Devanshi Consultants (P) Ltd., Kolkata V. ACIT, CC-XXIII, Kolkata, Kolkata

CO 29/KOL/2015

• Counselvise Citation: [2016] 123 COUNSELVISE.COM (IT) 2188 (ITAT-KOLKATA)
• Duration Of Justice: 7 month(s) 27 day(s)
• Appeal Type: Cross Objection
• Pronouncement Date: 29-02-2016
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: C
• Next Hearing Date: 15-02-2016
• Assessment Year: 2008-2009
• Appeal Filed On: 02-07-2015
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: G MALLIKARJUNA
• Assessee Lawyers: CROSS OBJECTOR SHRI S L KOCHAR; ANI
• Keywords: Unexplained cash credit; Search and seizure; Document seized; Validity of assessment; Accommodation entries
• Section: 133A; 153A; 133(6); 68; 6; 132

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL KOLKATA BENCH C KOLKATA BEFORE SHRI MAHAVIR SINGH, JUDICIAL MEMBER AND SHRI WASEEM AHMED, ACCOUNTANT MEMBER IT(SS)A NO.20-21/KOL/2012 ASSESSMENT YEARS :2006-07 & 2007-08 ACIT, C.C.-XXIII, 5 TH FLOOR, 18, RABIDNRA SARANI, KOLKATA-700 001 V/S . M/S SHUBHAM IMPEX (P) LTD., 505, CENTURY TOWERS, SHAKESPEARE SARANI, KOLKATA-700 017 [ PAN NO.AACCA 0874 H ] /APPELLANT .. /RESPONDENT C.O. NOS 23-24/KOL/2012 (IN IT(SS)A NO.20-21/KOL/2012 ASSESSMENT YEARS: 2006-07 & 2007-08 M/S SHUBHAM IMPEX (P) LTD., 505, CENTURY TOWERS, SHAKESPEARE SARANI, KOLKATA-700 017 V/S . ACIT, C.C.XXIII, 5 TH FLOOR, 18, RABINDRA SARANI, KOLKATA-01 CROSS OBJECTOR .. RESPONDENT IT(SS)A NO. 22-23/KOL/2012 ASSESSMENT YEARS: 2005-06 & 2006-07 ACIT, C.C.-XXIII, 5 TH FLOOR, 18, RABIDNRA SARANI, KOLKATA-700 001 V/S . M/S S.A. SUPPLIERS (P) LTD., 505, CENTURY TOWERS, SHAKESPEARE SARANI, KOLKATA-700 017 [ PAN NO.AAJCS 1752 M ] /APPELLANT .. /RESPONDENT IT(SS)A NO. 20-21/K/12 & CO 23-24/K/12 A.YS 06-07 & 07-08 IT(SS)A NO.22-23/K/12 & CO 21-22/K/12 A.YS. 05-06 & 06-07 IT(SS)A NO.24/K/12 & CO 30/K/15 A.Y. 05-06 IT(SS)A NO.25-26/K/12 & CO 28-29/K/15 A.YS. 06-07 & 08-09 PAGE 2 C.O. NOS 21-22/KOL/2012 (IN IT(SS)A NO.22-23/KOL/2012 ASSESSMENT YEARS: 2005-06 & 2006- 07 M/S S.A. SUPPLIERS (P) LTD., 505, CENTURY TOWERS, SHAKESPEARE SARANI, KOLKATA-700 017 V/S . ACIT, C.C.-XXIII, 5 TH FLOOR, 18, RABIDNRA SARANI, KOLKATA-700 001 CROSS OBJECTOR .. RESPONDENT IT(SS)A NO.24/KOL/2012 ASSESSMENT YEAR: 2005-06 ACIT, C.C.-XXIII, 5 TH FLOOR, 18, RABIDNRA SARANI, KOLKATA-700 001 V/S . M/S DSL TECHNOLOGIES LTD., 86, CANNING STREET, KOLKATA-700 001 [ PAN NO.AABCD 6179 P ] /APPELLANT .. /RESPONDENT C.O. NO. 30/KOL/2015 (IN IT(SS)A NO.23/KOL/2012) ASSESSMENT YEAR: 2005-06 M/S DSL TECHNOLOGIES LTD., 86, CANNING STREET, KOLKATA-700 001 V/S . ACIT, C.C.-XXIII, 5 TH FLOOR, 18, RABIDNRA SARANI, KOLKATA-700 001 /APPELLANT .. /RESPONDENT IT(SS)A NO. 25-26/KOL/2012 ASSESSMENT YEARS: 2006-07 & 2008-09 ACIT, C.C.-XXIII, 5 TH FLOOR, 18, RABIDNRA SARANI, KOLKATA-700 001 V/S . M/S DEVANSHI CONSULTANTS (P) LTD., 505, CENTURY TOWERS, SHAKESPEARE SARANI, KOLKATA-700 017 IT(SS)A NO. 20-21/K/12 & CO 23-24/K/12 A.YS 06-07 & 07-08 IT(SS)A NO.22-23/K/12 & CO 21-22/K/12 A.YS. 05-06 & 06-07 IT(SS)A NO.24/K/12 & CO 30/K/15 A.Y. 05-06 IT(SS)A NO.25-26/K/12 & CO 28-29/K/15 A.YS. 06-07 & 08-09 PAGE 3 [ PAN NO.AACCD 1796 P ] /APPELLANT .. /RESPONDENT C.O. NOS 28-29/KOL/2015 (IN IT(SS)A NO.25-26/KOL/2012 ASSESSMENT YEARS: 2006-07 & 2008-09 M/S DEVANSHI CONSULTANTS (P) LTD., 505, CENTURY TOWERS, SHAKESPEARE SARANI, KOLKATA-700 017 V/S . ACIT, C.C.-XXIII, 5 TH FLOOR, 18, RABIDNRA SARANI, KOLKATA-700 001 /APPELLANT .. /RESPONDENT FOR THE REVENUE SHRI G. MALLIKARJUNA, CIT-DR FOR THE ASSESSEE/CROSS OBJECTOR SHRI S.L. KOCHAR & SHRI ANIL KOCHAR, ADVOCATE /DATE OF HEARING 15-02-2016 /DATE OF PRONOUNCEMENT 29-02-2016 /O R D E R PER BENCH:- THESE ARE SEVEN APPEALS BY REVENUE AND SEVEN CROSS OBJECTION (CO) ARE BY DIFFERENT ASSESSEE ARISING OUT OF SEPARATE O RDERS OF COMMISSIONER OF INCOME TAX (APPEALS)-CENTRAL-III, KOLKATA DATED 25. 01.2011, 27.01.2011, 21.12.2011 AND 22.12.2011. ASSESSMENTS WERE FRAMED BY ACIT.CC-XXIII, KOLKATA U/S 153A R.W.S.143(3) OF THE INCOME TAX ACT , 1961 (HEREINAFTER REFERRED TO AS THE ACT) VIDE HIS SEPARATE ORDER D ATED 31.12.2010 FOR ASSESSMENT YEARS 2005-06 TO 2007-08 & 2008-09 RESPE CTIVELY. IT(SS)A NO. 20-21/K/12 & CO 23-24/K/12 A.YS 06-07 & 07-08 IT(SS)A NO.22-23/K/12 & CO 21-22/K/12 A.YS. 05-06 & 06-07 IT(SS)A NO.24/K/12 & CO 30/K/15 A.Y. 05-06 IT(SS)A NO.25-26/K/12 & CO 28-29/K/15 A.YS. 06-07 & 08-09 PAGE 4 2. SINCE COMMON GROUNDS ARE INVOLVED IN ALL THE APP EALS EXCEPT THE CHANGE OF THE FIGURES OF REVENUE, THEREFORE, WE HEA RD THEM TOGETHER AND DEEM IT APPROPRIATE TO DISPOSE OF THEM BY THIS COMM ON ORDER FOR THE SAKE OF CONVENIENCE. 3. AT THE OUTSET, LD. COUNSEL FOR ASSESSEE STATED T HAT THERE IS A LEGAL ISSUE RAISED IN THE CO OF ASSESSEE, HENCE, SAME SHOULD BE HEARD FIRST. 