M/s. Uttarakhand Uthan Samiti, Dehradun V. DGIT (Inv.), Lucknow

ITA 4093/DEL/2015

• Counselvise Citation: [2019] 116 COUNSELVISE.COM (IT) 5678 (ITAT-DELHI)
• Duration Of Justice: 4 year(s) 1 month(s) 16 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 08-08-2019
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: A
• Next Hearing Date: 03-05-2017
• Assessment Year: misc
• Appeal Filed On: 22-06-2015
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: SANJAY GOYAL
• Assessee Lawyers: SOUMYA SINGH S
• Keywords: Bogus purchase; Business income; Search and seizure; Document seized; Opportunity of being heard; Principle of natural justice; Retrospective amendment; Competent authority; Benefit of exemption; Documents seized
• Section: 12AA; 250; 263; 132; 28; 139

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH : A : NEW DELHI BEFORE SHRI R.K. PANDA, ACCOUNTANT MEMBER AND MS SUCHITRA KAMBLE, JUDICIAL MEMBER ITA NO.4093/DEL/2015 ASSESSMENT YEAR: - UTTARAKHAND UTHAN SAMITI, 32/4, EC ROAD, DEHRADUN. PAN: AAAAU1376N VS DGIT (INV.), AAYAKAR BHAWAN, 5-ASHOK MARG, LUCKNOW. (APPELLANT) (RESPONDENT) ASSESSEE BY : SHRI SALIL KAPOOR, ADVOCATE, SHRI SUNIL LAL CHANDANI, MS PALLAVI SAIGAL & MS SOUMYA SINGH, ADVOCATES REVENUE BY : SHRI SANJAY GOYAL, CIT, DR DATE OF HEARING : 04.07.2019 DATE OF PRONOUNCEMENT : 08.08.2019 ORDER PER R.K. PANDA, AM: THIS APPEAL FILED BY THE ASSESSEE IS DIRECTED AGAIN ST THE ORDER DATED 26 TH MARCH, 2015 PASSED BY THE DGIT (INV.), LUCKNOW CANC ELLING THE APPROVAL GRANTED U/S 10(23C)(VI) OF THE ACT RELATING TO ASSESSMENT Y EAR 2007-08 AND ONWARDS. 2. FACTS OF THE CASE, IN BRIEF, ARE THAT THE ASSESS EE M/S UTTARAKHAND UTHAN SAMITI IS A SOCIETY REGISTERED WITH THE REGISTRAR O F SOCIETIES VIDE REGISTRATION ITA NO.4093/DEL/2015 2 CERTIFICATE NO. 81/2004-05/1861 DATED 12/12/2004 AN D IS ALSO REGISTERED U/S 12AA OF THE I.T. ACT, 1961 BY THE CIT, DEHRADUN VIDE ORD ER NO.C-40(206)/ REGISTRATION/DEHRADUN/2006-07 /TECH/9703 DATED 29.1 1.2007. SHRI SANJAY BANSAL R/O 32/4, E.C. ROAD, DEHRADUN IS THE CHAIRMAN OF TH IS SOCIETY. THIS SOCIETY RUNS VARIOUS EDUCATIONAL INSTITUTES IN THE NAME OF DEV B HOOMI GROUP OF INSTITUTES AT DEHRADUN AND SAHARANPUR. THE SOCIETY HAS ALSO BEEN APPROVED FOR EXEMPTION UNDER CLAUSE 10(23C)(VI) OF THE I.T. ACT, 1961 BY T HE CCIT, DEHRADUN VIDE ORDER F.NO. CCIT/DDN/5/10(23C)(VI) AND (VIA) DATED 18.03. 2008 W.E.F. 1.4.2007. A SEARCH & SEIZURE OPERATION WAS CONDUCTED U/S 132 OF THE I.T. ACT, 1961 ON THE DEV BHOOMI INSTITUTE OF TECHNOLOGY, UTTRAKHAND UTHAN SA MITI AND OTHER GROUP CONCERNS ON 26.04.2012. VIDE CENTRALIZATION ORDER U/S 127 OF THE INCOME TAX ACT, 1961 DATED 16.01.2013 OF COMMISSIONER OF INCOME TAX , DEHRADUN, THE CASE OF THE ABOVE ASSESSEE HAS BEEN CENTRALIZED WITH CENTRAL CI RCLE, DEHRADUN FALLING WITHIN THE ADMINISTRATIVE CONTROL OF THE DGIT(INV.), LUCKN OW. CERTAIN EVIDENCES WERE GATHERED DURING THE COURSE OF SEARCH & SEIZURE, POS T SEARCH ENQUIRIES BY THE INVESTIGATION WING AND SUBSEQUENT ENQUIRIES BY THE ASSESSING OFFICER DURING THE COURSE OF ASSESSMENT PROCEEDINGS. AS A RESULT OF EN QUIRY, CERTAIN FACTS EMERGED WHICH INDICATED THAT THE ACTIVITIES OF THE ASSESSEE SOCIETY WAS NOT IN ACCORDANCE WITH CONDITIONS FOR ALLOWANCE OF EXEMPTION U/S.10(2 3C)(VI) OF THE INCOME TAX ACT, 1961 AND IT HAS VIOLATED THE PROVISION CONTAIN ED IN CLAUSE (A) AND (B) OF THE THIRD PROVISO OF SECTION 10(23C)(VI) OF THE 1 .T. A CT 61. ITA NO.4093/DEL/2015 3 3. THE LD. DGIT (INV.) OBSERVED THAT THE SOCIETY (U TTRAKHAND UTHAN SAMITI) UNDER WHICH VARIOUS EDUCATIONAL INSTITUTIONS ARE BE ING RUN IN THE NAME OF DEV BHOOMI GROUP OF INSTITUTIONS AT DEHRADUN, ROORKEE, SAHARANPUR RECEIVES INCOME BY WAY OF FEES AND OTHER CHARGES FROM THE STUDENTS. BESIDES, THE SOCIETY HAS ALSO RAISED TERM LOANS/OVERDRAFT FACILITY FROM VARIOUS B ANKS. THE SURPLUS INCOME AND EXEMPTION CLAIMED BY SOCIETY IS AS UNDER: A.Y. GROSS RECEIPTS (APPLIED FOR EDUCATIONAL PURPOSES) (RS.) EXPENDITURE (RS.) SURPLUS SHOWN (CLAIMED EXEMPT) (RS.) 2007 - 08 24779791 2 4691009 88,782 2008 - 09 60049012 57067849 29,81,162 2009 - 10 108264619 98360017 99 ,04,601 2010 - 11 178340690 160614144 1,77,26,545 2011 - 12 220785347 219694484 10 , 90,862 2012 - 13 298121824 297026755 10 , 85,069 4. HE NOTED THAT THE FOUNDER MEMBERS AND TRUSTEES O F THE SOCIETY ARE SH. SANJAY BANSAL, HIS WIFE SMT. SEEMA BANSAL, MOTHER SMT. BIM AL BANSAL AND BROTHER SH. SUDHIR BANSAL. DURING THE SEARCH AND SEIZURE OPERAT ION CONDUCTED ON THE SOCIETY U/S 132 OF THE INCOME TAX ACT, 1961 ON 26/4/2012, V ARIOUS INCRIMINATING DOCUMENTS WERE FOUND AND SEIZED. THESE SEIZED DOCUM ENTS REVEALED THAT THE TRUSTEE AND CHAIRMAN OF THE SOCIETY, SHRI SANJAY BA NSAL HAS SIPHONED OFF THE SOCIETY'S FUNDS IN A BIG WAY AND THE FUNDS SO SIPHO NED OFF WERE UTILIZED FOR ACQUIRING IMMOVABLE PROPERTIES BY HIM AND HIS FAMIL Y MEMBERS AND FOR OTHER PURPOSES. THE LD. DGIT (INV.) OBSERVED THAT THE MOD US OPERANDI ADOPTED FOR SIPHONING OFF THE SOCIETYS FUNDS IS THAT SHRI SANJ AY BANSAL HAD FLOATED SOME ITA NO.4093/DEL/2015 4 FICTITIOUS AND NON-GENUINE ENTITIES IN THE NAMES OF HIS TRUSTED EMPLOYEES/ACCOUNTANTS, NAMELY SHRI SUNIL DANDRIYAL, SHRI SUSHIL KUMAR AND THEIR FAMILY MEMBERS AND OPENED BANK ACCOUNTS IN THEIR NA MES BY FORGING THE DOCUMENTS SUBMITTED WITH ACCOUNT OPENING FORMS . TH E DEPOSITS CREDITED IN THESE ACCOUNTS WERE FROM THE TERM LOAN/OD ACCOUNTS OF UTT ARAKHAND UTHAN SAMITI, AND DEV BHOOMI INSTITUTE OF TECHNOLOGY DEHRADUN. HE NO TED THAT M/S FORTECH COMPUTER SYSTEM IS THE PROPRIETORSHIP CONCERN OF MR . SUNIL DANDRIYAL WHO IS THE ACCOUNTANT AND TRUSTED EMPLOYEE OF SHRI SANJAY BANS AL. AN ACCOUNT WAS OPENED IN THE NAME OF THE SAID CONCERN WHOSE INTRODUCER WAS S HRI SANJAY BANSAL. THE TOTAL RECEIPTS AND WITHDRAWALS FROM THIS ACCOUNT DURING T HE F.Y. 2008-09 TO 2010-11 WAS RS.2.99 CRORE AND SHRI DANDRIYAL WAS SHOWING IN COME FROM SALARY OF RS.1 LAKH IN THE RETURN FILED U/S 139 FOR EARLIER YEARS UPTO ASSESSMENT YEAR 2011-12. HOWEVER, AFTER THE SEARCH, HE HAS DISCLOSED BUSINES S INCOME FROM SALE OF COMPUTERS IN TWO CONCERNS, NAMELY, M/S FORTECH COMP UTER SYSTEM AND M/S CAD ARENA WHO HAVE SHOWN TO HAVE STARTED BUSINESS IN F. Y. 2008-09. HE NOTED THAT IN THE CASE OF M/S CAD ARENA, WHOSE PROPRIETOR IS SHRI SUNIL DANDRIYAL, THE BANK ACCOUNT WAS OPENED ON 25 TH SEPTEMBER, 2010 WHICH REMAINED OPERATIVE TILL 12 TH FEBRUARY, 2011 AND THERE WERE DEPOSITS TO THE TUNE OF RS.17,86,174/-. SIMILARLY, THERE WAS ANOTHER CONCERN IN THE NAME OF SHRI SUNIL DANDRIYAL, NAMELY, M/S NICE HOME BUILDERS WHICH IS THE PROPRIETOR CONCERN OF SH RI SUNIL DANDRIYAL WHEREIN THE TOTAL RECEIPTS AND WITHDRAWALS DURING THE F.Y. 2010 -11 WERE TO THE TUNE OF RS.58,50,000/-. HE OBSERVED THAT M/S DRISHTI ASSOC IATES WAS THE PROPRIETORSHIP ITA NO.4093/DEL/2015 5 CONCERN OF SMT. MAMTA DANDRIYAL, W/O SHRI SUNIL DAN DRIYAL WHEREIN