The Punjab and Haryana High Court has denied anticipatory bail to Jatinder Kumar in the case of multi-crore fake Input Tax Credit (ITC) scam involving fictitious firms and bogus e-way bills.
The bench of Justice Manisha Batra has observed that the petitioner, Jatinder Kumar who has not only alleged to have floated a fictitious firm but is also alleged to have passed on fake ITC to M/s Sona, availed ITC amounting to Rs.14,69,94,129 and Rs.14,70,59,558, prepared false e-way bills to show fictitious inward supplies, provided his wrong bank account number, facilitated rotation of money from one bank account to another without any profit or margin just to avoid payment of government exchequer and is also alleged to have given details of fictitious suppliers. The inquiry is at its nascent stage.
An investigation/inquiry was conducted against M/s Sona Casting Private Limited and it was revealed that M/s Sona had availed fraudulent Input Tax Credit (ITC) to the tune of Rs. 54.40 crores from some non-operational/fictitious firms. It was revealed that M/s Manvi Steels was one of the major suppliers of M/s Sona, who had passed on fake ITC to the tune of Rs. 3.72 crores to M/s Sona. The address of M/s Manvi was found to be fake and it was also found to be a non-existent firm. The petitioner, who had registered himself as proprietor of M/s Manvi, was issued notices under Section 73 of the CGST Act. Apprehending his arrest, the petitioner moved an application for grant of pre-arrest bail, which was dismissed by the Additional Sessions Judge, Fatehgarh Sahib.
The petitioner argued that he was the proprietor of a duly registered firm and was a regular tax payer. On receipt of summons under Section 70 of the CGST Act, he had appeared before the officers of the respondents. He had also filed reply to the show cause notice and had tendered a voluntary statement. Nonetheless, the registration of his firm was cancelled on the allegations of having claimed ITC in a fraudulent manner. The order of suspension of registration of his firm has been stayed by this Court in a separate writ petition filed by him. He has fully cooperated with the investigation conducted so far and has filed replies to the notices served upon him and is ready to join further inquiry. His custodial interrogation is not required. He is apprehending his arrest. It is, therefore, urged that he deserves to be extended benefit of pre-arrest bail.
The GST department argued that the firm of the petitioner availed fraudulent ITC to the tune of Rs.14,69,94,129 and Rs.14,70,59,558 and had passed on fake ITC to the tune of Rs.3.72 crores to M/s Sona. He had created a fictitious firm, which was actually non-existent. The documents collected by the respondents have revealed that there are material contradictions between the figures of inward and outward supplies made by the firm. Wrong account numbers had been provided in the GST portal by the petitioner. No actual movement of the vehicles shown in e-way bails has been found. He is shown to have rotated money from one bank account to another without any profit or margin. The list of suppliers of the firm of the petitioner was also having fictitious names. He has not cooperated with the inquiry and has not produced documents, which were required from him. He has caused loss of GST amount to the tune of Rs.70.19 crores on the taxable value of Rs. 389.90 crores. The matter is covered under the provisions of Section 132(1)(b) and (c) of the CGST Act. For conducting proper inquiry in the matter, his presence before the respondent is required. The allegations against him are serious in nature and do not make any case for grant of benefit of pre-arrest bail.
The court while refusing to grant pre-arrest bail held that there is possibility of the petitioner misusing the concession of pre-arrest bail. Any latitude may enable him to avoid custodial interrogation, tamper with evidence or manipulate records by taking undue advantage of the legal and procedural loopholes. He may also influence the witnesses/employees, who are actually aware of the transactions and can also delay the investigation by avoiding his personal appearance.
Case Details
Case Title: Jatinder Kumar Versus State of Punjab and others
Case No.: CRM-M-39132-2025 (O&M)
Date: 25/09/2025
Counsel For Petitioner: Urvashi Dhugga, Advocate
Counsel For Respondent: Ajay Kalra, Senior Standing Counsel