4. FIRST LEGAL ISSUE RAISED BY ASSESSEE IN THEIR RE SPECTIVE CO IS AS REGARDS TO VALIDITY OF ASSESSMENT FRAMED US 153A OF THE ACT DESPITE THE FACT THAT THERE IS NO INCRIMINATING MATERIAL PERTAINING TO SHARE AP PLICATION MONEY OR LOANS FOR THE RELEVANT AYS. FOR THIS, ASSESSEE HAS RAISED COM MON GROUNDS IN ALL COS. HENCE, WE DECIDED TO HEAR ALL CO FIRST AND DISPOSE THEM BY THIS COMMON ORDER FOR THE SAKE OF BREVITY AND THEREWITH REVENUE S APPEALS ARE IN COMMON GROUND, HENCE, WE TAKE UP IT(SS)A NO.20-21/KOL/2012 AS LEAD CASE FOR AYS 2006-07 TO 2007-08 RESPECTIVELY , WE ARE REPRODUCIN G THE GROUNDS FROM C.O NO.23/KOL/2012 & C.O NO.29/KOL/2015 FOR A.YS 2006-07 AND 2008-09 RESPECTIVELY, WHICH READS AS UNDER:- 1. FOR THAT THE LD. CIT ERRED IN HOLDING THAT THE PROCEEDINGS INITIATED BY THE AO U/S 153A OF THE INCOME TAX ACT, 1961 IN THE CASE OF THE RESPONDENT-ASSESSEE WERE VALID AND ENFORCEABLE. 2. FOR THAT THE LD. CIT(A) OUGHT TO HAVE ACCEPTED T HE CONTENTION OF THE RESPONDENT-ASSESSEE THAT THERE BEING NO WARRANT OF SEARCH U/S. 132 OF THE INCOME TAX ACT, 1961 IN THE NAME OF THE RESPOND ENT-ASSESSEE, ASSUMPTION OF JURISDICTION U/S.153A BY THE A.O WAS WRONG AND UNCALLED FOR. C.O NO.29/KOL/2015 A.Y. 08-09 1. FOR THAT THE LD. CIT(A) ERRED IN HOLDING THAT T HE PROCEEDINGS INITIATED BY THE AO U/S 1153A OF THE INCOME TAX ACT, 1961 IN THE CASE OF THE RESPONDENT-ASSESSEE WERE VALID AND ENFORCEABLE. 2. FOR THAT THE LD. CIT(A) OUGHT TO HAVE APPRECIATE D THE FACT THAT THERE BEING NO INCRIMINATED MATERIAL FOUND IN THE COURSE OF SEARCH CONDUCTED IT(SS)A NO. 20-21/K/12 & CO 23-24/K/12 A.YS 06-07 & 07-08 IT(SS)A NO.22-23/K/12 & CO 21-22/K/12 A.YS. 05-06 & 06-07 IT(SS)A NO.24/K/12 & CO 30/K/15 A.Y. 05-06 IT(SS)A NO.25-26/K/12 & CO 28-29/K/15 A.YS. 06-07 & 08-09 PAGE 5 U/S. 132 RELATING TO ASSESSMENT YEAR IN APPEAL, TH ERE WAS NO VALID JURISDICTION WITH THE AO TO PASS IMPUGNED ORDER U/S . 143(3)/153A. 3. FOR THAT THE INFORMATION ABOUT THE LOANS OBTAINE D BY THE ASSESSEE BEING AVAILABLE ON RECORD PRIOR TO SEARCH OPERATION U/S 132, IN THE ABSENCE OF INCRIMINATING MATERIAL FOUND IN SEARCH, NO ADDITION COULD BE MADE IN RESPECT OF COMPLETED ASSESSMENT. 4. FOR THAT THE LD. CIT(A) OUGHT TO HAVE ACCEPTED T HE CONTENTION OF THE RESPONDENT-ASSESSEE THAT THERE BEING NO WARRANT OF SEARCH U/S//S 132 OF THE INCOME TAX ACT, 1961 IN THE NAME OF THE RESP ONDENT-SE, ASSUMPTION OF JURISDICTION U/S. 143A BY THE AO WAS WRONG AND UNCALLED FOR 5. FOR THAT THIS CROSS OBJECTION IS SUBMITTED BEYON D THE TIME PRESCRIBED IN THE INCOME TAX ACT, 1961 FOR WHICH PRAYER IS MAD E FOR CONDONATION OF THE DELAY SEPARATELY. 5. BRIEFLY STATED FACTS OF THE CASE ARE THAT T HE ASSESSEE IN THE PRESENT CASE IS A PRIVATE LIMITED COMPANY AND ENGAGED IN THE BUS INESS OF FINANCE & INVESTMENT. A SEARCH AND SEIZURE OPERATION WAS COND UCTED UNDER SECTION 132 OF THE ACT AT THE RESIDENCE/ OFFICE PREMISES / BANK LOCKERS OF A NUMBER OF INDIVIDUALS AND COMPANIES FALLING WITHIN THE SURA NA GROUP OF COMPANIES ON AND FROM 19/03/2009. THE ASSESSEE COMPANY IS THE ON E WITHIN THE GROUP AGAINST WHICH THE SEARCH WARRANT U/S 132 WAS ISSUED . MR. SHANTI KUMAR SURANA IS ONE OF THE DIRECTOR OF THE ASSESSEE COM PANY. HE IS ALSO CONTROLLING THE AFFAIRS OF THE GROUP OF COMPANIES. 6. THE ASSESSEE WAS SERVED NOTICE UNDER SECTI ON 153A OF THE ACT AND IN RESPONSE TO THE SAID NOTICE THE ASSESSEE FURNISHED ITS RETURN OF INCOME FOR RS.47,38,726 AS ON 07/01/2010. 7. A SEPARATE SEARCH AND SEIZURE WAS ALSO CO NDUCTED AT THE RESIDENCE AS WELL AS THE OFFICE PREMISES OF THE CHARTERED ACCOUN TANT SHRI. SHAMBHU KUMAR MORE AS ON 09/05/2009. A STATEMENT OF SH. SHAMBHU K UMAR WAS RECORDED IT(SS)A NO. 20-21/K/12 & CO 23-24/K/12 A.YS 06-07 & 07-08 IT(SS)A NO.22-23/K/12 & CO 21-22/K/12 A.YS. 05-06 & 06-07 IT(SS)A NO.24/K/12 & CO 30/K/15 A.Y. 05-06 IT(SS)A NO.25-26/K/12 & CO 28-29/K/15 A.YS. 06-07 & 08-09 PAGE 6 U/S 132(4) OF THE ACT. SOME OF THE RELEVANT QUERIES PUT TO HIM AND THE ANSWERS GIVEN BY HIM ARE AS FOLLOWS: 8. DURING THE COURSE OF SURVEY U/S 133A CONDUCTED TODAY IN YOUR BUSINESS PREMISES AT 52, WESTON STREET, KOLKATA-700 012, THE NAMES OF NUMBER OF COMPANIES MOSTLY HAVING THEIR RE GISTERED OFFICES AT THE SAID PREMISES HAVE BEEN FOUND. PLEAS E FURNISH DETAILS OF THESE COMPANIES ALONG WITH THEIR NATURE OF BUSIN ESS. ANS.- I DONT REMEMBER THE NAMES OF ALL THE COMPANI ES RIGHT NOW. HOWEVER, SOME OF THE COMPANIES RUNNING FROM MY OFFI CE ARE:- I. M/S ALFA TIE-UP PVT. LTD. II. M/S. RANG VARDHAN FEBTRADE PVT. LTD. III. M/S. CYGNUS PUBLISHERS LTD. IV. M/S. PAYAAGPUR VYAPAAR PVT. LTD. V. M/S. ANUVRAT TRANSPORT SYSTEM LTD. VI. M/S. MANUSH DISTRIBUTORS LTD. VII. M/S TEJI MANDI SECURITIES PVT. LTD. I WILL FURNISH THE DETAILED LIST OF THE ABOVE ON 12 /5/2009. 9. ARE YOU DIRECTOR IN ANY OF THE COMPANIES MAINTAI NED IN ANS. NO.- 8? ANS.-NO. HOWEVER, I AM A DIRECTOR IN M/S. MORE HIGH RISE PVT. LTD., 52, WESTON STREET, KOLKATA-700012. IN THE OTHER COM PANIES THE DIRECTORS ARE MY BROTHER SRI RAJ KUMAR MORE AND MY EMPLOYEES, SRI RAVI AGARWAL ETC. 10. PLEASE EXPLAIN THE NATURE OF BUSINESS CONDUCTED BY THE ABOVE MENTIONED COMPANIES. ANS.-ALL THE ABOVE MENTIONED COMPANIES ARE ENGAGED IN THE BUSINESS OF SHARE TRADING, LOANS AND ADVANCES AND I NVESTMENT. 11. HAVE ANY OF THE ABOVE MENTIONED COMPANIES ENTER ED INTO ANY TRANSACTIONS (SHARES OR LOANS OR OTHERWISE) WITH EN TITIES BELONGING TO SHANTI KUMAR SURANA, PAWAN KUMAR SURANA OF THE SURANA GROUP? ANS.