Surendra Agrawal Vs Initiating Officer (Appellate Tribunal under SAFEMA, New Delhi)
Flat Purchased in Relative’s Name but Loan Repaid and Property Used by Another Constitutes Benami Property: SAFEMA
Summary: The Appellate Tribunal under SAFEMA has held that a flat registered in the name of a person having no financial capacity to purchase it was a benami property where the purchase negotiations, cash payments, housing-loan repayments and beneficial use of the property were attributable to his brother-in-law.
The Tribunal rejected the explanation that the payments represented financial assistance extended in good faith during a financial crisis. It upheld the attachment after finding that the alleged owner was unaware of basic details of the flat, the loan was substantially repaid by the alleged beneficial owner and the property was utilised as collateral for the beneficial owner’s company.
Facts of the case
A residential flat in Blue Berry Apartment, DB City, Gwalior, measuring approximately 1,262 sq. ft., was registered in the name of Shri Surendra Agrawal.
During an Income-tax search, the authorities found the property’s registration documents, chain documents, purchase agreement and receipts at premises connected with Shri Sandeep Mangal, the brother-in-law of the registered owner.
The investigation revealed that the flat had initially been booked in the name of Sonu Mangal, alias Sandeep Mangal, who had negotiated its purchase. A cash-payment receipt of ₹6,79,320 was also issued in his name.
