TaxTMI 
TaxTMI 
2026 (5) TMI 1598
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....undering Act, 2002 (in short "the Act of 2002"), a challenge has been made to the order dated 17.02.2025 passed by the Adjudicating Authority for retention of the articles and movable properties. Brief facts of the case: 2. An FIR was registered by Chakan Police Station on the basis of a complaint filed by Shri Sandeep Jagdish Choudhary, Managing Director of M/s HUF India Pvt. Ltd. In the complaint, it was alleged that during the period from 2010 to 2020, certain ex-employees of the company, namely Shri Sunil Kumar Garg (Ex-Managing Director), Shri Nikhil Agarwal (Ex-Finance Head), Shri Sandeep Vani (Ex-General Manager, Operations) and Shri Vishal Tamotiya (Ex-IT Head), in connivance with each other and other associates, diverted company funds amounting to approximately Rs. 139 Crores for their personal financial gain. It was further alleged that the accused persons withheld the information from other Directors of the company and the parent company situated in Germany. They manipulated and misused Purchase Orders, created false invoices, used fake stamps of M/s HUF India Pvt. Ltd. to generate fake Goods Receipt Notes (GRNs), and further misappropriated company funds in the gu....
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....udit Report dated 19.04.2021 prepared by Ernst & Young concerning the financial irregularities committed by the ex-employees of the company. 8. Scrutiny of the Forensic Audit Report revealed that Special Purchase Order (PO) series bearing numbers 170 and 172 were created from the year 2014 onwards. Payments amounting to Rs. 87,70,89,820/- were identified against invoices booked under these PO series. Multiple discrepancies were found, including mismatches in beneficiary names as reflected in the bank books and bank statements, missing entries and invoice reference numbers in the gate entry registers, and inconsistencies relating to material numbers and invoice copies. It was also found that access to the aforesaid PO series was restricted to selected SAP user IDs and that invoices generated under PO series 170 and 172 were deliberately concealed from other employees, members of the erstwhile Board of Directors, the holding company and auditors of the company. The investigation further revealed that kickbacks had been received by the ex-employees, their family members and entities controlled by them from vendors of M/s HUF India Pvt. Ltd. Analysis of the available bank statements....
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....ry payments and other fictitious services, though no actual services were rendered. The proceeds of crime were credited into bank accounts of the accused persons, their relatives and firms created for the purpose of layering and diversion of funds. By adopting the aforesaid modus operandi, approximately Rs. 139 Crores were siphoned off from the accounts of M/s HUF India Pvt. Ltd. During investigation, statements of various persons were recorded and bank account statements of the suspected persons were obtained and analyzed. The analysis confirmed that the accused persons had received funds from entities such as M/s Hari Om Udyog and M/s Yashaswi Academy for Skill, which were subsequently utilized for making various investments. Information collected from banks and financial institutions further revealed that the accused persons invested the proceeds of crime in movable and immovable assets, including fixed deposits, term deposits, shares, mutual funds and flats. Investigation further revealed that Shri Sunil Kumar Garg, being the Ex-Managing Director of M/s HUF India Pvt. Ltd., was the principal conspirator in the entire fraud and played a key role in ensuring that payments were ma....
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....r investments. (ii) Shri Prateek Garg - Shri Prateek Garg is the son of Shri Sunil Kumar Garg and Smt. Ritu Garg. Investigation revealed that he was a beneficiary of the amounts collected by his parents from the vendors of M/s HUF India Pvt. Ltd. The proceeds of crime were transferred into his bank accounts and were allegedly utilized for various investments and acquisition of assets. (iii) M/s Deendayal Associates - M/s Deendayal Associates is a partnership firm in which Shri Sunil Kumar Garg) and Smt. Ritu Garg are partners. Investigation revealed that the firm received substantial amounts in its bank accounts from vendors of M/s HUF India Pvt. Ltd., namely M/s Hari Om Udyog and M/s Yashaswi Academy for Skill, along with their directors and sister concerns. The funds received in the accounts of the firm were allegedly utilized for procurement and acquisition of movable and immovable properties and for further layering of the proceeds of crime. (iv) Sunil Kumar HUF - Sunil Kumar HUF is a Hindu Undivided Family (HUF) wherein Shri Sunil Kumar Garg is the Karta. Investigation revealed that Sunil Kumar HUF received large amounts in its bank accounts from ven....
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....ellant firm and the vendors is lawful and legitimate and that the financial dealings of the firm are exclusively connected with its consultancy business activities. The appellant has specifically emphasized that the vendors were independent business entities which had sought consultancy services from Deendayal Associates for their own business requirements and that such consultancy activities had no connection whatsoever with the affairs of M/s HUF India Pvt. Ltd. 15. Accordingly, the appellant has prayed for immediate release and defreezing of the seized assets on the ground that their continued seizure is unjustified, unsustainable in law and causing unnecessary financial and personal distress. The prayer was accordingly made to cause interference in the impugned order. 16. The appellant did not argue any other issue despite opportunity to raise any legal or factual issue. The counsel for the appellant restricted his arguments to the extent narrated above. The prayer was accordingly made to set aside the impugned order on the grounds raised by the appellants. Arguments of the Ld. Counsel for the respondent 17. The Ld. Counsel for the respondent has contested the appea....
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.... amounts were allegedly projected as consultancy charges and rental income in the financial records. Various immovable properties were acquired in the names of Shri Sunil Kumar Garg and his family members from the proceeds of crime so generated. 21. The fact on record shows diversion of funds to the extent of Rs. 139 Crore by the appellant, Shri Sunil Kumar Garg and many others involved with him from the funds of the Company where they were working as Managing Director or as employees. The fact of diversion of huge amount from the Company account was revealed only on Forensic Audit Report, otherwise, the Company managed from Germany was run on the trust of the Managing Director and the employees deceived the Company and accordingly FIR was lodged. 22. Ld. Counsel for the appellants did not make any argument to controvert the allegations made against the appellants. The main argument was on the source of income to acquire the properties, alleged to have been ignored by the Adjudicating Authority. It is, however, without realizing that the serious allegation exists against the appellants for receipt of kickbacks and manipulation of the accounts so as to siphoning of the money o....