- YES, MY COMPANIES HAVE ENTERED INTO SHARE AND LOAN TRANSACTIONS WITH COMPANIES BELONGING TO SRI SHANTI KUMAR SURANA 12. PLEASE SPECIFY IN DETAIL THE EXACT NATURE OF TH E TRANSACTIONS ENTERED INTO WITH THE COMPANIES BELONGING TO SHANTI KUMAR SURANA IT(SS)A NO. 20-21/K/12 & CO 23-24/K/12 A.YS 06-07 & 07-08 IT(SS)A NO.22-23/K/12 & CO 21-22/K/12 A.YS. 05-06 & 06-07 IT(SS)A NO.24/K/12 & CO 30/K/15 A.Y. 05-06 IT(SS)A NO.25-26/K/12 & CO 28-29/K/15 A.YS. 06-07 & 08-09 PAGE 7 ANS.- IN RESPECT OF ALL THE SAID TRANSACTIONS, FIRS T CASH IS RECEIVED FROM SRI SHANTI KUMAR SURANA. THEN AFTER A SERIES O F TRANSACTIONS THROUGH MY COMPANIES, CHEQUES OF RELEVANT AMOUNTS A RE FINALLY ISSUED TO THE RELEVANT COMPANIES BELONGING TO SRI S HANTI KUMAR SURANA AS PER INSTRUCTIONS RECEIVED FROM SRI SHANTI KUMAR SURANA, FROM TIME TO TIME. 13. PLEASE EXPLAIN IN DETAILS THE TRANSACTIONS WHIC H TAKE PLACE AFTER RECEIPT OF CASH FROM SRI SHANTI KUMAR SURANA, TILL THE ISSUE OF CHEQUES OF RELEVANT AMOUNTS TO COMPANIES BELONGING TO HIS GROUP. ANS.- WHENEVER CASH IS RECEIVED, FIRST OF ALL, I PR OCURE CHEQUES OF MATCHING AMOUNT ON VARIOUS DATES, FROM THE MARKET. SUBSEQUENTLY, CHEQUES OF RELEVANT AMOUNTS ARE ISSUED FROM MY COMP ANIES, AFTER THE FOLLOWING LAYERS OF IN-HOUSE TRANSACTIONS :- A. THE CHEQUES PROCURED FROM THE MARKET ARE INTRODU CED IN THE BOOKS OF ONE OR MORE COMPANIES, IN THE FORM OF SHARE CAPITAL OR AS PROCEEDS FROM SALE OF SHARE INVESTMEN TS. B. THEN THE AMOUNTS ARE FURTHER CIRCULATED AMONGST MANY COMPANIES, THROUGH LOAN TRANSACTIONS / ADVANCES / S HARE TRANSACTIONS, ETC. C. FINALLY AS PER THE REQUIREMENT OF SRI. SHANTI KU MAR SURANA, CHERQUES OF APPROPRIATE AMOUNTS ARE FINALLY ISSUED TO HIS COMPANIES IN THE FORM OF SHARE CAPITA L OR UNSECURED LOANS. D. I MAY ALSO MENTION THAT IN SOME OF THE CASES, TH E SHARES OF SRI SHANTI KUMAR SURANAS COMPANIES ARE BROUGHT BACK BY THE PROMOTERS AND THEIR FAMILY MEMBERS AT 20% OF THE SHARE VALUE, APPROXIMATELY. THE CHEQUES RECEIVED FO R THE SAID TRANSACTIONS ARE DEPOSITED INTO BANK AND EQUAL OR MATCHING AMOUNT ARE RETURNED BACK TO SR. SHANTI KUA MR SURANA IN CASH. THIS COMPLETES THE ENTIRE CYCLE OF TRANSACTIONS, W HEREBY, HIS UNACCOUNTED MONEY IS BROUGHT INTO THE BOOKS OF HIS COMPANY. THE DETAILS OF THE SAME ABOVE MENTIONED TRANSACTIONS WI LL BE SUBMITTED ON 12/5/2009. 14. PLEASE FURNISH THE NAMES OF THE PERSONS AND COM PANIES FROM WHOM YOU PROCURE CHEQUES IN LIEU OF CASH. ANS.- I PROCURE CHEQUES IN LIEU OF CASH FROM VARIOU S ENTRY OPERATORS. IN THE CASE OF THE CONCERNS OF THE SURA NA GROUP, WERE IT(SS)A NO. 20-21/K/12 & CO 23-24/K/12 A.YS 06-07 & 07-08 IT(SS)A NO.22-23/K/12 & CO 21-22/K/12 A.YS. 05-06 & 06-07 IT(SS)A NO.24/K/12 & CO 30/K/15 A.Y. 05-06 IT(SS)A NO.25-26/K/12 & CO 28-29/K/15 A.YS. 06-07 & 08-09 PAGE 8 PROCURED FROM SR. DEBESH UPADHYAY AND SR VINOD JAIS WAL, HAVING THEIR OFFICES AT WATERLOO STREET AND GIRISH PARK, R ESPECTIVELY. HOWEVER, I WILL CHECK THE RECORDS AND SUBMIT DETAIL S OF THE SAME ON 12/5/2009. 15. WHAT IS YOUR REMUNERATION FOR LAUNDERING THE UN ACCOUNTED MONEY OF SRI SHANTI KUMAR SURANA BY ROUTING IT THRO UGH ACCOMMODATION ENTRIES IN THE BOOKS OF YOUR COMPANIE S. AS ENUMERATED ABOVE BY YOU? ANS.- I EARN ON AN AVERAGE 0.6% OF THE CASH RECEIVE D AS GROSS COMMISSION INCOME FOR CARRYING OUT THE AFOREMENTION ED ACTIVITIES. AFTER ACCOUNTING FOR EXPENSES, MY NET COMMISSION IN COME IS APPROXIMATELY 0.35% OF THE CASH RECEIVED FROM SR. S HANTI KUMAR SURANA. 16. IN CASES WHERE CASH RECEIVED FROM SR SHANTI KUM AR SURANA IS ROUTED BACK TO HIS COMPANIES THROUGH UNSECURED LOAN S FROM YOUR COMPANIES, HOW IS THE INTEREST THEREON RECEIVED AND SUBSEQUENTLY ACCOUNTED FOR? ANS.- THE INTEREST ON UNSECURED LOANS IS IN THE RA NGE OF 6% TO 12% AND IS RECEIVED IN CHEQUE, NET OF TDS. THIS AMOUNT OF INTEREST INCOME IS OFFERED TO TAX BY THE RELEVANT COMPANIES AND TDS THEREON IS ACCORDINGLY CLAIMED. THE CASH OF AMOUNT EQUAL TO THE NET INTEREST INCOME (CHEQUE AMOUNT) IS GIVEN BACK T O SRI SHANTI KUMAR SURANA. THE TDS AMOUNT IS ALSO GIVEN BACK SUB SEQUENTLY IN THE FORM OF CASH TO SR. SHANTI KUMAR SURANA. ALS O, ANY FURTHER TAX LIABILITY ON ACCOUNT OF THE SAID INTEREST INCOM E IS USUALLY VERY SMALL AMOUNT RUNNING INTO A FEW THOUSAND AND IS BOR NE BY US. 17. IN RESPONSE TO Q. NO. 15 YOU HAVE STATED THAT Y OUR NET INCOME IS APPROXIMATELY 0.35% OF THE TOTAL CASH RECEIVED F ROM SRI. SHANTI KUMAR SURANA. PLEASE STATE THE MODE OF PAYMENT RECE IVED FROM SRI SHANTI KUMAR SURANA. AND ALSO STATE WHETHER THE SAID INCOME HAS BEEN OFFERED TO TAX OR NOT. ANS- I RECEIVED THE SAID INCOME IN CASH. THE RECEIP TS AND EXPENSES OF THE ABOVE TRANSACTIONS ARE OUTSIDE REGULAR BOOKS OF ACCOUNTS. 