2026 (3) TMI 219 - AT - Benami Property

Limited grounds for review under Prohibition of Benami Act; without mistake or new evidence, voiding of IDS certificates denied.

Reviewability under the Prohibition of Benami Property Transactions Act is confined to mistake apparent on the record, discovery of new and important ... Benami Property Transaction - Review jurisdiction under order xlvii rule 1 - mistake apparent on the face of the record - validity of declaration under Income Declaration Scheme, 2016 and effect of alleged subsequent nullification by Assessing Authority - absence of foundational evidence to sustain provisional attachment as benami property - discovery of new and important evidence - corroborative evidence requirement - Limited scope of review jurisdiction - HELD THAT:- The Tribunal applied the settled tests for review relief and held that review is permissible only for discovery of new and material evidence, an error apparent on the face of the record or any other sufficient reason analogous to those grounds. The review applicants failed to demonstrate a manifest error on the face of the record or any new evidence which could not with reasonable diligence have been produced earlier. The Tribunal therefore found no jurisdictional basis to reopen the appeal decision merely because the review applicants reiterate or reargue facts and legal contentions already considered. [Paras 11, 12, 18] Review petitions do not satisfy the limited grounds for review and cannot be entertained. Validity of declaration under Income Declaration Scheme, 2016 and effect of alleged subsequent nullification by Assessing Authority - Whether the Assessing Authority had competence or produced a lawful basis to treat the declaration/certificate under the Income Declaration Scheme, 2016 as null and void - HELD THAT: - The Tribunal examined the contention that the certificate issued under the Scheme of 2016 was later nullified by the Assessing Authority on a finding of forgery. The review applicant could not point to any provision of the Scheme or authority empowering the Assessing Authority to nullify the Principal Commissioner's certificate. The Tribunal noted absence of any opportunity of hearing afforded by the Assessing Authority before declaring the certificate forged, concluding that that order suffered from breach of natural justice and did not demonstrate sufficient grounds to impugn the declaration. Given that the declared valuation was by a Registered Valuer and tax under the Scheme had been paid, the review applicant failed to demolish the declaration. [Paras 13, 14, 15] The Assessing Authority's purported nullification of the Scheme certificate cannot be relied upon; no valid basis established to set aside the declaration under the Scheme. Requirement of corroborative evidence for reliance on retracted statement - absence of foundational evidence to sustain provisional attachment as benami property - Whether the provisional attachment as benami property was justified on the basis of the retracted statement and other material - HELD THAT: - The Tribunal found that the allegation of cash deposits and rotation to create benami assets rested principally on a statement of Yogendra Raj Singhvi which was immediately retracted. Reliance on the retracted statement by the authorities without independent corroboration was impermissible. The review applicant bore the onus to produce bank statements or other material to demonstrate cash deposits and transfers; no such foundational evidence was adduced. In absence of proof of the foundational fact (deposit/rotation of cash) the Tribunal held that the finding of benami transaction could not be sustained and provisional attachment was not justified. The Tribunal further observed that even if section 24(4) was invoked, acceptance of the review applicant's arguments would not alter the outcome because of lack of evidentiary foundation. [Paras 16, 17] Provisional attachment could not be sustained for want of corroborative evidence; reliance on the retracted statement alone is insufficient. Final Conclusion: All review petitions fail; the Tribunal's earlier order setting aside provisional attachments as not constituting benami transactions is upheld and the review applications are dismissed. Issues: (i) Whether the batch of review petitions under Section 47 of the Prohibition of Benami Property Transactions Act, 1988 satisfy limited grounds for review (mistake apparent on face of record, discovery of new evidence or any other sufficient reason) so as to set aside the Tribunal's earlier order; (ii) Whether the declaration made under the Income Declaration Scheme, 2016 (certified by the Principal Commissioner and tax paid) was nullified by the Assessing Authority such that the certificate can be treated as void; (iii) Whether the statement of Yogendra Raj Singhvi, including his subsequent retraction, constituted admissible and corroborative evidence to establish deposit/rotation of cash and thereby a benami transaction.Issue (i): Whether the review petitions disclose grounds sufficient for review under the limited jurisdiction applicable to review applications.Analysis: The Tribunal applied the settled tests for review (mistake apparent on the face of the record; discovery of new and important evidence; any other sufficient reason analogous to these grounds) as explained in the Supreme Court authority. The petitioners did not demonstrate a manifest error on the face of the record, nor did they produce new evidence that was previously unavailable despite due diligence. The Tribunal examined the factual basis relied upon by the review applicants and found no foundational factual error needing correction.Conclusion: Review dismissed; no ground for review is made out.Issue (ii): Whether the Assessing Authority validly nullified the certificate issued under the Income Declaration Scheme, 2016 thereby rendering the declaration void and affecting the Tribunal's prior decision.Analysis: The Tribunal required the review applicants to identify any scheme provision empowering the Assessing Authority to nullify a certificate issued under the Income Declaration Scheme, 2016. No such provision was shown. The valuation was certified by a registered valuer and not credibly impeached. The Assessing Authority's order purportedly treating the declaration as forged lacked evidence of hearing and did not set out sufficient grounds; thus it suffered from procedural infirmity and could not be relied upon to overturn the certified declaration for purposes of establishing benami transactions.Conclusion: The contention that the declaration/certificate is void is rejected; no basis shown to treat the declaration as null and void.Issue (iii): Whether the statement of Yogendra Raj Singhvi, despite retraction, furnished the necessary corroborative evidence of cash deposits/rotation to sustain a finding of benami transaction and provisional attachment.Analysis: The Tribunal noted that the allegation of cash deposits and rotation required foundational proof such as bank statements. The review applicants relied principally on the recorded statement of Yogendra Raj Singhvi which was promptly retracted. The respondents had not produced independent corroborative financial records (bank statements or equivalent) establishing deposit of cash by the noticees. The retracted statement, without corroboration, was insufficient to discharge the onus of proof required to sustain provisional attachment or a benami finding.Conclusion: The statement, being retracted and uncorroborated, does not support a case for benami transaction or warrant review.Final Conclusion: The review applications do not disclose any manifest error, new material fact, or other sufficient reason warranting interference with the Tribunal's earlier order; accordingly all review petitions are dismissed and the Tribunal's prior decision stands.Ratio Decidendi: Review under Section 47 of the Prohibition of Benami Property Transactions Act, 1988 is permissible only on limited grounds-mistake apparent on the face of the record, discovery of new and important evidence previously unavailable with due diligence, or other reasons analogous thereto-and absent such grounds (including absence of corroborative foundational evidence for alleged cash deposits), review must be denied.