FINAL ORDER

Dictated By: Rajesh Malhotra

1. Present Appeal u/s 46(1) of Prohibition of Benami Property Transactions Act, 1998 (PBPTA), is filed by the Initiating Officer, DCIT, BPU-2, Mumbai against the order dated 14.10.2021 passed by the Adjudicating Authority, whereby reference made u/s 24(5) of PBPTA, 1998 (as amended) qua the attached property was revoked and thereby the Provisional Attachment Order (PAO) dated 18.03.2020 was set-aside.

2. As per the facts of the case, M/s Brook Multimedia Pvt. Ltd., the Benamidar was incorporated on 30.11.2020. As per the returns of income, the benamidar has shown its nature of business as ‘0204 – Trading – Others’. The registered address of this company is Office No. 2, 2nd Floor, Daulat Bhavan, 407, Kalbadevi Road, Mumbai – 400002. On perusal of the returns of income and the ITR details available with the Income Tax Department, it was observed that the benamidar M/s Brook Multimedia Pvt. Ltd. (PAN: AAECB3481F) is holding the following benami property in its name:

S.	Description of property	Date of Consideration	Purchaser	No. Registration and Doc. No.
1.	B 1101, Asmi Realtors, Mahindra Eminent, SV Road, Goregaon (West), Mumbai 400104.	-	-	1,82,82,064

The Directors of the benamidar company at various points were as follow:

Sr. No.	Director Name	Appointment Date	Cessation Date
1.	Dinesh Kumar Sharma	16.12.2010	20.01.2011
2.	Pradeep Prajapati	16.12.2010	20.01.2011
3.	Aruna Chudaman Umredkar	30.11.2010	20.01.2011
4.	Harish Sharma	30.11.2010	16.12.2010
5.	Gangadhar Sail	20.01.2011	05.04.2018
6.	Pankaj Gupta	20.01.2011	30.09.2016
7.	Pramila Gupta	08.06.2016	Till date
8.	Payal Gupta	05.04.2018	Till date

The current shareholder of the benamidar as per the details available on Return of income for the AY 2019-20 are as under:

Sr. No.	Name	Number of shares held	% of holding
1.	Pawan Gupta	25500	27.72
2.	Pramila Pawan Gupta	36000	39.13
3.	Payal Pawan Gupta	30500	33.15
Total	92000	100.00

The analysis of the returns of income of the benamidar from AY2011-12 to AY 2019-20 reveals that the benamidar is not involved in any actual business activities. The important details as per the profit and loss account of the benamidar are as follow:

AY	Turnover	Opening Stock	Closing Stock	Purchases	Profit
2011-12	0	0	0	0	-3036
2012-13	0	0	0	0	-37027
2013-14	0	0	0	0	-287
2014-15	0	0	0	0	-525
2015-16	0	0	0	0	-825
2016-17	0	0	0	0	-11600
2017-18	0	0	0	0	-13318
2018-19	0	0	0	0	-168507
2019-20	0	0	0	0	130197

The benamidar has no income generating activity and the benamidar thus possesses all principal characteristics associated with a shell company. In absence of any revenue-generating activities of the benamidar, the source of funds used to purchase the benami property were analyzed. As seen from the table below, the source of funds available with the benamidar comes almost entirely from securities premium: It was observed from the records filed by the benamidar with the Ministry of Corporate Affairs (MCA), Government of India, that it had received Rs. 1,96,80,000/-, as premium on shares from various companies upon allotment of shares in FY 2010-11. The nominal value of the equity share of the benamidar was Rs. 10 per share. However, the benamidar had allotted equity shares to the shareholders at huge premium of Rs. 240/- per share, which was multiple times its nominal value and received Rs. 1,96,80,000/- as premium with each equity share of Rs. 10 allotted at Rs. 240. The benamidar was not conducting any actual business and as such, the benamidar did not possess any attractive profile that would warrant subscription of its shares at such high premium, but still the shares were subscribed at huge premium by following shareholders in FY2010-11 at huge premium:

S.	Name of the shareholder	No. of shares sold	Premium (Rs. 240 per share)
1.	Caren Trading Pvt. Ltd.	42000	10080000
2.	Sarveshwar Commer