18. I AM SHOWING YOU THE DETAILS OF ADDITION TO SHA RE CAPITAL AND SHARE PREMIUM A/C FOR THE F.Y 2004-05 IN THE CASE O F BIKAJI MERCANTILES PVT. LTD (PAN-AABCB4120A) WHICH IS A CO MPANY BELONGING TO THE SURANA GROUP . FROM THE DETAILS IT IS SEEN THAT ALL IT(SS)A NO. 20-21/K/12 & CO 23-24/K/12 A.YS 06-07 & 07-08 IT(SS)A NO.22-23/K/12 & CO 21-22/K/12 A.YS. 05-06 & 06-07 IT(SS)A NO.24/K/12 & CO 30/K/15 A.Y. 05-06 IT(SS)A NO.25-26/K/12 & CO 28-29/K/15 A.YS. 06-07 & 08-09 PAGE 9 THE 12,24,000 EQUITY SHARES OF THIS COMPANY HAVE BE EN SUBSCRIBED BY THE FOLLOWING COMPANIES A. M/S ALFA TIE-UP PVT. LTD. B. M/S. RANG VARDHAN FEBTRADE PVT. LTD. C. M/S CYGNUS PUBLISHERS LTD. D. M/S PAYAGPOUR VYAPAAR PVT. LTD. E. M/S ANUVRAT TRANSPORT SYSTEM LTD. F. M/S MANUSH DISTRIBUTORS LTD. G. M/S TEJI MANDI SECURITIES PVT. LTD. DOES THESE COMPANIES BELONG TO YOU? IF SO, PLEASE C ONFIRM THE MODUS OPEANDI WHICH YOU HAVE ALREADY EXPLAINED IN Y OUR RESPONSE TO Q. NO. 13. ANS.- YES, I CONFIRM THAT ALL THE SEVEN COMPANIES B ELONG TO ME AND HAVE THEIR REGISTERED OFFICES AT MY BUSINESS AT 52, WESTON STREET, KOLKATA-700012. I FURTHER CATEGORICALLY CONFIRM THA T WITH REGARD TO THESE 12,24,000 EQUITY SHARES, AN AMOUNT OF RS.(12, 24,000 X 20) = RS.,2,44,80,000/- WAS RECEIVED IN CASH FROM SRI. SH ANTI KUMAR SURANA. THE SAME WAS INVESTED BACK IN THE SHARES OF BIKAJI MERCANTILES PVT. LTD. 19. NOW I AM SHOWING YOU DETAILS OF UNSECURED LOANS TAKEN BY BIKAJI MERCANTILES PVT. LTD., DURING THE F.Y 2004-0 5, WHEREIN, IT IS SEEN THAT THIS COMPANY HAS ENTERED INTO UNSECURED L OAN TRANSACTIONS WITH 19 COMPANIES. PLEASE IDENTIFY THE COMPANIES BELONGING TO YOU AND CONFIRM THE MODUS OPEANDI AS E XPLAINED BY YOU IN ANSWER TO Q. NO. 13 AND 14. ANS.- OUT OF THE 19 COMPANIES, 2 COMPANIES NAMELY A NUVRAT TRANSPORT SYSTEMS PVT. LTD., AND MANUSH DISTRIBUTOR S LTD., ARE MY COMPANIES, I ALSO CONFIRM THAT AMOUNTS OF RS.3,97,9 8,082/- AND RS.4,83,76,460/- WERE RECEIVED IN CASH FROM SRI. SU RANA AND ROUTED BACK TO THE BOOKS OF BIKAJI MERCANTILES PVT. LTD., IN THE FORM OF UNSECURED LOANS. I FURTHER CONFIRM THAT DURING THE YEAR AMOUNTS OF RS.4,07,98,082/- AND RS.4,53,76,460/- WERE RECEIVED IN CHEQUE AND THE SAME AMOUNTS WERE RETURNED BACK EITHER IN C ASH OR THROUGH CHEQUE IN THE FORM OF SHARE CAPITAL IN M/S BIKAJI MERCANTILES PVT. LTD., I WILL SUBMIT THE DETAILS AF TER VERIFYING OUR RECORDS ON 12/5/2009. SHRI. SHAMBHU KUMAR FURNISHED ANOTHER STATEMENT SHO WING THE DETAILED LIST OF UNSECURED LOAN, INTEREST ON SUCH LOANS AS WELL AS S HARE CAPITAL / PREMIUM FOR IT(SS)A NO. 20-21/K/12 & CO 23-24/K/12 A.YS 06-07 & 07-08 IT(SS)A NO.22-23/K/12 & CO 21-22/K/12 A.YS. 05-06 & 06-07 IT(SS)A NO.24/K/12 & CO 30/K/15 A.Y. 05-06 IT(SS)A NO.25-26/K/12 & CO 28-29/K/15 A.YS. 06-07 & 08-09 PAGE 10 WHICH HE HAD PROVIDED ACCOMMODATION ENTRIES TO SHRI SHANTI KUMAR SURANA AND HIS GROUP COMPANIES. THE DETAIL FURNISHED BY HI M IS AS FOLLOWS. DETAILS OF UNSECURED LOAN TO SHANTI KUMAR SURANA AN D GROUP COMPANY NAME OF THE BORROWER NAME OF THE LENDER FINANCIAL YEAR AMOUNT GIVEN REFUND INTEREST SHANTI KR. SURANA ALFA TIE-UP PVT. LTD. 2002-03 37,00,000 37,00,000 1,02,345 SHANTI KR. SURANA TEJI MANDI SECURITIES PVT. LTD. 2002-03 45,00,000 45,00,000 1,51,170 SUB TOTAL 82,00,000 82,00,000 2,53,515 BIKAJI MERCANTILES PVT. LTD. MANUSH DISTRIBUTORS LTD. 2003-04 2,2,50,000 1,22,50,000 1,61,538 BIKAJI MERCANTILES PVT. LTD. ANUVRAT TRANSPORT SYSTEMS LTD. 2003-04 2,09,50,000 1,49,50,000 1,66,800 SHANTI KR. SURANA RANG VARDHAN FEBTRADE PVT. LTD. 2003-04 15,00,000 15,00,000 12,986 SHANTI KR. SURANA MANUSH DISTRIBUTORS LTD. 2003-04 4,65,00,000 2,05,00,000 8,38,093 SHANTI KR. SURANA ANUVRAT TRANSPORT SYSTEMS LTD. 2003-04 4,05,00,000 1,20,00,000 6,91,726 SUB TOTAL 13,17, 00,000 6,12,00,000 18,71,143 BIKAJI MERCANTILES PVT. LTD. MANUSH DISTRIBUTORS LTD. 2004-05 4,75,00,000 4,45,00,000 8,76,460 BIKAJI MERCANTILES PVT. LTD. ANUVRAT TRANSPORT SYSTEMS LTD. 2004-05 3,90,00,000 4,00,00,000 7,98,082 S.K. SURANA (HUF) MANUSH DISTRIBUTORS LTD. 2004-05 86,00,000 86,00,000 3,58,225 SHANTI KR. SURANA MANUSH DISTRIBUTORS 2004-05 3,95,00,000 5,35,00,000 33,64,636 IT(SS)A NO. 20-21/K/12 & CO 23-24/K/12 A.YS 06-07 & 07-08 IT(SS)A NO.22-23/K/12 & CO 21-22/K/12 A.YS. 05-06 & 06-07 IT(SS)A NO.24/K/12 & CO 30/K/15 A.Y. 05-06 IT(SS)A NO.25-26/K/12 & CO 28-29/K/15 A.YS. 06-07 & 08-09 PAGE 11 LTD. SHANTI KR. SURANA ANUVRAT TRANSPORT SYSTEMS LTD. 2004-05 2,33,00,000 5,18,00,000 36,23,901 S.A. SUPPLIERS PVT. LTD. MANUSH DISTRIBUTORS LTD. 2004-05 50,00,000 0 0 S.A. SUPPLIERS PVT. LTD. ANUVRAT TRANSPORT SYSTEMS LTD. 2004-05 50,00,000 0 0 SUB TOTAL 16,79,00,000 19,84,00,000 90,21,304 BIKAJI MERCANTILES PVT. LTD. MANUSH DISTRIBUTORS LTD. 2005-06 2,73,00,000 4,03,00,000 6,27,090 BIKAJI MERCANTILES PVT. LTD. ANUVRAT TRANSPORT SYSTEMS LTD. 2005-06 1,00,00,000 1,50,00,000 4,44,493 SHANTI KR. SURANA MANUSH DISTRIBUTORS LTD. 2005-06 3,40,00,000 4,60,00,000 15,63,288 SHANTI KR. SURANA ANUVRAT TRANSPORT SYSTEMS LTD. 2005-06 2,00,00,000 2,00,00,000 2,95,726 AMAR IMPEX PVT. LTD. ANUVRAT TRANSPORT SYSTEMS LTD. 2005-06 1,20,00,000 1,20,00,000 91,726 S.A. SUPPLIERS PVT. LTD. MANUSH DISTRIBUTORS LTD. 2005-06 0 50,00,000 1,79,178 S.A. SUPPLIERS PVT. LTD. ANUVART TRANSPORT SYSTEMS LTD. 2005-06 0 50,00,000 1,80,822 SUB TOTAL 10,33,00, 000 14,33,00,000 33,82,323 SHANTI KR. SURANA PAYAGPOUR VYAPAAR PVT. LTD. 2006-07 1,35,00,000 1,35,00,000 1,70,137 AMAR IMPEX PVT. LTD. ANUVRAT TRANSPORT SYSTEMS LTD. 2006-07 67,00,000 67,00,000 43,529 DEVANSHI PAYAGPOUR 