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TMI Blog2016 (6) TMI 747X X X X Extracts X X X X X X X X Extracts X X X X ..... levant to such assessment year. If a small portion of the entries related to the subsequent assessment year, it would not mean that the assessment cannot be reopened for the year during which majority of these transactions actually took place. With respect to the additional ground raised in the other petitions, the data provided by the Revenue for a total of 4,50,572 shares which has stated to have been claimed, it is true that some 30,843 fall during the period post 31.03.2011. However, majority of the sale of shares of nearly 4,20,000 was during the period 01.04.2010 to 31.03.2011 and only on this ground therefore, we would not be justified in quashing the notice for reopening. - Decided against assessee - SPECIAL CIVIL APPLICATION NO. 18080, 18081, 18090, 19382, 19383 of 2015 - - - Dated:- 14-6-2016 - MR. AKIL KURESHI AND MR. A.J. SHASTRI, JJ. FOR THE PETITIONER : MR RK PATEL, ADVOCATE FOR THE RESPONDENT : MRS MAUNA M BHATT, ADVOCATE COMMON ORAL JUDGMENT (PER : HONOURABLE MR.JUSTICE AKIL KURESHI) 1. These petitions involved substantially similar facts. They have been heard together and would be disposed of by this common judgment. 2. Brief facts ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ts under various names such as rajesh Jhaveri ; rj ; n navkar ; R JHAVERI ; RAJESH JHAVERI and N NAVKAR (sawaca) . These accounts contain the details of cash received from/through Rajesh Jhaveri by SCS and the accommodation entries provided there against. During the course of survey conducted at the office of SCS situated at Dwarka Ashish Building 'Sheetl' in MS Excel file n navkar bips 30.10.12 was impounded at the path F:\pen drive back up\Removable Disk \n Navkar of Annexure A35. Amongst other transactions, transactions related to purchase and sale of shares of Prraneta Industries Limited (hereinafter referred to as PIL ) were also found to be recorded. The transactions recorded in the said sheet of n navkar bips 30.10.12.xls with regard to shares of Prraneta Industries Limited contains the details of cash received (which is corroborated with the cash sheets for the respective dates), date of the transaction, particulars of the transactions, quantity of shares purchased or sold by SCS through the persons/entities controlled by him or other independent entities in badla transactions, the rate of shares of PIL at which the trade has been executed (in ce ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ares of the company are being controlled by Shirish Shah and the same are being used by him so as to provide long term capital gains entries by resorting to synchronized trading. Further, Shri Kumar Raichand Madan, director of PIL, in his statement u/s 131(1A) of the Act recorded on 09.04.2013, has stated that he is a dummy director and the entire affairs of the companies are managed and controlled by SCS. Other two directors of PIL, Jyoti Dhiresh Munver and Jils Raichand Madan have also filed declarations stating that they are dummy directors. During the presearch investigations it was found that Shri Damodar Attal is the key person, an employee of Shirish Shah, who was looking after the share manipulation and LTCG entry operations being undertaken by Shirish Shah. In the statement recorded u/s 132(4) of the Act on 09.04.2013, Shri Damodar Attal has stated that he works for Shirish Shah; he purchases and sells shares of BSE listed companies operated by Shirish Shah at the trading terminal as per instructions of SCS; he has provided the list of the listed companies operated by Shirish Chandrakant Shah which include Prraneta Industries Limited; SCS through synchronized trading ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... for the petitioner submitted that the reasons lack validity. There is no material on record to establish that there was any payout made to the petitioner as recorded in the reasons and that therefore, the formation of the belief by the Assessing Officer that income chargeable to tax had escaped assessment is wholly invalid. The counsel painstakingly took us through the reasons recorded on the materials produced by the Revenue on record and contended that there has not been any payout of the said sum of ₹ 4,03,34,595/- for sale of 9,55,644 shares as averred in the reasons. The counsel further submitted that in the reasons recorded, the Assessing Officer is uncertain whether such sum of ₹ 4.03 Crores (rounded off) represented unassessed income of the assessee for the assessment year 2010-11 or 2011-12. On this ground also, the notice must be quashed. 7. Similar contentions were raised in Special Civil Application No.19382 of 2015 also. In other three petitions in addition to raising these contentions, counsel for the petitioner submitted that the Revenue has included payments made to the petitioner for sale of shares after 01.04.2011 for reopening of the assessment for ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ng long term capital gain through sale of shares and retain commission for himself in the process. In this part, we also notice that Rajesh Jhaveri was one of the important players in this process devised by Shirish Chandrakant Shah. There was primafacie material suggesting Prraneta Industries Limited was one such company utilized by Shirish Chandrakant Shah for such purpose. These details had come on record through statements of various persons recorded by the Revenue authorities through search and survey operations. For example, during the search of Prraneta Industries Limited, the manager of the company Radheshyam Sharma had stated that there was no business activity in the company and the entire affairs including preparation and maintenance of books of accounts was being done by Shirish Chandrakant Shah. Shri Omprakash Anandilal Khandelwal, the Managing Director of the company had also stated that the company is engaged in providing accommodation entires and no actual business activity is being undertaken. The affairs of the company being managed and controlled by Shirish Chandrakant Shah and the bank accounts of the company are being used to provide accommodation entries. Th ..... X X X X Extracts X X X X X X X X Extracts X X X X
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