HARI SHANKAR SHARMAversusUNION OF INDIA

          HIGH COURT OF JUDICATURE AT ALLAHABAD
         CRIMINAL MISC. BAIL APPLICATION No. - 45131 of 2025

Hari Shankar Sharma
                                                           .....Applicant(s)
                                  Versus

Union of India
                                                               .....Opposite
                                                                     Party(s)

Counsel for Applicant(s)      : Anand Mani Tripathi, Arun Kumar
                                Shukla
Counsel for Opposite Party(s) : Dhananjay Awasthi, Parv Agarwal

2.
         CRIMINAL MISC. BAIL APPLICATION No. - 45969 of 2025

Deepak Jain
                                                           .....Applicant(s)
                                  Versus

Union Of India And Another
                                                               .....Opposite
                                                                     Party(s)

Counsel for Applicant(s)      : Ankit Kumar Pal, Mohit Singh, Shad
                                Azam
Counsel for Opposite Party(s) : A.S.G.I., Dhananjay Awasthi, Krishna
                                Agarawal
3.
          CRIMINAL MISC. BAIL APPLICATION No. - 261 of 2026

Sushant Goyal
                                                           .....Applicant(s)
                                  Versus

Union Of India And 3 Others
                                                               .....Opposite
                                                                     Party(s)

Counsel for Applicant(s)      : Anil Kumar Bajpai
Counsel for Opposite Party(s) : A.S.G.I., Anurag Sharma, Dhananjay
                                Awasthi, G.A., Parv Agarwal
Court No. - 53

                     HON'BLE SAMIT GOPAL, J.

1. List revised.

2. These are three bail applications filed under Section 483 B.N.S.S., 2023,
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                               2


by accused Hari Shankar Sharma, Deepak Jain and Sushant Goyal. They are
today listed at Item Nos. 36, 38 and 39 of the list of Fresh Cases of this
Court and thus have been taken together and are being heard together and
decided together. The said bail applications are of the accused in the same
case crime number.

3. CRIMINAL MISC. BAIL APPLICATION No. - 45131 of 2025 has
been filed by the applicant- Hari Shankar Sharma with the following
prayers:-

"It is therefore most respectfully prayed that, this Hon'ble Court may
graciously be pleased to release the applicant on bail in Case
No.1057/2025, Under Sections 132(1)(b)(c) and (i) of the Central Goods
and Services Tax (CGST) Act, 2017, P.S.- CGST Ghaziabad, during
pendency of his trial before the concerned court."

4. CRIMINAL MISC. BAIL APPLICATION No. - 45969 of 2025 has
been filed by the applicant- Deepak Jain with the following prayers:-

"It is, therefore, most respectfully prayed that this Hon'ble Court may
graciously be pleased to allow this application and release the applicant
on bail in Case No.1057/2025, U/s 132(1)(b), 132(1)(c), 132(1)(i) of
CGST Act, 2017, Police Station: DGGI Ghaziabad Unit, District
Ghaziabad, during the pendency of trial before the court below, otherwise
the applicant will suffer grave irreparable loss and injury."

5. CRIMINAL MISC. BAIL APPLICATION No. - 261 of 2026 has
been filed by the applicant- Sushant Goyal with the following
prayers:-

"It is, therefore, most respectfully prayed that this Hon'ble Court may
kindly be pleased to release the applicant on bail in Case No.1057 of
2025, registered under Sections 132(1)(b), 132(1)(c) and 132(1)(i) of the
CGST Act, 2017, under the jurisdiction of Directorate General of GST
Intelligence (DGGI), Ghaziabad, during the pendency of trial before the
court below and also pass any other and further order, which this Hon'ble
Court may deem fit and just in the circumstances and facts of the case."

6. The facts common in the present matter stem out on the basis of an
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                               3