2007-08 25,00,000 25,00,00 0 9,041 IT(SS)A NO. 20-21/K/12 & CO 23-24/K/12 A.YS 06-07 & 07-08 IT(SS)A NO.22-23/K/12 & CO 21-22/K/12 A.YS. 05-06 & 06-07 IT(SS)A NO.24/K/12 & CO 30/K/15 A.Y. 05-06 IT(SS)A NO.25-26/K/12 & CO 28-29/K/15 A.YS. 06-07 & 08-09 PAGE 12 CONSULTANTS PVT. LTD. VYAPAAR PVT. LTD DEVANSHI CONSULTANTS PVT. LTD. ANUVRAT TRANSPORT SYSTEMS LTD. 2007-08 71,00,000 71,00,000 19,396 SUB TOTAL 2,98,0 0,000 2,98,00,000 2,42,103 GRAND TOTAL 44,09 ,00,000 44.09,0,000 1,47,70,388 DETAILS OF SHARE APPLICATION MONEY IN THE GROUP COMPANIES OF SHANTI KUMAR SURANA NAME OF THE COMPANY NAME OF THE APPLICANT FINANCIAL YEAR AMOUNT GIVEN BIKAJI MERCANTILES PVT. LTD. MANUSH DISTRIBUTORS LTD. 2004-05 50,00,000 BIKAJI MERCANTILES PVT. LTD. ANUVRAT TRANSPORT SYSTEMS LTD. 2004-05 50,00,000 BIKJI MERCANTILES PVT. LTD. TEJI MANDI SECURITIES P VT. LTD. 2004-05 30,00,000 BIKAJI MERCANTILES PVT. LTD. RANG VARDHAN FEBTRADE PVT. LTD. 2004-05 30,80,000 BIKAJI MERCANTILES PVT. LTD. CYGNUS PUBLISHERS LTD. 2004-05 29,00,000 BIKAJI MERCANTILES PVT. LTD. ALFA TIE-UP- PVT. LTD. 2004-05 25,00,000 BIKAJI MERCANTILES PVT. LTD. PAYAGPOUR VYAPAAR PVT. LTD. 2004-05 30,00,000 DSL TECHNOLOGIES LTD. RANG VARDHAN FEBTRADE PVT LTD. 2004-05 20,00,000 DSL TECHNOLOGIES LTD. ALFA TIE-UP PVT. LTD. 2004-05 8,00,000 DSL TECHNOLOGIES LTD. PAYAGPOUR VYAPAAR PVT. LTD. 2004-05 13,00,000 SUB TOTAL 2,99,8 0,000 AMAR IMPEX PVT. LTD. PAYAGPOUR VYAPAAR PVT. LTD. 2005-06 70,00,000 AMAR IMPEX PVT. LTD. TEJI MANDI SECURITIES PVT. LTD. 2005-06 82,15,000 AMAR IMPEX PVT. LTD. ALFA TIE-UP PVT. LTD. 2005-06 21,00,000 AMAR IMPEX PVT. LTD. CYGNUS PUBLISHERS LTD. 2005-06 80,00,000 AMAR IMPEX PVT. LTD. RANG VARDHAN FEBTRADE PVT. LTD. 2005-06 62,50,000 DEVANSHI CONSULTANTS PVT. LTD PAYAGPOUR VYAPAAR PVT. LTD. 2005-06 35,00,000 IT(SS)A NO. 20-21/K/12 & CO 23-24/K/12 A.YS 06-07 & 07-08 IT(SS)A NO.22-23/K/12 & CO 21-22/K/12 A.YS. 05-06 & 06-07 IT(SS)A NO.24/K/12 & CO 30/K/15 A.Y. 05-06 IT(SS)A NO.25-26/K/12 & CO 28-29/K/15 A.YS. 06-07 & 08-09 PAGE 13 DEVANSHI CONSULTANTS PVT. LTD TEJI MANDI SECURITIES PVT. LTD. 2005-06 35,00,000 DEVANSHI CONSULTANTS PVT. LTD ALFA TIE-UP PVT. LTD. 2005-06 35,00,000 DEVANSHI CONSULTANTS PVT. LTD CYGNUS PUBLISHERS LTD. 2005-06 24,00,000 S.A. SUPPLIERS PVT. LTD. CYGNUS PUBLISHERS LTD. 200 5-06 20,00,000 S.A. SUPPLIERS PVT. LTD. TEJI MANDI SECURITIES PVT. LTD. 2005-06 20,00,000 S.A. SUPPLIERS PVT. LTD. ANUVRAT TRANSPORT SYSTEMS LTD. 2005-06 25,00,000 S.A. SUPPLIERS PVT. LTD. PAYAGPOUR VYAPPAR PVT. LTD. 2005-06 20,00,000 SUB T OTAL 5,29,65,000 GRAND TO TAL 8,29,45,000 NOTE : HERE IT IS TO BE MENTIONED THAT THE NAME OF M/S BIKAJI MERCANTILE PVT. LTD. WAS SUBSEQUENTLY CHANGED TO M/S SURANA MERCANT ILE PVT. LTD., AND THAT OF M/S AMAR IMPEX PVT. LTD. TO SHUBHAM IMPEX PVT. LTD. I.E. THE ASSESSEE IN THIS CASE. TWO MORE STATEMENT OF SHRI SHAMBHU KUMAR MORE, WERE ALSO OBTAINED UNDER SECTION 131(1) ON DATED 21.10.2010 AND 10.12.2010 W HEREBY HE CONFIRMED THE SAME AS THE STATEMENT RECORDED UNDER SECTION 13 2(4) OF THE ACT. 8. FROM THE STATEMENT OF SHRI SHAMBHU KUMAR MORE, T HE AO OPINED THAT LOAN TAKEN BY THE ASSESSEE IS NOTHING BUT UNEXPLAIN ED MONEY OF THE ASSESSEE. BESIDES THE STATEMENT OF SHRI SHANTI KUMA R SURANA WAS ALSO RECORDED WHERE HE DISCLOSED ADDITIONAL INCOME OF RS . 81,83,210.00 TOWARDS UNACCOUNTED JEWELLERY AND SILVER ARTICLES AND RS. 8 ,00,00,000.00 ON BEHALF OF HIMSELF, MEMBERS OF HIS FAMILY AND OTHER GROUP COMP ANIES. BUT LATER SHRI SHANTI KUMAR SURANA DENIED TO HAVE MADE ANY DISCLOS URE OF RS. 8 CRORES AND HAVE TAKEN ANY ACCOMMODATING ENTRIES IN LIEU OF CAS H FROM THE AFORESAID COMPANIES. HOWEVER THE AO DISREGARDED THE CLAIM OF THE ASSESSE E ON ACCOUNT OF THE FOLLOWING REASONS : IT(SS)A NO. 20-21/K/12 & CO 23-24/K/12 A.YS 06-07 & 07-08 IT(SS)A NO.22-23/K/12 & CO 21-22/K/12 A.YS. 05-06 & 06-07 IT(SS)A NO.24/K/12 & CO 30/K/15 A.Y. 05-06 IT(SS)A NO.25-26/K/12 & CO 28-29/K/15 A.YS. 06-07 & 08-09 PAGE 14 1.BY DISCLOSING AN ADDITIONAL INCOME OF RS.8 CRORE S DURING THE COURSE OF POST SEARCH PROCEEDINGS, SRI SURANA INDIR ECTLY ADMITTED OF HAVING ENTERED INTO TRANSACTIONS WITH THE AFOREM ENTIONED COMPANIES THROUGH SH. SHAMBHU KUMAR MORE. 2. DURING THE COURSE OF POST SEARCH PROCEEDINGS, D. D.I.T(INV.) CONDUCTED SELECTIVE ENQUIRIES FROM ABN AMRO BANK (T HE BANK WHERE THE ASSESSEE AND THE OTHER GROUP CONCERNS MAI NTAINED THEIR ACCOUNTTS0 TO TRAIL THE SOURCE OF DEPOSITS OF VARIO US UNSECURED LOANS AND SHARE CAPITALS IN THE BANK ACCOUNTS OF TH E ASSESSEE AND THE OTHER GROUP COMPANIES. THE UNDERSIGNED ALSO CON DUCTED SIMILAR ENQUIRIES FROM THE SAID BANK. FROM SUCH ENQ UIRIES THE FOLLOWING FACTS WERE DISCOVERED A. CASH OF RS.4,50,000/- AND RS.3,70,000/- DEPOSITE D IN THE ACCOUNT (NO.-1033167) OF SH. VIKAS KUMAR AGARWAL ON 22/12/2004 AND 23/12/2004 RESPECTIVELY. CASH OF RS.3,50,000/- AND RS.50,000/- DEPOSITED IN THE ACCO UNT (NO.- 992328) OF M/S. MJ ENTERPRISE ON 23/12/2004 AND 24/12/2004 RESPECTIVELY. BOTH OF THEM UTILIZED THIS AMOUNT TO ADVANCE RS.9,20,000/- BY TRANSFER TO THE ACCOUNT (N O.