Additional Commissioner of Commercial Taxes Vs Sri Mukund Agarwal

ADDITIONAL COMMISSIONER OF COMMERCIAL TAXES, ENFORCEMENT DEPARTMENT, SOUTH ZONE, B BLOCK, 2^ND FLOOR, ROOM No.204, V T K 2, RAJENDRANAGAR, KORAMANGALA-560047.

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…APPELLANT

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(BY SRI ADITYA VIKRAM BHAT, AGA)

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AND:

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Digitally signed by VALLI MARIMUTHU Location: HIGH COURT OF KARNATAKA

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SRI MUKUND AGARWAL S/O GHANSHYAM LAL AGARWAL, AGED ABOUT 29 YEARS, DIRECTOR OF M/S LAWRAGA METALS PRIVATE LIMITED, R/AT No.460, 4^TH MAIN, 6^TH CROSS, JP NAGAR 3^RD PHASE, BANGALORE-560078.

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COMMISSIONER OF CGST BENGALURU SOUTH ZONE, BENGALURU-560047.

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…RESPONDENTS

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(BY SRI M. ARUN SHYAM, SENIOR ADVOCATE FOR SRI DARSHAN R. ADVOCATE FOR C/R1; SRI JEEVAN J. NEERALAGI, ADVOCATE FOR R2)

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NC: 2025:KHC:30481-DB WA No. 645 of 2025

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HC-KAR

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THIS WRIT APPEAL IS FILED UNDER SECTION 4 OF THE KARNATAKA HIGH COURT ACT PRAYING TO SET ASIDE THE ORDER DATED 01/04/2025 PASSED BY THE LEARNED SINGLE JUDGE, HIGH COURT OF KARNATAKA, BENGALURU IN WP No.9586/2025.

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THIS WRIT APPEAL COMING ON FOR PRELIMINARY HEARING THIS DAY, JUDGMENT WAS DELIVERED THEREIN AS UNDER:

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CORAM: HON'BLE MR. JUSTICE S.G.PANDIT and

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HON'BLE MR. JUSTICE K. V. ARAVIND

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ORAL JUDGMENT

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(PER: HON'BLE MR. JUSTICE S.G.PANDIT)

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Appellant-Additional Commissioner of Commercial Taxes is before this Court under Section 4 of the Karnataka High Court Act, 1961 questioning the interim order dated 01.04.2025 passed by the learned Single Judge in Writ Petition No.9586/2025 whereunder, direction is issued to the respondents therein as well as the concerned jail authorities to release the petitioner i.e., respondent herein on interim bail, pending disposal of the petition, subject to the condition stated therein.

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Heard Sri. Aditya Vikram Bhat, learned AGA for the

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appellant and Sri. M. Arun Shyam, learned Senior counsel for Sri. Darshan R., learned counsel for respondent No.1. Perused the entire writ appeal papers.

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HC-KAR

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Learned AGA in addition to the grounds urged in the appeal memo would submit that the learned Single Judge could not have granted interim bail and could not have directed release of respondent No.1 when the interim bail was rejected by the Special Court for Economic Offences in Crime No.18/2025 in the writ petition. Further, learned AGA would submit that the said rejection of bail is not the subject matter of the writ petition. The subject matter of writ petition and the prayer of the petitioner is GST enquiry by the appellant herein.

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Learned AGA placed on record the memo along with the order dated 15.07.2025 in Special Leave to Appeal (Criminal) No.3736/2025, wherein the bail granted by the learned Single Judge in an identical fact situation is set aside with a direction to the petitioner therein to surrender before the trial Court and to seek regular bail. Learned AGA would submit that learned Single Judge in the instant case also in a hurried manner directed release of the respondent-petitioner. Therefore, he would pray for a similar order i.e., passed by the Hon'ble Apex Court.

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HC-KAR

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Per contra , Sri. M. Arun Shyam, learned Senior counsel for respondent No.1 would submit that the learned Single Judge in the instant case after considering the contentions of the appellant as well as respondent No.1 by a detailed order directed release of respondent No.1 by interim order dated 01.04.2025 in Writ Petition No.9586/2025. Therefore, he submits that the decision relied on by the learned AGA in Senior Intelligence Officer Vs. Ritu Nitin Minocha and Another in Special Leave to Appeal (Criminal) No.3736/2025 , would have no application to the facts of the present case.

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Learned Senior counsel while referring to the Hon'ble Apex Court order in Senior Intelligence Officer ( Supra ) would submit that the Hon'ble Apex Court without going into the merit or demerits of the case, has only on the ground that the interim bail was granted hurriedly has set aside the order with a direction to the respondent therein to surrender and to apply for regular bail.

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Further, learned Senior counsel would invite

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attention of this Court to interim order dated 22.04.2025

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HC-KAR

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passed in the instant appeal and would submit that respondent No.1 co-operated with the Investigating Authority. Therefore,

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he also submits that there is no need for the appellant to take him into custody. Therefore, he prays for dismissal of the appeal.

