Authority: Supreme Court of India, Criminal Appellate Jurisdiction

Order Date: 16 October 2026

Case Overview

  • Parties: Senior Intelligence Officer, Directorate General of Service Tax Intelligence (appellant) vs. Mohammed Kamran (respondent), proprietor of M/s MK Traders.
  • Allegations: Appellant filed a private complaint before the Special Court for Economic Offences, Bengaluru, alleging offences under the Central Goods and Services Tax Act, 2017 – Sections 16(2)(b) read with Sections 132(1)(b), 132(1)(c) and 132(1)(f), punishable under Section 135. The complaint claimed the respondent issued invoices without supply of goods, availed fraudulent input tax credit, falsified documents and financial statements, causing a loss of Rs. 43,08,22,936.
  • Arrest & Initial Bail Applications: Respondent was arrested on 16 September 2025. Bail applications before the trial court and the Additional City Civil and Sessions Judge were rejected.
  • High Court Bail Petition: Respondent filed a criminal petition for bail before the Karnataka High Court, first listed on 12 December 2025. The appellant was directed to file a statement of objections within two weeks. The High Court’s winter vacation began on 20 December 2025; nevertheless, the petition was listed on 26 December 2025 after a memo from the respondent’s counsel, and bail was granted on that date.
  • Appellant’s Contentions: The appellant argued that it was denied natural justice – the Special Public Prosecutor/Senior Standing Counsel was recorded as appearing despite being abroad, an adjournment request was rejected, and the bail hearing was conducted hurriedly during the court’s vacation. It also alleged that the respondent resisted a search at his declared and actual residences and fled the scene, leading to a separate FIR.
  • Parallel Remedies by Respondent:
  • On 10 December 2025, the respondent filed a bail application before the Sessions Court, which was rejected while the High Court petition was pending.
  • On 22 December 2025, the respondent filed Writ Petition No. 38771 of 2025 before the High Court, challenging the legality of his arrest, seeking quash of the complaint, and requesting an ad‑interim stay of further proceedings and release under Section 483 of the Bharatiya Nagarik Suraksha Sanhita, 2023 (BNSS). The ad‑interim relief was refused on the same day; the writ was later dismissed on 7 July 2026. The respondent did not disclose the refusal of ad‑interim relief to the Single Judge who granted bail on 26 December 2025.
  • Counsel Appearances: Mr. N. Venkataraman, Additional Solicitor General, represented the appellant; Mr. S. Nagamuthu, senior counsel, represented the respondent. Dispute arose over whether the appellant’s standing counsel was present and whether an adjournment was properly sought.
  • Supreme Court Hearing: The Court heard arguments from Mr. Venkataraman (appellant) and Mr. Nagamuthu (respondent), focusing on procedural fairness, alleged abuse of process, and the respondent’s alleged forum shopping and suppression of material facts.

Final Outcome

  • The Supreme Court set aside the part of the High Court order that disposed of the criminal petition with bail and restored the respondent’s interim bail on the earlier terms and conditions.
  • The matter was remitted to the Single Judge of the Karnataka High Court for fresh consideration of the criminal petition, preferably by the end of 2026.
  • The appellant was granted liberty to file a counter‑affidavit within two weeks; the respondent was given one week to file a rejoinder.
  • The interim bail granted to the respondent remains operative until further orders from the Single Judge.
  • The Court issued observations on urgent listing of matters during High Court vacations, stating that a two‑week period for listing should exclude vacation days unless a specific return date falls within the vacation, to ensure uniformity and prevent prejudice.

Topics: Bail, Court Procedure

Signed by J. Dipankar Datta and J. Sheel Nagu