- 968357) OF M/S. NITYA COMMODITIES LTD., ON 24/12/20 04. THIS CONCERN THEN UTILIZED THIS AMOUNT TO ADVANCE RS.9,0 0,000/- BY TRANSFER TO THE ACCOUNT (NO.-475870) OF M/S. CYG NUS PUBLISHERS LTD. (A COMPANY CONTROLLED BY SH. MORE) ON 24/12/2004. IT UTILIZED THIS AMOUNT TO ADVANCE RS.24,00,000/.- BY TRANSFER TO THE ACCOUNT (NO.-153 894) OF M/S MANUSH DISTRIBUTORS LTD. (ANOTHER COMPANY CONTR OLLED BY SH. MORE). THIS COMPANY UTILIZED THIS AMOUNT TO ADV ANCE RS.245,00,000/- BY TRANSFER TO THE ACCOUNT (NO.-891 096) OF M/S. SURANA MERCANTILE PVT. LTD., I.E., THE ASSESSE E AND THE ULTIMATE BENEFICIARY OF THE WHOLE CHAIN OF TRANSACT ION. B. CASH OF RS.5,00,000/- DEPOSITED IN THE ACCOUNT ( NO.- 1033167) OF SH. VIKAS KUMAR AGARWAL ON 27/12/2004. CASH OF RS.4,00,000/- DEPOSITED IN THE ACCOUNT (NO.-9941 33) OF M/S. MA TRADING COMPANY ON 27/12/2004. BOTH OF THEM UTILIZED THIS AMOUNT TO ADVANCE RS.19,00,000/- BY T RANSFER TO THE ACCOUNT NUMBER 262430 ON 27/12/2004. THIS CONCE RN THEN UTILIZED THIS AMOUNT TO ADVANCE RS.25,00,000/- BY TRANSFER TO THE ACCOUNT (NO.-243097) OF M/S. ANUVRA T TRANSPORT SYSTEMS LTD. (A COMPANY CONTROLLED BY SH. MORE) ON 27/12/2004. IT UTILIZED THIS AMOUNT TO ADVANCE IT(SS)A NO. 20-21/K/12 & CO 23-24/K/12 A.YS 06-07 & 07-08 IT(SS)A NO.22-23/K/12 & CO 21-22/K/12 A.YS. 05-06 & 06-07 IT(SS)A NO.24/K/12 & CO 30/K/15 A.Y. 05-06 IT(SS)A NO.25-26/K/12 & CO 28-29/K/15 A.YS. 06-07 & 08-09 PAGE 15 RS.25,00,000/- BY TRANSFER TO THE ACCOUNT (NO-89109 6) OF M/S. SURANA MERCANTILE PVT. LTD. I.E., THE ASSESSEE AND THE ULTIMATE BENEFICIARY OF THIS CHAIN OF TRANSACTION. C. NOTICE U/S 133(6) WAS ISSUED TO SH. VIKAS KUMAR AGARWAL, M/S. MJ ENTERPRISE AND M/S MA TRADING COMPANY TO FU RNISH THE SOURCE OF CASH DEPOSITED BY THEM. HOWEVER, NO R EPLY WAS RECEIVED FROM THEM. 3. THE ABOVE DESCRIPTION OF THE TRANSACTIONS CLEARL Y INDICATE THAT THE CASH DEPOSITS WERE ULTIMATELY TRANSFERRED TO TH E ASSESSEE COMPANY. THE CASH WAS DEPOSITED IN ACCOUNTS OPENED IN THE NAME OF FAKE HOLDERS WHO WERE NOT TRACEABLE. 4. DURING THE COURSE OF SEARCH AT THE OFFICE PREMIS ES OF THE ASSESSEE COMPANY AT CENTURY TOWERS, 45, SHAKESPEARE SARANI, SEVERAL BOOKS DOCUMENTS WERE FOUND AND SEIZED. ONE SUCH BUNCH MARKED SSI/5 CONTAIN NUMBER OF LOOSE SHEETS WITH NO TINGS AND ABSTRACTS OF MONETARY TRANSACTIONS. PAGE NO.-56 CON TAIN DETAILS OF FOLLOWING TRANSACTIONS:- FOR KOCHARJI SANGEETA & CO. --- 90,000 FOR BHARTIAJI PAYAGPORE --- 2,60,000 TEJI MANDI --- 2,80,000 ALFA TIE UP --- 1,60,000 RANG VARDHAN --- 2,00,000 PAGE NO. 5 CONTAIN DETAILS OF TRANSACTION OF 2.5 LA KH IN THE NAME OF SKS(H) AND RS.5 LAKH IN THE NAME OF PRABHA. PAGE NO.-58 CONTAIN DETAILS OF TRANSACTIONS OF RS.21 LAKH, RS.7 0,000/- AND RS.1,50,000/- IN VARIOUS NAMES. PAGE NO. 51 CONTAIN DETAILS OF TRANSACTIONS @ 4 AND @ 2 IN THE NAME OF VARIOUS PER SONS. PAGE NO. 49 CONTAIN DETAILS OF TRANSACTIONS OF RS.30 LAK H, RS.10 LAKH, RS.50 LAKH AND RS.10 LAKH IN THE NAME OF VARIOUS PE RSONS. PAGE NO. 44 CONTAIN NOTINGS OF TRANSACTION OF RS.15 LAKH IN THE NAME OF PRABHO. PAGE NO.-41 CONTAIN NOTINGS OF TRANSACTI ON OF RS.2,64,726/- AND RS.6,66,534/-. PAGE NO.-38 CONTAI N NOTINGS OF TRANSACTION OF RS.50,000/- IN THE NAME OF PRADYUMN A AGARWAL AND PAGE NO. 34 CONTAIN NOTINGS OF TRANSACTION OF R S.90,593/- AND RS.1,22,874/- IN THE NAMES OF BOSE DEVELOPERS A ND SUB DEVELOPERS. IT(SS)A NO. 20-21/K/12 & CO 23-24/K/12 A.YS 06-07 & 07-08 IT(SS)A NO.22-23/K/12 & CO 21-22/K/12 A.YS. 05-06 & 06-07 IT(SS)A NO.24/K/12 & CO 30/K/15 A.Y. 05-06 IT(SS)A NO.25-26/K/12 & CO 28-29/K/15 A.YS. 06-07 & 08-09 PAGE 16 SRI SURANA WAS ASKED TO FURNISH PAGE WISE EXPLANATI ON OF THESE LOOSE SHEETS. IN HIS REPLY, HE STATED THAT THESE AR E ROUGH NOTINGS OR ACCOUNT INFORMATION. BUT NO BASIS OF SUCH NOTING S WAS FURNISHED. 5. SRI SURANA WAS PROVIDED WITH THE COPIES OF ALL T HE STATEMENTS OF SRI MORE RECORDED U/S. 132(4) BEFORE D.D.I.T.(IN V) AND U/S 131(1) BY THE UNDERSIGNED AND HE WAS GIVEN AN OPPORTUNITY TO CROSS EXAMINE SRI MORE. ON THE STIPULATED DAY OF 16/12/20 10, BOTH SRI MORE AND SRI SURANA APPEARED BEFORE THE UNDERSIGNED BUT SRI SURANA REFUSED TO CROSS EXAMINE SRI MORE. THIS CLEA RLY INDICATES THE GUILTY MINDEDNESS OF SRI SURANA. IN VIEW OF THE ABOVE FACTS AND CIRCUMSTANCES OF THE CASE, THE AO FOR ALL THESE ASSESSMENT YEARS HELD THAT THE ASSESSEE AND HIS GRO UP CONCERNS HAVE ACCEPTED ACCOMMODATION ENTRIES IN THEIR RESPECTIVE BOOKS OF ACCOUNT TOWARDS UNSECURED LOANS AS WELL AS SHARE CAPITAL/SHARE PREM IUM IN LIEU OF UNACCOUNTED CASH ROUTED THROUGH VARIOUS CONCERNS OF SHRI SHAMBHU KR MORE, AS ADMITTED BY SHRI SAMBHU KR MORE. ACCORDINGLY TH E AO HAS ADDED THE LOAN AMOUNT OF RS. 67.00 LACS AS CASH CREDIT UNDER SECTI ON 68 OF THE ACT. 9. AGGRIEVED PARTY FILED AN APPEAL BEFORE LD. CIT ( A) AGAINST THE STERN ACTION TAKEN BY THE A.O. THE LD. CIT(A) DELETED THE ADDITION MADE BY OBSERVING IN PARA 6.2 TO 6.3 AS UNDER : 6.2 THE AO HAS ADDED ALL THESE SUMS AS UNEXPLAINED CASH CREDIT U/S 68 OF THE IT ACT IN IDENTICALLY DRAFTED ASSESSMENT ORDERS. IDENTICAL ISSUES WERE DECIDED BY ME IN THE CASE OF M/S SURANA MERCANTILES PVT. LTD. FOR A.YRS. 2004-05, 2005-06 & 2006-07 VIDE MY ORDER DATED 16.12.20011 IN APPEAL NS. 103, 104 & 1-5/CC-XXIII/C IT(A)C-III/10-11. BOTH THESE ASSESSEES ( THE APPELLANT AND M/S SURANA MERCANTILES PVT. LTD. ) BELONG TO THE SAME GROUP. ADDITIONS HAVE BEEN MAD E IN BOTH THESE CASES ON THE BASIS OF SIMILAR FACTS IN IDENTI CALLY DRAFTED ASSESSMENT ORDERS. THE REMAND REPORTS OF THE AO ARE ALSO IDENTICALLY DRAFTED. THE CONTENTIONS OF THE APPELLANT IN THE WR ITTEN AND ORAL SUBMISSIONS AND THE REJOINDER TO THE REMAND REPORT ARE ALSO MORE OR LESS SIMILAR. AFTER ELABORATELY DEALING WITH ALL TH E FACTS MATERIAL TO THE ISSUE, I HAD HELD IN MY ORDER DATED 16.12.2011 (SUP RA) THAT THE AO WAS NOT JUSTIFIED IN TREATING THE AMOUNTS RECEIVED AS L OAN AND SHARE SUBSCRIPTION AS UNEXPLAINED CASH CREDIT AND HAD DEL ETED THE ADDITIONS MADE U/S 68 OF THE IT ACT. THE FACTS AND CIRCUMSTAN CES REMAINING THE IT(SS)A NO. 20-21/K/12 & CO 23-24/K/12 A.YS 06-07 & 07-08 IT(SS)A NO.22-23/K/12 & CO 21-22/K/12 A.YS. 05-06 & 06-07 IT(SS)A NO.24/K/12 & CO 30/K/15 A.Y. 05-06 IT(SS)A NO.25-26/K/12 & CO 28-29/K/15 A.YS. 06-07 & 08-09 PAGE 17 SAME, FOR THE REASONS RECORDED BY ME IN MY ORDER DA TED 16.121.2011 (SUPRA), I HOLD THAT IN THE CASE OF THE PRESENT APP ELLANT THE AO WAS NOT JUSTIFIED IN TREATING THE AMOUNTS RECEIVED AS LOAN AND SHARE SUBSCRIPTION AS UNEXPLAINED CASH CREDIT. THEREFORE, I DELETE THE FOLLOWING ADDITIONS MADE U/S 68 OF THE IT ACT: A/Y 2006-07 : UNSECURED LOAN RS.1,20,00,000/- SHARE CAPITAL RS.3,15,65,000/- AY 2007-08 : UNSECURED LOAN RS.67,00,000/- 6.3 AS A COROLLARY TO MY DECISION IN DELETING THE A DDITION MADE U/S 68 IN RESPECT OF THE UNSECURED LOAN FOR AY 2007-08 I HOLD THAT THE ADDITION ON INTEREST AMOUNTING TO RS.43,529/- FOR AY 2007-08 IS NOT JUSTIFIED AND AS SUCH DELETE THE SAME. 10. AGGRIEVED, FOR THESE ASSESSMENT YEARS, REVENUE CAME IN APPEAL ON MERITS BEFORE TRIBUNAL AGAINST DELETION WHEREIN ASS ESSEE CAME IN CROSS OBJECTION AGAINST VALIDITY OF ASSESSMENT FRAMED U/S . 153A OF THE ACT FOR THE REASON THAT THERE IS NO INCRIMINATING MATERIAL FOR THESE ASSESSMENT YEARS AND THE ASSESSMENTS U/S. 143(3)/143(1) OF THE ACT HAVE ALREADY BEEN COMPLETED AND THE PROCEEDINGS CANNOT BE REVIVED UNLESS THE SA ME IS ABATED. IN THESE ASSESSMENT YEARS THE COMPLETED ASSESSMENT CANNOT BE ABATED IN TERM OF THE PROVISION OF SECTION 153A(1) OF THE ACT . 11. BEFORE US, LD. COUNSEL FOR THE ASSESSEE FIRST O F ALL STATED THAT FOR ASSESSMENT YEARS 2003-04 TO 2007-08 ASSESSMENTS WER E COMPLETED ORIGINALLY U/S. 143(3)/143(1) OF THE ACT AND NO PRO CEEDINGS, WHATSOEVER, WERE PENDING BEFORE THE AUTHORITIES UNDER ANY OF THE PRO VISIONS OF THE ACT BEFORE THE DATE OF SEARCH I.E. 19.03.2009. AFTER THE COMP LETION OF SEARCH THE AO ISSUED NOTICES U/S. 153A OF THE ACT IN RESPECT TO T HESE ASSESSMENT YEARS JUST BASED ON THE STATEMENT OF SHRI SAMBHU KR MORE RECOR DED U/S. 132(4) OF THE ACT ON 09.05.2009. ACCORDING TO LD. COUNSEL, THE I NCOME TAX DEPARTMENT CONDUCTED A SURVEY U/S. 133A OF THE ACT ON THE BUSI NESS PREMISES OF SHRI SAMBHU KR MORE ON 09.05.2009 AND THE SAME WAS CONVE RTED INTO SEARCH AND IT(SS)A NO. 20-21/K/12 & CO 23-24/K/12 A.YS 06-07 & 07-08 IT(SS)A NO.22-23/K/12 & CO 21-22/K/12 A.YS. 05-06 & 06-07 IT(SS)A NO.24/K/12 & CO 30/K/15 A.Y. 05-06 IT(SS)A NO.25-26/K/12 & CO 28-29/K/15 A.YS. 06-07 & 08-09 PAGE 18 SEIZURE OPERATION U/S. 132 OF THE ACT ON THE VERY S AME DAY. THE DEPARTMENT ON THE BASIS OF SHRI SAMBHU KR MORE CAME TO CONCLUS ION THAT HE HAS PROVIDED ACCOMMODATION ENTRIES TO SHRI SHANTI KR SURANA, THE ASSESSEE, AND HIS GROUP COMPANIES IN LIEU OF UNACCOUNTED CASH. APART FROM THE STATEMENT OF SHRI SAMBHU KR MORE THE REVENUE COULD NOT UNEARTH ANY EV IDENCE WHICH PROVES THAT THE ASSESSEE HAS RECEIVED UNSECURED LOANS, SHA RE CAPITAL/PREMIUM THROUGH ACCOMMODATION ENTRIES PROVIDED BY SHRI SAMB HU KR MORE. THERE WAS NO INCRIMINATING MATERIAL FOUND DURING THE COUR SE OF SEARCH EITHER ON THE SURANA GROUP OF COMPANIES ON 19.03.2009 OR DURING S EARCH AND SEIZURE OPERATION ON SAMBHU KR MORE ON 09.05.2009. ACCORDI NG TO LD. COUNSEL, AS THE REVENUE HAS ISSUED NOTICES U/S. 153A OF THE ACT IN RESPECT TO ASSESSEE AND HIS GROUP CONCERNS AFTER SEARCH AND ASSESSEE HA S FILED RETURN IN RESPONSE TO THE SAME DEPICTING THE SAME INCOME AS O RIGINALLY RETURNED AND ASSESSED BY THE DEPARTMENT, IN THE ABSENCE OF ANY I NCRIMINATING MATERIAL FOUND DURING THE COURSE OF SEARCH, THE REVENUE SHOU LD NOT HAVE FRAMED ASSESSMENT. ACCORDING TO HIM, THE ASSESSMENT FRAME D U/S. 153A OF THE ACT WITHOUT INCRIMINATING MATERIAL IS BAD IN LAW AND VO IDABLE. 