TaxTMI 
TaxTMI 
2016 (1) TMI 1349
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.... and others. Another PIL was filed by one Shri Aman Munda against Shri Madhu Koda, Shri Sanjay Kumar Chaudhary, Shri Binod Sinha and some other persons. In the aforesaid PILs the charges of corruption were made against the aforementioned persons that they have amassed wealth by corrupt or illegal means disproportionate to their known sources of income and had acquired huge properties both immovable and movable. 3. During the course of PIL proceedings before the Hon'ble High Court, Jharkhand at Ranchi, a FIR bearing No. 9/9, dated 2-7-2009 was registered at Police Station Nigrani, District Ranchi against Shri Madhu Koda and others for violation of Sections 409, 420, 423, 424, 465, 120B of the Indian Penal Code and Sections 7, 10, 11 and 13 of Prevention of Corruption Act, 1988. The said FIR was filed on the basis of complaint filed by one Shri Rajiv Sharma vide complaint No. 1/9, dated 1-7-2009. This case was taken up for investigation by the Vigilance Department of Ranchi Police as per order of the ld. Special Judge (Vigilance), Ranchi on 1-7-2009 under Section 156(3) of the Code of Criminal Procedure, 1973. 4. The State Vigilance Department, Ranchi carried out investig....
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....ng the appellant company not to transfer, dispose of, part with or otherwise deal with in any manner whatsoever with the share capital of Rs. 54,15,300/- and assets of Rs. 1,20,99,491/- as on 31-3-2009 unless specifically permitted to do so by the respondent. 9. Thereafter, based upon the aforesaid Provisional Attachment Order, an Original Compliant No. 76 of 2010 was filed by the respondent on or around 7-12-2010 under the provisions of Section 5(5) of the PMLA before the Adjudicating Authority praying that the order of provisional attachment dated 10-11-2010 may be confirmed and the appellant company be directed to hand over the attached assets. 10. The Adjudicating Authority after adjudication under Section 8 of PMLA confirmed provisional attachment of properties of the appellant company to the tune of Rs. 1.21 crore vide order dated 6-4-2011. However, the Adjudicating Authority declined to confirm the attachment of share capital of the appellant as the respondent did not press for the confirmation of the same. The order dated 6th April, 2011 of the Adjudicating Authority confirming the provisional attachment of properties is now being challenged in the present appea....
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....l hearing to the appellant's counsel. 14. The counsel submitted that on receipt of O.C. No. 76/2010 seeking confirmation of Provisional Attachment Order No. 4/2010, dated 10th November, 2010, the Adjudicating Authority issued show cause notice under Section 8(1), dated 9th December, 2010 fixing date of hearing on 28th January, 2011 which was not served to the appellant. He drew our attention to the copy of order sheet dated 28th January, 2011 passed by the Adjudicating Authority which is filed in the appeal papers and pointed out that the counsel for respondent/ED on 28th January, 2011 before the Adjudicating Authority had admitted that in respect of some of the defendants, show cause notice under Section 8(1) were not yet served. Consequently, the Adjudicating Authority directed the complainant (the present respondent) to ensure proper service of show cause notice u/s 8(1) of PMLA on all the defendants by 6th February, 2011 and the hearing of the case was fixed starting from 9th March, 2011 as per the schedule drawn by the Adjudicating Authority as there were a large number of defendants. The relevant portion of Adjudicating Authority's order sheet dated 28th January, 2011 i....
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....11 which is reproduced as follows: "F. No. : PMLA/AML/-CELL/ED-KZO/2011/     date : 3-2-2011 To The Deputy Director, Directorate of Enforcement, Delhi Zonal Office, NEW DELHI Sir, Sub : Service of notice to Show Cause No. 76/2010 along with documents (Vol. I to Vol. V) to M/s. Shivans Steel Pvt. Ltd., Kolkata in the case of Shri Madhu Koda and others - reg. Please refer to your letter No. ECIR/2/PAT/2009, dated 31-1-2011 on the subject. 2. An officer was deputed for the purpose of service of subject documents.The said documents were served upon Shri Tanusree Sankar Tafadar of M/s. S.K. Naredi & C., 21, Hemanta Basu Sarani, Suit No. 204, 2nd Floor, Kolkata - 700001 for and on behalf of M/s. Shivans Steel Pvt. Ltd., which is reported to have shifted its office to some unknown place, details of which could not be furnished by them. The original acknowledgement is enclosed for your needful....." 16. The learned counsel for the appellant submitted that the appellant has shifted its registered office from 25th September, 2008. Therefore, on the material date i.e. date of dispatch of show cause notice under Section 8(1) of PMLA through courier....