RECEIPTS AND WITHDRAWALS TO THE TUNE OF RS.58 LAKHS HAS TAKEN PL ACE DURING F.Y. 2010-11 AND RS.52,60,000/- DURING F.Y. 2011-12. SMT. MAMTA DAN DRIYAL IS ONLY HOUSEWIFE AND HAS NOT BEEN FILING ANY INCOME-TAX RETURN BEFORE TH E SEARCH. IT IS ONLY AFTER THE SEARCH THAT SHE STARTED FILING INCOME TAX RETURN SH OWING BUSINESS INCOME. HE NOTED THAT M/S PAWAN & CO. WAS THE PROPRIETORSHIP CONCERN OF MR. PAWAN KUMAR WHO IS A NON-EXISTING PERSON. THE BANK DOCUMENT SUBMITTED WITH THE ACCOUNT OPENING FORM, THE PHOTOGRAPH OF SHRI SUSHIL KUMAR, EMPLOYEE OF SHRI SANJAY BANSAL AND IDENTITY AND ADDRESS PROOFS OF SHRI SUNIL HAS BEEN AFFIXED. THE INTRODUCER IS SMT. SEEMA BANSAL, W/O SHRI SANJAY BANSAL AND THE TOTAL RECEIPTS AND WITHDRAWALS DURING F.Y. 2008-09 ARE TO THE TUNE OF RS.76,13,000 /-. HE NOTED THAT THERE IS ANOTHER CONCERN, NAMELY M/S RANA STEEL WHICH IS THE PROPRIETORSHIP FIRM OF SHRI RAHUL KUMAR RANA WHO WAS A NON-EXISTENT PERSON. THE DGIT (INV.) FURTHER NOTED THAT THERE ARE VARIOUS OTHER CONCERNS WHICH WERE OP ERATED BY THE TRUSTED EMPLOYEES OF THE ASSESSEE OR THEIR RELATIONS SUCH AS : I) M/S AKASHGANGA ASSOCIATES, PROPRIETOR SHRI SUSHIL K UMAR; II) M/S ALAKNANDA REALTORS, PROPRIETOR SMT. RAMA GAUTAM , W/O SHRI SUSHIL KUMAR; III) M/S CONFINITE, PROPRIETOR SHRI SUSHIL KUMAR IV) M/S NEGI BUILDERS & SUPPLIERS, PROPRIETOR SHRI MUKE SH NEGI; V) M/S EDISONS SALES CORP., PROPRIETOR SMT. BIMAL BAN SAL, MOTHER OF SHRI SANJAY BANSAL; ITA NO.4093/DEL/2015 6 VI) M/S STRATEGIC MARKETING PVT. LTD.; VII) M/S WALI GRAMUDYOG SANSTHAN, ROORKEE, ETC. 5. HE NOTED THAT THE ABOVE FICTITIOUS CONCERNS ARE SHOWN TO BE ENGAGED IN THE BUSINESS OF SUPPLY OF BUILDING MATERIAL, COMPUTERS/ LAPTOPS AND CIVIL CONSTRUCTION WORK, ETC. AND THE PURCHASES FROM THEM HAVE BEEN DE BITED IN THE BOOKS OF THE SOCIETY. THE EVIDENCES UNEARTHED DURING THE SEARCH ACTION AND SCRUTINY PROCEEDINGS REVEALED THE MODUS OPERANDI ADOPTED BY SHRI SANJAY BANSAL TO DIVERT THE FUNDS OF THE SOCIETY THROUGH THE ABOVE ACCOUNTS AND OTHER MEANS FOR HIS PERSONAL BENEFIT AND PURPOSES OTHER THAN EDUCATIONA L PURPOSES. SOME OF THE SALIENT FEATURES AS NOTED BY LD. DGIT (INV.) FROM PAGE 7 TO PAGE 14 OF HIS ORDER IS REPRODUCED AS UNDER:- I) WHILE OPENING THE ACCOUNTS WITH BANKS, ALL THESE P ERSONS HAVE BEEN INTRODUCED BY SHRI SANJAY BANSAL OR SMT. SEEMA BANS AL W/O SHRI SANJAY BANSAL. IN MOST OF THE ACCOUNTS, DOCUMENTS OF ADDRE SS AND IDENTITY PROOFS HAVE ALSO BEEN FORGED IN NAMES OF NON-EXISTENT CONC ERNS AND PERSONS. II) MOST OF THESE BOGUS CONCERNS WERE STARTED WITH MEAG ER CAPITAL. III) NO BOOKS OF ACCOUNT WERE FOUND IN CASES OF CONCERNS WHERE SEARCH WAS CARRIED OUT. EVEN IN OTHER CASES NO BOOKS OF AC COUNTS PRODUCED EVEN BEFORE THE AO. IV) THESE CONCERNS WERE HAVING ONLY ONE CLIENT THAT IS UTTARKHAND UTHAN SAMITI. THESE WERE NOT SUPPLYING ANYTHING TO ANY OT HER PERSON. IN MANY CASE PROPRIETORS DID NOT HAVE ANY BUSINESS EXPERIENCE. V) THE AMOUNTS CREDITED IN THE BANK ACCOUNTS OF THE FI CTITIOUS CONCERNS ARE FROM THE TERM LOANS AND OD ACCOUNTS OF UTTARAK HAND UTHAN SAMITI AND BANK ACCOUNT OF DBIT COLLEGE FOR EXPENDITURE BOOKED AGAINST THE BOGUS PURCHASES SHOWN FROM THESE CONCERNS. THE REPAYMENTS OF THESE TERM LOAN AND OD ACCOUNTS HAVE BEEN MADE FROM FUNDS OF THE SOCIET Y THROUGH ACCOUNT NUMBER 1175009301046063 WITH PNB, KAULAGARH ROAD DE HRADUN OF SOCIETY AND ACCOUNT NUMBER 1175002100008302 OF DBIT COLLEGE . PAYMENTS HAVE ITA NO.4093/DEL/2015 7 BEEN MADE THROUGH CHEQUES, AND SUBSEQUENTLY CASH HA S BEEN IMMEDIATELY WITHDRAWN FROM THE BANK ACCOUNTS OF THESE FICTITIOU S CONCERNS BY ISSUING BEARER CHEQUES WHICH HAVE BEEN EXAMINED BY THE ASSE SSING OFFICER. THE CASH WAS RECEIVED MAINLY BY FOUR PERSONS SHRI SUNIL DAND RIYAL, SHRI SUSHIL KUMAR, SHRI ATUL DIXIT AND SHRI NEERAJ TYAGI, WHO ARE THE TRUSTED EMPLOYEES OF SHRI SANJAY BANSAL. BOTH SH. SUSHIL KUMAR AND SUNIL DAND RIYAL IN THEIR STATEMENTS RECORDED U/S 132(4) OF THE IT ACT, 1961 HAD ADMITTE D THE FACT OF BOGUS CONCERNS OPERATED UNDER THEIR NAMES AND FAMILY MEMB ERS ON INSTRUCTIONS OF SH. SANJAY BANSAL. THE IMPORTANT LOAN ACCOUNTS OF S OCIETY BETWEEN PERIOD FY 2006-07 TO FY 2010-11 ARE AS UNDER: S.NO. BANK NAME AMOUNT OF LOAN 1 PNB KAULAGARH DEHRADUN AGAINST FDR 60,00,000 2 TERM LOAN FOR BUILDING FROM PNB KAULAGARH 50,00,000 3 TERM LOAN FOR BUILDING FROM PNB KAULAGARH 50,00,000 4 TERM LOAN FOR LAPTOP FROM PNB KAULAGARH 64,91,000 5 LOAN FROM PNB KAULAGARH AGAINST FDR 83,50,000 6 OD LIMIT FROM PNB 7,00,00,000 7 ICICI BANK RAJPUR ROAD 9,62,489 8 LOAN AGAINST FDR FROM PNB KAULAGARH ROAD 2,34,61,000 9 TERM LOAN FOR BUILDING FROM PNB KAULAGARH 3,75,00,000 10 TERM LOAN FOR LAPTOP FROM PNB KAULAGARH 2,24,64,000 11 OD LIMIT FROM SBBJ SAHARANPUR CHOWK DEHRADUN 80,00,000 12 TERM LOAN FOR LAPTOP FROM PNB KAULAGARH 24,50,000 13 TERM LOAN FOR LAPTOP FROM PNB AWAS VIKAS SAHARANPUR 2,62,00,000 14 TERM LOAN FOR BUILDING FROM PNB AWAS VIKAS SAHARANPUR 8,00,00,000 15 OD LIMIT FROM PNB AWAS VIKAS SAHARANPUR 30,00,00,000 VI. THROUGH THESE BOGUS AND NONEXISTENT CONCERNS, THE SOCIETY HAS CLAIMED TO HAVE MADE SUBSTANTIAL PURCHASES OF COMPU TERS/LAPTOPS AND BUILDING MATERIAL ETC WHICH HAS BEEN RECORDED IN TH E BOOKS OF THE SOCIETY. THE INTEREST EXPENSES PAID ON THE TERM LOANS AND DEPREC IATION CLAIMED ON THE BUILDING AND COMPUTERS HAVE BEEN CHARGED TO THE PRO FIT AND LOSS ACCOUNT OF THE SOCIETY. HOWEVER, NO BILLS FOR PURCHASE WERE FOUND DURING THE SEARCH. THE SOCIETY HAD STATED TO HAVE PURCHASED COMPUTERS/LAPT OPS FROM M/S FORTECH COMPUTERS, M/S CAD ARENA AND STRATEGIC MARKETING PV T. LTD IT OBTAINED TERM LOAN/OVERDRAFT FACILITIES TO THE TUNE OF RS.731.64 CRORES FROM PUNJAB NATIONAL BANK, SAHARANPUR AND DEHRADUN WHICH WAS TRANSFERRED IN THE BANK ACCOUNTS ITA NO.4093/DEL/2015 8 OF THE ABOVE CONCERNS WHICH WERE NOT CARRYING OUT A NY BUSINESS. SOME OF THE EVIDENCES UNEARTHED IN RESPECT OF SUCH BOGUS PURCHA SES MADE BY THE SOCIETY WERE AS UNDER: (A) A TERM LOAN OF RS. 224.64 LAKHS WAS SANCTIONED BY THE PUNJAB NATIONAL BANK, NAV, SAHARANPUR TO THE SOCIETY UTTRA KHAND UTHAN SAMITI, DEHRADUN VIDE LETTER DATED 25.3.2009 FOR PURCHASE O F LAPTOPS. THIS LOAN WAS SANCTIONED TO BE REIMBURSED TO THE SOCIETY IN LIEU OF 800 LAPTOPS WORTH RS. 299.52 LAKHS PURCHASED FOR DISTRIBUTING TO THE STUD ENTS IN FAVOUR OF UTTRAKHAND UTHAN SAMITI. THIS LOAN AMOUNT WAS DISBURSED THROUG H ACCOUNT NO. 117500IC00000378. THE BANK PROVIDED THE COPY OF SAN CTION LETTER DT. 25.3.2009, COPY OF INVOICE NO. 1984 DATED 16.10.200 8 OF M/S FORTECH COMPUTER SYSTEMS PVT. LTD. (2008-09), G-10, SIDHART HA BUILDING, 96-NEHRU PLACE, NEW DELHI AND A COPY OF LETTER DATED 14.11.2 008 OF UTTARAKHAND UTHAN SAMITI ADDRESSED TO BRANCH MANAGER, PNB, KAULAGARH ROAD, DEHRADUN STATING THAT THE SOCIETY HAS RECEIVED THE LAPTOP IN 20.10.2 008 VIA BILL NO. 1984 DATED 16.10.2008 AND THE PAYMENT PAID TO THE SUPPLIER BY THE SOCIETY FROM