Case details
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Case Title: Directorate General of GST Intelligence v. Sanjay Jaglan
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Court: High Court of Delhi at New Delhi
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Petition Number: CRL.M.C. 834/2020 & CRL.M.A. 3412/2020
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Date of Judgment: 30 May 2025
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Relevant Section: Section 132, CGST Act, 2017; Section 482 CrPC
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Category of Dispute: Bail in GST fraud case (Input Tax Credit fraud)
Facts (Paras 1–3)
The Directorate General of GST Intelligence alleged that the respondent, through his company M/s R.R. India Pvt. Ltd., fraudulently availed bogus Input Tax Credit (ITC) of around ₹33.75 crores on manpower service invoices from six non-existent firms. He was arrested on 01.12.2019. The Chief Metropolitan Magistrate granted him bail on 17.12.2019 after he deposited ₹1 crore and agreed to property attachment worth ₹40.76 crores, with further direction to deposit ₹3 crores more. The respondent complied by depositing a total of ₹4 crores.
Questions before the Court (Paras 4–6)
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Whether bail granted at the initial stage of investigation should be cancelled on account of alleged involvement in multiple GST fraud cases.
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Whether prolonged investigation without filing a prosecution complaint can justify continued custody.
Observations (Paras 7–11)
The Court noted that no prosecution complaint had been filed against the respondent even though investigation commenced in 2019. The respondent had deposited ₹4 crores, which exceeded 10% of the disputed liability, consistent with the Supreme Court ruling in Pradeep v. CCE (GST), (2021) 19 SCC 547, where bail was granted on deposit of 10%. The department itself admitted these deposits. There was no allegation of misuse of bail liberty. The Court emphasized that in absence of progress in investigation and with compliance of bail conditions, no supervening circumstance existed to warrant cancellation.
Judgment (Paras 12–14)
The High Court dismissed the petition and refused to cancel bail. The conditions imposed by the CMM would continue to apply.
Table of cases referred
| Case | Citation | Verdict / Ratio |
|---|---|---|
| Pradeep v. CCE (GST) | (2021) 19 SCC 547 | Bail granted on deposit of 10% of disputed liability; proportional deposit considered sufficient safeguard. |
Between Fine Lines
For businesses, this ruling shows that once substantial deposits (10% or more of the alleged liability) are made and no complaint is filed within a reasonable time, bail is unlikely to be cancelled. The department must act diligently in filing prosecution complaints; otherwise, courts will prioritize liberty over indefinite investigation delays.
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