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....Adjudicating Authority, the respondent could not have served the appellant through newspapers and such service of notice is bad in law and void. The learned counsel drew our attention to Rule 12(b) and (d) of the Adjudicating Authority Regulations, 2005 (in short Regulations) and submitted that the Regulations provide that notice shall be sent by registered post, acknowledgement due. He submitted that in the ordinary course the notice is to be sent only by registered post and it is only when the Adjudicating Authority is satisfied that there is any reason to believe that the defendant is keeping out of the way for the purpose of avoiding service or that for any other reason the notice cannot be served in the ordinary way, the Adjudicating Authority shall order service by way of an advertisement in daily newspaper. He submitted that perusal of order sheet dated 28th January, 2011 passed by the Adjudicating Authority clearly reveals that neither the Adjudicating Authority recorded its satisfaction as required under sub-rule (d) of Regulation 12 of the Regulations nor directed service of notice by way of advertisement in a daily newspaper. He submitted that since the service of notice....
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....Enforcement Lucknow Zonal Office 57-a, Meera Bal Marg Lucknow-2260001 Uttar Pradesh Versus M/s. Shivansa Steel Pvt. Ltd.         .......Defendant Suit No. 204, 2nd Floor Center Point 21 Hemant Basu Sarani Kolkata-700001 Above named complaint has filed a complaint under sub-section (5) of Section 5 against you. You are called upon to indicate the source of your incoming earning or assets out of which or by means of which you have acquired the property provisionally attached under sub-section (1) of Section 5 of the Prevention of Money-laundering Act, evidence on which you rely and other relevant information and particulars and to show cause why all or any of such property should not be declared to be the properties involved in money laundering and confiscated by the Central Government. You are directed to appear before Adjudicating Authority at Jeevan Deep Building, 4th Floor, Room no. 25, Parliament Street, New Delhi in person or through an advocate/authorized representative duly instructed on the 10th day of March, year 2011 at 11:00 am, failing which the complaint shall be heard and decided in your absence. A photocopy of o....
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....rtunity in an effective and purposeful manner to present its case on the allegations made in the Original Complaint and all the adjudication proceedings were conducted in a highly unfair manner and in violation of well established principles of natural justice. He prayed that the impugned order be set aside and remanded to the Adjudicating Authority for readjudication. No other arguments were advanced on behalf of the appellant. 23. The learned counsel for the respondent vehemently contested the pleas and contentions raised on behalf of the appellant. He submitted that the Provisional Attachment Order dated 10th November, 2010 was served in person to Shri Subhik Chattopadhaya for M/s. Shivans Steel Pvt. Ltd. on 24th November, 2010. He submitted that show cause notice u/s 8(1) of PMLA along with Original Complaint and relied upon documents was sent to the appellant through Blue Dart courier on 22nd December, 2010 which was received back with the comment "refused" and Original Complaint and relied upon documents sent with the show cause notice were also received back. 24. He submitted that in compliance of the directions of the Adjudicating Authority vide order sheet entr....
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....and allegations as stated in the Original Complaint and no arguments are advanced, therefore, it is not necessary that the appellant be provided an opportunity of hearing during that time. He submitted that there is no provision under PMLA to grant opportunity of hearing to appellant at that time. He submitted that by not granting an opportunity of hearing to the appellant at the time of going through the complaint by the respondent, no prejudice was caused to the appellant as it was granted full opportunity to file its response by way of written submissions, personal hearing and to make its arguments before Adjudicating Authority in its defense. 28. He submitted that the appellant was required to answer the show cause notice on the basis of Original Complaint. The respondent/ED only took Adjudicating Authority through the complaint at the time of preliminary submissions on 9th March, 2011. The learned counsel submitted that the provisions of Section 8(1) of PMLA require that the appellant be put to notice in order to give an opportunity and admittedly the appellant was put to notice and was given an opportunity of hearing. He drew our attention to the copy of order sheet dat....