SOCIETYS RESERVED FUND. FROM THE DETAILS FURNISHED BY THE BA NK, IT IS SEEN THAT THE BANK HAS SANCTIONED LOAN OF RS.224.64 LACS TO THE SOCIET Y TO BE REIMBURSED TO THE SOCIETY IN LIEU OF 800 LAPTOPS WORTH RS.299.52 LAKH S PURCHASED FOR DISTRIBUTING TO THE STUDENTS ON THE BASIS OF TWO DOCUMENTS SUBMI TTED BY THE SOCIETY NAMELY INVOICE NO. 1984 DATED 16.10.2008 OF M/S FORTECH CO MPUTER SYSTEMS PVT. LTD., 96 NEHRU PLACE, DELHI AND THE LETTER DT. 14.1 1.2008 WRITTEN BY CHAIRMAN, UTTARAKHAND UTHAN SAMITI TO PNB, KAULAGARH ROAD, DE HRADUN INTIMATING THAT THE SOCIETY HAS ALREADY PURCHASED AND RECEIVED LAPT OP IN 20.10.2008 AND HAS ALSO MADE PAYMENTS FOR THE SAME FROM THE SOCIETYS RESERVED FUND. M/S FORTECH COMPUTER SYSTEMS PVT. LTD. VIDE THEIR LETTE R DT. 25.7.2012 HAS INFORMED THAT THEY HAD SUPPLIED 467 LAPTOPS TO UTTA RAKHAND UTHAN SAMITI, DEHRADUN DURING THE YEAR 2008-09 AS UNDER:- - 450 LAPTOPS (HP-540) VIDE INVOICE NO. RTL.INV\139 6 DT. 29.9.2008 FOR RS. 1,23,61,500/- -16 LAPTOPS (HP-540) & 466 LAPTOP BAGS VIDE INVOICE NO. RTL.INV.\1514 DT. 16.10.2008 FOR RS.905516/- -1 LAPTOP VIDE INV. NO.RTL.INV/L648 DT. 8.11.2008 F OR RS. 28,470/- AND RECEIVED PAYMENT OF RS. 1,33,00,000/- AS UNDER: - -RS. 25,00,000/- ON 29.8.2008 CREDITED IN THEIR A/C NO.0318008700009938 -RS. 1,08,00,000/- ON 29.9.2008 CREDITED IN THEIR A /C NO. 2254008700000853 THEY HAVE FURTHER INFORMED THAT THEY HAD NO DEALING DURING THE YEAR 2009-10 AND 2010-11. IT WAS ALSO INFORMED IN THE AFORESAID LETTER THAT THE INVOICE NO. ITA NO.4093/DEL/2015 9 1984 DATED 16.10.2008 (WHICH THE SOCIETY HAS SUBMIT TED WITH BANK) IS NOT ISSUED BY THEIR COMPANY. THEY HAVE ISSUED THREE INV OICES ONLY AS MENTIONED ABOVE. IN VIEW OF THE ABOVE STATED FACTS, IT IS CLE AR THAT THE SOCIETY UTTARAKHAND UTHAN SAMITI, DEHRADUN HAD SUBMITTED TO THE BANK A FABRICATED INVOICE ON THE BASIS OF WHICH THE BANK HAD SANCTIONED LOAN. THE BA NK DID NOT OBTAIN ANY OTHER DOCUMENTS IN SUPPORT OF PURCHASE OF 800 LAPTO PS BY THE SOCIETY. AS SUBMITTED BY BANK, NO INSPECTION REPORT OF THE BANK OFFICER REGARDING THE END USE OF LOAN AMOUNT IS AVAILABLE WITH THE BANK. MORE OVER, THE BANK HAS ALSO WAIVED THE CONDITION OF INSURANCE OF LAPTOPS BY THE SOCIETY. (B) A FRESH TERM LOAN (ACCOUNT NO. 117500IC0000041 1) OF RS. 245.00 LAKH FOR PURCHASE OF 950 LAPTOPS WORTH RS. 355.68 L AKHS TO BE DISTRIBUTED TO THE STUDENTS WAS SANCTIONED/DISBURSED BY BANK VIDE LETTER DATED 5.11.2009 IN FAVOUR OF UTTRAKHAND UTHAN SAMITI, DEHRADUN. M/S UT TRAKHAND UTHAN SAMITI/DBIT HAD SUBMITTED AN INVOICE NO. SM 09-10/1 331 DATED 04.12.2009 OF M/S STRATEGIC MARKETING 29/3, FIRST FLOOR, RAJPU R ROAD, ANEKANT PLACE, DEHRADUN TO THE BANK FOR PURCHASE OF 950 NOS. OF HP -C-510 BUSINESS NOTE BOOK FOR RS. 3,55,68,000/-. THE ABOVE LOAN WAS SANC TIONED BY THE BANK ON THE BASIS OF THE SAID INVOICE NO.SM 09-10/1331 DATED 4. 12.2009 OF M/S STRATEGIC MARKETING. THE COPY OF THE INVOICE MENTIONED ABOVE IS THE ONLY DOCUMENTS SUBMITTED BY M/S UTTRAKHAND UTHAN SAMITI TO THE BAN K IN SUPPORT OF THE PURCHASE OF 950 BUSINESS NOTE BOOK (COMPUTERS) AND THE END USE OF THE LOAN SANCTIONED. AFTER SANCTIONING AND DISBURSING THE SA ID TERM LOAN, THE BANK HAS NOT OBTAINED THE PURCHASE BILL FROM THE SOCIETY IN SUPPORT OF PURCHASE OF LAPTOP/COMPUTERS FOR WHICH THE LOAN WAS SANCTIONED. MOREOVER, WHILE SANCTIONING THE LOAN VIDE LETTER DT. 05.11.2009, TH E BANK HAS WAIVED THE CONDITION OF INSURANCE OF LAPTOPS/ BUSINESS NOTE BO OKS. MOREOVER, NO INSPECTION REPORT IN RESPECT OF END USE OF THE TERM LOAN IS AVAILABLE WITH THE BANK AS STATED IN LETTER DT. 27.7.2012 OF CHIEF MAN AGER, PNB, AVAS VIKAS BRANCH, SAHARANPUR .THEREFORE, AS ALREADY CONFIRMED BY THE FIRM M/S STRATEGIC MARKETING, BOGUS EXPENDITURE HAS BEEN DEBITED IN TH EIR NAMES IN BOOKS OF SOCIETY. (C) A FURTHER TERM LOAN OF RS. 262 LAKHS WAS SANCTI ONED BY THE BANK PNB NAV, SAHARANPUR TO THE SOCIETY UTTRAKHAND UTHAN SAM IT, DEHRADUN VIDE LETTER DATED 07.09.2010. THIS LOAN WAS SANCTIONED FOR PURC HASE OF 1050 LAPTOPS WORTH RS.393.12 LAKH TO BE DISTRIBUTED TO THE STUDE NTS OF THE INSTITUTE. THIS LOAN AMOUNT WAS DISBURSED THROUGH ACCOUNT NO. 11750 0IC00000448. BANK PROVIDED THE COPY OF SANCTION LETTER DT. 07.09.2010 , COPY OF PROFORMA INVOICE OF M/S CAD ARENA NO.J9AD109932 DATED 19.8.2010 WHIC H IS STATED TO BE AUTHORIZED DEALER OF M/S HEWLETT PACKARD INDIA SALE S PVT. LTD. (HPISPL) 24, SALARPURIA ARENA HOSURE MAIN ROAD, ADUGODI, BANGALO RE, KARNATAKA AND A COPY OF PURCHASE ORDER BY UTTARAKHAND UTHAN SAMITI BEARING NO. DBIT/ORDER/09-10/198 DATED 19.8.2010 TO M/S CAD ARE NA, 2ND NEAR HOSTEL ROYAL PALACE, ROORKEE U.K. FOR PURCHASE OF 1 050 MP COMPAQ 420 BUSINESS CLASS NOTEBOOK FOR RS. 3,93,12,000/-. THE BANK HAD ALSO PROVIDED A ITA NO.4093/DEL/2015 10 COPY OF UNSIGNED LETTER OF ONE NAMAN PATIL (MANAGER SALES-NORTH INDIA) OF HEWLETT PACKARD INDIA SALES PVT. LTD., 24, SALARPUR IA ARENA HOSUR MAIN ROAD, ADUGODI, BANGALORE ADDRESSED TO THE DIRECTOR/CHAIRM AN, UTTRAKHAND UTHAN SAMITI (DEVBHOOMI GROUP OF INSTITUTIONS) 32/4 E.C.R OAD, DEHRADUN, UTTRAKHAND CONFIRMING RECEIPT OF RS. 59,99,500/- BY RTGS TRANSFER FOR THE SUPPLY OF 1050 LAPTOPS ON 30.8.2010 AND 6.9.2010 FO R RS. 35,99,5000/- AND RS. 24,00,000/- VIDE RTGS NO. SD2046240 AND SD 2248 301 RESPECTIVELY. VIDE AFORESAID SANCTION LETTER DT.07.09.2010 OF TH E BANK, FRESH TERM LOAN OF RS. 262 LAKH HAS BEEN SANCTIONED FOR PURCHASE OF 1050 LAPTOPS WORTH RS. 393.12 LAKHS AND FURTHER WAIVEMENT OF INSURANCE OF LAPTOPS WAS ALSO APPROVED BY THE BANK. M/S HEWLETT-PACKARD INDIA SALES PVT. L TD VIDE ITS LETTER DT.10.08.2012 : I) THAT IT HAS SUPPLIED ONLY 150 LAPTOP ON 17.9.2010 F OR RS. 34,42,500/- AGAINST INVOICE NO. J9B6123942, 100 LAPTOPS ON 7.10 .2010 FOR RS. 22,95,000/- AGAINST INVOICE NO.J9B6124615 AND ONE L APTOP 10.3.2011 AGAINST INVOICE NO.J9D6113904 FOR RS. 22950/- TOTAL ING TO RS. 60,00,000/- AGAINST WHICH IT HAS RECEIVED THE PAYME NT OF RS. 35,99,500/- ON 30.8.10 AND RS. 24,00,000/- ON 6.9.2 010 THROUGH RTGS. II) THAT CAD ARENA IS NOT AN AUTHORIZED DISTRIBUTOR OF HPISPL FOR THE SUPPLY OF LAPTOPS IN NORTH INDIA, III) SH. NAMAN PATIL IS NOT THE MANAGER SALES-NORTH INDIA OR AN EMPLOYEE OF HPISPL AND IV) HPISPL HAS NOT ISSUED THE PROFORMA INVOICE NO.J 9AD109932 DATED AUGUST 19, 2010 FOR THE VALUE OF RS.3,93,12,000/-. FROM THE ABOVE FACTS, IT IS CLEAR THAT THE DOCUMENT S (PROFORMA INVOICE NO. J9AD109932) OF HEWLETT-PACKARD INDIA SALES PVT. LTD ., THE ALLEGED LETTER BY NAMAN PATIL (MANAGER SALES-NORTH INDIA) OF HPISPL C ONFIRMING ADVANCE OF RS. 59,99,500/- ON BEHALF OF CAD ARENA ) ARE FOUND TO BE NOT GENUINE AND FABRICATED ONE. IN VIEW OF THE REPLY OF HPISPL ONLY 251 LAPTOP WERE PURCHASED BY DEVBHOOMI INSTITUTE OF TECHNOLOGY AND NO COMPUTER/LAPTOPS WERE SUPPLIED BY THEM AGAINST THE PURCHASE ORDER NO . DBIT/ORDER/09-10/198 DATED 9.8.2010 OF UTTRAKHAND UTHAN SAMITI. THESE TH REE