written objection
against the prayer for bail.
4. It is submitted by Mr. Choudhury, learned Senior Counsel for the petitioner,
that the present accused/petitioner is innocent and he is a businessman by
profession having proprietorship of a firm in the name and style M/S Goodwill
Traders having GST Registration Certificate and also a law abiding person. Upon
receipt of a summon from the investigating agency on 06.03.2025, the
petitioner appeared before the authority and on 07.03.2025, he was arrested in
connection with this case and since then, he is in judicial custody. As per
allegation, he indulged in issuance of fake invoices without actual supply of
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goods and thereby passed ineligible ITC of Rs. 30.89 Crores. However, during
his entire period in judicial custody, the Investigating Authority did not asked for
any police remand nor made any prayer for custodial interrogation. He has been
arrested connection with this case merely on suspicion and in a very mechanical
manner and without any proper investigation or his involvement in the alleged
offence, and accordingly, Mr. Choudhury submitted that it is a fit case wherein
the accused/ petitioner may be granted with the privilege of bail.
5. Mr. Choudhury further submitted that though the Central Goods & Services
Tax Act, 2017 (in short, ‘CGST Act‘) is a special enactment, but the same is not
a complete Code in itself as regards to the provision of search, seizure and
arrest and the provision of the Code of Criminal Procedure would equally apply
unless expressly or impliedly excluded by the provision of CGST Act. More so, in
view of Section 4(2) of Cr.P.C., the procedure prescribed under the Code also
applied to special statues unless it is expressly barred or prohibited by the Act
itself. In that context, he also relied on a decision of Hon’ble Supreme Court
which was reported vide 2025 SCC OnLine SC 449 (Radhika Agarwal Vs.
Union of India & Ors.) wherein it has been held that ” the GST Acts are not a
complete code when it comes to the provisions of search and seizure, and
arrest, for the provisions of the Code would equally apply when they are not
expressly or impliedly excluded by provisions of the GST Act.”
6. Mr. Mahajan further submitted that there is no mention of Document
Identification Number (in short, ‘DIN’) in the arrest memo which is mandatory
required as per the Circular No. 122/41/2019-GST, dated 05.11.2019, issued by
the Commissioner, GST-Inv and the same shall be treated as invalid and shall be
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deemed to have never been issued. In the Grounds of Arrest issued on
07.03.2025 also, it is seen that there is no mention of DIN, although the Arrest
Memo dated 07.03.2025, Jama Talashi and Letter dated 07.03.2025 were having
their respective DIN numbers, and in absence of DIN numbers in documentation
can be considered as a good ground for bail.
7. The learned Senior Counsel for the petitioner also raised the issue that the
competent authority by exercising its power under Section 69 of CGST Act
having reasons to believe that the accused/petitioner has committed an offence
under Section 132(1)(a) of CGST Act and punishable under Section 132(1)(i) of
the CGST Act, but the said authorization letter having reason to believe was
never furnished to the accused/petitioner so as to enable him to exercise his
right of challenging the validity of his arrest whereby the fundamental right of
the accused/petitioner is violated. In that context, Mr. Choudhury also relied on
paragraph No. 32 of the judgment of Hon’ble Supreme Court in Radhika
Agarwal (supra), which reads as under:
“32. The contention of the DoE that while “grounds of arrest” were mandatorily
required to be supplied to the arrestee, “reasons to believe”, being an internal and
confidential document, need not be disclosed, was decisively rejected in Arvind
Kejriwal (supra). It was held that “reasons to believe” are to be furnished to the
arrestee such that they can challenge the legality of their arrest. Exceptions are
available in one-off cases where appropriate redactions of “reasons to believe” are
permissible. The relevant portion reads:
“41. Once we hold that the accused is entitled to challenge his arrest
under Section 19(1) of the PML Act, the court to examine the validity of arrest
must catechise both the existence and soundness of the “reasons to believe”,
based upon the material available with the authorized officer. It is difficult to
accept that the “reasons to believe”, as recorded in writing, are not to be
furnished. As observed above, the requirements in Section 19(1) are the
jurisdictional conditions to be satisfied for arrest, the validity of which can be
challenged by the accused and examined by the court. Consequently, it would
be incongruous, if not wrong, to hold that the accused can be denied and not
furnished a copy of the “reasons to believe”. In reality, this would effectively
Page No.# 5/14prevent the accused from challenging their arrest, questioning the “reasons to
believe”. We are concerned with violation of personal liberty, and the exercise
of the power to arrest in accordance with law. Scrutiny of the action to arrest,
whether in accordance with law, is amenable to judicial review. It follows that
the “reasons to believe” should be furnished to the arrestee to enable him to
exercise his right to challenge the validity of arrest.
