R. Kalaivani Vs DCIT (Madras High Court)
Madras High Court held that dormant partner cannot be made vicariously liable for benami transaction especially since even the necessary averment to invoke vicarious liability is absent in the complaint. Accordingly, order set aside to that extent.
Facts- It is the case of the respondent that post-demonetisation in the year 2017 there were cash deposits to the tune of Rs.68.71 Crores made into the bank of the Partnership Firm viz., first accused, in which the second accused and the third accused are the Partners; that the accused did not have the requisite sources to make such a huge deposits; that the accused could not produce the source of making such huge deposits; that the income declared during the previous years was very less; that the sudden increase in profits declared by the first accused is improbable and does not commensurate with the business and financial standing of first accused and hence, first accused along with second accused, who is its Managing Partner and third accused, who is the Director, are jointly liable for the aforesaid offence.
The petitioners sought for discharge on various grounds before the trial Court. The learned Judge dismissed the discharge petitions on the ground that the Court at the stage of charge framing cannot shift and weigh the evidence and that the respondent has made out a prima facie case to proceed further against the petitioners. Being aggrieved, the petitioners are before this Court.