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.... their oral submissions for their clients as mentioned below : Advocate for the Defendant Defendant No. Mr. Manoj Def. No. 12, 15, 16, 17 and 18. Mr. Pyiush Kumar Def. No. 11 Mr. Gaurav Agrawal (as instructed by Sh. S.K. Poddar) Def. No. 13 Mr. S.K. Poddar Def. No. 14, 19, 21 and 22 Dr. Prabhat Kumar Def. no. 10 For Defendant No. 1 to 9, no one appeared by the scheduled time of hearing i.e. 11:00 am today. However, when the bench was rising for lunch for around 1:45 pm, Mr. Rajeev Singh, Advocate, Shivansh Singh, Advocate, Alok Shukla, Advocate appeared on behalf of Defendant No. 1, 2, 3, 4, 5, 7, 8 and 9 requested for adjournment by ten (10) days. This was rejected by the Bench. However, they were permitted to make their submissions at the end of the schedule of hearing drawn up as on 28-1-2011. For Defendant No. 6, Mr. S.K. Srivastava, Advocate, Mr. Mareesh P. Shay, Advocate appeared and also asked for adjournment by ten (10) days, on the ground that their client had not received the copy of the complaint. On behalf of the Deputy Director it is mentioned that notice was served duly along with Annexure including the complaint through courier in December, 2010. Reques....
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....at the appellant in appeal memo has made false statement that large number of relied upon documents were not legible but later as an afterthought, it has been argued in adjudication proceedings that copy of the Original Complaint was not supplied to the appellant. 32. He submitted that the provisions of Civil Procedure Code do not apply to the adjudication proceedings under Section 8 of PMLA. He drew our attention to provisions of Section 6(15) of PMLA and submitted that Adjudicating Authority is not bound by the procedure laid down by the Code of Civil Procedure, 1908 but shall be guided by the principles of natural justice. The counsel submitted that the show cause notice was to show legitimate source of properties attached. He drew our attention to the copy of reply/written submissions filed by the appellant before the Adjudicating Authority and pleaded that the contents of reply indicate that the appellant had access to the copy of Original Complaint and relied upon documents. He submitted that the appellant has filed copy of Original Complaint in appeal. He contended that if the appellant did not have access to legible copy of relied upon documents then how the appellant....
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....ney and also investing such monies. Further, the evidence on record establishes that cash amounts traceable to Shri Binod Sinha and Shri Vikas Sinha were projected as untainted through the mechanism of accommodation entries made in the books of companies controlled by Shri Binod Sinha, Shri Vikas Sinha, Shri Vijay Joshi and other associates of Sh. Madhu Koda, without there being any legitimate and/or actual underlying commercial transaction. Therefore, having established a nexus between Shri Binod Sinha and the monies illegally obtained by Sh. Madhu Koda, and the complicity of Sh. Vijay Joshi in a number of transactions, and having also demonstrated an elaborate modus operandi wherein cash amounts were utilized to make accommodation entries, where such monies were projected as share application monies or loan amounts, thereby projecting the tainted property as "untainted", the burden would be on the appellant to establish that the entries in question were not accommodation entries and the transactions in question were legitimate business transactions supported by necessary documentation regarding the existence of such underlying transactions and genuineness of transactions and part....
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....upreme Court noted that "Even if it is found by the court that there is a violation of principles of natural justice, the courts have held that it may not be necessary to strike down the action and refer the matter back to the authorities to take fresh decision after complying with the procedural requirement in those cases where non-grant of hearing has not caused any prejudice to the person against whom the action is taken. Therefore, every violation of a facet of natural justice may not lead to the conclusion that the order passed is always null and void. The validity of the order has to be decided on the touchstone of "prejudice". The ultimate test is always the same viz. the test of prejudice or the test of fair hearing." The Hon'ble Supreme Court observed that "even when we find that there is an infraction of principles of natural justice, we have addressed a case to the authority to make fresh demand of amount recoverable, only after issuing notice to show cause to the appellant". He submitted that the Hon'ble Supreme Court held that since non-issuance of notice before sending recovery order has not resulted in any prejudice to the appellant and it may not be feasible to dire....