42. We would accept that in a one-off case, it may not be feasible to reveal all
material, including names of witnesses and details of documents, when the
investigation is in progress. This will not be the position in most cases. DoE may
claim redaction and exclusion of specific particulars and details. However, the
onus to justify redaction would be on the DoE. The officers of the DoE are the
authors of the “reasons to believe” and can use appropriate wordings, with
details of the material, as are necessary in a particular case. As there may only
be a small number of cases where redaction is justified for good cause, this
reason is not a good ground to deny the accused’s access to a copy of the
“reasons to believe” in most cases. Where the non-disclosure of the “reasons to
believe” with redaction is justified and claimed, the court must be informed.
The file, including the documents, must be produced before the court.
Thereupon, the court should examine the request and if they find justification, a
portion of the “reasons to believe” and the document may be withheld. This
requires consideration and decision by the court. DoE is not the sole judge.
43. Section 173(6) of the Code, permits the police officer not to furnish
statements or make disclosures to the accused when it is inexpedient in public
interest. In such an event, the police officer is to indicate the specific part of the
statement and append a note requesting the Magistrate to exclude that part
from the copy given to the accused. He has to state the reasons for making
such request. The same principle will apply.”
8. Citing the said paragraph No. 32 of the aforesaid judgment, it is submitted
by Mr. Choudhury that the grounds of arrest are mandatorily required to be
supplied to arrestee as well as the reasons to believe so that they can challenge
the legality of their arrest.
9. Mr. Choudhury, learned Senior Counsel, further submitted that no proper
assessment was undertaken by the concerned Assessing Officer and the
Investigating Agency and in a very mechanical and arbitrary manner, the
accused/petitioner was arrested without proper determination of tax, cess,
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penalty and the interest by the Assessing Authority and imposed an imaginary
figure of Rs. 30.89 Crores without proper assessment. More so, considering the
maximum punishment under the offence attributed in the instant case, the
issuance of Notice under Section 35(3) of BNSS, corresponding to Section 41(A)
Cr.P.C., is mandatory as per direction of the Hon’ble Supreme Court passed in
the case of Arnesh Kumar Vs. State of Bihar and reiterated in Satender
Kumar Antil Vs. CBI, reported in 2022 SCC OnLine SC 825.
10. Mr. Choudhury further raised the issue of non-mentioning of DIN number
in 3 (three) documents, namely, Authorization Letter of Arrest, Grounds of
Arrest and Arrest Memo. He submitted that in absence of DIN number, a person
cannot be arrested and can be considered as a good ground for bail. More so,
he submitted that the reasons to believe are also not available in all those
documents while issuing the same to the petitioner and thus, the
accused/petitioner was not in a position to know as to on what ground he is
being arrested in connection with this case, which is mandatorily required to be
served on the respondent as per the ratio laid down by the Hon’ble Supreme
Court in the case of Radhika Agarwal (supra).
11. It is further submitted by learned Senior Counsel that though it is stated in
the objection filed by the respondent side that reasons to believe has been
recorded in the file, but those were admittedly not communicated to the present
petitioner which reveals from the record and the documents which have been
issued to the present petitioner. He further submitted that as the present Act is
not a complete Code, the provision of Code of Criminal Procedure has to be
followed and in the instant case, it is also seen that no Notice under Section 50
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Cr.P.C., corresponding to Sections 47 & 48 of BNSS, were issued to the present
petitioner at the time of his arrest nor the grounds of arrest was being intimated
to his family members. In that regard, he also relied on decisions of Hon’ble
Supreme Court passed in the cases of Vihaan Kumar Vs. State of Haryana,
reported in 2025 SCC OnLine SC 269.
12. Mr. Choudhury further submitted that the learned Additional Session Judge
No. 5, Kamrup(M), Guwahati, vide order dated 11.05.2023, passed in Bail Appln.
No. 362/2023, had granted bail to an accused only for violation of Section
41/41A of Cr.P.C. considering the view expressed by the Hon’ble Supreme Court
in the case of Arnesh Kumar Vs. State of Bihar as well as in the case of
Rajesh Kumar Dudani Vs. State of Uttarakhand [2023 SCC OnLine SC
209].
13. It is further submitted that the I.O. got sufficient time for custodial
interrogation of the present accused/petitioner as he is behind the bar for last
30 days and the police also did not sought for any police remand or for his
interrogation in the jail premises and hence, Mr. Choudhury submitted that
further custodial interrogation of the present petitioner may not be required for
the interest of investigation. However, the present petitioner is ready and willing
to extend his co-operation in further investigation of this case.