DOCUMENTS NAMELY PROFORMA INVOICE NO. J9AD109932) OF HEWLETT-PACKARD INDIA SALES PVT. LTD., THE ALLEGED LETTER BY NAMAN PATIL (MANAGER SALES-NO RTH INDIA) OF HPISPL, AND PURCHASE ORDER NO. DBIT/ORDER/09-10/198 DATED 9.8.2 010 OF UTTRAKHAND UTHAN SAMITI ARE THE ONLY DOCUMENTS MADE AVAILABLE BY THE BANK IN SUPPORT OF PURCHASE OF 1050 LAPTOPS AND IN SUPPORT OF THE END USE OF THE TERM LOAN OF RS. 262 LAKH DISBURSED TO THE SOCIETY. ITA NO.4093/DEL/2015 11 FROM THE ABOVE FACTS, IT IS ESTABLISHED THAT UTTRAK HAND UTHAN SAMITI HAS NOT PURCHASED ANY LAPTOP/COMPUTERS (HP COMPAQ 420 BUSIN ESS CLASS NOTEBOOK (XL189PA#AC) AGAINST THE TERM LOAN OF RS. 262 LAKH SANCTIONED BY THE BANK. (D) THE SOCIETY ALLEGEDLY MADE PURCHASE FOR BUILDIN G MATERIALS AND CONSTRUCTION MATERIAL FROM THE ABOVE MENTIONED FICT IOUS CONCERNS FOR CONSTRUCTION OF COLLEGE BUILDING AND SARASWATI HOST EL:- S.NO NAME OF PARTY AMOUNT OF PURCHASES 1 NEGI BUILDERS AND SUPPLIERS 2,32,33,500 2 PAWAN KUMAR AND CO. 76,25,000 3 ALAKNANDA REALTORS 55,00,000 4 AKASHGANGA ASSOCIATES 60,00,000 5 NICE HOME BUILDERS 58,50,000 6 DRISHTI ASSOCIATES 58,00,000 7 RANA STEELS 2,78,54,000 11 EDISON SALES 76,76,656 12 RISHIRAJ BUILDING MATERIAL SAHARANPUR 85,79,196 HOWEVER AS ALREADY DISCUSSED IN DETAIL ALL THESE PU RCHASES WERE BOGUS AND THE ACTUAL UTILISATION OF FUNDS HAD BEEN DIVERTED FOR P URPOSES OTHER THAN AS REQUIRED UNDER THE PROVISIONS OF SECTION 10(23)(C)( VI) OF THE I.T.ACT,1961. VII) A TERM LOAN IC-25 OF RS.8CRORES WAS TAKEN FROM PNB BANK, AWAS VIKAS BRANCH, SAHARANPUR FOR THE PURPOSE OF CONSTRU CTION OF COLLEGE BUILDING AT SAHARANPUR. SH.SANJAY BANSAL SUBMITTED COPIES OF FORGED BILLS TO THE BANK AGAINST THE ABOVE LOAN WHEREAS ACTUAL UTILIZATION O F THE AMOUNT WAS MADE FOR PAYMENTS TO THE FICTIOUS CONCERNS DISCUSSED IN PARA 6 AND FOR ADVANCING PERSONAL LOANS AND USE . EXAMINATION OF THESE BILLS PRIMA FACIE REVEALED THAT MANY OF THESE BILLS WERE FORGED OR FAKE WHICH WAS L ATER CONFIRMED BY THE PARTIES FROM WHOM ENQUIRIES WERE MADE AS UNDER: (A) BILL NO. 7547 DATED 1.11.2010 OF M/S UNIVERSAL IRON STORES FOR RS. 2,30,100/- AND BILL NO.7891 DATED 19.2.2011 FOR RS. 1,38,597/-: ENQUIRIES FROM UNIVERSAL IRON STORE, 27 DHAMAWALA B AZAR, DEHRADUN REVEALED THAT IT HAD ISSUED TWO BILLS IN THE NAME O F DEV BHOOMI INSTITUTE OF TECHNOLOGY AS UNDER: - -BILL NO. 7891 DATED 19.2.11 FOR RS. 36,717/- ISSUE D IN THE NAME OF DEV BHOOMI INSTITUTE OF TECHNOLOGY, MANDUWALA -BILL NO. 7547 DATED 1.11.2010 FOR RS. 30,100/- ISS UED IN THE NAME OF DEV BHOOMI INSTITUTE OF TECHNOLOGY, D.DUN. ITA NO.4093/DEL/2015 12 M/S UNIVERSAL IRON STORE ALSO FURNISHED COPY OF LED GER ACCOUNT OF DEV BHOOMI INSTITUTE OF TECHNOLOGY, DEHRADUN IN ITS BOO KS OF ACCOUNT FOR THE PERIOD 1.4.2010 TO 31.3.2011. IN THIS LEDGER ACCOUN T ALSO, SALES OF ONLY RS. 36,717/- AGAINST BILL NO.7891 DT. 19.2.2011AND RS.3 0,100/- AGAINST BILL NO. 7547 DT. 2.11.2010 TO DEV BHOOMI INSTITUTE OF TECHN OLOGY, DEHRADUN HAVE BEEN RECORDED. M/S UNIVERSION IRON STORE ALSO PROVI DED TO THIS OFFICE COPIES OF ORIGINAL BILLS NO. 7891 AND 7547 AS WAS AVAILABLE W ITH THEM. FROM THE ANALAYSIS OF BILLS OF UNIVERSAL IRON STORE, IT WAS REVEALED THAT SHRI SANJAY BANSAL HAD FORGED THE BILLS ISSUED BY THE ABOVE CON CERNS TO HIM FOR SUPPLY OF GOODS AT DBIT, DEHRADUN. BY FORGING, ALTERING, FAKE BILLS PURPORTEDLY ISSUED BY UNIVERAL IRON STORE, DHAMALA WALA, DEHRADUN IN T HE NAME DEV BHOOMI INSTITUTE OF TECHNOLOGY, SAHARANPUR HAVE BEEN PREPA RED BY SHRI SANJAY BANSAL. IN FACT, NO SUCH BILLS WERE ISSUED BY M/S U NIVERSAL IRON STORE, DHAMAWALA DEHRADUN. THE SOCIETY HAS THUS, CLAIMED B OGUS EXPENSES OF RS. 2,30,100/- AND RS., 1,38,597/- THROUGH THESE TWO BO GUS BILLS. (B) BILLS OF SHREE JEE ENTERPRISES PRO: ANUJ RANA, LOWER TUNWALA DEHRADUN FOR SUPPLY OF BRICKS : SHRI ANUJ RANA, PROPR. SHREE JEE ENTERPRIES, LOWER TUNWALA, DEHRADUN IN HIS STATEMENT DENIED OF BEING ENGAGED IN THE BUSINESS O F SUPPLY OF BRICKS. HOWEVER, HE ADMITTED OF HAVING SUPPLIED 48,000 BRIC KS (FOUR TRUCKS) TO SHRI SANJAY BANSAL FOR HIS COLLEGE AT DEHRADUN DIRECTLY FROM THE BRICK KILN ON COMMISSION BASIS. EXCEPT SUPPLYING 48000 BRICKS TO SHRI SANJAY BANSAL AT DEHRADUN, HE DENIED OF HAVING SUPPLIED ANY BRICKS T O DEV BHOOMI INSTITUTE DABKI ROAD, SAHARANPUR. EXAMINATION OF BILLS SUBMIT TED BY SHRI SANJAY BANSAL REVEALED THAT HE HAS SUBMITTED FOLLOWING BIL LS ALLEGEDLY ISSUED BY SHREE JEE ENTERPRISES PROP. ANUJ RANA. BILL NO. 325 DT. 12.3.2011 FOR RS.2,40,480/- BILL NO. 325 DT. 28.2.2011 FOR RS. 2,31,120/- BILL NO. 325 DT. 21.2.2011 FOR RS. 2,13,860/- BILL NO. 325 DT. 11.2.2011 FOR RS. 1,97,640/- BILL NO. 325 DT. 31.1.2011 FOR RS. 2,46,600/- BILL NO. 325 DT. 22.01.2011 FOR RS. 2,21,0407- BILL NO. 325 DT. 10.1.2011 FOR RS. 2,32,560/- BILL NO. 325 DT. 31.12.2010 FOR RS. 2,16,220/- BILL NO. 325 DT. 22.10.2010 FOR RS. 2,40,920/- BILL NO. 325 DT. 22.12.2010 FOR RS. 2,15,560/- BILL NO. 325 DT. 10.12.2010 FOR RS. 1,94,400/- BILL NO. 325 DT. 30.11.2010 FOR RS. 2,41,680/- BILL NO. 325 DT. 10.11.2010 FOR RS. 1,75,320/- BILL NO. 325 DT. 31.10.2010 FOR RS. 1,95,320/- BILL NO. 325 DT. 22.10.2010 FOR RS.2,40,920/- BILL NO. 325 DT. 11.10.2010 FOR RS.2,44,800/- ITA NO.4093/DEL/2015 13 BILL NO. 325 DT. 10.9.2010 FOR RS. 1,83,600/- BILL NO. 325 DT. 21.09.2010 FOR RS.2,07,100/- BILL NO. 325 DT. 30.9.2010 FOR RS. 1,83,600/- TOTAL RS.41,22,740/ - IT IS SEEN FROM THESE BILLS THAT ALL THESE BILLS AR E NUMBERED 325 THOUGH THE DATE MENTIONED ON THESE BILLS IS DIFFERENT. HOWEVER, IN THE LIST OF BILLS SUBMITTED TO THE BANK, DIFFERENT BILLS NUMBERS HAVE BEEN PUT AGA INST THE NAME OF THE ABOVE SUPPLIER. THIS SHOWS THAT FRAUD HAS BEEN COMMITTED BY SHRI SANJAY BANSAL WITH THE BANK AND ALSO WITH THE TAX AUTHORITIES. SH RI SANJAY BANSAL HAS CLAIMED TO HAVE SPENT THIS MUCH OF AMOUNT FOR CONST RUCTION OF HIS INSTITUTE BUILDING AT SAHARANPUR WHICH HE DID NOT INCUR. (C) RISHIRAJ BUILDING MATERIAL SUPPLIER, MEHNDI SA RAV, SAHARANPUR . DETAILS PROVIDED BY THE PNB NEW AVAS VIKAS, SAHARAN PUR, IT IS REVEALED THAT SHRI SANJAY BANSAL HAS SUBMITTED TO THE BANK BILLS OF RISHIRAJ BUILDING MATERIAL SUPPLIER, MAHNDI SARAY, SAHARANPUR FOR AN AMOUNT OF RS.85,79,196/- .AN ORIGINAL BILL BOOK OF RISHI RAJ BUILDING MATERI AL SUPPLIERS, TILWADI, DEHRADUN (PROPR. RISHIRAJ SINGH) WAS FOUND AND SEIZ ED FROM THE PREMISES OF DEV BHOOMI INSTITUTE OF TECHNOLOGY AT MANDUWALA, NA VGAON, DEHRADUN. SH.RISHIRAJ ADMITTED IN HIS STATEMENT RECORDED U/S 13 L(L)(B) TO HAVE NO PLACE OF BUSINESS IN SAHARANPUR AND HAS NEVER SUPPLIED AN Y BUILDING MATERIAL FOR COLLEGE AT SAHARANPUR BUT ONLY IN DBIT AT MANDUWALA DEHRADUN. HE ALSO DENIED TO HAVE ISSUED ANY OF THE ABOVE BILLS. THOUG H HE STATED THAT ORIGINAL BILL BOOK WAS ASKED BY SANJAY BANSAL ONLY FOR THE PURPOS E OF TALLY OF HIS ACCOUNTS AND WAS GIVEN IN MARCH JUST BEFORE THE SEARCH. (D) BILLS OF PAWAN KUMAR, UTTRAKHAND . SIMILARLY