Revocation of Bail Cancellation Order.

Kabir Kumar v. Directorate General of GST Intelligence

High Court of Delhi

CRL.M.C. No. 3535 of 2021; CRL.M.A. Nos. 20961 & 20962 of 2021

Category of Dispute: Bail in GST-related Economic Offence

Date of Judgement: 24 December 2021

Relevant Section: Section 70 of the CGST Act, 2017 (Summoning for investigation)

Facts of the Case

1. The petitioner, Kabir Kumar, was granted bail on 5.12.2020 with certain conditions including that he shall not commit similar offences in future and must appear before Court as directed [5:3].
2. His bail was first sought to be cancelled by the DGGI, but the application was rejected by the ASJ-02 on 18.1.2021, holding that no interference in investigation or evasion of proceedings was shown [5:4].
3. A second cancellation application was filed alleging that Kabir had violated condition no. 4 by indulging again in fake invoice transactions post bail, based on disclosure statements of co-accused Manish and Vikas recorded under Section 70 of CGST Act [5:5–6].
4. The department alleged that the petitioner’s acts were part of a larger economic crime network, causing loss to the exchequer and linked to black money generation [5:6].
5. The petitioner failed to appear in person on 20–21 December 2021, citing COVID-19 symptoms, and sought to attend virtually [5:13]. The CMM rejected the explanation, viewed it as avoidance, and cancelled the bail on 22.12.2021 [5:14].

Question(s) in Consideration

1. Whether the petitioner violated bail condition no. 4 by indulging in similar offences post bail?
2. Whether non-appearance on 20-21 December 2021 justified cancellation of bail?
3. Whether the CMM’s order dated 22.12.2021 cancelling bail was sustainable in law?

Observation of Court

1. The High Court held that apart from the disclosure statements of co-accused Manish and Vikas, there was no fresh incriminating evidence collected against the petitioner post 5.12.2020; thus, violation of condition no. 4 could not be presumed at this stage [5:8–9].
2. The absence of the petitioner on 20-21 December 2021 was explained through medical records and COVID-related symptoms, which the Court found plausible [5:13–16].
3. The High Court criticized the trial court’s assumption that bail conditions were violated, stating it was premature and unsupported by material evidence [5:16].

Judgement of the Court

The High Court of Delhi set aside the CMM’s order dated 22.12.2021 cancelling the petitioner’s bail, restoring the original bail order dated 5.12.2020. However, it directed the petitioner to deposit Rs. 1,00,000/- with the Delhi High Court Legal Services Committee as cost and produce the receipt before the trial court the same day [5:17].

Between Fine Lines

• Mere disclosure statements without corroboration are insufficient to cancel bail.
• COVID-19 symptoms and medical advice justified virtual appearance in special circumstances.
• Bail cannot be cancelled on speculative allegations without evidence.
• The Court re-emphasized that economic offences do not automatically disqualify bail.
• Procedural fairness must be upheld in bail cancellation proceedings.

Summary of Referred Cases