undated complaint filed for offences committed under Section 132(1)(b),

132(1)(c) and 137 of the Central Goods and Services Tax Act, 2017 and

punishable under Clause (i) of Section 132(1) of the CGST Act, 2017,

against accused Hari Shankar Sharma, Deepak Jain, Sushant Goel, M/s

WMCA Trade Mart Private Limited, M/s Hari Shankar Sharma HUF, M/s

Madhuban Trading Company and M/s Omtex with the allegations that on

the basis of credible intelligence inputs, subsequently developed and

substantiated by the officers of the Directorate General of GST

Intelligence (DGGI), Meerut Zonal Unit, it has emerged that a consortium

of inter-linked entities was deliberately and systematically engaged in the

creation, circulation and infusion of fictitious Input Tax Credit (ITC),

without the actual supply of goods. The fraudulent design was executed

through the issuance of invoices without underlying supply of goods,

thereby amounting to a fraudulent contrivance to wrongfully avail and

pass on ITC in contravention of the mandate of the CGST Act, 2017. In

this context. Shri Hari Shankar Sharma (Director of M/s WMCA Trade

Mart Private Limited & Karta, M/s Hari Shankar Sharma HUF), Shri

Deepak Jain, proprietor of M/s Madhuban Trading Company and Shri

Sushant Goel, Proprietor of M/s Omtex, were engaged in the availment

and passing on of fraudulent Input Tax Credit (ITC) on the basis of

invoices issued without any actual supply of goods, through a network of

non-existent and dummy firms. On scrutiny of GST returns for the period
from April 2020 to July 2025, it was found that M/s Madhuban Trading

Company (GSTIN: 07BDUPJ5869EIZY) had availed fraudulent ITC of

Rs.45,79,68,750/- from multiple fake/non-existent firms and further

passed on such ITC to various entities, including M/s WMCA Trade Mart

Private Limited (OSTIN: 07AADCW600BQIZU). Further, scrutiny of the

GST returns of M/s WMCA Trade Mart Private Limited for the period
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                               4


from October 2023 to July 2025 revealed that the firm had also availed

ineligible ITC of Rs.15,48,88,802/- from 12 fake/non-existent firms. Also,

M/s Hari Shankar Sharma HUF (GSTIN: 07AAGHH2408K1ZC) have

availed fake input tax credit (ITC) of Rs. 28,16,33,878/- from their inward

suppliers. Further, M/s Omtex (Prop. Shri Sushant Goel), GSTIN:

07AJOPG6374R1ZC has availed fraudulent ITC of Rs.14,17,69,669/-

from M/s WMCA Trade Mart Pvt. Ltd., M/s Hari Shankar Sharma HUF

and other fake/non-existent suppliers. Out of this, Rs. 26,52,42,431/- was

passed on by M/s WMCA Trade Mart Pvt. Ltd., Rs. 3,18,27,388/- by M/s

Hari Shankar Sharma HUF and remaining from other suppliers.

The complaint further describes the roles of the accused, their
confessional statements and the manner in which the said money was
availed being fake input tax credit with the prayers that the court may take
cognizance of the offences and the accused be put to trial and be punished
in accordance with law.

7. Submissions of learned counsel for the applicant- Hari Shankar Sharma
are as under:-

(A) The applicant has been falsely implicated in the present case.

(B) A search was conducted at the house of the applicant on 30.10.2025
and a search memo was prepared after which on 31.10.2025 the
investigating officer of the CGST Department recorded confessional
statement of the applicant wherein it is shown that he has admitted that
his firm/company availed and passed on fraudulent ITC amounting to Rs.
15.48 crores through 12 fake supplier firms without supplying the
underlying goods.

(C) The unaccounted cash of Rs.30.5 lakhs seized from the applicant is
unrelated to the alleged ITC activities and belongs to lawful dealings.

(D) The applicant has no criminal history as stated in para-13 of the
affidavit and is in jail since 01.11.2025.
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                               5


(E) The investigation in the matter has concluded and a complaint has
been filed which is annexure no. S.A.-1 to the second supplementary
affidavit dated 31.12.2025 which is on the record.

(F) The Apex Court in the case of Vineet Jain vs. Union of India,
Criminal Appeal No.2269 of 2025, decided on 28.4.2025 has granted bail
to the said accused on the ground that maximum sentence in the said
matter is of 5 years with fine and a charge sheet has been filed and the
applicant is in custody for about 7 months, the case is triable by the
Judicial Magistrate and the sentence is limited and in any case, the
prosecution is based on documentary evidence and thus the present case
also stands on identical facts and the applicant deserves to the released on
bail.

8. Submissions of learned counsel for the applicant- Deepak Jain are as
under:

(A) Arguments of learned counsel for the applicant Hari Shankar Sharma
are adopted.

(B) Further the judgement in the cases of Arvind Dham. Vs. Directorate
of Enforcement, 2026 SCC OnLine SC 30, Vineet Jain vs. Union of India
(Criminal Appeal No. 2269 of 2025), Manoj Kumar Garg vs. Union of
India [2025 (36) Centax 96 (All.)], Vinay Kumar vs. Union of India:
[2026 (39) Centax 164 (All.)], Dhiraj Nath Gupta vs. Union of India, Bail
Application No.32145 of 2025, Mukul Sharma vs. Commissioner, Bail
Application No.39263 of 2024, Azharuddin vs. Union of India, Bail
Application No. 29377 of 2025, have been placed to submit that in a case
of identical nature the Apex Court and the co-ordinate Benches of this
Court have granted bail to the said accused.

