DCIT (BPU) Vs Sara Company (Appellate Tribunal Under Safema At New Delhi)
The appeals were filed under Section 46(1) of the Prohibition of Benami Property Transactions Act, 1988, challenging the order dated 30.07.2024 passed by the Adjudicating Authority, which had refused to confirm the provisional attachment of property. The Adjudicating Authority had concluded that no benami transaction existed and answered the reference against the appellant.
The case involved allegations that the respondent entity was acting as a benamidar for a beneficial owner. The Initiating Officer had provisionally attached the property, but the Adjudicating Authority, after examining the evidence and submissions, declined to confirm the attachment. The appellant challenged this decision on three primary grounds: first, that the benamidar was conducting business from the premises of the alleged beneficial owner; second, that although the respondent claimed the premises were used on rent, no lease agreement or proof of rent payment was produced; and third, that the accounts of the benamidar were maintained at the office of the alleged beneficial owner. The appellant also relied on statements of certain individuals to support the allegation of a benami transaction.
The respondent contested the appeals, arguing that none of the essential ingredients of a benami transaction under Section 2(9)(A) of the Act were satisfied. It was submitted that the arrangement between the parties was merely a business arrangement intended to facilitate smooth supply of goods, with one entity acting as a supplier to the other. The respondent contended that such an arrangement did not involve any element of benami transaction and that the Adjudicating Authority had correctly appreciated the evidence in arriving at its conclusion.
