Case Summary
Ashish Kumar Tiwari v. Union of India & Mohd. Tabrez Amdani v. Union of India
High Court of Chhattisgarh, Bilaspur
MCRC No. 1312 of 2023 & MCRC No. 3901 of 2023
Judgment dated: 17.07.2023
Hon’ble Justice: Deepak Kumar Tiwari
Category of dispute: Bail under Section 132 CGST Act, 2017 (GST Fraud / ITC)
Relevant Sections: Section 132(1)(b), (c), (i), (ii), Section 132(4), Section 132(5) of CGST Act, 2017; Section 439 CrPC
Facts (Paras 1–3, 7–8)
The applicants, Ashish Kumar Tiwari (accountant) and Mohd. Tabrez Amdani (director of M/s Topisto Products Pvt. Ltd.), were arrested on 29.11.2022 for allegedly creating fake firms and issuing forged invoices without supply of goods, fraudulently availing ITC of ₹114.70 crore and passing on forged bills worth ₹1.04 crore. Before filing of the complaint, ITC worth ₹113.90 crore was voluntarily reversed. The applicants argued that since the remaining disputed amount was below ₹5 crore, the offence was compoundable and bailable. They also contended that evidence was documentary in nature, reducing the risk of tampering, and sought bail citing prolonged custody exceeding seven months.
Questions before Court (Paras 2–5)
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Whether reversal of substantial ITC and residual liability below ₹5 crore reduces the offence from a non-bailable to a bailable one?
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Whether the applicants, having been in custody for over seven months, deserved bail considering the nature of offence, gravity of economic offences, and possibility of trial delay?
Observations (Paras 4–9)
The prosecution opposed bail citing fraud through multiple shell firms, reliance on precedents including Basudev Mittal v. Union of India (where bail was rejected despite partial deposit), and judgments like Nimmagadda Prasad v. CBI (2013) 7 SCC 466 highlighting seriousness of economic offences. They stressed that economic crimes undermine the financial system and must be dealt with sternly.
The Court, however, relied on principles from Mohd. Sharief v. Union Territory of J&K (2020 SCC OnLine J&K 649) and Ratnambar Kaushik v. UOI (2023) 2 SCC 621), holding that bail is the rule and jail the exception. It noted that:
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Substantial ITC reversal reduced the effective exposure.
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Custody since 29.11.2022 without trial progress was excessive.
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Maximum punishment was five years and trial was triable by JMFC.
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Evidence was largely documentary/electronic, reducing risk of tampering.
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No flight risk was demonstrated.
Judgment (Paras 9–10)
The High Court granted bail to both applicants subject to conditions:
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Furnishing a bond of ₹2,00,000 with two sureties.
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Filing affidavit of movable/immovable properties and not alienating assets without court’s permission.
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Attending trial on all dates.
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Not committing similar offences in the future.
Table of Precedents Cited
| Case | Court & Citation | Ratio / Outcome |
|---|---|---|
| Ratnambar Kaushik v. UOI | Supreme Court, (2023) 2 SCC 621 | Bail granted in GST case; custody >4 months, evidence documentary, max punishment 5 years. |
| Basudev Mittal v. UOI | Chhattisgarh HC, MCRC No. 3919/2022; SLP (Crl) No. 8128/2022 (SC) | Bail rejected despite partial deposit; affirmed by SC. |
| Nimmagadda Prasad v. CBI | SC (2013) 7 SCC 466 | Economic offences require stricter bail scrutiny; grave impact on economy. |
| State of Gujarat v. Mohanlal Jitamalji Porwal | SC (1987) 2 SCC 364 | Economic offences harm national economy; need strict approach. |
| P.V. Ramana Reddy v. UOI | Telangana HC, 2019 SCC OnLine TS 2516; affirmed by SC | Upheld arrest powers in GST fraud, bail not automatically granted. |
| Mohd. Sharief v. UT of J&K | J&K HC, 2020 SCC OnLine J&K 649 | Bail is the rule, jail the exception; prolonged custody without trial weighs in favour of bail. |
Between Fine Lines
For businesses, this judgment underlines that voluntary reversal of wrongly availed ITC and cooperation during investigation can weigh heavily in favour of bail. Even in serious GST fraud cases, where offences are economic in nature, courts balance the right to liberty with seriousness of allegations, particularly when evidence is documentary and custody is prolonged. However, early deposit or reversal does not absolve liability—trial proceedings will continue.
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