High Court Rules Against Bypassing GST Act for Prosecution Under IPC

Deepak Singhal vs. Union of India (Writ Petition No. 21641 of 2024) in points :

1. Court and Judges : Madhya Pradesh High Court, Indore. Judged by Hon’ble Justice Sushrut Arvind Dharmadhikari and Justice Duppala Venkata Ramana.

2. Petitioner : Deepak Singhal, proprietor of M/s. Agrawal Soya Extracts Pvt. Ltd.

3. Respondents : Union of India and others.

4. Relief Sought :
– Quashing of proceedings linked to summons issued under Section 70 of GST Act (11/08/2021) and FIR No. 62/2022 under IPC.
– Clarification from GST authorities regarding the petitioner’s implication in the FIR.

5. Facts of the Case :
– Summons issued to the petitioner by GST authorities.
– Search and seizure conducted at M/s. Shreenath Soya Exim Corporate, revealing fraudulent registration and issuance of fake invoices for input tax credit (ITC).
– Petitioner implicated based on a memorandum under the Evidence Act.

6. Petitioner’s Argument :
– GST Act, 2017, is a special statute. The FIR registered under the IPC bypassed the proper procedures under the GST Act.
– FIR is invalid without sanction from the GST Commissioner under Section 132(6) of the GST Act.

7. Respondents’ Argument :
– Offences under IPC and GST are distinct, allowing for prosecution under both.

8. Court’s Issue : Whether GST authorities can prosecute under the IPC without following the procedures and sanctions required by the GST Act.

9. Judgment :
– The FIR registered under the IPC was quashed as it bypassed the procedures and safeguards of the GST Act.
– The court emphasized that prosecution under IPC without invoking GST Act provisions was an abuse of legal process.

10. Date of Order : Heard on 17.08.2024, pronounced on 11.09.2024 .