VARIOUS BILLS OF PAWAN KUMAR, UTTRAKHAND WERE SUBMITTED BY SHRI SANJAY BANSAL TO THE BANK IN SUPPORT OF PURCHASE OF YAMUNA DUST. AS ALREADY DISCUSSED THAT BANK ACCOUNT OPENED IN THE NAME OF P AWAN KUMAR AND CO. WAS BOGUS AND THEREFORE EXPENDITURE DEBITED TO THIS ACC OUNT IS BOGUS. (E) THE BILLS OF FOLLOWING PARTIES SUBMITTED TO THE PNB BANK HAD BEEN FORGED. THE BILLS OF THESE PARTIES SUBMITTED TO BAN K SHOW THAT THE BILLS ISSUED BY THESE PARTIES AGAINST THE SUPPLY MADE TO DBIT/UU S DEHRADUN HAVE BEEN TEMPERED WITH AND FABRICATED SHOWING INFLATED AMOUN T OF BILL AND ALSO SHOWING ADDRESS OF DBIT SAHARANPUR IN PLACE OF DBIT /UUS, DEHRADUN.: - M/S UNITED ENTERPRISES, 55 PARK ROAD, DEHRADUN - PRADEEP ELECTRICALS, 84 PEEPAL MANDI, DEHRADUN - CHOPRA PLYWOOD CO., DEVKI COMPLEX MOTIBAZAR, DEH RADUN ITA NO.4093/DEL/2015 14 - M/S SHRI GANESH TRADING CO. 36, ARHAT BAZAR, SAH ARANPUR CHOWK, DEHRADUN, -M/S SHREE GANESH TRADERS, BEHIND SUBZI M ANDI, NEAR NITCO TRANSPORT CO., NIRANJANPUR, DEHRADUN, - NATIONAL HARDWARE AGENCIES, 2 MALVIYA ROAD, DEHRA DUN, - KUKRETI TIMBERS, 13/1 SAHARANPUR ROAD, DEHRADUN, - M/S SUPER PAINT AND HARDWARE STORE, 6 CROSS ROAD, DEHRADUN, - SHREE CEEMENTS LTD., - SHREE GRINDING UNIT, LAKSAR, - M/S UTTRANCHAL IRON & ISPAT PVT. LTD., MUZAFFAMAG AR - M/S TEHRI IRON AND STEEL, - M/S VINOD SALES CORPORATION. AS EVIDENT FROM THE LETTER OF MANAGER, PNB BRANCH S AHARANPUR ,THE PERIODICAL INSPECTION OF THE BUILDING CONSTRUCTION AT SAHARANP UR WAS NOT DONE BY THE BANK AUTHORITIES AT THE EACH STAGE AND THE VALUATIO N WAS NOT DONE BY THE GOVERNMENT VALUER . THEREFORE, SH.SANJAY BANSAL MIS APPROPRIATED THE FUNDS TAKEN FOR PURPOSE OF CONSTRUCTION AND DIVERTED THEM FOR OTHER PURPOSES. 6. DESPITE AMPLE OPPORTUNITIES GRANTED BY THE DGIT (INV.), THERE WAS NON- COMPLIANCE FROM THE SIDE OF THE ASSESSEE. ON THE BA SIS OF THE THOROUGH INQUIRY CONDUCTED BY THE DGIT (INV.) AND ON THE BASIS OF TH E ANALYSIS OF THE SEIZED DOCUMENTS AND INFORMATION GATHERED DURING THE COURS E OF SEARCH AS WELL AS POST SEARCH INQUIRIES, HE WAS OF THE OPINION THAT THE FU NDS HAVE NOT BEEN UTILIZED FOR THE PURPOSE OF THE TRUST AS REQUIRED U/S 10(23C)(VI) OF THE IT ACT. THE SCHEME OF FORGERY AND MANIPULATION OF BANK ACCOUNTS AND DIVER SION OF FUNDS ACCORDING TO HIM PROVES BEYOND DOUBT THE INTENTION OF SHRI SANJA Y BANSAL TO MISUSE THE EXEMPTION GRANTED U/S 10(23C)(VI) OF THE IT ACT. HE OBSERVED THAT THE DETAILS OF RETURNS OF INCOME FILED BY THE ASSESSEE FOR DIFFERE NT ASSESSMENT YEARS ARE AS UNDER:- ITA NO.4093/DEL/2015 15 (FIGURE IN RS) A.Y. GROSS RECEIPTS EXPENDITURE EXCESS OF INCOME OVER EXPENDITURE (SURPLUS) RETURNED INCOME DATE OF RETURN 2007-08 24779791 24691009 85358 NIL. EXEMPT U/S 10(23C)(VI) 31.03.2008 2008-09 60049012 57967849 2971297 NIL. EXEMPT U/S 10(23C)(VI) 31.12.2008 2009-10 108264619 98360017 9893329 NIL. EXEMPT U/S 10 (23C)(VI) 31.12.2009 2010-11 178340690 160614144 177471 NIL. EXEMPT U/S 10(23C)(VI) 15.10.2010 2011-12 220785347 219694484 107836 NIL. EXEMPT U/S 10(23C)(VI) 28.09.2011 2012-13 298121824 297026755 107007 NIL. EXEMPT U/S 10(23C)(VI) 30.09.2012 7. THEREFORE, A SHOW CAUSE NOTICE WAS ISSUED TO THE ASSESSEE VIDE LETTER DATED 22.11.2013. THEREAFTER, A NUMBER OF OPPORTUNITIES WERE GRANTED TO THE ASSESSEE. HOWEVER, THERE WAS NO COMPLIANCE FROM THE SIDE OF T HE ASSESSEE. IN VIEW OF THE ABOVE, LD. DGIT (INV.), LUCKNOW, HELD THAT THE ASSE SSEE IS NEITHER EXISTING SOLELY FOR EDUCATIONAL PURPOSES NOR IT IS NOT FOR THE PUR POSE OF PROFIT. HE, THEREFORE, HELD THAT THE SOCIETY IS NOT EXISTING SOLELY FOR TH E PURPOSE OF EDUCATION AND, HE, THEREFORE, CANCELLED THE APPROVAL GRANTED U/S 10(23 C)(VI) OF THE IT ACT TO THE ASSESSEE TRUST FROM ASSESSMENT YEAR 2007-08 ONWARDS . THE RELEVANT OBSERVATIONS OF DGIT (INV.), VIDE PARA 14 OF HIS ORDER READ AS U NDER:- 14. A SHOW CAUSE NOTICE WAS ISSUED TO THE ASSESSEE VIDE LETTER DATED 22/11/2013. THEREAFTER OPPORTUNITIES WERE FURTHER P ROVIDED VIDE LETTERS DATED 03.01.2014 & 31.01.2014 & 08.07.2014, BUT THE ASSES SEE HAS FAILED TO AVAIL ANY OF THE FOUR OPPORTUNITIES GIVEN TO HIM AND HAS SIMPLY REQUESTED EITHER TO ADJOURN THE CASE OR WITHDRAW THE PROCEEDINGS BY SEN DING LETTERS. ON NONE OF THE OCCASION IT PRESENTED ITSELF THROUGH AUTHORIZED REPRESENTATIVE BEFORE THE UNDERSIGNED. EVEN NO WRITTEN SUBMISSION ON ISSUES R AISED WAS FILED. HENCE THE ONLY LOGICAL CONCLUSION IS THAT HE HAS NOTHING TO S AY IN THIS REGARD. AT THIS POINT IT IS ALSO IMPORTANT TO CONSIDER THAT THE ABO VE ANALYSIS IS BASED ON THE ITA NO.4093/DEL/2015 16 DOCUMENTS, EVIDENCES, INFORMATION FOUND DURING THE COURSE OF A SEARCH AND SEIZURE OPERATION AND FROM PART OF PANCHNAMA DRAWN IN THE CASE OF THE ASSESSEE. IN TERMS OF SECTION 292C OF THE IT ACT, T HESE DOCUMENTS ARE PRESUMED TO BE BELONGING TO THE ASSESSEE AND THAT T HE CONTENTS OF SUCH BOOKS OF ACCOUNT AND OTHER DOCUMENTS ARE TRUE. THE ASSESS EE HAS DESPITE REPEATED OPPORTUNITIES NEITHER TRIED TO GIVE ANY JUSTIFICATI ON FOR THE IRREGULARITIES, BOGUS TRANSACTIONS ETC., NOR FURNISHED ANY EVIDENCE WHICH MAY SUGGEST OTHERWISE. THEREFORE, BASED ON THE EVIDENCES/MATERIAL ON RECOR D AS DISCUSSED IN DETAIL ABOVE, IT IS HELD THAT THE ASSESSEE I.E., UTTARKHAN D UTHAN SAMITI IS (I) NEITHER EXISTING SOLELY FOR EDUCATIONAL PURPOSES, (II) NOR IT IS NOT FOR THE PURPOSE OF PROFIT. THEREFORE, AS PER PROVISION AND CONDITION MENTIONED IN SECTION 10(23C)(VI) OF THE INCOME TAX ACT-1961, BASIC CONDI TION THAT IT SHOULD EXIST SOLELY FOR EDUCATION PURPOSE IS NOT SATISFIED. IN T HE LIGHT OF ABOVE, IN TERMS OF POWERS VESTED TO THE UNDERSIGNED IN TERMS OF SECTIO N 2(23 C) OF THE IT ACT 1961, THE APPROVAL GRANTED U/S 10(23C) (VI) OF THE IT ACT TO THE ABOVE MENTIONED ASSESSEE IS HEREBY CANCELLED W.E.F. ASSES SMENT YEARS 2007-08 ONWARDS. 8. AGGRIEVED WITH SUCH ORDER OF THE DGIT (E), THE A SSESSEE IS IN APPEAL BEFORE THE TRIBUNAL BY RAISING THE FOLLOWING GROUNDS:- ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW THE ORDER DATED 26.03.2015 PASSED BY THE DIRECTOR GENERAL OF INCOME-TAX (INVESTIGATION), LUCKNOW CANCELLING THE APPROVAL GR ANTED U/S 10 (23C)(VI) OF THE INCOME-TAX ACT, 1961 UNDER THE PROVISO TO THAT SECTION BASED ON MISINTERPRETATION OF FACTS, PEJORATIVE CHARGES AND PREPOSTEROUS READING OF LAW IS ARBITRARY, MISCONCEIVED, ERRONEOUS AND ILLEGAL M UST BE QUASHED WITH DIRECTIONS FOR RELIEF. 