GST Fraud Kingpin Denied Bail — ₹80 Crore Bogus Billing Case Dismissed

Get the full picture - access the original judgement of the court order here

Case Name

Vikas Goel vs. Deputy Director, Directorate General of Goods and Service Tax Intelligence, Gurugram Zonal Unit

Court Name: High Court of Punjab and Haryana at Chandigarh

Case No.: CRM-M-18992-2019

Date of Decision: 24th July, 2019

Key Takeaways

1. Bogus Billing = Serious Economic Offence: Creating fake paper transactions to claim GST input tax credit without actual supply of goods is treated as a grave economic crime.

2. Scale Matters: The alleged fraud was worth more than ₹80 crore, which the court considered a “huge magnitude” economic offence.

3. Kingpin Gets No Bail: If you are identified as the main accused or kingpin of a large-scale economic fraud, courts are very reluctant to grant bail.

4. Second Bail Petition Also Rejected: This was Vikas Goel’s second attempt at getting bail — and it was dismissed just like the first.

5. Early Stage of Case: The court noted the case was still at a preliminary stage, which further weighed against granting bail.

Issue

Was Vikas Goel, the alleged kingpin of a ₹80+ crore GST bogus billing fraud, entitled to regular bail under Section 439 of the Code of Criminal Procedure, 1973?

The short answer the court gave: No.

Facts

• Who is Vikas Goel? He is the petitioner (the person asking for bail) and is alleged to be the main accused in a GST fraud case.

• What was the complaint? A complaint case bearing No. COMA-137 dated 13.11.2018, titled “Shankar Prasad Sarma vs. MICA Industries and others” was filed against him.

• What did he allegedly do? Along with co-accused persons, he allegedly:
• Created bogus/fake billing 
• Showed transactions on paper without any actual transportation or sale of goods
• Wrongly claimed GST relief (Input Tax Credit) of more than ₹80 crore 

• What laws were invoked? He was charged under:
• Section 132 of the CGST Act, 2017 (offences relating to GST fraud)
• Section 10 of the IGST (Integrated GST provisions)
• Arrested under powers conferred by Section 69 of the CGST Act, 2017 (power to arrest)

• What did he ask for? This was his second petition under Section 439 of the Code of Criminal Procedure, 1973 seeking regular bail.

• Where did the case stand? The case was still at a preliminary stage at the time of this hearing.

Arguments

Petitioner’s Side (Vikas Goel):

The judgment does not go into extensive detail about the petitioner’s specific arguments, but the fact that he filed a second bail petition suggests his counsel argued for his release, likely on grounds such as:

• Entitlement to bail pending trial
• Possibly challenging the severity of allegations

(Note: The court did not elaborate on the petitioner’s specific arguments in the judgment text.)

Respondent’s Side (DGGI, Gurugram Zonal Unit):

• The respondent contested the petition and filed a reply.
• They highlighted the serious nature of the allegations — bogus billing, paper transactions, no actual goods movement.
• They emphasized that the petitioner was the main accused and the alleged kingpin of the fraud.
• The wrongful claim amounted to more than ₹80 crore, making it a massive economic offence.

Key Legal Precedents

The court relied on one key Supreme Court precedent:

State of Bihar and another vs. Amit Kumar @ Bacha Rai, 2017(3) R.C.R.(Criminal) 690

• What did this case say? The Hon’ble Supreme Court held that an accused who is:
• Charged with an economic offence of huge magnitude, AND
• Alleged to be the kingpin of the crime
• …is NOT entitled to the benefit of bail.

• How was it applied here? The court directly applied this principle to Vikas Goel’s case — since he was allegedly the main accused/kingpin in a ₹80+ crore GST fraud, the Supreme Court’s ruling in Amit Kumar @ Bacha Rai squarely applied, and bail was denied.

Judgment

Decision: Petition Dismissed — Bail Denied

• Who won? The Respondent (DGGI, Gurugram Zonal Unit) — the government agency won. Vikas Goel’s bail petition was dismissed.