12. WE HAVE HEARD RIVAL CONTENTIONS AND GONE THROUG H FACTS AND CIRCUMSTANCES OF THE CASE. WE FIND THAT THE ASSESS EE HAD BORROWED FUNDS AND THESE BORROWINGS ARE DULY CONFIRMED BY THE LEND ERS BY PRODUCING LOAN CONFIRMATIONS. WE FIND THAT THE TRANSACTIONS OF REC EIPT OF LOAN AND RE-PAYMENTS THEREOF ARE ALL BY ACCOUNT PAYEE CHEQUES. THE ASSES SEE BEFORE US EXPLAINED THE SOURCE OF THE CASH CREDITS APPEARING IN HIS BOO KS AND HAS SUBMITTED CONFIRMATIONS IN SUPPORT OF THE SAME. NOWHERE IN TH E ORDER OF ASSESSMENT MADE BY THE AO THERE IS ANY REFERENCE TO ANY PAPER/ DOCUMENT SEIZED BY THE SEARCH PARTY IN THE CURSE OF SEARCH U/S 132 IN THE CASE OF THE ASSESSEE AS WELL AS IN THE CASE OF SHRI SHAMBU KUMAR MORE. FURTHER, SURVEY OPERATIONS WERE CONDUCTED U/S 133A IN THE CASE OF COMPANIES WHO HAD ADVANCED LOANS TO ASSESSEE. NO INCRIMINATING PAPER/DOCUMENT WAS FOUND IN THE COURSE OF SUCH SURVEY. THE AO HAS SIMPLY PROCEEDED ON THE BASIS OF A VERBAL STATEMENT OF IT(SS)A NO. 20-21/K/12 & CO 23-24/K/12 A.YS 06-07 & 07-08 IT(SS)A NO.22-23/K/12 & CO 21-22/K/12 A.YS. 05-06 & 06-07 IT(SS)A NO.24/K/12 & CO 30/K/15 A.Y. 05-06 IT(SS)A NO.25-26/K/12 & CO 28-29/K/15 A.YS. 06-07 & 08-09 PAGE 19 SHRI SHAMBHU KUMAR MORE WHICH HAS NO EVIDENTIARY VA LUE. FIRSTLY BECAUSE HE HIMSELF ADMITTED THAT HE HAS NO EVIDENCE IN SUPPORT OF WHAT HE DEPOSED U/S 132(4) AND SECONDLY, IN FACT IMPORTANT TO NOTE THAT SEARCHES AND SURVEYS MADE BY THE REVENUE DID NOT BRING OUT ANY EVIDENCE INDICATING ANY FALSEHOOD OF THE TRANSACTIONS. BUT THE AO HAS SUMMED UP THE MATTER IN HOLDING THAT THE ASSESSEE ACCEPTED ACCOMMODATION ENTRIES FOR HIMSELF AS WELL AS FOR OTHER GROUP CONCERNS IN LIEU OF UNACCOUNTED CASH. 12.1 WE ARE RELYING IN THE DECISION OF THIS TRIBUNA L IN THE CASE OF CIT VS SHRI SHANTI KUMAR SURANA I.T.(SS). NOS. 12 TO 16/KOL/2012 AND CIT VS. SURANA MERCANTILES PVT. LTD. I.T.(SS).A NOS. 17 TO 19/KOL/2012 WHERE IN OWN GRO UP OF THE ASSESSEES CASES THE RELIEF WAS GRANTED ON THE SAME FACTS & CIRCUMSTANCES BY OBSERVING AS UNDER : 15. IN VIEW OF THE FACTS IN ENTIRETY AND THE LEGAL PRINCIPLES ENUNCIATED BY HON'BLE BOMBAY HIGH COURT IN THE CASE OF CONTINE NTAL WAREHOUSING CORPORATION (NHAVA SHEVA) LTD., SUPRA, OF HON'BLE A LLAHABAD HIGH COURT IN THE CASE OF SHAILA AGARWAL, SUPRA AND MUMB AI SPECIAL BENCH DECISION IN THE CASE OF ALL CARGO GLOBAL LOGISTICS, SUPRA, WE ARE OF THE VIEW THAT THERE IS NO INCRIMINATING MATERIAL FOUND DURING THE COURSE OF SEARCH IN THE PRESENT CASE FOR THESE ASSESSMENT YEA RS, EXCEPT THE STATEMENT OF ONE SHRI SAMBHU KR MORE, AS ADMITTED B Y THE AO IN HIS REMAND REPORT DATED 23.09.2011 AND DESPITE NUMBER O F OPPORTUNITIES REVENUE COULD NOT PRODUCE ANY INCRIMINATING MATERIA L BEFORE THE BENCH AND THE ASSESSMENTS ARE ALREADY COMPLETED FOR THESE ASSESSMENT YEARS ORIGINALLY, THE ASSESSMENTS FRAMED U/S. 153A OF THE ACT IS IN VALID AND HENCE, QUASHED. 16. ACCORDINGLY, THE CROSS OBJECTIONS OF THE ASSESS EE IN CO NOS. 13 TO 20/KOL/2012 ARE ALLOWED. 17. IN REGARD TO THE REVENUES APPEALS IN IT(SS)A N OS.12 TO 19/K/2012, THE REVENUE HAS CHALLENGED THE DELETION OF ADDITION ON MERITS BY CIT(A). SINCE WE HAVE ALREADY QUASHED TH E ASSESSMENT FRAMED U/S. 153A OF THE ACT ON LEGAL ISSUE, WE NEED NOT TO ADJUDICATE THE MATTER OF REVENUES APPEALS ON MERITS. HENCE, CONSEQUENTIALLY THESE APPEALS OF REVENUE ARE DISMISSED. IT(SS)A NO. 20-21/K/12 & CO 23-24/K/12 A.YS 06-07 & 07-08 IT(SS)A NO.22-23/K/12 & CO 21-22/K/12 A.YS. 05-06 & 06-07 IT(SS)A NO.24/K/12 & CO 30/K/15 A.Y. 05-06 IT(SS)A NO.25-26/K/12 & CO 28-29/K/15 A.YS. 06-07 & 08-09 PAGE 20 FOLLOWING THE SAME PROPOSITION OF THE FACTS IN ASSE SSEES CO AND THAT OF REVENUES APPEAL AS STATED ABOVE, WE ALLOW THE CO O F THE ASSESSEE AND APPEAL FILED BY THE REVENUE IS DISMISSED. COMING TO OTHER COS AND THAT OF REVENUE APPEALS 13. IN ALL OTHER APPEALS OF THE REVENUE AND COS OF THE ASSESSEE, ALL THE GROUNDS OF APPEAL AND FACTS OF THE CASE ARE SAME EX CEPT THE FIGURES. WE HAVE ALREADY UPHELD THE ORDER OF THE LD. CIT(A) BY DISMI SSING THE APPEAL OF REVENUE IN IT(SS)A 20 & 21 OF 2012 AND BY UPHOLDING THE CO OF ASSESSEE IN 23/KOL/2012 & 29/KOL/2015. FOLLOWING THE SAME PROPO SITION FOR THE OTHER CASES OF REVENUE IN IT(SS)A NO.22 TO 26/KOL/2012 AN D CO NO.S 21. 22, 24 OF 2012 AND CO 28 & 30 OF 2015 OF THE ASSESSEE, WE DIS MISS ALL THE APPEALS OF THE REVENUE AND ALLOW THE CO OF THE ASSESSEE. 14. IN REGARD TO THE REVENUES APPEALS IN IT(SS)A N O.22 TO 26 OF 2012, THE REVENUE HAS CHALLENGED THE DELETION OF ADDITION ON MERITS BY L. CIT(A). SINCE WE HAVE ALREADY QUASHED THE ASSESSMENT FRAMED U/S.1 53A OF THE ACT ON LEGAL ISSUE, WE NEED NOT TO ADJUDICATE THE MATTER OF REVE NUES APPEALS ON MERITS. HENCE, CONSEQUENTIALLY THESE APPEALS OF REVENUE ARE DISMISSED. 15. IN COMBINED RESULT, REVENUES APPEALS ARE DISMISSED AND THAT OF ASSESSEES COS ARE ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT 29/ 02/2016 SD/- SD/- (MAHAVIR SINGH) (WASEEM AHMED) (JUDICIAL MEMBER) (ACCOUNTANT MEMBER) KOLKATA, *DKP - 29/02/2016 IT(SS)A NO. 20-21/K/12 & CO 23-24/K/12 A.YS 06-07 & 07-08 IT(SS)A NO.22-23/K/12 & CO 21-22/K/12 A.YS. 05-06 & 06-07 IT(SS)A NO.24/K/12 & CO 30/K/15 A.Y. 05-06 IT(SS)A NO.25-26/K/12 & CO 28-29/K/15 A.YS. 06-07 & 08-09 PAGE 21 / COPY OF ORDER FORWARDED TO:- 1. / APPELLANT-ACIT, CC-XXIII, KOLKATA 2. /RESPONDENT-M/S SHUBHAM IMPEX (P) LTD / M/S S.A.SUP PLIERS (P) LTD M/S DEEVANSHI CONSULTANTS (P) LTD., 505, CENTURY TOWERS , SHAKESPEARE SARANI, KOLKATA-17 / M/S DSL TECHNOLOGIES LTD., 86, CANNING ST, KOL-01 3. ! # / CONCERNED CIT KOLKATA 4. # - / CIT (A) KOLKATA 5. $%& '' ! , ! , / DR, ITAT, KOLKATA 6. &() / GUARD FILE. BY ORDER/ , /TRUE COPY/ / ! ,