14. Mr. Choudhury also submitted that the entire case is based on
documentary evidence and during the custodial period of the present petitioner,
the Investigating Authority has already recovered all the relevant documents
from the possession of the present accused/petitioner and accordingly he
submitted that considering all these grounds and also considering the non-
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compliance of the provision of Section 41/41A Cr.P.C., viz-a-viz non-compliance
of Sections 47/48 of BNSS, and also considering the non-furnishing of reasons
to believe, as recorded by the authority concerned, the bail prayer of the
present petitioner may be considered.
15. Mr. Keyal, learned Standing Counsel, GST submitted in this regard that in
all the documents, the DIN numbers have been mentioned and there is
sufficient compliance of Section 70 of CGST Act, which is corresponding to
Section 41A of Cr.P.C. Further he submitted that the reasons to believe has
already been recorded by the authority concerned which is in the file. He
accordingly produced the record wherefrom it is seen that the reasons to believe
has been recorded by the investigating authority. He further submitted that the
arrest was also made complying all the necessary formalities as required under
Section 69 of the CGST Act and there is no dispute in regards to the compliance
of Section 69 of CGST Act at the time of arrest of the present
accused/petitioner. He also submitted that the grounds of arrest are also
communicated to the present petitioner and in Arrest Memo, the DIN number is
also mentioned.
16. In that context, Mr. Choudhury, learned Senior Counsel for the petitioner,
submitted that there is no dispute regarding the compliance of proper provision
at the time of arrest nor there is any dispute in regards to recording of reasons
to believe by the authority concerned, but the only issue raised by the petitioner
is that the reasons to believe is not communicated to the present
accused/petitioner. More so, he submitted that though in the Arrest Memo the
DIN number may be available, but it seems to be incorporated subsequently as
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the same is in the form of hand written and in other documents, the DIN
number were written in typed form and accordingly, he submitted that
admittedly in the Authorization Letter as well as in the Grounds of Arrest, which
were communicated to the present accused/petitioner, the DIN numbers are
missing.
17. Mr. Keyal, learned Standing Counsel, NCB further submitted that the GST is
a complete Code in itself and Section 69 of the CGST Act has endowed powers
to order arrest to the Commissioner in matters of commitment of an offence
specified in clause (a) or clause (b) or clause (c) or clause (d) of sub-section (1)
of Section 132 and all the formalities were complied with at the time of the
arrest of the accused/petitioner. More so, as stated above, the “reasons to
believe” before authorizing the arrest of the petitioner has already been
recorded in the file. Further, the grounds of arrest were also communicated to
the present petitioner.
18. He further relied on a decision of Hon’ble Telangana High Court passed in
Writ Petition No. 4764 of 2019 (P.V. Ramana Reddy Vs. Union of India
& Ors.), which was subsequently upheld by the Hon’ble Supreme Court,
wherein it was observed that “CGST Act, 2017 is a complete code in itself in
respect of (1) the acts that constitute offences, (2) the procedure for
prosecution and (3) the punishment upon conviction, then the power of
Commissioner, who is not a Police Officer, to order the arrest of a person should
also emanate from prescription contained in the Act itself. Section 69(1) of
CGST Act, 2017 very clearly delineates the power of the Commissioner to order
the arrest of a person whom he has reasons to believe, to have committed an
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offence which is cognizable and non-bailable.”
19. Mr. Keyal further submitted that the present case is also considered to be
an economic offence and hence it has to be viewed with a different approach
while dealing with the matter of bail. In that context, he also relied on a
judgment of Hon’ble Supreme Court passed in the case of Y.S. Jagan Mohan
Reddy Vs. Central Bureau of Investigation (Criminal Appeal No. 730 of
2013) and emphasized on paragraph Nos. 15 & 16 of the judgment, which
reads as under:
“15) 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.
16) While granting bail, the court has to keep in mind the nature of accusations, the
nature of evidence in support thereof, the severity of the punishment which conviction
will entail, the character of the accused, circumstances which are peculiar to the
accused, reasonable possibility of securing the presence of the accused at the trial,
reasonable apprehension of the witnesses being tampered with, the larger interests of
the public/State and other similar considerations.”
20. He further submitted that the petitioner engaged in issuance of fake
invoices with the help of allies, namely, Shri Prince Jain, Shri Rahul Yadav and
Shri Shubam Jain. Accordingly, he submitted that it is not at all a fit case to
consider the bail application of the present petitioner only on the ground of his
detention and the illness. His further custodial interrogation will be required for
the proper investigation of this case and if the petitioner is released on bail at
this stage, there may be probability of hampering or tampering with the
investigation of this case.
Page No.# 11/14
21. After hearing the entire submissions made by the learned counsels for
both sides, I have also perused the case record and the annexures filed along
with the petition and the record which was produced by the respondent
authorities.