8.1 THE ASSESSEE HAS ALSO REQUESTED FOR ADMISSION O F THE FOLLOWING ADDITIONAL GROUNDS:- ADDITIONAL GROUND: 2 - THAT THE ORDER PASSED BY DI RECTOR GENERAL OF INCOME TAX (INVESTIGATION) DATED 26.03.2015 CANCELLING THE APPROVAL GRANTED U/S 10(23C)(VI) OF THE ACT IS ILLEGAL, BAD IN LAW AND W ITHOUT JURISDICTION. ADDITIONAL GROUND: 3- THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW THE DIRECTOR GENERAL OF INCOME TAX (INVE STIGATION) ERRED IN WITHDRAWING APPROVAL GRANTED U/S 10(23C)(VI) WITH R ETROSPECTIVE EFFECT FROM A. Y. 2007-08 ONWARDS, ON BASIS OF ORDER DATED 26.0 3.2015. ITA NO.4093/DEL/2015 17 ADDITIONAL GROUND: 4- THAT SHOW CAUSE NOTICE DATED 22.11.2013 ISSUED BY THE JOINT DIRECTOR OF INCOME TAX IS ILLEGAL, BAD IN LAW AND WITHOUT JURISDICTION AS THE SHOW CAUSE NOTICE HAS TO BE ISSUED BY THE 'PRES CRIBED AUTHORITY' AT THE RELEVANT TIME. ADDITIONAL GROUND: 5- THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW THE DIRECTOR GENERAL OF INCOME TAX (INVE STIGATION) HAS ERRED IN PASSING EX-PARTE I.E. WITHOUT GIVING ANY PROPER AND REASONABLE OPPORTUNITY OF PRESENTING ITS CASE AND OF BEING HEARD, WHICH IS IN VIOLATION OF THE PRINCIPLES OF NATURAL JUSTICE. ADDITIONAL GROUND 6 - THAT THE DOCUMENTS FILED OR A VAILABLE ON RECORD HAVE NOT BEEN PROPERLY CONSIDERED. THE ORDER PASSED IS NOT JUSTIFIED IN VIEW OF THE DOCUMENTS AVAILABLE ON RECORD. 9. REFERRING TO THE DECISION OF THE HON'BLE SUPREME COURT IN THE CASE OF NTPC LTD. V.CIT, REPORTED IN 229 ITR 383, THE LD. COUNSE L FOR THE ASSESSEE SUBMITTED THAT ALL THESE GROUNDS GO TO THE ROOT OF THE MATTER AND THE RELEVANT FACTS ARE ALREADY ON RECORD AND NO NEW FACTS ARE REQUIRED TO BE INVESTIG ATED. HE ACCORDINGLY SUBMITTED THAT THE ADDITIONAL GROUND RAISED BY THE ASSESSEE S HOULD BE ADMITTED. 10. AFTER HEARING BOTH THE SIDES AND CONSIDERING TH E FACT THAT ALL RELEVANT FACTS ARE ALREADY ON RECORD AND NO NEW FACTS ARE REQUIRED TO BE INVESTIGATED, THE ADDITIONAL GROUNDS RAISED BY THE ASSESSEE ARE ADMIT TED FOR ADJUDICATION. 11. THE LD. COUNSEL FOR THE ASSESSEE REFERRED TO CO PY OF SHOW CAUSE NOTICE ISSUED BY THE DGIT (INV.) DATED 22 ND NOVEMBER, 2013 AND SUBMITTED THAT THE SAID NOTICE NOWHERE SHOWS THE SATISFACTION OF THE DGIT (INV.). REFERRING TO THE DECISION OF THE JAIPUR BENCH OF THE TRIBUNAL IN THE CASE OF MODERN SCHOOL SOCIETY VS. CIT (E), VIDE ITA NO.1118/JP/2016, ORDER DATED 20 TH DECEMBER, 2017 THE LD. COUNSEL FOR THE ASSESSEE SUBMITTED THAT THE TRIBUNAL IN THE SAI D DECISION HAS DISCUSSED THE ITA NO.4093/DEL/2015 18 POWER AND JURISDICTION TO WITHDRAW THE APPROVAL GRA NTED U/S 10(23C)(VI) OF THE IT ACT AND RELYING ON VARIOUS DECISIONS IT HAS BEEN HE LD THAT THE NOTICE ISSUED BY THE AUTHORITY OTHER THAN THE PRESCRIBED AUTHORITY IS NO T VALID. REFERRING TO PAGE NO.1 OF THE PAPER BOOK, VOLUME NO.1, HE SUBMITTED THAT T HE APPROVAL U/S 10(23C)(VI) OF THE IT ACT WAS GRANTED BY THE CHIEF COMMISSIONER OF INCOME-TAX, DEHRADUN VIDE ORDER DATED 18 TH MARCH, 2008, THEREFORE, THE COMPETENT AUTHORITY IN THIS CASE IS THE CHIEF CIT, DEHRADUN AND, THEREFORE, THE LD. DGIT (I NV.) HAS NO AUTHORITY TO ISSUE NOTICE FOR CANCELLATION OF APPROVAL GRANTED U/S 10( 23C)(VI) OF THE IT ACT. HE SUBMITTED THAT THE DECISION OF THE JAIPUR BENCH OF THE TRIBUNAL IN THE CASE OF MODERN SCHOOL SOCIETY HAS BEEN APPROVED BY THE HON' BLE RAJASTHAN HIGH COURT AND THE APPEAL FILED BY THE REVENUE HAS BEEN DISMIS SED. THE COPY OF THE SAME IS PLACED AT PAPER BOOK PAGES 111 TO 119. HE SUBMITTE D THAT THE SLP FILED BY THE REVENUE HAS BEEN DISMISSED BY THE HON'BLE SUPREME C OURT, VIDE ORDER DATED 11 TH FEBRUARY, 2019. 12. REFERRING TO THE PROVISIONS OF SECTION 10(23C)( VI) OF THE IT ACT, HE SUBMITTED THAT THE PRESCRIBED AUTHORITY MAY WITHDRA W THE APPROVAL SO GRANTED AFTER IT IS SATISFIED THAT: ( I ) SUCH FUND OR INSTITUTION OR TRUST OR ANY UNIVERS ITY OR OTHER EDUCATIONAL INSTITUTION OR ANY HOSPITAL OR OTHER MEDICAL INSTIT UTION HAS NOT ( A ) APPLIED ITS INCOME IN ACCORDANCE WITH THE PROVISI ONS CONTAINED IN CLAUSE ( A ) OF THE THIRD PROVISO; OR ( B ) INVESTED OR DEPOSITED ITS FUNDS IN ACCORDANCE WIT H THE PROVISIONS CONTAINED IN CLAUSE ( B ) OF THE THIRD PROVISO; OR ( II ) THE ACTIVITIES OF SUCH FUND OR INSTITUTION OR TR UST OR ANY UNIVERSITY OR OTHER EDUCATIONAL INSTITUTION OR ANY HOSPITAL OR OTHER ME DICAL INSTITUTION ITA NO.4093/DEL/2015 19 ( A ) ARE NOT GENUINE; OR ( B ) ARE NOT BEING CARRIED OUT IN ACCORDANCE WITH ALL OR ANY OF THE CONDITIONS SUBJECT TO WHICH IT WAS NOTIFIED OR APPROVED, 13. HE SUBMITTED THAT IN THE INSTANT CASE, THE SHOW CAUSE NOTICE HAS TO BE ISSUED AFTER THE SATISFACTION OF THE COMPETENT AUTHORITY. UNLESS SUCH SATISFACTION IS DISCERNIBLE FROM THE SHOW CAUSE NOTICE, THE ASSESSE E COULD NOT HAVE OBJECTED TO THE SHOW CAUSE NOTICE. HE SUBMITTED THAT THE ASSESSEE HAS TO BE PUT ON NOTICE AFTER THE SATISFACTION OF THE COMPETENT AUTHORITY. SINCE IT I S NOT DISCERNIBLE FROM THE NOTICE REGARDING THE SATISFACTION OF THE COMPETENT AUTHORI TY, THEREFORE, THE NOTICE IS INVALID AND, THEREFORE, THE SUBSEQUENT ORDER IS ALSO INVALI D. 14. WITHOUT PREJUDICE TO THE ABOVE, THE LD. COUNSEL FOR THE ASSESSEE SUBMITTED THAT THE COPY OF THE ORDER HAS BEEN SIGNED BY THE J OINT DIRECTOR OF INCOME-TAX AND NOT SIGNED BY THE DIRECTOR GENERAL OF INCOME-TAX (I NV.). THEREFORE, THIS NOTICE ITSELF IS NOT VALID. REFERRING TO THE PAPER BOOK F ILED BY THE LD. DR, HE SUBMITTED THAT THE PROPOSAL WAS RECEIVED BY THE DGIT, CENTRAL CIRCLE FROM THE DCIT, CENTRAL, DEHRADUN FOR CANCELLATION OF EXEMPTION GRA NTED U/S 10(23C)(VI) OF THE IT ACT. THEREFORE, THE DUE PROCESS OF LAW HAS NOT BEE N FOLLOWED AND THE LETTER WAS NOT GIVEN BY THE CHIEF COMMISSIONER OF DEHRADUN WHO HAD GRANTED THE APPROVAL TO THE ASSESSEE AND, THEREFORE, THE REQUIREMENT OF LAW HAS NOT BEEN FULFILLED. THE LD. COUNSEL FOR THE ASSESSEE IN ANOTHER PLANK OF ARGUME NT SUBMITTED THAT THE ORDER PASSED BY THE DGIT (INV.) IS NOT A VALID ORDER SINC E THE ORDER WAS PASSED ON 26 TH MARCH, 2015 WHEREAS HE HAS CANCELLED THE APPROVAL W ITH RETROSPECTIVE EFFECT I.E., ITA NO.4093/DEL/2015 20 W.E.F. ASSESSMENT YEAR 2007-08 ONWARDS. HE SUBMITT ED THAT THE DGIT (INV.) WHILE PASSING THE ORDER HAS TRAVELLED BEYOND THE SHOW CAU SE NOTICE DATED 22 ND DECEMBER, 2013 ISSUED BY THE JOINT DIRECTOR OF INCOME-TAX (IN V.) (HQ.) BECAUSE THE DGIT (INV.) HAD CONSIDERED THE ISSUES THAT WERE NOT COVE RED IN THE SAID NOTICE. RELYING ON VARIOUS DECISIONS INCLUDING THE DECISION OF THE HON'BLE DELHI HIGH COURT IN THE CASE OF CIT VS. CONTIMETERS ELECTRICALS PVT. LTD., 317 ITR 249, HE SUBMITTED THAT WHEN THE ISSUE WAS NOT STATED IN THE SHOW CAUSE NOT ICE, THE DEPARTMENT CANNOT BE PERMITTED TO GO BEYOND THE FACTS STATED IN THE SHOW CAUSE NOTICE. HE FURTHER SUBMITTED THAT THE INTENTION OF THE JOINT DIRECTOR OF INCOME-TAX (INV.) (HQ) WAS NEVER CONFRONTED TO THE ASSESSEE AND, THEREFORE, TH E SAID NOTICE IS AGAINST THE PRINCIPLE OF NATURAL JUSTICE. 