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....he complete implication thereof with reference to the nature of recovery orders passed by Respondent No. 1, challenge thereto before the Commissioner (Appeals) and interim order of pre-deposit passed by the Commissioner (Appeals) on March 31, 2004 as also the nature of challenge which was laid by the Appellant against the said order of pre-deposit in the writ petitions filed in the High Court, which were dismissed by the learned Single Judge on May 18, 2004. 11. By virtue of notification dated July 8, 1999, the Appellant was granted refund of the duty deposited in cash up to February, 2001. After the enactment of Section 154 of the Act of 2003, recovery order dated June 3, 2003 was passed for recovery of the aforesaid amount which had been refunded to the Appellant. Simultaneously, another order dated June 6, 2003 was issued asking the Appellant to pay duty on the ground that such goods were no more exempted from payment of duty. In the appeals which were filed by the Appellants before the Commissioner (Appeals) challenging the aforesaid orders, the Commissioner passed interim orders dated March 31, 2004 directing the Appellants to pay the amount demanded by the aforesaid ord....
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....ive in nature, could not be taken into consideration by the Division Bench in the impugned judgment, thereby dismissing the Reference, invoking the principle of res judicata. The order of the learned Single Judge dismissing the writ petition was challenged before the Division Bench and the Division Bench passed interim orders in the writ appeals not to dismiss the appeals preferred by the Appellant for non-deposit of the duty. In this backdrop, appeals were heard and Appellant even partly succeeded. After the order of the Commissioner (Appeals) dated June 15, 2005 deciding the appeals partly in favour of the Appellant, the writ appeals which were pending before the Division Bench had become infructuous and disposed of as such without going into the merit of the order passed by the learned Single Judge. This is yet another reason to hold that the order of the learned Single Judge could not be treated as res judicata. 13. Having regard to the aforesaid position, we heard the instant appeal on merits, namely, on the issue as to whether it was mandatory to issue show cause notice making an order of recovery. The Commissioner (Appeals) has held it to be mandatory and this order of....
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.... of issuance of notice for recovery. Further, no doubt, the effect of the said amendment retrospectively was to take away the benefit which was granted earlier. However, the question is whether before passing such an order of recovery, whether it was necessary to comply with the requirement of show cause notice? The Appellant wanted to contend that Section 11A of the Excise Act was applicable, which requires this procedure to be followed. Even if that provision is not applicable, it is fundamental that before taking any adverse action against a person, requirement of principles of natural justice is to be fulfilled. This Court in Collector of Central Excise, Patna and Ors. v. I.T.C. Limited and Anr. - MANU/SC/0602/1995 : (1995) 2 SCC 38 has held that show cause and personal hearing is necessary before saddling an Assessee with additional demand. It is also trite that when a statute is silent, with no positive words in the Act or Rules spelling out need to hear the party whose rights or interests are likely to be affected, requirement to follow fair procedure before taking a decision must be read into statute, unless the statute provides otherwise. 17. What is the genesis behi....
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....f Mohinder Singh Gill and Anr. v. The Chief Election Commissioner, New Delhi and Ors. - MANU/SC/0209/1977 : (1978) 1 SCC 405 : AIR 1978 SC 851 explained the Indian origin of these principles in the following words: Indeed, natural justice is a pervasive facet of secular law where a spiritual touch enlivens legislation, administration and adjudication, to make fairness a creed of life. It has many colours and shades, many forms and shapes and, save where valid law excludes, it applies when people are affected by acts of authority. It is the bone of healthy government, recognised from earliest times and not a mystic testament of judge-made law. Indeed from the legendary days of Adam-and of Kautilya's Arthashastra-the rule of law has had this stamp of natural justice, which makes it social justice. We need not go into these deeps for the present except to indicate that the roots of natural justice and its foliage are noble and not new-fangled. Today its application must be sustained by current legislation, case law or other extant principle, not the hoary chords of legend and history. Our jurisprudence has sanctioned its prevalence even like the Anglo-American system. 21. Arist....
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....social goals. The object is to advance certain social goals, whether through administrative processes, or through the civil or criminal trial. The law and its processes are simply instruments for achieving some social good as determined from time to time by the law makers of the society. Each case is an instance in achieving the general goal, and a mistaken decision, whether to the benefit or the detriment of a particular person, is simply a failure to achieve the general good in that case. At this level of understanding, judgments of fairness have no place, for all that matters is whether the social good, as expressed through laws, is effectively achieved. Galligan also takes the idea of fair treatment to a second level of understanding, namely, pursuit of common good involves the distribution of benefits and burdens, advantages and disadvantages to individuals (or groups). According to him, principles of justice are the subject matter of fair treatment. However, that aspect need not be dilated. 24. Allan, on the other hand, justifies the procedural fairness by following the aforesaid principles of natural justice as rooted in rule of law leading to good governance. He sup....
