9911796707
TMI Blog2003 (4) TMI 71X X X X Extracts X X X X X X X X Extracts X X X X ..... in Delhi; that the lease dated June 26, 2000, was, accordingly executed between Shri Nandlal Kothari and Shri Shyam Sunder Kothari on the one hand and the petitioner-company on the other, leasing a portion of the aforesaid property to the petitioner-company at a rent of Rs. 6,000 per month. On September 7, 2000, the premises of the petitioner were searched by the officials of the Income-tax Department under section 132(1)(i) to (v) of the Income-tax Act (in short referred to as "the Act") to carry on search and seizure of Kothari Marbles and Kothari Exports and the business concerns of Kothari group. The officers of the petitioner were stated to have initially raised objections to the search of the petitioner's premises pursuant to the war ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... It is submitted that since it was the first year of the operation of the petitioner-company and the time for filing the return had not yet come, no return of income was filed by the petitioner and it was, therefore, premature to apprehend that the petitioner would not disclose its correct income to the Department and there was no question of the petitioner having not disclosed such income as the return of income was yet to be filed by the petitioner-company and as such the provisions of section 132(1)(c) of the Act were not applicable and consequently the premises of the petitioner could not be searched. It is also submitted that the bank account having been disclosed by the petitioner in its books of account, operation of the same could no ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e petitioner was mentioned to be a finance company of the group recently acquired by the Kothari group. It is submitted that during the course of the search, the statement of Shri Nandlal Kothari was recorded and in his reply to a question it was stated that the petitioner-company was his valued customers and they had financed Dee Pearls India Pvt. Ltd., another company of the Kothari group of companies and the petitioner had paid Rs. 3 crores in advance for supply of marbles to them. It was also stated by Shri Nandlal Kothari while replying to another question that to the best of his memory no share of the petitioner company was owned by him or by his family members. It is submitted that according to the documents recovered by the Departme ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is submitted that the lease deed was a fictitious document prepared only to show the existence of two different parties and it did not reflect the true state of affairs. In reply to the contention of the petitioner that its premises could not be searched under section 132(1)(c) of the Act nor the operation of the bank account could be stopped as the same had been disclosed by the petitioner in its books of account, learned counsel for the respondent submits that the search of the premises of the petitioner was in fact a consequential action conducted on the basis of the information given by Mr. Shyam Sunder Kothari in his statement recorded by the Income-tax Department on the date of the search. It is submitted that the search was not carr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... vouchers of Dee Pearls India Pvt. Ltd., which was admittedly a group company of Kotharis. The petitioner has also not denied that a large sum of money was transferred from the account of the petitioner to the account of Dee Pearls India Pvt. Ltd. The petitioner has also not denied in the rejoinder that certain fax messages were sent by the aforesaid Mr. Deepak Baheti for and on behalf of Dee Pearls India Pvt. Ltd. as well as on behalf of Shri Nandlal Kothari. It is not explained either in the rejoinder or during the course of argument as to in what capacity Mr. Deepak Baheti was acting for and on behalf of Dee Pearls India Pvt. Ltd. If there was no interlinking between the Kothari groups of companies and the petitioner-company, there was n ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ally these companies were laundering money. The total amount of cash deposited in four to five companies exceeded Rs. 90 crores; the source of cash was not explained and cheque entries were given to a large number of persons including Mr. Kothari through conduit companies. All these allegations cannot be brushed aside simply on the basis of the averments made in the writ petitions. These are questions which are required to be examined by the Department. The respondents have disclosed that during the financial year 1999-2000 various concerns of Kothari groups received a total of Rs. 5,97,00,000 from the petitioner-company. In view of the fact that an elaborate network of companies was created in Calcutta and Delhi in which cash was being dep ..... X X X X Extracts X X X X X X X X Extracts X X X X
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