1. A search was conducted by  the Central Bureau of Investigation (CBI) in the hands of Shri Jagan

Mohan Reddy and his group of companies on 18.08.2011.

2. The information collected by CBI during the course of search was passed

on to the Income tax department.

3. The  allegation of the CBI was that the share applicant companies have

been selected by Shri Y.S. Jaganmohan Reddy and they have received

benefits from State Government of Andhra Pradesh during the tenure

of Shri Rajasekar Reddy in the form of licences/projects, public

properties, SEZs, Mining leases, ports, real estate permissions and

other benefits.

4.The case of CBI was that these share applicants, in

turn, have given bribes to Shri Y.S. Jaganmohan Reddy under the guise of purchasing shares in companies controlled by him at high premium.

5.The details of additions made by the AO are given below: –

 (A) CARMEL ASIA HOLDINGS: –

 Assessment year 2007-08 6059.79 lakhs

 Assessment year 2008-09 1878.58 lakhs

 (B) JANANI INFRASTRUCTURE P LTD: –

 Assessment year 2007-08 1210.17 lakhs

 Assessment year 2008-09 769.55 lakhs

6. The decision rendered by

Hon’ble Supreme Court in the case of NRA Iron and Steel P Ltd (supra) was considered in this order

7. Additions were deleted