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.... to be mandatorily applied irrespective of the fact as to whether there is any such statutory provision or not. De Smith captures the essence thus - "Where a statute authorises interference with properties or other rights and is silent on the question of hearing, the courts would apply rule of universal application and founded on plainest principles of natural justice". Wade also emphasizes that principles of natural justice operate as implied mandatory requirements, non-observance of which invalidates the exercise of power. In Cooper v. Sandworth Board of Works - (1863) 14 GB (NS) the Court laid down that: '...although there is no positive word in the statute requiring that the party shall be heard, yet justice of common law would supply the omission of Legislature". Exhaustive commentary explaining the varied contours of this principle can be traced to the judgment of this Court in Managing Director, ECIL, Hyderabad and Ors. v. B. Karunakar and Ors. - MANU/SC/0237/1994 : (1993) 4 SCC 727, wherein the Court discussed plenty of previous case law in restating the aforesaid principle, a glimpse whereof can be found in the following passages: 20. The origins of the law can al....
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....es satisfies the Court that the party visited with adverse order has not suffered from denial of reasonable opportunity, the Court will decline to be punctilious or fanatical as if the rules of natural justice were sacred scriptures. 22. In Institute of Chartered Accountants of India v. L.K. Ratna - MANU/SC/0083/1986 : (1986) 4 SCC 537, Charan Lal Sahu v. Union of India - MANU/SC/0285/1990 : (1990) 1 SCC 613 (Bhopal Gas Leak Disaster Case) and C.B. Gautam v. Union of India - MANU/SC/0673/1992 : (1993) 1 SCC 78, the doctrine that the principles of natural justice must be applied in the unoccupied interstices of the statute unless there is a clear mandate to the contrary, is reiterated. In his separate opinion, concurring on this fundamental issue, Justice K. Ramaswamy echoed the aforesaid sentiments in the following words : 61. It is now settled law that the proceedings must be just, fair and reasonable and negation thereof offends Articles 14 and 21. It is well settled law that principles of natural justice are integral part of Article 14. No decision prejudicial to a party should be taken without affording an oppo....
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....e and its authorities. It is, thus, clear that before taking an action, service of notice and giving of hearing to the noticee is required. In Maharashtra State Financial Corporation v. Suvarna Board Mills and Anr. - MANU/SC/0527/1994 : (1994) 5 SCC 566, this aspect was explained in the following manner: 3. It has been contended before us by the learned Counsel for the Appellant that principles of natural justice were satisfied before taking action under Section 29, assuming that it was necessary to do so. Let it be seen whether it was so. It is well settled that natural justice cannot be placed in a straight-jacket; its rules are not embodied and they do vary from case to case and from one fact-situation to another. All that has to be seen is that no adverse civil consequences are allowed to ensue before one is put on notice that the consequence would follow if he would not take care of the lapse, because of which the action as made known is contemplated. No particular form of notice is the demand of law: All will depend on facts and circumstances of the case. 28. In the case of East India Commercial Co. Ltd., Calcutta and Anr. v. The Collector of Customs, Calcutta - M....
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....on such admission is upheld. It is for this reason, in certain circumstances, even post-decisional hearing is held to be permissible. Further, the Courts have held that under certain circumstances principles of natural justice may even be excluded by reason of diverse factors like time, place, the apprehended danger and so on. 31. We are not concerned with these aspects in the present case as the issue relates to giving of notice before taking action. While emphasizing that the principles of natural justice cannot be applied in straight-jacket formula, the aforesaid instances are given. We have highlighted the jurisprudential basis of adhering to the principles of natural justice which are grounded on the doctrine of procedural fairness, accuracy of outcome leading to general social goals, etc. Nevertheless, there may be situations wherein for some reason - perhaps because the evidence against the individual is thought to be utterly compelling - it is felt that a fair hearing 'would make no difference '-meaning that a hearing would not change the ultimate conclusion reached by the decision-maker - then no legal duty to supply a hearing arises. Such an approach was endorsed by....
