Case Details: Smt. Mina Kiranbhai Shah vs. Initiating Officer, BPU [2025] 180 taxmann.com 708 (SAFEMA-New Delhi)
Judiciary and Counsel Details
- Munishwar Nath Bhandari, Chairman & Gopal Chandra Mishra, Member
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Kanhaiya Singhal, SPP, Prasanna, Ajay Kumar, Rhythm Bhardwaj & Ms Avantika Shankar, Advs. for the Respondent.
Facts of the Case
During a survey at a bank branch, it was found that a large amount of cash in old denominations had been deposited into various bank accounts operated by six persons. Further investigation revealed that cash had been deposited into the bank account of a proprietorship firm.
During the recording of statements, the account operators admitted that the cash did not belong to them, the account holders, and that there was no business activity in the account. It was further revealed that the cash received from beneficiaries was later transferred to the appellant, the beneficiary.
SAFEMA Held
The Adjudicating Authority held that the bank account was used to settle demonetised funds at the relevant time through a benami transaction. He thus confirmed the Provisional Attachment Order.
The assessee filed an appeal to the Tribunal. The Tribunal held that the assessee claimed ignorance about the transaction as her husband managed her bank account. It was even in her statement under section 131, but ignorance would not absolve the appellant from the benami transaction. It is even more so when it happened in her bank account. It is not that the appellant pleaded total ignorance of the receipt of the money; instead, on enquiry, it was shown that the money was received out of the sale of property, which, according to the appellant herself, did not materialise, and the money was still kept. There is no document showing the sale transaction for receiving a hefty amount of Rs. 71.50 lakhs in advance or otherwise. In fact, no Agreement to Sell has been placed on record.
The fact further remains that the amount aforesaid was transferred from the account of the benamidar with whom the appellant has not shown any transaction to justify the receipt of the amount. Using the banking channel, the group of persons got involved in converting demonetised money through the bank. The appellant persuaded herself or, through her husband, to get demonetised money monetised and entered into a benami transaction under which the property was first transferred to a benamidar through the persons, and then received back by the beneficial owner as a future benefit.
Thus, the order holding a case of a benami transaction was justified.
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