15. SO FAR AS THE MERIT OF THE CASE IS CONCERNED, T HE LD. COUNSEL FOR THE ASSESSEE SUBMITTED THAT NO ADVERSE MATERIAL WAS FOUND DURING THE COURSE OF SEARCH OR POST SEARCH INQUIRIES. FURTHER, THE EVIDENCES WERE NEVE R CONFRONTED TO THE ASSESSEE WHICH WERE USED AGAINST THE ASSESSEE. FURTHER, THE REGISTRATION U/S 12AA HAS BEEN RESTORED TO THE ASSESSEE. HE SUBMITTED THAT WHEN I N THE SHOW CAUSE NOTICE IT WAS NEVER MENTIONED THAT THE APPROVAL U/S 10(23C)(VI) O F THE IT ACT IS GOING TO BE CANCELLED FOR ASSESSMENT YEAR 2007-08 ONWARDS, THER EFORE, IN ABSENCE OF THE SAME IN THE MANDATORY SHOW CAUSE NOTICE, THE COMPETENT A UTHORITY COULD NOT HAVE CANCELLED SUCH APPROVAL WITH RETROSPECTIVE EFFECT. THE LD. COUNSEL ALSO RELIED ON THE FOLLOWING DECISIONS:- ITA NO.4093/DEL/2015 21 1. CIT VS. SPLS SIDDHARTHA LTD., IN ITA NO. 836/2011 DATED 14.09.2011 PASSED BY HONBLE HIGH COURT OF DELHI AT NEW DELHI; 2. VARKEYCHACKO VS. CIT, [1993] 203 ITR 885 (SC); 3. GHANSHYAM K. KHABRANI VS. ACIT, [2012] 346 ITR 443 (BOM.); 4. DSJ COMMUNICATION LTD. VS. DCIT, [2014] 41 TAXMANN. COM 151 (BOM.); 5. MODEM SCHOOL SOCIETY VS. CIT, ITA NO. 1118/JP/2016 DATED 20.12.2017 PASSED BY IT AT, JAIPUR BENCH, JAIPUR; 6. ORISSA TRUST OF TECHNICAL EDUCATION VS. CCIT, [2009 ] 178 TAXMAN 363 (ORISSA); 7. THE CIT (EXEMPTIONS), JAIPUR VS. MODERN SCHOOL SOCI ETY, MA NO. 53/JP/2018 IN ITA NO. 1118/JP/2016 DATED 24.07.2018 PASSED BY ITAT, JAIPUR BENCH, JAIPUR; 8. CIT VS. MODERN SCHOOL SOCIETY, D.B.ITA NO. 172/2018 DATED 31.07.2018 PASSED BY HONBLE HIGH COURT OF JUDICATURE FOR RAJA STHAN BENCH AT JAIPUR; 9. CIT VS. MODERN SCHOOL SOCIETY SLP(C) DISMISSAL DATE D 11.02.2019 [SLP (C) DIARY NO. 4190/2019]; 10. ORISSA TRUST OF TECHNICAL EDUCATION VS. CCIT, [2009 ] 178 TAXMAN 363 (ORISSA); 11. PATEL NARSHI THAKERSHI AND ORS. VS. SHRI PRADYUMANS INGHJI ARJUN SINGHJI, (1971) 3 SCC 844; 12. CIT VS. RAJESH KUMAR PANDEY, [2012] 25 TAXMANN.COM 242 (ALL.); 13. M/S. ASSAM BENGAL CARRIERS KOLKATA VS. CIT, ITA NO. 706/KOL/2013 DATED 15.01.2016 PASSED BY ITAT, D BENCH, KOLKATA; ITA NO.4093/DEL/2015 22 14. ARUNKANTI SAMANTA VS. CIT, ITA NO. 1516/KOL/2014 DA TED 20.02.2015 PASSED BY ITAT, A BENCH, KOLKATA; 15. SONA EXPORTS VS. THE DIRECTOR OF MINES & GEOLOGY AN D ORS, W.P.NO. 1183/1998 DATED 08.09.1998 PASSED BY HONBLE HIGH C OURT OF ANDHRA PRADESH AT HYDERABAD. 16. NATARAJ THEATRE VS. GOVT, OF ANDHRA PRADESH, WP NO. 21691/1995 DATED 26.08.1999 PASSED BY HONBLE HIGH COURT OF ANDHRA P RADESH AT HYDERABAD; 17. T. VARGHESE GEORGE VS. KORA K. GEORGE AND ORS, (201 2) 1 SCC 369; 18. WELHAM BOYS SCHOOL SOCY. VS. CENTRAL BOARD OF DIRE CT TAXES [2006] 285 ITR 74 (UTTARANCHAL); 19. OXFORD ACADEMY FOR CAREER DEVELOPMENT VS. CCIT, [20 09] 315 ITR 382 (ALL.); 20. CIT VS. MANAV VIKAS AVAM SEWA SANSTHAN, [2011] 336 ITR 250 (ALL.); 21. DIT (EXEMPTIONS) VS. MOOL CHAND KHAIRATI RAM TRUST, [2011] 339 ITR 622 (DEL.); 22. NATIONAL THERMAL POWER CO. LTD. VS. CIT, [1998] 229 ITR 383 (SC); 23. COLLECTOR LAND ACQUISITION, ANANTNAG & ANR VS. MST. KATIJI & ORS., 1987 AIR 1353. 16. THE LD. DR, ON THE OTHER HAND, STRONGLY SUPPORT ED THE ORDER OF THE DGIT (INV.) CANCELLING THE APPROVAL GRANTED EARLIER U/S 10(23C)(VI) OF THE IT ACT. HE SUBMITTED THAT THE PROVISIONS OF SECTION U/S 10(23C ) DO NOT PRESCRIBE ANY REQUIREMENT OF ISSUING SHOW CAUSE NOTICE TO THE ASS ESSEE PROPOSING THE CANCELLATION OF EXEMPTION GRANTED U/S 10(23C)(VI) OF THE IT ACT TO THE ASSESSEE ON EARLIER ITA NO.4093/DEL/2015 23 OCCASION STRICTLY UNDER THE SIGNATURE OF THE PRESCR IBED AUTHORITY. HE SUBMITTED THAT THE POWER AND JURISDICTION TO WITHDRAW THE APPROVAL GRANTED U/S 10(23C)(VI) OF THE IT ACT IS PROVIDED UNDER THE 13 TH PROVISO TO THE SAID SECTION. THE ONLY CONDITION BEFORE CANCELLING OF EXEMPTION GRANTED U/S 10(23C)( VI) OF THE IT ACT TO THE ASSESSEE ON EARLIER OCCASION IS THAT THE ASSESSEE H AS TO BE GIVEN A REASONABLE OPPORTUNITY OF BEING HEARD AND, THEREAFTER THE ASSE SSEE HAS TO BE SHOW CAUSED WHICH IN THE INSTANT CASE WAS GIVEN. REFERRING TO THE DECISION OF THE HON'BLE SUPREME COURT IN THE CASE OF CIT VS. AMITABH BACHCHAN REPORTED IN 384 ITR 200, HE SUBMITTED THAT THE HON'BLE SUPREME COURT IN THE SAID DECISION HAS HELD THAT SECTION 263 DOES NOT REQUIRE ANY SPECIFIC SHOW CAUS E NOTICE DETAILING SPECIFIC GROUND ON WHICH REVISION OF ASSESSMENT ORDER IS TEN TATIVELY BEING PROPOSED. REFERRING TO THE DECISION OF THE HON'BLE DELHI HIGH COURT IN THE CASE OF BSES RAJDHANI POWER LTD. VS. PCI, 399 ITR 228 (DEL), HE SUBMITTED THAT THE FAILURE TO ISSUE NOTICE ON A PARTICULAR ISSUE DOES NOT VITIATE THE EXERCISE OF POWER U/S 263 OF THE ACT AS LONG AS THE ASSESSEE IS HEARD AND GIVEN OPPORTUNITY. REFERRING TO THE DECISION OF THE JAIPUR BENCH OF THE TRIBUNAL IN THE CASE OF INDIAN MEDICAL TRUST VS. PCIT, 99 TAXMANN.COM 273 , HE SUBMITTED THAT THE TRIBUNAL IN THE SAID DECISI ON HAS HELD THAT WHERE THE ASSESSEE, A TRUST REGISTERED U/ S 12AA WAS RUNNING VARIOUS EDUCATIONAL INSTITUTIONS AT CALCUTTA, HUGE AMOUNT O F CAPITATION FEES FROM STUDENTS FOR ADMISSION TO MEDICAL COLLEGES, THE IMPUGNED ORD ER PASSED BY THE COMMISSIONER (E) CANCELLING THE REGISTRATION GRANTE D TO ASSESSEE U/S 12AA AS WELL AS WITHDRAWING EXEMPTION GRANTED TO IT U/S 10(23C)( VI) AND U/S 10(23C)(VIA) OF THE ITA NO.4093/DEL/2015 24 IT ACT WAS JUSTIFIED. HE SUBMITTED THAT IN THE CAS E OF THE ASSESSEE ALSO PERUSAL OF THE ORDER DATED 26 TH MARCH, 2015 CLEARLY AND SUFFICIENTLY REVEALS THAT THERE IS ENOUGH MATERIAL BROUGHT ON RECORD BY THE DGIT (INV. ) THAT THE ASSESSEE WAS NOT FULFILLING THE CONDITIONS LAID DOWN IN SECTION 10(2 3C)(VI) OF THE IT ACT W.E.F. ASSESSMENT YEAR 2008-09 ONWARDS. ACCORDINGLY, THE DGIT (INV.) HAS RIGHTLY CANCELLED THE EXEMPTION TO THE ASSESSEE W.E.F. ASSE SSMENT YEAR 2008-09 ONWARDS. 16.1 SO FAR AS THE MERIT OF THE CASE IS CONCERNED, HE SUBMITTED THAT THE NUMEROUS SEIZED DOCUMENTS EXTENSIVELY DISCUSSED BY THE DGIT (INV.) IN HIS ORDER DATED 26 TH MARCH, 2015 CLEARLY ESTABLISHES THAT THE SOCIETY WA S NOT ESTABLISHED FOR THE PURPOSE OF EDUCATION AND IT WAS NOT BEING RUN AS PER ITS ST ATED OBJECTS. VARIOUS FORGED DOCUMENTS, MANIPULATION OF THE BANK ACCOUNT AND THE DIVERSION OF FUNDS FOR PERSONAL PURPOSES PROVED BEYOND DOUBT THAT THE TRUS TEES WERE MISUSING THE BENEFIT OF EXEMPTION GRANTED TO THE ASSESSEE U/S 10(23C)(VI ) OF THE IT ACT. THEREFORE, WHEN ALL THESE MANIPULATIONS WERE DONE BY THE ASSES SEE BY SIPHONING OFF OF THE FUNDS OF THE TRUST AND THE ASSESSEE DID NOT ATTEND THE PROCEEDINGS BEFORE THE DGIT (INV.), THEREFORE, IT CANNOT BE SAID THAT THE ASSES SEE WAS NOT GIVEN ANY OPPORTUNITY. SO FAR AS THE ARGUMENT OF THE LD. COUNSEL FOR THE A SSESSEE THAT THE NOTICE SHOULD HAVE BEEN ISSUED BY THE COMPETENT AUTHORITY WHO HAS GIVEN THE APPROVAL IS CONCERNED, HE SUBMITTED THAT THE BOARD HAS ISSUED N OTIFICATION NO.20/2015 DATED 5 TH MARCH, 2015 WHEREIN THE JURISDICTION OF THE VARIOU S AUTHORITIES HAVE BEEN PRESCRIBED. AS PER CLAUSE (VIII) OF THE SAID NOTIF ICATION, THE DGIT (INV.) IS THE ITA NO.4093/DEL/2015 25 COMPETENT AUTHORITY IN THE INSTANT CASE, THEREFORE, THE ARGUMENT ADVANCED BY THE LD. COUNSEL THAT THE COMPETENT AUTHORITY HAS NOT SIGNED THE NOTICE IS NOT TENABLE. HE ACCORDINGLY SUBMITTED THAT THE VARIOUS GROUNDS RAIS ED BY THE ASSESSEE SHOULD BE DISMISSED. HE ALSO RELIED ON THE DECISION OF THE H ON'BLE DELHI HIGH COURT IN THE CASE OF UP DISTILLERS