In Writ Tax No. 834 of 2023 -ALL HC- Allahabad High Court satisfied with Petitioner's case for proper construction of Section 69 of CGST Act, Grants interim bail
Chief Justice Pritinker Diwaker & Justice Ashutosh Srivastava [13-07-2023]

Read Order: Ashish Kakkar v. Union of India and Another

Chahat Varma

New Delhi, July 31, 2023: In a recent judgment, the division bench of the Allahabad High Court has granted interim bail to the petitioner, Ashish Kakkar, in a writ petition challenging the constitutionality of Section 69 of the Central Goods and Services Tax Act, 2017 (CGST Act).

Briefly stated, the petitioner had filed the present writ petition challenging the constitutionality of Section 69 of the CGST Act, contending that the provision was arbitrary and violated Articles 14 and 21 of the Constitution of India. The petitioner sought an alternative construction of Section 69 or any other suitable interpretation by the Court. Additionally, the petition requested summoning of records and setting aside the petitioner's alleged illegal arrest made under Section 69. The petitioner also sought a declaration that the arrest was illegal. The interim relief sought was the petitioner's release on interim/ad-interim bail, pending in the case before the Court of Special Chief Judicial Magistrate, Meerut.

The division bench headed by Chief Justice Pritinker Diwaker, rejected the Department's argument that releasing the petitioner on bail would hamper the investigation. The bench observed that the Department had only requested judicial custody of the petitioner and did not seek any further interrogation. The conduct of the Department indicated their satisfaction with the interrogation conducted so far, and there was no indication that they needed the petitioner for additional questioning. The bench also observed that the petitioner had assured the Court of his cooperation in the investigation and promised not to obstruct it in any way.

The bench further noted that the arrest memo did not specify the exact offense committed by the petitioner under Section 132(1) of the CGST Act. Instead, it mentioned multiple clauses of the said provision, indicating uncertainty on the part of the Department regarding the specific offense attributed to the petitioner.

“We are satisfied that the petitioner has made out a case for proper construction of Section 69 of the Act, 2017 and the issues concerning violation of statutory and constitutional procedural safeguards in the matter of arrest, do merit consideration and in the meantime, a case for bail is also made out,” said the division bench.

Thus, the bench granted the petitioner, interim relief by allowing his prayer for bail. As a result, he was directed to be released on bail in a case, which was pending before the Court of Special Chief Judicial Magistrate in Meerut. To secure his release, the petitioner was required to furnish a personal bond in the amount of Rs. 1.00 crore.