2018 (5) TMI 1548
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....ied out in the case of Madhav Group of cases, Vadodara at the business premises of Madhav Infra Projects Limited at Madhav House, Subhanpura, Vadodara on 09.11.2016 to 11.11.2016. During the search proceedings, some incriminating documents were found and seized. 3.1 A laptop of Shri Amish Bhagwat was found. The hard disc of the laptop was removed and seized and inventorised as Annexure A-26. Further a master image of the laptop hard disk was made and seized alongwith a working copy and inventorised as Annexure A-25. While analyzing the working copy of the same, a PDF file was found. The name of the file was "List of Allottee.pdf" dated 22.10.2011. 3.2 This file contains allotment details of 100000 share of the company-MSK Real Estates Pvt. Ltd., the assessee. 4. On further verification, it was found out that the assessee company alloted 100000 shares on 30.04.2009. The face value of shares was Rs. 10 and they were alloted at a premium of Rs. 90 per share. Thus, total share capital raised through this issue was Rs. 1 crores. These shares were allotted to following Kolkata based companies. The pdf file was printed and scanned copy of the same is reproduced hereunder:- MSK....
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....In the case of above companies, the main controller was Shri Beni Prasad Lahoti and Shri Hari Prasad Rathi. The statement of Shri Beni Prasad Lahoti has been recorded by the Investigating Wing of Kolkata taken in which he has accepted that the companies are not doing any genuine business and only provide accommodation entries. Further Sh Jay Prakash Roy, director of Echolac Vinimay P Ltd and Galore Suppliers P Ltd and Sh Jogendra Pradhan, director of MSV Fiscal Services P Ltd Oleander Manufactures Credit P Ltd and Slow & Sound Electronics P Ltd have accepted in their letters addressed to the DDIT (Inv) Unit II(3) Kolkata that they are dummy directors of the companies and receiving remuneration of Rs. 1000/- to Rs. 2000/- p m for this purpose. The Dy. Director or Income Tax (Inv) Unit 4(2) Kolkata's has furnished the inquiry report dated 10.11.2016 in this regard. 5.1 During the course of search at the residence of Shri Ashok Khurana at 1, Vikram Society, Gotri Road, Vadodara, state of Shri Ashok Khurana was recorded u/s. 132(4) of the Income Tax Act, 1964. In the state in Q.No 44 to 47 he was asked about the unsecured loans from Kolkatta based entities and the genuineness of....
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.....1.2 Department's view. The contention of the assessee is not acceptable because actually, the assessee company had alloted shares on 30.04.2009 i.e. during F.Y. 2009-10 relevant to A.Y. 2010-11 to the bogus Kolkata based companies mentioned at para 2 above. The allotment of share is prima facie the matter of concern not the receipt of share application money. The issue is very crystal clear that the assessee has alloted the share to bogus companies. Moreover, the subscribers of shares become the real owner of the share after the shares are alloted to them and not at the time when they make the payment. In general principle an entity when applies to subscribe the share, has to pay for the price of the share in advance i.e. prior to allotment of share. In case, the person is not alloted with the share, in advance i.e. prior to allotment of share. In case, the person is not alloted with the share, the money has to be returned back. The receipt of share application money has to be accounted for by the issuing company after the shares are alloted to the subscribers and not at the time of receiving the cheques. Sometimes, the shares are oversubsribed, in that case, the balance am....
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....e has been credited to its bank account during F.Y. 2009-10. Therefore, without prejudice to the facts mentioned at 3.1.2 above the assessee had wrongly reflected in its balance sheet that it had received the share application money of Rs. 1,00,00,000/- during F.Y. 2008-09 relevant to A.Y. 2009-10." 5. From the record, it emerges that the assessee had not filed return for the relevant assessment year. Further, the reasons cited by the Assessing Officer for issuing the notice of reopening are quite serious. In such reasons, he had pointed out that the material collected by the department during search operation in case of Madhav Group of cases which led to further information that the assessee had alloted 1 lac shares to different investor companies by charging Rs. 90/- by way of premium over and above the nominal value of Rs. 10/- per share. The Investigating Wing of the department had collected material to suggest that these were shell companies engaged in providing accommodation entries having dummy directors. Statement of the director of the assessee-company was also recorded. He could not provide genuineness of these transactions. He would also confronted with the report of t....