In their crackdown on GST evasion, officials at the Central Goods and Services Tax (CGST) Commissionerate in Jaipur have shown no qualms about making even innocent people accused.
CGST Superintendent, Hanuman Ram Mundel has produced witnesses on the lease deed, namely Bhaskar Jangid, a resident of Harmada in Jaipur, and Sumit, a resident of New Delhi, an employee of the accused company and a part-time delivery boy for Zomato.
Dutta was not only accused in the case of GST evasion worth crores of rupees but was also arrested and sent to jail for months.
After hearing the case, the Economic Offences Court, Jaipur, for the first time, not only acquitted the accused arrested under the GST Act due to lack of concrete evidence and proof, but also recommended action against Hanuman Ram Mundel, the then investigating officer of CGST Jaipur and Superintendent in the Anti-Evasion Branch, and directed the Finance Secretary of the Union Finance Ministry to take action and inform the court. He was also directed to do so.
The presiding officer of Economic Offences Court, Jaipur, Rajesh Kumar Meena also made strong comments on the investigating officer and said that he tried not to take action against the real culprits, while the department had a lot of information related to GST fraud.
The bench said that it is the responsibility of the department to present evidence and proof against the accused, in which the department failed.
On December 19, 2020, Harmada resident Bhaskar Jangid, son of Puranmal Jangid, was arrested for taking premises on rent to open offices for operating firms for the people of Delhi and committing GST fraud of Rs 150 crore without selling goods through 8 firms formed on these premises, and Delhi resident Sumit Dutta, son of Vinod Dutta, was arrested for using fake input tax credit (ITC) of Rs 47 crore and obtaining ITC of Rs 46.30 crore by claiming to be a partner of Vito Merchandise. While Sumit Dutta told the officials that apart from working as an employee at Vito Merchandise on a monthly salary of Rs 15,000, he also worked as a part-time delivery boy for Zomato after 7 pm to support his family.
CGST officials arrested both accused in the case involving a company called Vito Merchandise.
Advocates Nemichand Atal, Ram Sharma, and their team presented numerous facts on behalf of the accused, stating that Bhaskar Jangid had only signed the lease agreement as a witness for the premises rented for the alleged fake firms’ office operations. Jangid also provided information to CGST officials about Tilakdhari Yadav, the real accused of renting the premises and providing goods without a bill under the GST Act.
Similarly, accused Sumit Dutta also described himself as a monthly-salaried employee and denied any involvement in GST evasion or fraud. During the hearing, the accused’s lawyers informed the court that the department had completely failed to prove the accused’s involvement in GST evasion.
The CGST department has no evidence against Bhaskar Jangid other than his signature as a witness on lease agreements for alleged fake firms. There are no documents proving Bhaskar to be an owner, proprietor, or partner in any firm.
Jangid also created or had the fake firms created. While other people besides Bhaskar signed the lease agreements as witnesses, Bhaskar mentioned working for Tilakdhari Yadav, but the department failed to provide the statements of other witnesses or information about the investigation conducted against Tilakdhari Yadav in the court records.
During a raid at the Delhi residence of Sumit Dutta, alleged to be a partner in Vito Merchandise, where he was living as a tenant, officials found no evidence of involvement in GST evasion.Â
The court did not present the panchnama and details of the documents seized during the raid at Dutta’s residence, the notice issued regarding his summons from Delhi to Jaipur, proof of Dutta’s partnership in Vito Merchandise, and the investigation report confirming that Sumit Dutta’s signature on the Vito Merchandise registration certificate application was actually his.
Similarly, the partnership deed, lease agreement, bill vouchers, and other transaction slips belonging to Dutta were also missing from the file.Â
The investigation did not reveal that the firms against which Dutta was accused were registered in the accused’s name.
Following the investigation and hearing, the court stated in its decision that under the GST law, transactions involving crores of rupees of input tax credit are conducted through bank accounts, regardless of whether the ITC was passed on or availed, and the bank through which the funds were received.
The department failed to produce details of bank transactions against any of the accused, even though bank statements should be obtained for transactions involving crores of rupees.
The fact that the transaction took place through a bank account and who are the operators of that account should also come to light. The court said that it appears that the department deliberately does not want to present the best evidence to the court.
The court did not even present the evidence which is available online with the department. Similarly, the court considered the failure to investigate the person who hired the firm on the lease deed as an attempt to protect the real culprits.
The court not only acquitted the accused due to lack of concrete evidence and proof against the department, but also held Hanuman Ram Mundel, the investigating officer and Superintendent of the Anti-Evasion Branch, for failure to conduct a fair investigation with the intention of protecting the main accused, gross negligence against the duty. recommended action against.
