Courts Are Not Bargaining Forums—Parties Cannot Play Fast and Loose with Judicial Process”: Supreme Court Sets Aside Bail Orders in GST Tax Evasion Case

“Voluntary Offer During Bail Hearing Is Not a Game to Be Abandoned Later”: In a strongly worded judgment Supreme Court of India, comprising Justice K.V. Viswanathan and Justice Nongmeikapam Kotiswar Singh, delivered a stinging rebuke against the increasing practice of litigants making voluntary monetary offers to secure bail, only to later turn around and claim that such conditions are onerous, illegal, or unauthorized.

The Court declared, “The judicial process cannot be trivialised by litigants who approbate and reprobate at their convenience. Courts are not bargaining forums.”

In this case petitioner, facing allegations of evading GST to the tune of ₹13.73 crores, had secured bail from the Madras High Court on the basis of a voluntary offer to deposit ₹2.5 crores, only to later challenge this very condition before the Supreme Court as excessive and unenforceable.

“When Bail Becomes a Transaction, It Undermines Justice” — Supreme Court Criticises Voluntary Bail Offers Followed by Retraction

The Supreme Court recorded with concern that, “This case presents a scenario which is becoming commonplace before us. When parties move for bail, voluntary offers are made to deposit substantial sums to secure liberty. Courts, thereafter, are foreclosed from considering the merits. But then grievance is made that the condition is onerous or illegal. We strongly deprecate this practice.”

The facts revealed that the petitioner had been arrested on 27th March 2025 under serious offences of Section 132(1)(a), 132(1)(i), and 132(5) of the CGST Act, 2017, following an alleged tax evasion of nearly ₹13.73 crores. During the bail hearing before the Madras High Court, his counsel voluntarily submitted that the petitioner had already deposited ₹2.86 crores and was willing to deposit another ₹2.5 crores, if granted bail.

On this assurance, the High Court granted bail on 8th May 2025, requiring an immediate deposit of ₹50 lakhs before release, with the remaining ₹2 crores to be paid within 10 days of release.

However, days later, the petitioner filed a modification plea, not disputing the authority of his counsel but pleading that the initial deposit of ₹50 lakhs before release be deferred, citing his wife’s pregnancy and his father’s ill-health.

The High Court modified the order on 14th May 2025, allowing the entire ₹2.5 crores to be deposited within 10 days post-release, failing which the bail would automatically stand cancelled.

“Judicial Process Cannot Be Turned into a Game of Convenience” — Supreme Court Slams Attempt to Withdraw Voluntary Bail Offers

The Supreme Court, expressing its disapproval, stated, “If the offer for monetary deposit had not been made at the outset, the High Court may have considered the case on merits and either granted or declined bail. Today the petitioner seeks to undo what was offered voluntarily. This conduct amounts to approbating and reprobating—something which courts cannot condone.”

The Court went on to observe, “We are conscious of the petitioner’s rights under Article 21 of the Constitution. But rights under Article 21 cannot be divorced from the sanctity of the judicial process. Courts cannot permit litigants to play ducks and drakes with the court.”

“Onerous Conditions in Bail Are a Separate Question—But You Cannot Secure Bail on an Offer and Then Resile From It” — Apex Court Clarifies Legal Position

The Bench acknowledged that onerous bail conditions are disfavoured, remarking, “There is no dispute that excessive bail is equivalent to denial of bail, and onerous conditions ought not to be imposed. But what is troubling is the emerging pattern where litigants themselves foreclose the court’s ability to evaluate merits by making voluntary offers, only to later argue the condition is excessive.”

The Court underscored, “Such practices undermine fairness in the judicial process. If litigants are permitted to withdraw voluntary representations made to courts, it would be impossible for the system to function in an orderly manner.”

“Had There Been No Voluntary Offer, the Court Might Have Denied or Granted Bail on Merits. The Petitioner Cannot Play Both Sides.” — Supreme Court Justifies Setting Aside Bail

Refusing to permit the petitioner’s belated claim that his counsel had no authority to offer monetary deposit, the Court noted, “In the modification application filed before the High Court, the petitioner never stated that counsel was unauthorised. The only plea was that the immediate deposit of ₹50 lakhs be deferred. The attempt now to contend otherwise is not worthy of acceptance.”

Supreme Court’s Final Order — “Bail Orders Are Quashed, But Interim Protection from Surrender is Granted”

The Court ruled, “Both the original bail order dated 08/05/2025 and the modification order dated 14/05/2025 are hereby set aside. Crl.O.P. No. 14718/2025 is restored to the file of the High Court of Madras.”

It directed, “The papers shall be placed before the Chief Justice of the High Court on or before 30/06/2025 to constitute an appropriate bench to hear the bail application afresh on its own merits, uninfluenced by the earlier orders.”

Recognising the petitioner’s personal circumstances, the Court granted interim protection from surrender till the first date of hearing before the High Court after remand, observing, “Ordinarily, the consequence would be to send the petitioner back to jail. However, considering the special circumstances cited regarding the petitioner’s wife’s pregnancy and father’s ill-health, we are inclined to grant limited protection.”

The Court concluded emphatically, “The sanctity of the judicial process cannot be compromised. Courts are not negotiation tables. Parties cannot make offers to secure relief and then disown them at their convenience.”

Date of Decision: 23 June 2025