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Having heard the learned counsel for the parties and on perusal of the entire writ appeal papers, the only point that would fall for consideration is as to whether interference of this Court is warranted to the interim order dated 01.04.2025 which is impugned herein. The answer to the above point would be in the negative for the following reasons:

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Writ Petition No.9586/2025 with the following

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prayer and interim prayer was filed on 28.03.2025.

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"a) Call for records in GST enquiry pending before the Respondent No.2 in File No. ADCOM/ENF/SZ/CTO-46/INS/2024-25;

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b) Issue a Writ of Certiorari quashing the impugned GST enquiry pending before the Respondents in File No. ADCOM/ENF/SZ/CTO-46/INS/2024-25;

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c)

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d) Grant costs and any further relief(s) deemed fit.

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NC: 2025:KHC:30481-DB WA No. 645 of 2025

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HC-KAR

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Interim Prayer

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Pending disposal of this Writ Petition, this Hon'ble Court may be pleased to

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a) Stay the proceedings in File No. ADCOM/ENF/SZ/CTO-46/INS/2024-25 against the Petitioner by Respondents;

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b) Issue a direction to release the Petitioner from the judicial custody in the interest of justice."

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The said writ petition was listed for preliminary hearing on the same day i.e., 28.03.2025. On the said date, learned Single Judge directed learned AGA to take notice on behalf of respondent No.2 i.e, appellant herein with a further direction to serve the copies of the petition directing re-listing of the matter on 01.04.2025. On 01.04.2025, the impugned order is passed by the learned Single Judge against which, the present appeal is preferred. In the instant appeal on 22.04.2025, Co-ordinate Bench passed the following order:

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"Sri Jeevan J.Neeralagi, Stg.Counsel is requested to accept notice for Respondent No.2.

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Heard the learned Senior State Counsel for the appellant and the learned Sr.Advocate appearing for respondents.

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Both the sides having argued the matter vociferously against each other for some time, now graciously agree with the suggestion of this Court that the first respondent- Mr.Mukund Agarwal shall make available himself to the appellant-authorities for interrogation during the period between 8 a.m. & 6 p.m.

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HC-KAR

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for the initial period of 15 working days with effect from 28.04.2025 with liberty to the appellants to seek extension thereof by showing cogent grounds therefor. In connection with the issue of eventual extension, contentions of the parties will be considered when the same is sought. However, he shall not be subjected to any ill-treatment.

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It is open to both the sides to move the Vacation Bench if need arises. All usual conditions as would obtain in the erstwhile Cr.PC. would apply to this arrangement including those enumerated in the learned Single Judge's order, that is put in challenge."

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Learned Senior counsel appearing for respondent No.1 submitted that the respondent No.1 has co-operated with the investigation by attending the office of the appellant whenever he was called in pursuance of the interim order dated 22.04.2025 passed in the present appeal. The said submission is not disputed by the learned AGA.

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The purpose of taking a person into custody is for the purpose of interrogation and investigation. The purpose of taking the respondent into custody is achieved by interrogation or investigation of the respondent. However, learned AGA submits that further investigation is under process.

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Learned Senior counsel for respondent No.1 would submit that respondent No.1 would further co-operate with the

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HC-KAR

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appellant in further investigation and the said undertaking is placed on record.

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Furthermore, learned counsels appearing for the parties would submit that respondent No.1 has complied with the conditions of interim bail and further learned Senior counsel for respondent No.1 would submit that those conditions would bind respondent No.1 during the pendency of the writ petition.

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The correctness or otherwise of the arrest of respondent No.1 is to be gone into and decided by the learned Single Judge. If the correctness or otherwise of the interim order of the learned Single Judge is answered in the present appeal, it may affect the contentions of the either parties before the learned Single Judge. Therefore, we have kept open all the contentions of the parties.

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Learned AGA places reliance on the decision of the Hon'ble Apex Court in Senior Intelligence Officer ( Supra ) in support of his contention. On going through the decision of the Hon'ble Apex Court ( Supra ), we are of the considered opinion that in the said case the Hon'ble Apex Court, without going into

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HC-KAR

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the merits or demerits of the case, only on the ground that in a hurried manner the learned Single Judge has granted interim bail, had set aside the same with a direction to the respondent therein to surrender and seek regular bail.

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In the instant case, the writ petition was filed on 28.03.2025 and on the same day, notice was ordered to be served on learned AGA appellant herein and the matter was ordered to be listed on 01.04.2025 on which date, after hearing the submission of the learned AGA as well as respondent No.1, impugned order is passed. Therefore, the said decision would have no application to the facts of the present case. More over, by interim order passed in this appeal, interest of the appellant is protected.

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In light of the above, we decline to interfere with the impugned interim order passed by the learned Single Judge. However, we request the learned Single Judge to dispose of the pending writ petition expeditiously.

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