TMI Blog2014 (8) TMI 489X X X X Extracts X X X X X X X X Extracts X X X X ..... , it cannot be said that satisfaction arrived at by the Assessing Officer while initiating proceedings under section 158BC of the Act has been vitiated in any manner - There is ample material on record in the satisfaction note against the respective petitioners and Goyal Industries Ltd and another - even the Rajendra Goyal is the Director of Goyal Industries Ltd. and the Company i.e. Goyal Industries Ltd. is run through its Director/Manager/employees etc. - no error or illegality has been committed in issuing notice u/s 158BD – Decided against the assessee. - Special Civil Application No.15311 of 2004, Special Civil Application No.15315 of 2004 - - - Dated:- 30-7-2014 - M. R. Shah And K. J. Thaker,JJ. For the Petitioner : Mr. B. S. Soparkar For the Respondent : Mr. Sudhir M. Mehta ORDER (Per : Honourable Mr. Justice M. R. Shah) 1. As the common question of law has arisen in both these petitions, they are heard and disposed of by this common judgment and order. 2. In both these petitions under Article 226 of the Constitution of India, the respective petitioners have prayed for an appropriate writ, order or direction to quash and set aside the impugned n ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ng of summons under section 131 of the I.T. Act. As the department s case, said Shri Sharma stated that he was working as manager in the Goyal Industries Ltd. and the bank accounts which were in the name of Rahul International Prop. Shri Rahul Chopra, Rahul International Prop. Shri Dilip Makwana, Roopa Textiles Prop. Shri Rajesh Nath and Raju Fabrics Prop. Shri Satyanarayan Dayma, were operated by him on the instruction of Shri Rajendra Goyal (Director of Goyal Industries Ltd.). During the interrogation, said Shri Satyanarayan Sharma confirmed that he was working as manager in the Goyal Industries Ltd. i.e. Shri Rajendra Goyal, but two concerns namely Raju Fabrics and Gunjan Exports were being run as his proprietary concerns and the books of accounts were being written at he office of Shri Rajendra Goyal, Director of Goyal Industries Ltd. He also stated that the cash deposited in the accounts of Rahul International and Roopa Textiles was actually given to him by the aforesaid Rajendra Goyal, Director of Goyal Industries Ltd. He also stated that he was actually handling all the bank accounts of the group at the instruction of Shri Rajendra Goyal. It appears that in view of the afore ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that any undisclosed income belong to any persons other than the persons with respect to whom search was made under section 132 of the Act or whose books of account or any assets were searched under section 132 of the Act, in such a case alone, block assessment proceedings under section 158BD of the Act can be initiated against that person of which the Assessing Officer is satisfied that any undisclosed income belong to the said person. It is submitted that in the present case, there is no such satisfaction and/or it does not born out that the Assessing Officer is satisfied that any undisclosed income is belonged to the respective petitioners. It is, therefore, submitted that as requirements as provided under section 132 of the Act are not satisfied, the subjective satisfaction of the Assessing Officer against the respective petitioners is vitiated, and therefore, the impugned notices for block assessment under section 158BD require to be quashed and set aside. Making above submissions, it is requested to allow the present petitions. 7. Both these petitions are vehemently opposed by Mr. Sudhir Mehta learned advocate appearing for the respondent-Revenue. A detailed affidavitin- r ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the proceedings under section 158BD of the Act have been initiated. It is submitted that as such the Goyal Industries Ltd. is a company who runs through Directors and its employees. It is submitted that the satisfaction arrived at by the Assessing Officer while initiating the proceedings under section 158BD of the Act are not vitiated and the block assessment proceedings under section 158BD of the Act are rightly initiated by issuing the notice under section 158BD of the Act. Making above submissions, Mr. Mehta requests to dismiss both the petitions. 8. Heard the learned advocates appearing for the respective parties. 