Bail u/s 132 CGST Act Cannot Be Denied Due to Pending Probe of Co-Accused | HC

Case Details: Manish Kumar vs. Directorate General, Goods & Service Tax Intelligence, Zonal Unit, Ludhiana (2025) 33 Centax 248 (P&H.)

Judiciary and Counsel Details

• HARPREET SINGH BRAR, J.
• S/Shri Vinod Ghai, Sr. Adv., Ms Kashish Sahnia, Arnav Ghai, Ms Muskaan Gupta and Ms Muskan Chauhan, Advs. for the Petitioner.
• Ms. Sharmila Sharma, Sr. Panel Counsel, S/Shri Sunish Bindlish, Sr. Standing counsel, Ms. Pridhi Sandhu, Sr. Standing Counsel, Manish Bansal, Public Prosecutor and Alankrit Bharadwaj, Addl. P.P. for the Respondent.

Facts of the Case

The petitioners were accused in a complaint registered under Section 132 of the CGST Act and Punjab GST Act for alleged tax evasion. They filed applications seeking grant of regular bail under Section 69 of the said Acts. It was contended that the petitioners had clean antecedents, had duly cooperated during the investigation, and that the entire evidence against them was documentary or electronic in nature, already in possession of the investigating agency. It was further submitted that the pendency of an investigation against other co-accused could not be a valid ground to continue their custody, and that the right to bail must be determined individually based on each accused’s role and circumstances. The matter was accordingly placed before the Punjab and Haryana High Court.

High Court Held

The Punjab and Haryana High Court held that bail under Section 132 of the CGST Act could not be denied to an accused solely because an investigation was pending against a co-accused. The Court held that bail must be decided qua each accused individually, based on the specific role attributed to them, their antecedents, and cooperation in the investigation. Since the accused had clean antecedents and had fully cooperated, and most evidence was in documentary and electronic form already in possession of the investigating agency, continued custody was not justified. The Court, therefore, directed that the accused be released on regular bail subject to furnishing bail bonds and surety bonds.

List of Cases Cited

• Anush Kumar Gangwani v. Union of India — 2019 (22) G.S.T.L. 191 (P&H.) — Referred [Para 6]
• Anush Kumar Gangwani v. Union of India — 2024 (83) G.S.T.L. 169 (Chhattisgarh) = (2024) 14 Centax 274 (Chhattisgarh) – Referred [Para 6]
• Ashok Kumar v. Commissioner of CGST And Central Excise — 2020 (42) G.S.T.L. J111 (SC) — Referred [Para 6]
• Ashutosh Garg v. Union of India — (2024) 20 Centax 595 (S.C.) — Referred [Para 19]
• Basudev Mittal v. Union of India — 2023 (69) G.S.T.L. 124 (Chhattisgarh) = (2023) 2 Centax 291 (Chhattisgarh) — Referred [Para 6]
• Basudev Mittal v. Union of India — 2023 (69) G.S.T.L. 118 (S.C.) = (2023) 2 Centax 295 (S.C.) – Referred [Para 6]
• Jatinder Manro v. DGGSIT — 2020 (371) E.L.T. 137 (P&H) — Referred [Para 6]
• Nigammadda Prasad v. CBI — 2013 (3) R.C.R. (Criminal) 690 (SC) — Referred [Para 6]
• P.V. Ramana Reddy v. Union of India — 2019 (26) G.S.T.L. J175 (S.C.) — Referred [Para 6]
• Prahlad Singh Bhati v. NCT, Delhi — (2001) 4 SCC 280 — Referred [Para 17]
• Radhika Agarwal v. Union of India — 2025 (95) G.S.T.L. 225 (S.C.) = 2025 (392) E.L.T. 273 (S.C.) = (2025) 27 Centax 425 (S.C.) — Referred [Para 10]
• Rajesh Gandhi v. Union of India — (2024) 23 Centax 319 (Telangana) — Referred [Para 6]
• Ratnambar Kaushik v. Union of India — (2022) 1 Centax 278 (S.C.) = 2023 (68) G.S.T.L. 233 (S.C.) — Referred [Para 19]
• Sandeep Goyal v. Union of India — 2020 (36) G.S.T.L. 497 (S.C.) — Distinguished [Paras 6, 17]
• Sanjay Chandra v. CBI — (2012) 1 SCC 40 — Referred [Para 18]
• Sanjay Dhingra v. DGGSIT — [CRM-M-50256-2019, dated 23-1-2020] — Referred [Para 6]
• State of Bihar v. Amit Kumar — 2017 (3) R.C.R. (Criminal) 175 (SC) — Referred [Para 6]
• State of Gujarat v. Choodamani Parmeshwaran Iyer — 2023 (76) G.S.T.L. 146 (S.C.) = (2023) 8 Centax 224 (S.C.) — Referred [Para 6]
• Subair T.B. v. State of Kerala — (2025) 26 Centax 158 (Ker.) — Referred [Para 6]
• Vikas Goel v. Central GST Commissionerate — 2019 (22) G.S.T.L. 191 (P&H) — Referred [Para 6]
• Vimal Yashwantgiri Goswami v. State of Gujarat — 2020 (106) UPTC 1681 (Guj. – DB) — Referred [Para 6]
• Vineet Jain v. Union of India — (2025) 30 Centax 57 (S.C.) — Referred [Para 18]
• Y.S. Jagan Mohan Reddy v. CBI — 2013 (3) R.C.R. (Criminal) 108 (SC) — Referred [Para 6]

List of Departmental Clarification Cited

• CBI&C Circular No. 171/03/2022-GST, dated 6-7-2022 [Para 5]
• CBI&C Instruction No. 1/2025-GST, dated 13-1-2025 [Para 5]