• Reasoning:

1. There are serious allegations against the petitioner as the main accused.
2. He allegedly created bogus billing and made paper transactions without actual movement of goods.
3. The wrongful claim was of more than ₹80 crore — a huge magnitude.
4. Relying on the Supreme Court’s ruling in State of Bihar vs. Amit Kumar @ Bacha Rai, the court held that a kingpin of a large economic offence is not entitled to bail.
5. The case was at a preliminary stage, adding further reason to deny bail.

• Order: The petition was found to have no merit and was dismissed.

• Judge: Hon’ble Mr. Justice Inderjit Singh

FAQs

Q1: What is Section 132 of the CGST Act, 2017?

Section 132 deals with punishment for certain offences under GST, including fraudulent availment of Input Tax Credit (ITC) without actual supply of goods or services. It can attract imprisonment and fines depending on the amount involved.

Q2: What is Section 69 of the CGST Act, 2017?

Section 69 gives the power to arrest a person if the Commissioner has reasons to believe that the person has committed a cognizable and non-bailable offence under Section 132 of the CGST Act.

Q3: Why was this Vikas Goel’s second bail petition?

The judgment mentions this is a second petition under Section 439 CrPC, meaning his first bail application was already rejected. He tried again before the High Court, but was denied once more.

Q4: What is “bogus billing” in the GST context?

Bogus billing means creating fake invoices showing sales/purchases of goods that never actually happened. This is done to fraudulently claim Input Tax Credit (ITC) — essentially getting a tax refund or credit for transactions that were never real.

Q5: Can Vikas Goel appeal this decision?

Yes, he could potentially approach the Supreme Court of India under Article 136 of the Constitution (Special Leave Petition) challenging the High Court’s order. However, given the Supreme Court’s own precedent in Amit Kumar @ Bacha Rai, it would be an uphill task.

Q6: What does “preliminary stage” of the case mean?

It means the trial had not yet begun in full — investigations, charge framing, or initial proceedings were still underway. Courts are generally more cautious about granting bail at this stage in serious economic offence cases.

Q7: Is this judgment reportable?

Interestingly, the judgment itself notes: “Whether reportable: No” — meaning it was not intended to be officially reported in law journals as a binding precedent. However, it still reflects the application of existing Supreme Court principles.

Petitioner has filed this second petition under Section 439 of the Code of Criminal Procedure, 1973 for grant of regular bail in a complaint case bearing No.COMA-137 dated 13.11.2018, titled as 'Shankar Prasad Sarma Versus MICA Industries and others', under Section 132 of the CGST Act, 2017 read with Section 10 of the IGST in exercise of the powers conferred under Section 69 of the CGST Act, 2017.

Notice of motion was issued. Learned counsel appeared and filed a reply on behalf of the respondent-State and contested this petition.

I have heard learned counsel for the petitioner as well as learned counsel for the respondent and gone through the record.

Perusal of record shows that there are serious allegations

against the present petitioner, who is the main accused, that he alongwith

co-accused, by falsely showing bogus billing etc., adjusted the amount

without any actual transportation of the goods or sale of goods etc. Only

paper transactions were done and the accused have wrongly claimed the

relief of more than `80 crore. The case is at preliminary stage.

In State of Bihar and another Vs. Amit Kumar @ Bacha

Rai, 2017(3) R.C.R.(Criminal) 690, the Hon'ble Supreme Court has held

that the accused charged with economic offence of huge magnitude and

is alleged to be the kingpin of crime, is not entitled to the benefit of bail.

Keeping in view the serious nature and gravity of the

offence and in view of the fact that the petitioner-accused has been

charged with economic offence of huge magnitude, I do not find it a fit

case where the petitioner is entitled to the benefit of regular bail.

Therefore, finding no merit in the present petition, the same

is dismissed.

(INDERJIT SINGH)

JUDGE