Godavari Biorefineries Ltd v. The Assistant Commissioner Of Income Tax, Circle 2(1)(1), Mumbai & Ors

Digitallysigned bySHAMBHAVISHAMBHAVINILESHNILESHSHIVGANSHIVGANDate:2024.02.2611:42:02+0530 IN THE HIGH COURT OF JUDICATURE AT BOMBAY ORDINARY ORIGINAL CIVIL JURISDICTION WRIT PETITION NO.3957 OF 2022 Godavari Biorefineries Ltd.VersusThe Assistant Commissioner of Income Tax, Circle 2(1)(1), Mumbai & Ors. …Petitioner ….Respondents Mr. Dinkle Hariya, with Ms. Rashmi Vyas, for Petitioner.Mr. Suresh Kumar, for Respondents-Revenue. CORAM:K. R. SHRIRAM &DR.NEELA GOKHALE, JJ.DATED:22nd February 2024 PC:- 1.Petitioner had filed its return of income for Assessment Year2013-14 declaring a total loss of Rs.12,34,56,525/-. The assessment proceedings under Section 143(3) of the Income Tax Act, 1961 (“theAct”) was completed on 30[th] December 2016. 2.Petitioner, thereafter received a notice dated 31[st] March 2021under Section 148 of the Act. The reason to believe reads as under: “2.A search action u/s 132 of the Act is carried out in thecase of M/s Shri Renuka Mata Multi State Urban Co-operativeCredit Society Ltd. (SRMUCS, PAN- ) and therefound huge money deposited in the bank accounts maintainedin the society. The modus operandi of SRMUCS is acceptinglarge cash deposit through multiple channels, thereaftertransferred these amount to various beneficiary entitiesthrough RTGS/other banking modes to various non-genuineentities. It is pertinent to say that the beneficiary may havereceived money not only from SRMUCS but also from otherbogus companies as well as other co-operative societies. Oneof the assessee M/s Godavari Biorefineries Ltd is a beneficialwhose account was credited by Rs.64,17,550/- during F.Y 2012-13 through banking channel. The assessee M/s GodavariBiorefineries Ltd has received the amount from SRMUCSwhich has origin in the cash deposited under various accounts.Since, SRMUCS was engaged in non- genuine cash depositsand further transfers of amounts having nature of unaccountedincome, the amounts received by assessee are not from theaccounted sources. 3.On the basis of the tangible material received fromADIT (Inv.), Bhavnagar, it is seen that, M/s GodavariBiorefineries Ltd has not truly and fully disclosed all materialfacts in its return of income (ROI). Considering theinformation, above mentioned transactions are found to benon-genuine. 4.Therefore, I have reason to believe that incomechargeable to tax amounting to Rs.64,17,550/- has escapedassessment for A.Y. 2013-14 within the meaning of section 147of the Act.” 3.Petitioner has been repeatedly calling upon Respondents toprovide copies of documents based on which it is alleged that ShriRenuka Mata Multi State Urban Co-operative Credit Society Ltd.(“SRMUCS”) had deposited a huge amount in its bank accounts andthose amounts were transferred to various beneficiaries entities/non-genuine entities through banking modes and Petitioner was one ofthe beneficiaries of a sum of Rs.64,17,550/- for the relevantassessment year. 4.Ms. Hariya states and it is also alleged in the Petition that noneof these details have been provided. 5.Mr. Suresh Kumar states in the affidavit in reply an excel sheethas been reproduced giving the details. In our view, it does not help.The excel sheet does not answer the basic ground of Petitioner that it did not have bank account with SRMUCS and it also does not answerPetitioner’s stand that it did not have any banking relationship withSRMUCS and had not deposited any cash for facilitating any thing. 6.Even the break up of the amount of Rs.64,17,550/- or thename of the parties have been provided to Petitioner.Notwithstanding Petitioner requesting the Assessing Officer (“AO”) toprovide these details, the same has not been provided. Instead, anorder rejecting the objections dated 15[th] February 2022 has beenpassed which is impugned in this petition. 5.Mr. Suresh Kumar states in the affidavit in reply an excel sheethas been reproduced giving the details. In our view, it does not help.The excel sheet does not answer the basic ground of Petitioner that it did not have bank account with SRMUCS and it also does not answerPetitioner’s stand that it did not have any banking relationship withSRMUCS and had not deposited any cash for facilitating any thing. 6.Even the break up of the amount of Rs.64,17,550/- or thename of the parties have been provided to Petitioner.Notwithstanding Petitioner requesting the Assessing Officer (“AO”) toprovide these details, the same has not been provided. Instead, anorder rejecting the objections dated 15[th] February 2022 has beenpassed which is impugned in this petition. 7.In our view, such an order cannot be sustained becausePetitioner has not been provided the documents based on which anallegation is made that Petitioner was a beneficiary to the largestfrom SRMUCS. 8.In the circumstances, the order dated 15[th] February 2022 ishereby quashed and set aside. 9.Respondents are directed to provide within two weeks fromtoday all documents including the statements relying upon which thereason to believe escapement of income has been arrived at.Petitioner shall also be provided the details as to how Respondentshave arrived at the figure of Rs.64,17,550/-. Within two weeks ofreceiving the same, Petitioner shall supplement the reply alreadyfiled. Thereafter the proceedings shall be completed on or before 31[st]Shivgan May 2024. Petitioner shall be given a personal hearing, noticewhereof shall be communicated at least five working days in advanceand the order to be passed shall be a reasoned order dealing with allobjections of Petitioner. 10.Petition disposed. 11.All rights and contentions are kept open. (DR. NEELA GOKHALE, J.) (K. R. SHRIRAM, J.)