The assessee challenged the notice issued u/s 148 of the Act . In the Course of hearing  the revenue produced the investigation report contained in the notice further states that inquiries were made from those entities, whose gross taxable income for the Financial Year 2011-12 was miniscule despite having substantial turnover and dealings with Moral. Summonses were issued to such entities, namely M/s Brilliant Metals Pvt. Ltd., Progressive Alloys (India) Pvt. Ltd,  Unnati Alloys Pvt. Ltd., JBN Impex Private Limited, Forward Minerals & Metals Private Limited, Bafna Metals Put Ltd, Misawa Impex Pvt. Ltd, Durga Enterprises and QNS Metals. However, in most cases, summonses could not be served because these entities were not found to exist at their respective addresses. Brilliant Metals Pvt. Ltd. – though found at the given address, had only one person/ Caretaker. On inquiry, he states that no business activity had ever been undertaken on that premises. Investigation further found that the two Directors of Moral were also the Directors of Forward Minerals & Metals Private Limited and Unnati Alloys Pvt. Ltd. The two entities with whom Moral had the highest money transactions were Unnati Alloys Pvt. Ltd. and Misawa Impex Pvt. Ltd. The amounts credited into the account of Moral, as depicted from the account of Moral, in respect of both these entities were almost equal. Court also observed that the amounts credited into the account of Moral from these two entities were further transferred to other entities on the same day and the accounts of Moral were left with minimal balance. The Investigation Report contained the analysis in respect of the ITR of Moral for the Assessment Year 2012-13. The same has been extracted by the Assessing Officer in his reasons . On analysing the report and recorded reasons the court held that  the obligation on the assessee to disclose the material facts or what are called primary facts is not a mere disclosure but a disclosure which is full and true. A false disclosure is not a true disclosure. Whenever an assessee takes or provides accommodation entries, one part of the transaction would appear to be completely transparent ; through banking channels, and the recipient of the funds would disclose it in his returns and offer the income to tax – if such receipts constitute income liable to tax. The mere disclosure of a part of the transaction in its records by the assessee is not sufficient to establish the genuineness of the transaction Court held that the assessee did not deny the fact that it, indeed, had financial transactions with Moral Alloys Pvt. Ltd.

  Moral Alloys Pvt. Ltd, where under it received substantial amounts of Rs.90.32 crores in the financial year 2011-12. Moral Alloys Pvt. Ltd had been found to be indulging in provision of accommodation entries, and it appeared that it carried out only that business and nothing else. There was nothing to show that while passing the assessment order, the Assessing Officer had examined the aspect of genuineness of the transaction undertaken by the assessee with  Moral Alloys Pvt. Ltd Thus, the Assessing Officer had good reason to believe that the amounts received by the assessee from  Moral Alloys Pvt. Ltd  also partook of the same colour as the other transactions of Moral Alloys Pvt. Ltd  undertaken with other entities. The whole business model of  Moral Alloys Pvt. Ltd  as was evident from the investigation report, was merely to rotate funds by a process of layering through other entities. If the transaction undertaken by  Sterlite Industries Private Limited (SIPL) with Moral Alloys Pvt. Ltd.  Moral Alloys Pvt. Ltd were indeed not genuine, as reasonably believed by the Assessing Officer, it would not be correct to say that SIPL had disclosed fully and truly all the material facts for its assessment for the relevant assessment year. The notice of reassessment was valid. Court also observed that despite the aforesaid being a gross case and despite the decision of the Supreme Court in PCIT v. NRA Iron & Steel Pvt. Ltd(2019) 412 ITR 161 (SC)  and RDS Project Ltd v .ACIT  [2020] 421 ITR 624 (Delhi)(HC) being brought to the notice of learned counsel for the petitioner, learned counsel for the petitioner continued to press the matter at the expense of judicial time, which could have been better utilised to deal with other pending cases.  Accordingly  directed the petitioner to pay cost of Rs. 1 lakhs to be paid to The Delhi High Court Advocates Welfare Trust. The costs shall be paid within four weeks of the receipt of this decision.   ( AY.2012-13)