22. It is seen that there is no dispute in regards to the Arrest Memo issued by
the respondent authorities by complying all necessary formalities under Section
69 of the CGST Act. But it is the issue raised by the petitioner that there was no
proper compliance of Section 41/41A of Cr.P.C. which are mandatorily required
to be followed. From the view expressed by the Hon’ble Supreme Court in case
of Radhika Agarwal (supra), it is evident that though the CGST is a special
enactment, but the same cannot be considered as a complete Code in itself as
regards to the provision of search, seizure and arrest and as stated above, the
provision of Code of Criminal Procedure would be applicable unless it is
expressly or impliedly barred by the provision of the said Act. But, here in the
instant case, it is seen that there is no compliance of Section 41/41A of Cr.P.C.,
which is mandatorily required to be followed as per the guideline of Hon’ble
Supreme Court in the cases of Arnesh Kumar Vs. State of Bihar and
reiterated in Satender Kumar Antil Vs. CBI. More so, there was also no
compliance of Sections 47/48 of BNSS at the time of arrest made by the
respondent authorities which is in violation of Article 21 & 22(1) of the
Constitution of India and the ratio laid down by the Hon’ble Supreme Court in
the cases of Vihaan Kumar Vs. State of Haryana, reported in 2025 SCC
OnLine SC 269, and Prabir Purkayastha Vs. State (NCT of Delhi),
reported in (2024) 8 SCC 254.
Page No.# 12/14
23. It is also an admitted position that in the Authorization Letter as well as
Grounds of Arrest, which were communicated to the accused/petitioner, the DIN
numbers are missing, though in the Arrest Memo, the DIN number was
incorporated in the hand written form, which was allegedly inserted
subsequently. But, as per the Circular No. 122/41/2019-GST, dated 05.11.2019,
issued by the Commissioner, GST-Inv, the Arrest Memo and the other
documents, which are to be supplied to the accused/petitioner, the DIN number
has to be incorporated otherwise it shall be deemed to have never been issued.
24. Coming to the communication of “reasons to believe”, it is seen that
admittedly the “reasons to believe” was duly recorded in the file at the time of
issuing Authorization Letter of Arrest. It is also an admitted fact that it is an
internal and confidential document when the arresting authority will record their
“reasons to believe” before issuing any Authorization Letter. But, as per the view
expressed by the Hon’ble Apex Court in the case of Radhika Agarwal (supra),
it can be held that “reasons to believe” are to be furnished to the arrestee so
that they can challenge their legality of their arrest. But, here in the instant
case, though the “reasons to believe” is found to be duly recorded by the
authority concerned, but the same was not communicated to the present
accused/petitioner at the time of his arrest or while furnishing the ground of
arrest. Thus, it is seen that there is no compliance of Section 41/41A Cr.P.C., viz-
a-viz the Grounds of Arrest, was also not communicated which are mandatorily
required to be furnished and in the same time, the “reasons to believe”, as
recorded by the authority concerned, was also not communicated to the present
accused/petitioner which may be a grounds for consideration of bail.
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25. It is also seen that the accused/petitioner is in custody for last 29/30 days
and thus, the I.O. got sufficient opportunity to interrogate the
accused/petitioner keeping him in custody.
26. In view of the entire discussions made above and also considering the
views expressed by the Hon’ble Apex Court in the case laws referred to
hereinabove and further considering the fact that there is sufficient progress in
the investigation of the case and most of the relevant documents are also found
to be collected by the I.O. during investigation, I find that further custodial
interrogation of the present petitioner may not be necessary for the interest of
investigation and therefore, I find it a fit case to extend the privilege of bail to
the accused/ petitioner.
27. Accordingly, it is provided that on furnishing a bond of Rs. 50,000/-
(Rupees fifty thousand) only with one surety of like amount to the satisfaction
of the learned Chief Judicial Magistrate, Kamrup(M), Guwahati, the
accused/petitioner, namely, Prabin Jha, be enlarged on bail, subject to the
following conditions:
(i) that the petitioner shall fully co-operate in the investigation of the
case and shall appear before the Investigating Officer as and when
required in connection with the investigation of the aforesaid P.S.
Case;
(ii) that the petitioner shall not, directly or indirectly, make any
Page No.# 14/14inducement, threat or promise to any person acquainted with the
facts of the case so as to dissuade him from disclosing such facts to
the Court or to any police officer; and
(iii) that the petitioner shall not leave the jurisdiction of the learned
Chief Judicial Magistrate, Kamrup(M), Guwahati, without prior
permission.
28. In terms of above, this bail application stands disposed of.
JUDGE
Comparing Assistant
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