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2013 DIGILAW 978 (BOM)

Hasmukh Jagasi Visharia v. State of Maharashtra

2013-05-09

A.H.JOSHI

body2013
Judgment : 1. This is an application for anticipatory bail. 2. The applicant is named as accused in C.R. No.8 of 2013 registered at Narpoli Police Station for the offenses punishable under Sections 420, 465, 467, 468, 471 of I.P.C. and Section 74(1)B, 1(C), 74(1)(e), 74(1)(f), 74(2), 74(4) & 29(4) of the Maharashtra Value Added Tax Act. 3. The FIR was lodged by one Shri Kamlesh Dinkar Nagare, Joint Commissioner, Sales Tax, Government of Maharashtra. 4. Summary of version contained in the FIR is as follows: (a) Applicant is the Proprietor of Mahavira Paper Cutting, a proprietary firm having its Trading Identification No.27140248967V/C (TIN) for the purposes of payment of Value added tax. (b) The applicant has shown that he had made various purchases from many traders who are having TIN numbers. (c) In relation to trading done by the applicant, he was liable to pay the Value Added Tax. At the time of furnishing the return of the payment of the VAT, the applicant had claimed credit on the basis of tax payment by his vendors. (d) For this claim of credit applicant has relied on record showing payment of tax by his vendors, under respective TIN. (e) It had surfaced during perusal of the computer generated results that the credit as claimed by the applicant could not be available to the applicant, since the traders in relation to whom the credit was claimed had not at all paid the tax and, (f) The evidence of tax payment by the vendors for which the credit was claimed by the applicant were forged and fabricated documents. (g) Therefore, the department had commenced investigation. (h) It has revealed during the investigation done by the department, that various Traders from the applicant claimed that he had done purchases, had not sold any material to the applicant, no invoices were issued and they had received any payments from the applicant. (i) Those traders have given statement before the investigator of the department that they had not transacted any business nor received money from the applicant. (j) The documents constituting purportedly the evidence of tax payment made by the vendors, are found to be forged and fabricated by or at the behest of the applicant. (i) Those traders have given statement before the investigator of the department that they had not transacted any business nor received money from the applicant. (j) The documents constituting purportedly the evidence of tax payment made by the vendors, are found to be forged and fabricated by or at the behest of the applicant. (k) During the investigation it has revealed that based on the documents claiming credit, was the documentary evidence forged by the applicant and he had claimed the credit totaling to Rs.46,99,372/-, and thereby he had cheated the State Government apart from other offences under IPC and also under Maharashtra Value Added Tax Act apart from this tax liability. (l) These acts of forgery, prima facie constitutes forgery of valuable security being a document evidencing payment of cash and having value of cash. (m) Hence the applicant has been indicted for offence Section 420, 465, 467, 468 and 471 of IPC along with offense punishable under Section 74(1)B, 1(C), 74(1)(e), 74(1)(f), 74(2), 74(4) & 29(4) of the Maharashtra Value Added Tax Act. 5. The applicant was permitted to produce additional documents, which contain copies of statements of bank accounts, documents showing details of various traders with whom the applicant had transacted and the particulars of TIN of such traders, which were in operation for considerable period and even after the department claims that the registrations of those traders was canceled. 6. Learned Special P. P. has also tendered for perusal of the court copies of document which constitute the record of investigation conducted before filing of charge-sheet and the record of investigation conducted by the Investigating Officer after filing of the judgment of the report and registration of the offence. 7. Heard. Perused the record furnished by both sides. 8. Submissions of the applicant are as follows:- (a) These large numbers of documents are produced to show that the applicant is an innocent person, and present case is one of simple case of a tax demand which is disputed. There is no element of criminal law involved therein. (b) The applicant has dealt with genuine and existing parties and actual trading had been done and various amounts payable towards the transactions were paid through bank and none of the transactions can be termed as bogus. There is no element of criminal law involved therein. (b) The applicant has dealt with genuine and existing parties and actual trading had been done and various amounts payable towards the transactions were paid through bank and none of the transactions can be termed as bogus. (c) If in relation to some of the documents, any errors are found, and even if some of the traders may not have paid tax and made false representations to the applicant that they have actually