(C) Investigation in the matter has concluded and thus there are no
chances of the applicant tempering with the evidence.

(D) The complaint has been filed by the Department.

(E) The applicant has no criminal history as stated in para-36 of the
affidavit and is in jail since 31.10.2025.
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                               6


9. Learned counsel for the applicant Sushant Goyal submits as under:-

(A) Arguments of learned counsels in the bail applications of the
applicant- Hari Shankar Sharma and Deepak Jain are adopted.

(B) Cognizance on the complaint has been taken vide order dated
24.11.2025 by the court concerned as has itself been stated in para-37 of
the counter affidavit dated 09.2.2026 filed on behalf of the opposite party
no. 2 and 3.

(C) The judgement in the case of Ratnambar Kaushik vs. Union of
India: (2023) 2 SCC 621 is being relied upon to submit that the Court
while considering the prayer for bail has opined that since the
investigation has concluded and charge sheet has been filed, punishment
may extend to imprisonment for a term of 5 years with fine, the applicant
has undergone incarceration for about 4 months and trial would take time
to complete, has been granted bail.

(D) The applicant has no criminal history as stated in para-3 of the
affidavit and is in jail since 31.10.2025.

10. Per contra, learned counsel for the respondent department of GST
opposed the three bail applications vehemently and submitted as under:-

(A) Reading of the complaint would show that the applicants availed fake
input tax credit of Rs.15,68,68,198/- from 21 inward suppliers, 11 of these
inward suppliers were currently inactive yet they have passed on ITC
amounting to Rs.15,15,04,494/- which shows that 96.5 % of the total ITC
availed by M/S WMCA Trade Mart Private Limited.

(B) The applicants are mastermind of the said scam.

(C) The applicant Hari Shankar Sharma is Director of M/S WMCA Trade
Mart Private Limited and Karta in M/s Hari Shankar Sharma HUF who
in order to avail fake ITC from non-existent firms and controlled by
brokers/builders and further creating fake invoices from his entities in
order to pass on the same to other beneficiaries and obtained commission
on the same, controlled the entire operations and operated it.

(D) The applicant Deepak Jain is the proprietor of M/s Madhuban Trading
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                               7


Company who in order to avail fake ITC from various non existent firms
controlled by brokers/builders and further creating fake invoices from his
entity in order to pass on the same to other beneficiaries and earn
commission of the same, controlled the entire operations and operated it.

(E) The applicant Sushant Goyal is the proprietor of M/s Omtex who also
controlled and operates the entire operations of the company in order to
avail fake ITC from various non existent firms controlled by
brokers/builders and other persons including Hari Shankar Sharma and
further creating fake invoices from his entity in order to pass on to the
same to other beneficiaries and earn commission on the same.

(F) The accused together entered into a conspiracy by creating and using
fake firms and defrauded the government exchequer.

(G) The present matter is serious in nature as the present GST fraud
involves huge revenue loss, large scale of ITC fraud, operations though
bogus firms, preparing of fake invoices through which input tax credit
was obtained. The matter is serious economic offence. The statements of
the accused itself show their involvement and thus there are reasons to
believe that they are involved in the matter. The amount involved is huge.
The accused are actively involved in the offences. There are good chances
of their tempering with the evidence and absconding.

(H) The judgements of the Apex Court in the case of Serious Fraud
Investigation Office vs. Nittin Johari and others: MANU/SC/1246/2019,
para-13, 14 and 15, Ayodhya Prasad Mishra vs. State of Uttar Pradesh:
MANU/SCOR/27988/2020 and Rakesh Mittal vs.Ajay Pal Gupta alias
Sonu Chaudhary and another: SLP (Crl.) No. 19708/2025, decided on
02.2.2026, para-19, have been placed before the Court.

(I) While placing the judgement in the case of Rakesh Mittal (supra) it
is submitted that the Apex Court cancelled the bail granted to the
applicant which was initially stayed since the applicant was not released
on bail in a matter which was triable by Magistrate. It is submitted that
the principles of bail in heinous crimes must apply to serious economic
offences also since they uproot the entire financial structure of the country
and public money at the last end, is siphoned by such fraudulent acts.
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                                    8


(J) It is submitted that the prayer for bail be rejected.

