Benami law provisional attachment upheld for alleged pre-amendment transactions, with threshold challenge and natural justice objection rejected.

Under the benami law, provisional attachment and initiation of adjudication were treated as valid even where the alleged transactions pre-dated 1 November 2016, because the amended scheme was held to operate from 19 May 1988 except for Sections 3, 5 and 8. The Court characterised provisional attachment as an interim measure pending adjudication and noted that the statute requires reference to the Adjudicating Authority and issue of notice under Section 26(1). A challenge at the threshold on lack of jurisdiction and breach of natural justice was therefore rejected, and the writ petition failed, leaving the petitioner to to the statutory notice and participate in the pending proceedings.

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Issues: Whether the provisional attachment and consequential notice issued under the benami law could be sustained in respect of transactions alleged to have occurred before the amendment came into force, and whether the proceedings were vitiated for want of notice and natural justice.

Analysis: The relevant statutory scheme was examined together with the commencement clause. It was held that the amended provisions, except Sections 3, 5 and 8, were deemed to have come into force from 19 May 1988, and that the provisional attachment under Section 24(4)(a)(i) was only an interim measure pending adjudication. The Court further noted that after such attachment, the statute requires reference to the Adjudicating Authority and issuance of notice under Section 26(1), so the challenge was made at the threshold of the proceedings. On that basis, the plea that the action lacked jurisdiction merely because the alleged transaction pre-dated 1 November 2016 was rejected, and the natural justice objection was not accepted at the stage of provisional attachment and notice.

Conclusion: The initiation of proceedings, provisional attachment, and show-cause notice were held valid, and the challenge failed.

Final Conclusion: The writ petition was not maintainable at that stage and the petitioner was relegated to respond to the statutory notice and participate in the pending adjudication.

Ratio Decidendi: Under the benami law, provisional attachment and initiation of adjudication proceedings are permissible for alleged pre-amendment transactions where the statute deems the relevant provisions to have been in force from 19 May 1988, and such threshold proceedings cannot be quashed merely on the ground of prior date of transaction.

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