RIZWAN LATIF vs STATE
This matter concerns a petition for post-arrest bail filed by the petitioner, Rizwan Latif, who was charged with tax fraud involving a loss of Rs. 5.59 million to the government exchequer under the Sales Tax Act, 1990. The petitioner had been in custody since September 2007, and his initial bail application was rejected by the Special Judge Customs, Taxation & Anti-Smuggling. The core legal question was whether the petitioner was entitled to bail despite the serious nature of the financial loss caused to the state, even though the alleged offences did not fall within the prohibitory clause of Section 497 of the Code of Criminal Procedure 1898. The Court held that the mere fact that an offence does not attract the prohibitory clause is insufficient, by itself, to justify the release of an accused involved in significant financial crimes against the state. Emphasizing a dynamic judicial approach, the Court determined that no case for bail was made out at that stage, particularly given the disputed status of recovery and the failure of the co-accused to honor an undertaking regarding the loss.
- Does the fact that an offence does not fall within the prohibitory clause of Section 497 of the Code of Criminal Procedure 1898 automatically entitle an accused to bail?
- Can a court deny bail to an accused charged with causing significant financial loss to the state exchequer despite the offence being non-prohibitory?
- Is a disputed claim of recovery sufficient grounds to grant post-arrest bail in tax fraud cases?
- Section 7, Sales Tax Act 1990
- Section 8(1)(d), Sales Tax Act 1990
- Section 10(2), Sales Tax Act 1990
- Section 10(4), Sales Tax Act 1990
- Section 23, Sales Tax Act 1990
- Section 26, Sales Tax Act 1990
- Section 73, Sales Tax Act 1990
- Section 33(1)(11)(a), Sales Tax Act 1990
- Section 33(1)(11)(b), Sales Tax Act 1990
- Section 33(1)(11)(c), Sales Tax Act 1990
- Section 33(1)(13), Sales Tax Act 1990
- Section 36(1), Sales Tax Act 1990
- Section 11(2), Sales Tax Act 1990
- Section 37-A, Sales Tax Act 1990
- Section 2(37), Sales Tax Act 1990
- Section 497(1), Code of Criminal Procedure 1898
ORDER
Rizwan Latif son of Abdul Latif, petitioner, by filing this petition, seeks post-arrest bail in case FIR No, 01/2007 dated 22.09.2007, registered with Collectorate of Sales Tax and Federal Excise G.T. Road, Gujranwala, for offences under Sections 7, 8 (1) (d), 10(2)(4), 23, 26 & 73 of the Sales Tax Act, 1990 read with Sections 33(1)(11)(a)(b)(c) (Amended in the Finance Act, 2005 as 33(1)(11) and 33(1)(13) of the Sales Tax Act, 1990 recoverable under Sections 36(1) and 11(2) of the Sales Tax Act, 1990 falling under the purview of Section 37-A and 2(37) of the Sales Tax Act, 1990.
2. The allegation against the petitioner was that he alongwith his co-accused committed tax fraud and thereby caused loss of Rs,5.59 million to the Government exchequer.
3. The petitioner was arrested on 25.09.2007 and is in custody ever since. His application for post- arrest bail had been turned down by the learned Special Judge Customs, Taxation & Anti- Smuggling, Lahore, vide order dated 01.11.2007. Hence this petition.
4. I have heard Mr. Waheed Anwar, Advocate, the learned counsel for the petitioner, as also Mr. Muhammad Khalid Chaudhry, the learned Legal Advisor to the Customs Department and have perused the record brought by Ilyas Ahmad Assistant Collector, Collectorate of Sales Tax and Federal Excise G.T. Road, Gujranwala with record.
5. The petitioner is named in the FIR with specific role of committing tax fraud to the tune of Rs, 5.59 millions. During arguments the learned counsel for the petitioner claimed that recovery of Rs, 16,00,000/- had already been effected and that further recovery is in progress. However, the learned Legal Advisor to Customs department refuted the claim and stated that no recovery has so far been effected. He however, submitted that if an amount of Rs, 30,00,000/- is deposited with the department he would have no serious objection to the grant of bail. The learned counsel for the petitioner further brought to the notice A of the Court that Faisal Hameed co-accused of the petitioner had given an undertaking, that he would be ready and willing to make good the loss which had been caused to the department. Faisal Hameed co-accused was incidentally present in the Court and on being asked as to whether he is ready to live up to his undertaking he kept silent and made an attempt to convince the Court that the undertaking had been given by him in a different context. It is true that the offences with which the petitioner has been charged do not attract the prohibitory clause of Section 497(1) Cr.P.C. but this very fact is not sufficient by B itself to release an accused person on bail who is involved in causing loss to the state exchequer. The Hon'ble Supreme Court has time and again stressed that Courts have to take a dynamic approach while deciding, casts. No case for bail at this stage is made out, this petition is according dismissed.