ASSOCIATION VS. CIT, 2017-TIO L-2253 AND THE DECISION OF THE HON'BLE KARNATAKA HIGH COURT IN THE CASE OF M/S NAV ODAY EDUCATION TRUST VS. DGIT (INV.) AND BATCH OF OTHER APPEALS, IN WRIT PET ITION NO.3468-3472, REPORTED IN 2018-261-HC-KAR. 17. THE LD. COUNSEL FOR THE ASSESSEE, IN HIS REJOIN DER, SUBMITTED THAT IN THE CASE OF INDIAN MEDICAL TRUST RELIED ON BY THE LD. DR IN THE SAID DECISION, THE VARIOUS INCRIMINATING MATERIALS WERE CONFRONTED TO THE ASSE SSEE WHEREAS IN THE INSTANT CASE SUCH MATERIALS WERE NOT CONFRONTED TO THE ASSESSEE, THEREFORE, THE SAID DECISION IS DISTINGUISHABLE AND NOT APPLICABLE TO THE FACTS OF THE PRESENT CASE. 18. WE HAVE CONSIDERED THE RIVAL ARGUMENTS MADE BY BOTH THE SIDES AND PERUSED THE ORDER OF THE DGIT (INV.) AND THE PAPER BOOK FIL ED ON BEHALF OF THE ASSESSEE. WE HAVE ALSO CONSIDERED THE VARIOUS DECISIONS CITED BEFORE US. WE FIND THE LD. DGIT (INV.), ON THE BASIS OF THE EVIDENCE GATHERED DURING THE COURSE OF SEARCH AND POST SEARCH INQUIRIES OBSERVED THAT THE ACTIVITIES OF THE ASSESSEE SOCIETY WAS NOT IN ACCORDANCE WITH THE CONDITIONS LAID DOWN FOR ALLOWA NCE OF EXEMPTION U/S 10(23C)(VI) OF THE IT ACT, 1961 AND IT HAS VIOLATED THE PROVISIONS CONTAINED IN CLAUSE (A) AND CLAUSE (B) OF THE 13 TH PROVISO TO SECTION 10(23C)(VI) OF THE IT ACT. ITA NO.4093/DEL/2015 26 DESPITE REPEATED OPPORTUNITIES GRANTED, THE ASSESSE E DID NOT FILE ANY JUSTIFICATION FOR THE IRREGULARITIES, BOGUS TRANSACTION, ETC., NO R FURNISHED ANY EVIDENCE WHICH MAY SUGGEST OTHERWISE. HE, THEREFORE, CANCELLED TH E APPROVAL GRANTED EARLIER U/S 10(23C)(VI) OF THE IT ACT TO THE ASSESSEE W.E.F. AS SESSMENT YEAR 2007-08 ONWARDS. THE FIRST OBJECTION OF THE LD. COUNSEL FOR THE ASSE SSEE IS THAT BEFORE INITIATING THE PROCEEDINGS U/S 10(23C)(VI) OF THE IT ACT R.W. THE 13 TH PROVISO TO THE SAID SECTION, ONLY THE COMPETENT AUTHORITY I.E., THE PRESCRIBED A UTHORITY, CAN ONLY ISSUE A SHOW CAUSE NOTICE GIVING AN OPPORTUNITY TO THE ASSESSEE TO REPLY AND EXPLAIN ITS CASE. ACCORDING TO HIM, SINCE THE APPROVAL WAS GRANTED EA RLIER BY THE CCIT, DEHRADUN, VIDE HIS ORDER DATED 18 TH MARCH, 2008, THEREFORE, HE IS THE COMPETENT AUTHOR ITY TO CANCEL THE APPROVAL GRANTED EARLIER AND, THEREFORE, DGIT (INV.) HAS NO AUTHORITY TO ISSUE THE SHOW CAUSE NOTICE AND, THEREAFTER CANCEL THE REGISTRATION. 18.1 WE DO NOT FIND ANY MERIT IN THE ABOVE ARGUMENT OF THE LD. COUNSEL FOR THE ASSESSEE IN VIEW OF THE NOTIFICATION NO.20/2015 DAT ED 5 TH MARCH, 2015 WHEREIN CLAUSE (VIII) OF THE SAID NOTIFICATION READS AS UND ER:- (VIII) FOR CASES OTHER THAN THOSE MENTIONED AT (I) TO (VII) ABOVE, THE CHIEF COMMISSIONER OR DIRECTOR GENERAL TO WHOM THE ASSESS ING OFFICER HAVING JURISDICTION TO ASSESS THE UNIVERSITY OR OTHER EDUC ATIONAL INSTITUTION OR ANY HOSPITAL OR OTHER MEDICAL INSTITUTION REFERRED TO I N SUB-CLAUSE (VI) AND SUB- CLAUSE (VIA) OF CLAUSE (23C) OF SECTION 10 OF THE A CT WAS SUBORDINATE PRIOR TO THE 15TH DAY OF NOVEMBER, 2014 AND WHERE SUCH CHIEF COMMISSIONER OR DIRECTOR GENERAL WHO WAS SO AUTHORISED HAS CEASED T O EXIST, THE PRINCIPAL CHIEF COMMISSIONER OF INCOME TAX OF THAT REGION. 19. THEREFORE, THE FIRST OBJECTION RAISED BY THE LD . COUNSEL FOR THE ASSESSEE IS REJECTED. ITA NO.4093/DEL/2015 27 20. THE SECOND OBJECTION OF THE LD COUNSEL IS THAT THE SHOW CAUSE NOTICE DATED 22.11.2013 WAS ISSUED BY THE JOINT DIRECTOR OF INCO ME-TAX AS THE SAME HAS TO BE ISSUED BY THE PRESCRIBED AUTHORITY AT THE RELEVANT TIME. HERE ALSO WE DO NOT FIND ANY MERIT IN THE ARGUMENT OF THE LD. COUNSEL. A PE RUSAL OF THE SHOW CAUSE NOTICE DATED 22.11.2013 SHOWS THAT THE JOINT DIRECTOR OF I NCOME-TAX (INV.) (HQRS.) HAS SIGNED THE NOTICE ON BEHALF OF THE DIRECTOR GENERAL OF INCOME-TAX (INV.), LUCKNOW. THE LETTER WAS ISSUED FROM THE OFFICE OF THE DIRECT OR GENERAL OF INCOME-TAX (INV.) AND NOT FROM THE OFFICE OF THE JOINT DIRECTOR OF IN COME-TAX (INV.). THEREFORE, THE SECOND OBJECTION OF THE LD. COUNSEL ALSO IS WITHOUT ANY MERIT AND THE SAME IS REJECTED. 20.1 THE THIRD OBJECTION OF THE LD. COUNSEL FOR THE ASSESSEE IS THAT THE LD. DIRECTOR GENERAL OF INCOME-TAX (INV.) COULD NOT HAVE WITHDRA WN THE APPROVAL GRANTED U/S 10(23C)(VI) OF THE IT ACT WITH RETROSPECTIVE EFFECT FROM ASSESSMENT YEAR 2007-08 ONWARDS ON THE BASIS OF ORDER DATED 26 TH MARCH, 2015. HERE ALSO, WE DO NOT FIND ANY MERIT. THE ORDER PASSED BY THE DGIT (INV.) IS BASED ON THE NUMEROUS INCRIMINATING DOCUMENTS FOUND AND SEIZED DURING THE COURSE OF SEARCH AND POST SEARCH ENQUIRIES WHICH ESTABLISHES VARIOUS FORGED D OCUMENTS, THE MANIPULATION OF THE BANK ACCOUNTS AND THE DIVERSION OF FUNDS FOR PE RSONAL PURPOSES WHICH PROVES BEYOND DOUBT THAT THE TRUSTEES WERE MISUSING THE BE NEFIT OF EXEMPTION GRANTED U/S 10(23C)(VI) OF THE IT ACT. THEREFORE, THE ARGUMENT OF THE LD. COUNSEL ON THIS ISSUE IS ALSO WITHOUT ANY MERIT AND ACCORDINGLY THE SAME IS DISMISSED. ITA NO.4093/DEL/2015 28 20.2 SO FAR AS THE ARGUMENT OF THE LD. COUNSEL THAT THE DIRECTOR GENERAL OF INCOME-TAX (INV.) HAS PASSED AN EX PARTE ORDER WITHOUT GIVING ANY PROPER AND REASONABLE OPPORTUNITY OF PRESENTING ITS CASE AND O N BEING HEARD IS CONCERNED, WE FIND FROM THE ORDER OF THE DGIT (INV.) THAT HE HAD GIVEN NUMBER OF OPPORTUNITIES TO THE ASSESSEE, HOWEVER, THE ASSESSEE HAS NOT AVAILED OF THOSE OPPORTUNITIES. HOWEVER, SINCE VARIOUS INCRIMINATING DOCUMENTS FOUN D DURING THE COURSE OF SEARCH AND EVIDENCE GATHERED DURING POST SEARCH ENQUIRIES GIVE DETAILS OF SIPHONING OF FUNDS BY THE ASSESSEE, MANIPULATION AND FORGERY OF DOCUMENTS, ETC., THE SAME NEEDS TO BE ANSWERED BY THE ASSESSEE. NO DOUBT DESPITE R EPEATED OPPORTUNITIES GRANTED BY THE DGIT (INV.), VIDE LETTERS DATED 03.01.2014, 31.01.2014 AND 08.07.2014, THE ASSESSEE HAS FAILED TO AVAIL THE OPPORTUNITIES GRAN TED TO HIM. HOWEVER, CONSIDERING THE TOTALITY OF THE FACTS OF THE CASE AND IN THE IN TEREST OF JUSTICE, WE DEEM IT PROPER TO RESTORE THE ISSUE TO THE FILE OF DGIT (INV.) WIT H A DIRECTION TO GIVE ONE FINAL OPPORTUNITY TO THE ASSESSEE TO SUBSTANTIATE ITS CAS E BY FILING THE REQUISITE DETAILS. THE ASSESSEE IS HEREBY DIRECTED TO APPEAR BEFORE TH E DGIT (INV.) WITHOUT SEEKING ANY ADJOURNMENT UNDER ANY PRETEXT, FAILING WHICH TH E DGIT (E) SHALL PASS APPROPRIATE ORDER AS PER LAW. NEEDLESS TO SAY, THE LD. DGIT (E) SHALL GIVE DUE OPPORTUNITY OF BEING HEARD TO THE ASSESSEE AND DECI DE THE ISSUE AS PER FACT AND LAW. WE HOLD AND DIRECT ACCORDINGLY. THE GROUNDS RAISED BY THE ASSESSEE ARE ACCORDINGLY PARTLY ALLOWED FOR STATISTICAL PURPOSES . ITA NO.4093/DEL/2015 29 21. IN THE RESULT, THE APPEAL FILED BY THE AS SESSEE IS PARTLY ALLOWED FOR STATISTICAL PURPOSES. THE DECISION WAS PRONOUNCED IN THE OPEN COURT ON 0 8.08.2019. SD/- SD/- (SUCHITRA KAMBLE) (R.K. PANDA) JUDICIAL MEMBER ACCO UNTANT MEMFBER DATED: 08 TH AUGUST, 2019 DK OPY FORWARDED TO 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(A) 5. DR ASSTT. REGISTRAR, ITAT, NEW DELHI