11. After having heard learned counsels for the parties and perusing the
records, it is evident that the applicants are involved in fraud by which
they have illegally availed input tax credit which was a huge amount. The
matter relates to economic offence.

12. The Apex Court, in Tarun Kumar v. Enforcement Directorate,
(2024) 13 SCC 788 has held that economic offences constitute a class
apart and need to be visited with a different approach and with the
advancement of technology and artificial intelligence, the economic
offences like money laundering have become a real threat to the
functioning of the financial system of the country and have become a
great challenge for the investigating agencies to detect and comprehend
the intricate nature of transactions, as also the role of the persons involved
therein. It has been held as under:

“21. Lastly, it may be noted that as held in a catena of decisions, the economic
offences constitute a class apart and need to be visited with a different approach in the
matter of bail. The economic offences having deep-rooted conspiracies and involving
huge loss of public funds need to be viewed seriously and considered as grave
offences affecting the economy of the country as a whole and thereby posing serious
threat to the financial health of the country. Undoubtedly, economic offences have
serious repercussions on the development of the country as a whole. To cite a few
judgments in this regard are Y.S. Jagan Mohan Reddy v. CBI [Y.S. Jagan Mohan
Reddy v. CBI, (2013) 7 SCC 439 : (2013) 3 SCC (Cri) 552], Nimmagadda Prasad v.
CBI [Nimmagadda Prasad v. CBI, (2013) 7 SCC 466 : (2013) 3 SCC (Cri) 575],
Gautam Kundu v. Enforcement Directorate [Gautam Kundu v. Enforcement
Directorate, (2015) 16 SCC 1 : (2016) 3 SCC (Cri) 603 : (2016) 195 Comp Cas 186],
State of Bihar v. Amit Kumar [State of Bihar v. Amit Kumar, (2017) 13 SCC 751 :
(2017) 4 SCC (Cri) 771]. This Court taking a serious note with regard to the
economic offences had observed as back as in 1987 in State of Gujarat v. Mohanlal
Jitamalji Porwal [State of Gujarat v. Mohanlal Jitamalji Porwal, (1987) 2 SCC 364 :
1987 SCC (Cri) 364] as under: (SCC p. 371, para 5)

“5. … The entire community is aggrieved if the economic offenders who ruin the
economy of the State are not brought to book. A murder may be committed in the heat
of moment upon passions being aroused. An economic offence is committed with cool
calculation and deliberate design with an eye on personal profit regardless of the
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                                                                        9


                                    consequence to the community. A disregard for the interest of the community can be
                                    manifested only at the cost of forfeiting the trust and faith of the community in the
                                    system to administer justice in an even-handed manner without fear of criticism from
                                    the quarters which view white-collar crimes with a permissive eye unmindful of the
                                    damage done to the National Economy and National Interest.”

                                    22. With the advancement of technology and artificial intelligence, the economic
                                    offences like money laundering have become a real threat to the functioning of the
                                    financial system of the country and have become a great challenge for the
                                    investigating agencies to detect and comprehend the intricate nature of transactions,
                                    as also the role of the persons involved therein. Lot of minute exercise is expected to
                                    be undertaken by the investigating agency to see that no innocent person is wrongly
                                    booked and that no culprit escapes from the clutches of the law. When the detention of
                                    the accused is continued by the court, the courts are also expected to conclude the
                                    trials within a reasonable time, further ensuring the right of speedy trial guaranteed
                                    by Article 21 of the Constitution. With the aforestated observations, the appeal is
                                    dismissed.”

                                    13. In so far as the fact that the matter is triable by the Magistrate and bail
                                    should be granted on the said count considering the total punishment and
                                    the period of detention is concerned, the Apex Court in the case of
                                    Rakesh Mittal (Supra) has clearly held that the principles of bail in
                                    heinous crimes must apply to serious economic offence. Such illegal act
                                    of the accused/applicants clearly makes the economy of the country
                                    vulnerable which if misused and illegally swiped, the said money is
                                    public money and the public at large is put on to burden.

                                    14. Looking to the nature of the offence, the judgement of the Apex Court
                                    in the case of Rakesh Mittal (Supra) and the roles of the applicants, no
                                    case for bail is made out.

                                    15. The said bail applications are, accordingly, rejected.
                                    16. However, it is expected that the trial court shall proceed with the trial
                                    expeditiously.


                                                                                                       (Samit Gopal,J.)
                                    February 27, 2026
                                    Naresh




Digitally signed by :-
NARESH KUMAR
High Court of Judicature at Allahabad