The Delhi High Court has granted regular bail to Narender Kumar, accused in a case involving alleged fraudulent Input Tax Credit (ITC) claims worth Rs. 11.5 crore under the Central Goods and Services Tax (CGST) Act, 2017.
The bench of Justice Neena Bansal Krishna, while passing the order, emphasized that when the investigation is complete and the evidence is largely documentary, custodial detention serves no further purpose, especially when the accused has no criminal antecedents.
The case, investigated by the Directorate General of GST Intelligence (DGGI), Delhi Zonal Unit, pertains to the creation of fake firms and the generation of bogus invoices and e-way bills to fraudulently avail and utilize ITC without actual movement of goods. The alleged fraud was pegged at ₹11.5 crore.
The accused, who was arrested on June 4, 2025, claimed that he was taken into custody without prior summons or notice under Section 41A of the Cr.P.C. or Section 35 of the BNSS, in violation of due process. His counsel, Advocates Anubhav Singh, Nitin Kumar, and Maria Mary Sunil, alleged that the arrest memo and grounds of arrest were served after a 14-hour delay, contrary to the Supreme Court’s directions in Arnesh Kumar v. State of Bihar (2014).
It was further alleged that the statements recorded under Section 70 of the CGST Act were signed under duress and coercion, with the applicant claiming to have been physically assaulted by DGGI officials and made to sign documents in English that he could not read or understand.
The defence also contended that there was no corroborative evidence linking the applicant to the alleged fake firms, and that the entire case relied solely on statements purportedly obtained under pressure.
Opposing the bail plea, Special Public Prosecutor Vertika Sharma argued that the case involved systematic fraud through the creation of bogus firms using stolen KYC documents to generate fake GST returns and refunds.
The DGGI submitted that the accused and his associates had prepared fictitious invoices and e-way bills to falsely claim refunds and benefits, while no goods were actually supplied. The agency maintained that investigations were still underway against other persons, including the absconding mastermind, and that granting bail could prejudice the case.
The bench however, found no justification for continued detention once the prosecution complaint was filed on July 30, 2025, and the evidence was documentary. The Court observed that all witnesses in the case were official witnesses, minimizing the risk of tampering.
Citing the Supreme Court’s recent decisions in Vineet Jain v. Union of India (Criminal Appeal No. 2269/2025) and Ratnambar Kaushik v. Union of India (2023) 2 SCC 621, the Court reiterated that in economic offences under the CGST Act—punishable by up to five years’ imprisonment—bail should be the norm once the investigation is complete and there are no exceptional circumstances.
“The right to personal liberty cannot be curtailed when the investigation has concluded and the evidence is documentary,” the Court stated, emphasizing that continued incarceration violates the principles of justice.
The Court directed release on a personal bond of ₹25,000 with one surety of like amount, subject to the various conditions.
Firstly, the accused must inform the investigating officer or trial court of any change in address or mobile number.
Secondly, the accused shall not contact or influence prosecution witnesses.
Lastly, the accused shall not tamper with evidence or engage in any act prejudicial to the trial.
Case Details
Case Title: Narender Kumar Versus DGGI
Case No.: BAIL APPLN. 3065/2025
Date: 08/10/2025
Counsel For Petitioner: Anubhav Singh
Counsel For Respondent: Vertika Sharma
Read More: ITC Claim Prima Facie Valid: Delhi High Court Waives Pre-Deposit