paid the tax. (d) If at all it is found that the credit of tax claimed by the applicant is found to be erroneous this fact does not per-se constitute to be an offence. (e) The matter of evasion of tax is still under investigation by the department and as well by the investigating officer and even if any tax liability is finally adjudicated, the applicant would have right to challenge said assessment. At the most and at the end, the applicant would have to discharge said eventual liability. In any case it is not an offence. (f) For the present all these accusations are extremely premature. (g) If at all any tax liability arises upon adjudication, the applicant liable for payment of some more amount of tax, at the most, therefore any criminal liability would not arise. (h) The offence, in any case, cannot be of forgery even if the case turns out to be of claiming a credit based on documents which are found to be untrue. (i) Relying on the documents while claiming credit by assessee would mean reliance on false document and in any case it would not amount to be forgery of valuable securities and hence section 467 and section 468 of IPC are not attracted. (j) In any case it is not an offence of forgery punishable under section 471 of IPC. Even in that eventuality the said offense is punishable for less than seven years and in such circumstances applicant is entitled for anticipatory bail. Other offences as 467 and 468 etc. are not at all attracted. (k) Power to arrest would not presupposes necessity of arrest and particularly subsection (2) of Section 41 and 41(1)(b) and 41A(3) implies that arrest has to be exceptional and not a rule. 9. Other offences as 467 and 468 etc. are not at all attracted. (k) Power to arrest would not presupposes necessity of arrest and particularly subsection (2) of Section 41 and 41(1)(b) and 41A(3) implies that arrest has to be exceptional and not a rule. 9. Learned Advocate for the applicant has placed reliance on number of judgments to urge that as to how on the basis of cause contained in the FIR, it would not attract Section 471 and as to how on facts would not fall under to the restrictions termed as “forgery”, if the representations and recitals contained in the documents, which are alleged to be forged and false, when the applicant himself being author of those documents. 10. Learned Special Public Prosecutor, while answering has placed for perusal of the Court, copy of the record of investigation conducted by the Tax Audit and Investigation Department of the Department of Sales Tax. This record consists of statements of persons from whom the applicant has done purchasing and their TIN are represented in the invoices. This record is now in the hands of the Investigating Officer on the basis of which he has proceeded. 11. This court has considered respective submissions and record produced before the court as well as precedent cited at bar. 12. It is seen from the investigation record that the Department has recorded statements of various witnesses which inter alia include:- (a) Persons who are running different business enterprises, from whom the applicant claims to have done purchases. (b) Persons who have discounted cheques issued by applicant in the name of vendors and after deducting the commission, returned/paid money to the applicant. 13. Sum effect of version contained in the statements of witnesses is that the applicant has forged the record to show the trading, payment of Tax by vendors, payment towards purchases done by him, and got back money shown as paid to vendors, by getting the cheques discounted etc. 14. It is also seen that after the Investigating Officer took up investigation, he has cross checked large number of persons, who are shown as vendors, who have led to the conclusion by the Department that there has been not only a tax evasion by claiming refund and adjusting credit based on fictitious trade and fictitious credit, but has done the same by fabrication of record. 15. 15. By recording the statements by the Investigating Officer, the versions of the traders, as given before the Sales Tax Department, is confirmed by them. What appears on the basis of the material which are surfaced on the basis of investigating conducted by the officers of the department and which is confirmed in the process of investigation by the Investigating Officer, after registration of offence, that present is a case where credits were claimed in relation to Value Added Tax by the applicant not sheerly by falsehood but by himself either authoring or being a master-mind of fabrication of record. 16. On the basis of material that has come to the hands of both the investigating agencies brought on record that the applicant himself or with command of the applicant is different and, hence, Section 471 comes into picture along with other offences read with Section 467. 17. In the result, it would not be a case where there would be fetter against the applicant for arrest. On the basis of what is surfaced, the applicant has failed to make out a case for grant of anticipatory bail. 18. In the result, the application for anticipatory bail is rejected.