9. At the out-set, it is required to be noted that what is challenged in the present petitions is initiation of block assessment proceedings against the respective petitioners under section 153BD of the Act, i.e. notices issued by the Assessing Officer under section 158BD of the Act. It is required to be noted that the impugned notices have been issued and/or the block assessment proceedings under section 158BD of the Act are issued with the following satisfaction Note:- 2. During the course of search in Malpani group of cases, a locker key was found from t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... heques have been issued. The cheques from the account of Rahul International and Roopa Textiles were mostly issued in the names of (i) Gunjan Exports (ii) Raju Fabrics and (iii) Aditya Yard Pvt. Ltd. 4. The address given in the bank accounts were found to be bogus except in the case of Rahul International, Prop. Shri Dilip V. Makwana. During the course of statement under sec. 131 of the IT Act, Shri Dilip Makwana stated that he has been working as a peon in the office of Shri Rajendra Goyal, director of Goyal Ind. Ltd. It was was admitted by him that the account in The Udhna Citizen Co. Op. Bank Ltd., Ring Road, Surat was opened at the instruction of Shri Satyanarayan Sharma @ Dayma, who was the manager of Goyal Ind. Ltd. The blank cheques were signed by him at the instruction of Shri Satyanarayan Sharma. It was stated by him that he has no knowledge regarding the deposit of cash or issue of cheques in the said account. In the circumstances, statement of Shri Satyanarayan Sharma was recorded by issuing of summmons u/s. 131 of the I.T. Act. Shri Satyanarayan Sharma stated that he was working as manager in the Goyal Ind. Ltd. and the accounts as below were operated by him at the i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he said accounts. 7. The statement made by Shri Rajendra Goyal does not appear to be correct because the sequence of transaction is as below: (I) The three concerns namely (i) Goyal Ind. Ltd. (ii) Goyal Synthetics Pvt. Ltd. and (iii) Foremost Finvest pvt. Ltd. were 100% Export Oriented Units. They were importing yarns. The imported yarns were sold to the following concerns: (a) Raju Fabrics, Pro. Shri Satyanarayan Sharma (b) Gunjan Exports, Prop. Shri Satyanarayan Sharma (c) Aditya Yarn Pvt. Ltd., director Shri Satyanarayan Sharma. (II) The first two concerns i.e. Raju Fabrics and Gunjan Exports were stated to be involved in manufacturing of grey and third concern i.e. Aditya Yarn Pvt. Ltd. was to be involved in texturing. (III) The payments against the purchases were made by the aforesaid three concerns to the (i) Goyal Ind. Ltd., (ii) Goyal Syntehtics Pvt. Ltd. and (iii) Foremost Finvest Pvt. Ltd. by way of cheques. The three concerns owned by Shri Satyanarayan Sharma were stated to have sold grey or texturised yarn to 100% EOU locally. But, it is found that the three concerns were receiving cheques from the fictitious concerns, pointed out in para-4 i.e. Rahul ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion Total Transaction Cash Deposited 1 Pakeeza Dresses 898 The Udhna Citizen co.op. Bank 28.07.2000 to 31.03.2001 24,20,04,211 15,38,32,00 0 2 Yash Fabrics 734 The Udhna Citizen co.op. Bank 02.03.2000 to 29.07.2001 6,95,00,908 79,43,000 3 Tin Silk Mills 996 The Udhna Citizen co.op. Bank 23.10.2000 to 28.03.2001 4,03,79,087 4,70,000 4 Jay Rayons 1063 The Udhna Citizen co.op. Bank 28.12.2000 to 25.06.2001 4,06,28,725 6,96,000 5 Surti Textiles 929 The Udhna Citizen co.op. Bank 05.09.2000 to 28.12.2001 8,93,94,920 73,72,000 6 Urmi Traders 814 The Udhna Citizen co.op. Bank 02.05.2000 to 13.02.2001 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 8 Surti Textiles 929 The Udhna Citizen co.op. Bank 05.09.2000 to 28.12.2001 8,93,94,920 73,72,000 9 Urmi Traders 814 The udhna Citizen co.op. Bank 02.05.2000 to 13.02.2001 18,00,62,653 3,18,89,000 Total 92,01,74,261 40,48,31,355 The total credits in the aforesaid benami accounts are to the extent of ₹ 92,01,74,261/- out of which, the sum of ₹ 40,48,31,355/- is by way of cash. All the credits in the aforesaid accounts have ultimately reached the group concerns of Shri Rajendra Goyal i.e. Goyal Ind. Ltd., Goyal Synthetics Pvt. Ltd. and Foremost Finvest Pvt. Ltd. through the concerns in the name of Shri Satyanarayan Dayma/Sharma i.e. Raju Fabrics,Gunjan Exports and Aditya Yarn Pvt. Ltd. 9. From the facts narrated above,it is clear that the group concerns of Shri Rajendra Goayl i.e. Goyal Industries Ltd., Goyal Synthetics Pvt. Ltd. and Foremost Finvest Pvt. Ltd. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... proceedings under section 158 of the Act has been vitiated in any manner. 11. Now, so far as the contention of the petitioners that during the course of search/inquiry, whatever is found is against the Rajendra Goyal and not against the Goyal Industries Ltd., and therefore, no block assessment proceedings could have been initiated against the present petitioners is concerned, tt is required to be noted that there is ample material on record, so mentioned in the satisfaction note, against the respective petitioners and Goyal Industries Ltd and another. It is required to be noted that even the said Rajendra Goyal is the Director of Goyal Industries Ltd. and the Company i.e. Goyal Industries Ltd. is run through its Director/Manager/employees etc. Considering the material on record and in the facts and circumstances of the case and the satisfaction Note, we are satisfied that no error or illegality has been committed in issuing notice under section 158BD of the Act. 12. It is required to be noted that as such pursuant to the interim order passed by this Court, the block assessment proceedings were permitted to be concluded, however,are not served and implemented upon the petitio ..... X X X X Extracts X X X X X X X X Extracts X X X X
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