Goods & Services Tax (GST) in IndiaIn Absence of Final Assessment, Condition of Pre-Deposit for Anticipatory Bail not Sustainable

April 4, 20230

The Supreme Court in Rajesh kumar Dudani vs State of Uttrakhand, [SLP (CRL.) No. 9938 of 2022] decided on 27.02.2023, held that anticipatory bail can be granted and in absence of final assessment under GST Act, no legal liability can be imposed.


Mr. Rajesh Kumar Dudani (Hereinafter referred to as “Appellant”) was summoned on 12.05.2022 and 20.05.2022 by the Deputy Commissioner State GST Dehradun under Section 70 of the Uttarakhand Goods and Services Tax or Central Goods and Services Tax Act, 2017 (hereinafter referred to as “CGST Act”). The Appellant filed an anticipatory bail before the Uttarakhand High Court, which was rejected vide order dated 22.09.2022 (hereinafter referred to as “Impugned Order”). The Appellant has challenged the Impugned Order in the present appeal.


Whether the condition of pre-deposit for anticipatory bail is mandatory in absence of final assessment in fake invoice case?


The Appellant submitted that Section 132 (i) (iii) of CGST Act prescribes the punishment of imprisonment for a term that may extend to a year. As the present case is entirely based on documentary evidence and other electronic evidence that were already placed on record, the Appellant is not required for any custodial interrogation.

It was argued that the final assessment has not been done under the GST Act. Hence, there was no legal liability to make any payment or deposit any amount for the grant of anticipatory bail.

The Respondent submitted that the Appellant may be directed to deposit at least half of the revenue loss of Rs. 14.68 Crores to the state for providing fake invoices to multiple forms that have been unearthed during the investigation.


The Supreme Court observed that the Appellant cannot be said to be under legal liability as there is no final assessment in fake invoice cases made under GST Act. Accordingly, it is not sustainable to impose the condition of pre-deposit for the grant of anticipatory bail.

The Supreme Court relied on, Subhash Chouhan Vs. Union of India [Criminal Appeal No. 186 of 2023 decided on 20.01.2023] and Anatbhai Ashokbhai Shah v State of Gujarat & Ors  [Criminal Appeal No. 523 of 2023 decided on 17.02.2023]  and granted anticipatory bail to the Appellant without imposing any condition.

The Supreme Court held that in case the Appellant is arrested, he shall be released subject to the terms and conditions of the Trial Court or the Investigating Agency. The Court further set aside the Impugned Order.



The Supreme Court held that anticipatory bail can be granted without imposing of any conditions when the final assessment has not been completed by the GST Authority. Moreover, in case of arrest, the release shall be made subject to the conditions of the Trial Court or Investigating Agency.


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