The Supreme Court has held that pursuing parallel proceedings for bail or release without adequately disclosing related proceedings and adverse orders amounts to an abuse of the process of law.
The bench of Justice Dipankar Datta and Justice Sheel Nagu directed fresh consideration of a bail petition in a case involving alleged fraudulent input tax credit and tax evasion of ₹43.08 crore, while allowing the accused to remain on interim bail.
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A Bench strongly deprecated the conduct of Mohammed Kamran, proprietor of M/s MK Traders, for pursuing overlapping remedies and failing to inform the court hearing his bail petition that release had been refused in other proceedings.
According to the prosecution complaint, Kamran allegedly issued invoices without supplying goods, availed fraudulent input tax credit, falsified documents and financial statements, and furnished false information with the intention of evading GST. The alleged loss to the revenue was ₹43,08,22,936.
The complaint referred to Section 16(2)(b), read with Sections 132(1)(b), 132(1)(c) and 132(1)(f), of the Central Goods and Services Tax Act, 2017.
The department also alleged that Kamran resisted officials during searches at his declared and actual residential premises and subsequently fled. A separate FIR was registered in connection with that alleged incident.
He was arrested on September 16, 2025. Bail applications before the trial court and the Sessions Court were rejected before the disputed High Court order was passed.
The Supreme Court examined the sequence of proceedings pursued by Kamran. He filed a bail petition before the High Court on December 9, 2025, and another bail application before the Sessions Court the following day. The latter application was rejected while the High Court petition remained pending.
On December 12, 2025, the High Court directed service of the bail petition on the department’s Standing Counsel and allowed the department two weeks to file objections.
On December 22, 2025, Kamran also instituted a writ petition challenging his arrest, the complaint and the order taking cognizance. In those proceedings, he sought interim release while asserting that the remedy of applying for bail under Section 483 of the Bharatiya Nagarik Suraksha Sanhita, 2023, was not efficacious.
The writ court refused interim release that day. Later, a memo was moved seeking urgent listing of the pending bail petition, which was subsequently heard during the winter vacation on December 26, 2025.
The Supreme Court found that the refusal of interim release in the writ proceedings and the rejection of bail by the Sessions Court were not brought to the attention of the Single Judge who granted bail.
The department argued that the High Court proceeded despite an adjournment request made because its arguing counsel was unavailable. It maintained that the panel counsel who appeared had no instructions to contest the petition on merits.
Kamran’s counsel disputed this account, submitting that the department’s representative had addressed the merits after initially seeking an adjournment. He also argued that the department had failed to file its objections within the time allowed.
After examining affidavits, a video recording of the hearing and its transcript, the Supreme Court reached a qualified conclusion. It found that the counsel present had made some submissions on merits, but had also sought an adjournment because Standing Counsel had been engaged to appear.
The Bench therefore observed that it would not be entirely correct to say that the department was wholly unrepresented. At the same time, it accepted that the department could not be represented by its Standing Counsel.
The Supreme Court’s principal concern was the accused’s conduct in pursuing multiple avenues for release without full disclosure.
The Bench found a lack of utmost good faith, which it described as foundational to invoking the equitable and discretionary jurisdiction for bail. It concluded that the circumstances disclosed forum shopping and suppression of material facts.
While recognising an accused person’s right to challenge arrest and seek bail, the Court held that pursuing such remedies simultaneously, particularly without adequate disclosure, clearly amounted to abuse of process.
The Bench also noted that the department had not filed objections placing the relevant material before the High Court. However, the winter vacation and the absence of notice of the urgent-listing memo meant that neither the department nor the counsel appearing for it could bring all the facts to the Single Judge’s attention. The accused’s own failure to disclose those facts remained central to the Court’s criticism.
The Court separately questioned the manner in which the bail petition was brought before the Vacation Bench.
It observed that the petition should ideally have been listed after the High Court reopened, particularly because no specific returnable date during the vacation had been fixed and there was no direction to place it before the Vacation Bench.
Obtaining a hearing without adequate notice to the department was viewed as an attempt to gain a procedural advantage by misleading the court.
Despite its criticism, the Supreme Court did not direct Kamran’s immediate return to custody.
The Bench set aside the portion of the High Court order that finally disposed of the bail petition and restored the petition for fresh consideration by the same Single Judge. Kamran was permitted to continue on interim bail on the earlier terms and conditions until further orders.
The department was allowed two weeks to file its counter-affidavit and supporting material, with Kamran given one week thereafter to file a rejoinder. The High Court was asked to decide the petition independently on its merits, preferably by the end of 2026.
The ruling therefore requires a fresh decision on bail; it does not determine whether the allegations of GST fraud have been proved.
Before concluding, the Supreme Court issued observations intended to promote uniformity in vacation listing practices.
Where a court directs that a matter be listed “two weeks hence” and the resulting listing would fall during a vacation, the registry should ordinarily compute the period by excluding the vacation.
The Court distinguished cases in which the Bench fixes a specific date during the vacation or expressly directs listing before a Vacation Bench. Such directions should ordinarily be followed, subject to the relevant High Court rules.
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