CGST Ghaziabad | Bail of Businessman Accused of Rs. 75 Crore GST Fraud Rejected By Meerut Court

The Court of the Additional Sessions Judge, Court No. 01, Meerut, has rejected the bail application of Vivek Garg, a Ghaziabad-based businessman accused of orchestrating a large-scale fake GST invoice racket involving over Rs. 75 crore of fraudulent Input Tax Credit (ITC). The order was passed by Shri Achal Narain Saklani (H.J.S.), holding that the gravity of the offence, coupled with strong digital and documentary evidence, did not justify grant of bail at this stage. The bail application arose from Case registered under Sections 132(1)(b), 132(1)(c) and 132(1)(i) of the CGST Act, 2017, at CGST Police Station, Ghaziabad. The applicant, Vivek Garg, proprietor of M/s Garg Traders, was arrested on 18 December 2025 following a search conducted under Section 67(2) of the CGST Act. According to the prosecution, intelligence developed by CGST Ghaziabad revealed the creation and operation of multiple fake GST firms using forged rent agreements bearing a common notary stamp, which was found to be non-verifiable on official records. Data analysis further revealed that the IP address used by one fake entity, M/s Singh Enterprises, matched that of the applicant’s firm, establishing a crucial digital linkage. During the search of Garg’s business premises on 17 December 2025, CGST officers seized incriminating diaries, electronic devices, login credentials, debit and credit cards, cheque books, PAN and Aadhaar cards, and other records. These materials allegedly detailed the operation of fake firms and commission-based passing of ITC at rates ranging from 2–3% in cash. The court noted that on 18 December 2025, the accused voluntarily admitted to purchasing and operating 12 fake GST firms through intermediaries for the sole purpose of passing on fraudulent ITC. He confessed to having passed ineligible ITC worth ₹53.14 crore and availed excess ITC of ₹21.95 crore, taking the total alleged fraud beyond ₹75 crore.Significantly, the accused reiterated his admission before the Chief Judicial Magistrate (Economic Offences), Meerut, even offering to identify other members of the tax evasion syndicate. The defence argued that the arrest was illegal and premature in the absence of adjudication under Sections 73 or 74 of the CGST Act. The case was purely documentary and custodial interrogation was unnecessary. Statements obtained under coercion Continued custody amounted to pre-trial punishment. Reliance was placed on Supreme Court rulings emphasizing that “bail is the rule and jail is the exception.” The court held that prosecution under Section 132 of the CGST Act is independent of adjudication proceedings. It observed that the case is supported by digital footprints, seized documents, and voluntary admissions. The alleged offence is cognizable and non-bailable due to the quantum involved. Investigation is at a critical stage, including forensic examination of electronic devices and tracing of beneficiaries. Release of the accused could lead to tampering with evidence and influencing witnesses Relying on landmark Supreme Court judgments including Ram Narain Popli v. CBI and Y.S. Jagan Mohan Reddy v. CBI, the court reiterated that economic offences constitute a distinct class requiring a stricter approach in bail matters due to their serious impact on public revenue and the national economy. Considering the gravity of the offence, magnitude of alleged fraud, and ongoing investigation, the court concluded that it would not be appropriate to enlarge the accused on bail at this stage. Accordingly, the bail application of Vivek Garg was rejected. Case Details Case Title: Vivek Garg Case No.: First Bail application No. 6795 of 2025 Date: 05.01.2026 Counsel For Petitioner: Jitendra Singh Counsel For Respondent: Lakshya Kumar Singh Click Here To Read Order Read More: Binny Bansal’s Non-Resident Claim Rejected; ITAT Denies India–Singapore DTAA Relief on Flipkart Share Sale

CGST Ghaziabad | Bail of Businessman Accused of Rs. 75 Crore GST Fraud Rejected By Meerut Court

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