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....e non-furnishing of the report may have prejudiced him gravely while in other cases it may have made no difference to the ultimate punishment awarded to him. Hence to direct reinstatement of the employee with back-wages in all cases is to reduce the rules of justice to a mechanical ritual. The theory of reasonable opportunity and the principles of natural justice have been evolved to uphold the rule of law and to assist the individual to vindicate his just rights. They are not incantations to be invoked nor rites to be performed on all and sundry occasions. Whether in fact, prejudice has been caused to the employee or not on account of the denial to him of the report, has to be considered on the facts and circumstances of each case. Where, therefore, even after the furnishing of the report, no different consequence would have followed, it would be a perversion of justice to permit the employee to resume duty and to get all the consequential benefits. It amounts to rewarding the dishonest and the guilty and thus to stretching the concept of justice to illogical and exasperating limits. It amounts to an "unnatural expansion of natural justice" which in itself is antithetical to justi....
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....re empowered to consider as to whether any purpose would be served in remanding the case keeping in mind whether any prejudice is caused to the person against whom the action is taken. This was so clarified in the case of Managing Director, ECIL (supra) itself in the following words : 31. Hence, in all cases where the enquiry officer's report is not furnished to the delinquent employee in the disciplinary proceedings, the Courts and Tribunals should cause the copy of the report to be furnished to the aggrieved employee if he has not already secured it before coming to the Court/Tribunal and given the employee an opportunity to show how his or her case was prejudiced because of the non-supply of the report. If after hearing the parties, the Court/Tribunal comes to the conclusion that the non-supply of the report would have made no difference to the ultimate findings and the punishment given, the Court/Tribunal should not interfere with the order of punishment. The Court/Tribunal should not mechanically set aside the order of punishment on the ground that the report was not furnished as it regrettably being done at present. The courts should avoid resorting to short cuts. Since it i....
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....thout possibility of any change in the decision of the case on merits. It was so explained in the following terms : 64. Right of hearing to a necessary party is a valuable right. Denial of such right is serious breach of statutory procedure prescribed and violation of rules of natural justice. In these appeals preferred by the holder of lands and some other transferees, we have found that the terms of government grant did not permit transfers of land without permission of the State as grantor. Remand of cases of a group of transferees who were not heard, would, therefore, be of no legal consequence, more so, when on this legal question all affected parties have got full opportunity of hearing before the High Court and in this appeal before this Court. Rules of natural justice are to be followed for doing substantial justice and not for completing a mere ritual of hearing without possibility of any change in the decision of the case on merits. In view of the legal position explained by us above, we, therefore, refrain from remanding these cases in exercise of our discretionary powers under Article 136 of the Constitution of India. 39. Therefore, on the facts of this case....
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.... by the learned counsel for respondent from the appeal memo at para 10, the appellant itself has stated that the reply dated 23-3-2011 filed before the Adjudicating Authority was prepared on the basis of Provisional Attachment Order and Original Complaint which is adverted to as follows : "10. The counsel for the Appellant was left with no option and filed reply/written statement dated 23-3-2011 merely on bare perusal of the PAO and the complaint wherein it was stated that the fixed assets sought to be attached have been acquired through the appellant's capital/loan/business income which have been declared in the Income Tax Returns; ........" 39. A perusal of the appeal also reveals that the appellant has filed copy of Original Complaint in the documents filed with the appeal, however, the appellant has not disclosed the source of this copy though specific question was asked by the Tribunal during the course of hearing. In the light of these facts and circumstances, we are of the considered opinion that the appellant had copy of Original Complaint at the time of adjudication proceedings before Adjudicating Authority on the basis of which reply was filed on 23-3-2011. ....
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....of the Authority points out to the fact that the authority seemed to be in great hurry to conclude the proceedings without even following the basic principles of natural justice. A true typed copy of the order dated 10-3-2011 passed by the Adjudicating Authority is annexed herewith and marked as Annexure A6." 42. From careful consideration of the above facts disclosed by the appellant in its appeal memo and application, it is clear that the appellant changed its stand on supply of relied upon documents to allege violation of principles of natural justice. The contradiction in the facts alleged by the appellant clearly show that these allegations are merely an afterthought and as already discussed in earlier paragraphs, the appellant had access to complete copy of the Original Complaint and relied upon documents on the basis of which reply dated 23-3-2011 was filed before the Adjudicating Authority. 43. A perusal of Provisional Attachment Order and Original Complaint reveals that it is alleged by respondent that Shri Madhu Koda by misusing his official position and by corrupt practices generated huge amount of proceeds of crime which he invested for acquisition of proper....
