Nassar Vs State of Kerala

FULL TEXT OF THE JUDGMENT/ORDER OF KERALA HIGH COURT

This Bail Application is filed under Section 483 of Bharatiya Nagarik Suraksha Sanhita (BNSS).

2. Petitioner is an accused in a crime registered by the State Goods and Services Department alleging commission of offences punishable under Sections 131(1)(b) (c)) of the SGST/CGST Act, 2017.

3. The prosecution case is that, the petitioner accepted input tax credit (ITC) originated from the inward supply made by dummy registrants without actual acceptance of goods and that he has utilized the ITC to set off his tax liability. The accused was arrested when he appeared on summons on 07.01.2025. Hence, this bail application.

4. Heard counsel for the petitioner and the Special Government Pleader, Tax.

5. The counsel for the petitioner submitted that, even if the entire allegations are accepted, no offence is made out. The counsel submitted that the maximum punishment that can be imposed to the petitioner is five The counsel submitted that the petitioner is in custody from 07.01.2025.

6. The Special Government Pleader seriously opposed the bail application. The Special Government Pleader submitted that the offence alleged against the petitioner is very He submitted that this Court may not release the petitioner on bail at this stage because, the investigation is going on.

7. This Court considered the contention of the petitioner and the Special Government Pleader. It is true that the allegation against the petitioner is serious. But, the petitioner is in custody from 07.01.2025. The maximum punishment that can be imposed as per the offence alleged against the petitioner is five years. The Apex Court in Arnesh Kumar State of Bihar and Another [(2014) 8 SCC 273], observed like this:

” 7.1. From a plain reading of the aforesaid provision, it is evident that a person accused of an offence punishable with imprisonment for a term which may be less than seven years or which may extend to seven years with or without fine, cannot be arrested by the police officer only on his satisfaction that such person had committed the offence punishable as aforesaid. A police officer before arrest, in such cases has to be further satisfied that such arrest is necessary to prevent such person from committing any further offence; or for proper investigation of the case: or to prevent the accused from causing the evidence of the offence to disappear; or tampering with such evidence in any manner; or to prevent such person from making any inducement, threat or promise to a Witness so as to dissuade him from disclosing such facts to the court or the police officer; or unless such accused person is arrested, his presence in the court whenever required cannot be ensured. These are the conclusions, which one may reach based on facts.

7.2. The law mandates the police officer to state the facts and record the reasons in writing which led him to come to a conclusion covered by any of the provisions aforesaid. while making such arrest. The law further requires the police officers to record the reasons in writing for not making the arrest.

7.3. In pith and core, the police officer before arrest must put a question himself, why arrest? Is it really required? What purpose it will serve? What object it will achieve? It is only after these questions are addressed and one or the other conditions as enumerated above is satisfied, the power of arrest needs to be exercised. In fine, before arrest first the police officers should have reason to believe on the basis of information and material that the accused has committed the offence. Apart from this, the police officer has to be satisfied further that the arrest is necessary for one or the more purposes envisaged by sub-clauses (a) to (e) of clause (1) of Section 41 Cr.P.C.”

8. Keeping in mind the above principle, this Court considered the allegation against the petitioner. I am of the considered opinion that, the petitioner can be released on bail after imposing stringent conditions, in the light of the above principle, and also in the light of the fact that the petitioner is in custody from 07.01.2025. There can be a direction to the petitioner to surrender his passport. If there is no passport, the petitioner shall file an affidavit before the Jurisdictional Court to that effect.

9. Moreover, it is a well accepted principle that the bail is the rule and the jail is the exception. The Hon’ble Supreme Court in  P v Directorate of Enforcement [2019 (16) SCALE 870], after considering all the earlier judgments, observed that, the basic jurisprudence relating to bail remains the same inasmuch as the grant of bail is the rule and refusal is the exception so as to ensure that the accused has the opportunity of securing fair trial.

10. Moreover, in Jalaluddin Khan v. Union of India [2024 KHC 6431], the Hon’ble Supreme Court observed that:

“21. Before we part with the Judgment, we must mention here that the Special Court and the High Court did not consider the material in the charge sheet objectively. Perhaps the focus was more on the activities of PFI, and therefore, the appellant’s case could not be properly appreciated. When a case is made out for agrant of bail, the Courts should not haveany hesitation in granting bail. Theallegations of the prosecution may be veryserious. But, the duty of the Courts is toconsider the case for grant of bail inaccordance with the law. “Bail is the ruleand jail is an exception” is a settled law.Even in a case like the present case where there are stringent conditions for the grantof bail in the relevant statutes, the samerule holds good with only modification thatthe bail can be granted if the conditions inthestatute are satisfied. The rule alsomeans that once a case is made out for thegrant of bail, the Court cannot decline togrant bail. If the Courts start denying bailin deserving cases, it will be a violation ofthe rights guaranteed under Art.21 of ourConstitution.” (underline supplied)

11. In Manish Sisodia v. Directorate of Enforcement [2024 KHC 6426], also the Hon’ble Supreme Court observed that:

“53. The Court further observed that, over a period of time, the trial courts and the High Courts have forgotten a very well – settled principle of law that bail is not to be withheld as a punishment. From our experience, we can say that it appears that the trial courts and the High Courts attempt to play safe in matters of grant of bail. The principle that bail is a rule and refusal is an exception is, at times, followed in breach. On account of non – grant of bail even in straight forward open and shut cases, this Court is flooded with huge number of bail petitions thereby adding to the huge pendency. It is high time that the trial courts and the High Courts should recognize the principle that “bail is rule and jail is exception”.

Considering the dictum laid down in the above decision and considering the facts and circumstances of this case, this Bail Application is allowed with the following directions:

1. Petitioner shall be released on bail on executing a bond for Rs.50,000/- (Rupees Fifty Thousand only) with two solvent sureties each for the like sum to the satisfaction of the jurisdictional Court.

2. The petitioner shall appear before the Investigating Officer for interrogation as and when   The  petitioner  shall co-operate with the investigation and shall not, directly or indirectly make any inducement, threat or promise to any person acquainted with the facts of the case so as to dissuade him from disclosing such facts to the Court or to any police officer.

3. Petitioner shall not leave India without permission of the jurisdictional Court.

4. Petitioner shall not commit an offence similar to the offence of which he is accused, or suspected, of the commission of which he is suspected.

5. Petitioner shall surrender his passport. If there is no passport, the petitioner shall file an affidavit before the Jurisdictional Court to that effect.

6. If any of the above conditions are violated by the petitioner, the jurisdictional Court can cancel the bail in accordance to law, even though the bail is granted by this Court. The prosecution and the victim are at liberty to approach the jurisdictional court to cancel the bail, if there is any violation of the above conditions.