HomeGSTOral Contract Dispute Is Civil, Not Criminal, With Rs. 2.81 Lakh Already...

Oral Contract Dispute Is Civil, Not Criminal, With Rs. 2.81 Lakh Already Deposited with GST Authority:  Gauhati High Court Grants Bail To Areca Nut Trader

The Gauhati High Court has granted the pre-arrest bail to Karnataka Trader in Rs. 59 lakh areca nut payment dispute, terms case ‘civil in nature’.

The bench of Justice Anjan Moni Kalita has observed that the issue of payment dispute seems to be an issue of civil nature, concerning an oral contract, whereby, the consignment was sent to the accused-applicant and subsequently, payment was made to the informant by the accused-applicant. 

The bench did not find any issue involving any criminal element; moreover, it has been submitted that the accused-applicant has also paid an amount of Rs. 2,81,000 in addition to other payments which are lying with the GST Authority. 

The accused-applicant, Mr Gayaz is a businessman having proprietorship concern in the name and style, M/s Aaina Traders, located at Mudiyappa Badavane, Pattanegere Roadkadur, Chikkamagaluru, Karnataka. It has been alleged in the FIR that aforesaid M/s Aaina Traders had purchased Areca Nuts from the informant for an amount of Rs. 59,16,750/-, including the GST. 

It has been alleged that though the consignment was sent by the informant to the aforesaid M/s Aaina Traders and majority of the payment has been made to the informant, an amount of Rs. 7,16,750 is yet to be paid. It has been further alleged that in spite of repeated requests, the aforesaid amount was not paid by the accused-applicant till date. The informant has filed the aforementioned FIR before the Officer in-charge Kharupetia Police Station, Kharupetia for proper action against the accused person.

The accused-applicant submitted that the issue involved is purely of civil nature without having any criminal element. Though the consignment was received by the accused-applicant, there are certain issues relating to a part of the consignment, as a part of the consignment was found to be damaged and therefore, the accused-applicant had requested the informant to replace the same before the full payment is made by him, however, the same is not carried out by the informant, till date.

The issue apparently seems to be an issue of civil nature, concerning an oral contract, whereby, the consignment was sent to the accused-applicant and subsequently, payment was made to the informant by the accused-applicant. 

The Court did not find any issue involving any criminal element in the instant case, moreover, it has been submitted that the accused-applicant has also paid an amount of Rs. 2,81,000 in addition to other payments which are lying with the GST Authority. Therefore, the only payment remaining to be paid is Rs. 4,30,000, which could be cleared at any time when the damaged Areca Nuts are replaced by the informant.

Case Details

Case Title: Mr Gayaz Versus The State Of Assam

Case No.: AB/2435/2025

Date: 14.10.2025

Counsel For Petitioner:  J I Borbhuiya, Mr. L Mohan, Mrs. K H Choudhury

Counsel For Respondent: PP

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Mariya Paliwala
Mariya Paliwalahttps://www.jurishour.in/
Mariya is the Senior Editor at Juris Hour. She has 5+ years of experience on covering tax litigation stories from the Supreme Court, High Courts and various tribunals including CESTAT, ITAT, NCLAT, NCLT, etc. Mariya graduated from MLSU Law College, Udaipur (Raj.) with B.A.LL.B. and also holds an LL.M. She started as a freelance tax reporter in the leading online legal news companies like LiveLaw & Taxscan.

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