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.... for this he (Budh Narayan Gupta) had to travel to Kolkata also; that the disclosures made in the statement by Shri Budh Narayan Gupta under the provisions of Income-tax Act during the course of searches of his firm were confirmed by him (S.K. Naredi); that following were the companies based at Kolkata to whom cash belonging to Shri Binod Sinha and Shri Vikas Sinha was handed over for the accommodation entries : 1. Arihant Tracom Pvt. Ltd. 2. Basudeo Trading Co. Pvt. Ltd. 3. Doyen Marketing Pvt. Ltd. 4. Sumit Credit Co. Pvt. Ltd. 5. Lucky Projects Pvt. Ltd. 6. Creative Fiscal Services Ltd. 7. Ekanta Emporium Pvt. Ltd. 8. Kejriwal Finvest Pvt. Ltd. 9. Monnet Vyapaar Pvt. Ltd. 45. Shri S.K. Naredi in his statement further stated that cash was transported to Kolkata either by the persons of Shri Binod Sinha/Shri Vikas Sinha or by Shri Budh Narayan Gupta at different occasions, thereafter cheques from the above said Kolkata based companies were issued in the name of companies of Shri Binod Sinha/Shri Vikas Sinha/family members/Shri Vijay Joshi; that the receipt of cheques were shown against share application money/loa....
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....me in his regular books of account as share capital/unsecured loan in the name of these paper/investment companies. The CA/entry operator received commission/service charges in return which generally varies between 2 to 4 per cent. of the cheque amount. 48. Thus in the Provisional Attachment Order and Original Complaint, it is alleged that Shri S.K. Naredi deposed inter alia in his statement before the income-tax authorities on 2-11-2009 and 25-12-2009 that he provided accommodation entries to Shri Binod Sinha and group through the following companies i. M/s. Ekanta Emporium Pvt. Ltd., ii. M/s. Basudev Trading Co. Pvt. Ltd., and iii. M/s. Arihant Tracom Pvt. Ltd. and that directors in these companies are employee of his firm M/s. S.K. Naredi & Co. in which he is a partner; that these companies are engaged in business of investment, trading and non-banking financial transactions with certain companies and business concerns; that his transactions are limited to provide accommodation entries in lieu of cash; that he through above said three companies provided accommodation entries, upon receipt of cash, by issuing cheques exhibiting the purpose as share application money, unsecu....
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.... that he had provided accommodation entries under the cover of share capital money or unsecured loan to Shri Binod Sinha and group in lieu of cash received and against service charges of 2% to 4%. It is alleged that similarly Shri Vivek Kumar Goenka of Kolkata in his statement dated 25-12-2009 stated that he had provided accommodation entries under the cover of share capital money or unsecured loan to Shri Binod Sinha and group in lieu of cash received and against service charges of 2% to 4%. It is alleged that similarly Shri Pradeep Kumar Paramsukha in his statement dated 25-12-2009 stated that he had provided accommodation entries under the cover of share capital money or unsecured loan to Shri Binod Sinha and group in lieu of cash received and against service charges of 2% to 4%. 51. Shri Vikas Sinha in his statements deposed that accommodation entries under the cover of share capital money or unsecured loan were obtained in lieu of cash which was given by his elder brother Shri Binod Sinha; that his elder brother Shri Binod Kumar Sinha was getting cash from different companies like Adhunik Steels of Manoj Agarwal, Usha Martin of Sameer Lohia, R.S. Rungta for mining activi....
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....he printout of the data source impounded by income-tax authorities at Ranchi office of IVRCL on 23-12-2009 was the printout of payments by Ranchi office of IVRCL prepared at the instruction of Shri A.P. Srivastava, project manager for the approval of the excess expenses incurred over and above Rs. 9.30 crores provided by the Head Office to meet the expenditure towards payment and commission to Chief Minister and other officials of JSEB and others. 53. Further, Shri Arun Kumar Srivastava, personal secretary of Shri Madhu Koda in his statement dated 5-11-2009 before the income-tax authorities inter alia stated that Shri Madhu Koda as CM of Jharkhand State was also holding the charge of Mining Ministry since March, 2005 till August, 2008; that Shri Binod Sinha was very close to Shri Madhu Koda and used to talk to the concerned leasing companies at his residence in Panchwati, Ranchi for negotiation for illegal money/bribe/gratification for giving mines on lease to the concerned companies on behalf of Shri Madhu Koda; that he knew the name of some persons/companies and they were Rungta Mines, Sunflag and Electrosteel; that all these companies had been allotted lease agreement; tha....