AI Drafter 
TaxTMI 
TaxTMI 
2020 (12) TMI 614
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....rious entities and individuals linked to the petitioners would show taxes paid on all the income and the assessment stands completed. These tax returns filed much prior to the registration of the case, and money belonging to other accused cannot be fastened on the accused. Reliance is placed upon DSP Chennai vs K Insbasagaran (2006) 1 SCC 420 and State of Andhra Pradesh vs J. Satyanarayan JT 2000 (10) SC 430. Further reliance is placed upon Gapadibai vs State of Madhya Pradesh (1980) 2 SCC 327 to assert that in order to prove benami transactions evidence must be led to show that (i) accused paid consideration; (ii) he had custody of the sale deed; (iii) he was in possession of the property; and (iv) the motive of the transaction. It is argued that there was no material to show that the properties of various entities such as M/s Morni Devi Brij Lal Trust, M/s PUS Properties, M/s Sahil Properties and M/s Morni Merchants Ltd. were benami properties of the petitioners, or that consideration was paid for the said properties. It is argued that the CBI failed to take into account income of M/s Morni Merchants Ltd which had earned Rs. 30.84 lacs through special bearer bonds. It is argued t....
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.... house at Masjid Moth, double storied house at Plot No. 2/6080, Dev Nagar, Karol Bagh, New Delhi, petrol pump on land measuring 8888/9 Sq Yards at Garh Mukteshwar, 5.5 acres of land at Suitanpur Villate in the name of his son Punit Sabharwal and Sumeet Sabharwal, six bighas land purchased at village Indergarhi, Ghaziabad, UP, 14 biswas and 5 bishwami of agricultural land at Indergarh, Ghaziabad UP, 2 bighas agricultural land at village Indergarhi and a parking space at G-72, Cannaught Place and one Maruti car. It is also alleged that accused R.C. Sabharwal is also in possession of various costly electronic equipment, gadgets and huge bank account in his name or in the name of his family members. 2. During investigation it was revealed that father of accused R.C. Sabharwal was running petrol pump before partition at Rawalpindi and after partition family fled away from Pakistan to Delhi who expired in 1973. The accused R.C. Sabharwal was born in the year 1940 and graduated from Delhi University in the year 1967 and he was appointed as Architecture Assistant in 1968. He was married to Smt. Usha, a medical graduate on 02.06.69 and he has two sons Shri Puneet Sabharwal and Sume....
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....uired 24 immovable assets to the tune of Rs. 2,27,94,907/- either in his name or in the name of his family members and sister during the check period. Accused R.C. Sabharwal acquired assets disproportionate to his known source income for which he could not satisfactorily account for. He was a party to criminal conspiracy with his son Puneet Sabharwal, who had received 79 lacs through encashment of Special Bearer Bonds and he facilitated commission of offence as conspirator and in furtherance to the said criminal conspiracy assets were acquired by him in the names of Morni Devi Brij Lai Trust, Morni Merchants and other firms in which sole beneficiary was his son accused Puneet Sabharwal. The accused was found in possession of total assets of Rs. 3,10,58,324/- for the check period w.e.f. 20.08.1968 to 23.08.1995 and assets worth Rs. 2,05,63,341/- were disproportionate to his known source of income." 4. The learned Senior Counsel for the petitioners has contends that no case could be made out against the son - Puneet Sabharwal, because the check period started from August, 1968 and he was born only on 03.09.1970 and attained the age of majority in 1991. The court would note that th....
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....n offence punishable under either of those Chapters or under that Act or for the purpose of enforcement of any civil liability. Explanation.-- For the purposes of this sub- section, "civil liability" does not include liability by way of tax under any law for the time being in force. 7. He further refutes the petitioner's contention that, at best, only four transactions would come under the scanner for trial in the present proceedings, is untenable because ITAT's order, relied upon by the petitioner, is of subsequent date i.e. 31.08.2007 whereas the material available before the CBI pertains to the period prior thereto i.e. for the period ending 1995. The order on charge was framed on 21.02.2006, therefore, a subsequent document would not be of any assistance to the petitioner. He relies upon the principle that Income Tax Returns are only with respect to such monies, as may be taxble under the said Act. It does not examine the source or the manner in which the monies were brought into the hands of the assessee as envisaged under section 13(1)(e) of the PC Act. The test of legitimacy of the money would be the jurisdiction of the investigating agency under the latter Act. ....
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.... the source(s) of income, the pith of the charge levelled against the respondents. It is the plea of the defence that the income tax returns and orders, while proved by the accused persons had not been objected to by the prosecution and further it (prosecution) as well had called in evidence the income tax returns/orders and thus, it cannot object to the admissibility of the records produced by the defence. To reiterate, even if such returns and orders are admissible, the probative value would depend on the nature of the information furnished, the findings recorded in the orders and having a bearing on the charge levelled. In any view of the matter, however, such returns and orders would not ipso facto either conclusively prove or disprove the charge and can at best be pieces of evidence which have to be evaluated along with the other materials on record. Noticeably, none of the respondents has been examined on oath in the case in hand. Further, the income tax returns relied upon by the defence as well as the orders passed in the proceedings pertaining thereto have been filed/passed after the charge-sheet had been submitted. Significantly, there is a charge of conspiracy and abetme....
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....ecorded during the investigation. 10. The petitioner submits that there is nothing specific, whatsoever, about abetment by the son during the entire period. In law, he could not possibly be an abettor to a crime under the provisions of the Prevention of Corruption Act, while the son was a minor. An unsubstantiated statement to the effect that the father had amassed wealth disproportionate to his known source of income or otherwise by illegal means would not by itself be sufficient to impute criminality against son or abetment by son to indulge in illegal activities. Additionally, he submits that the father has two sons one of whom lives in UK. Since he is similarly placed to the petitioner, he too could be said to be beneficiary of the encashment of the Special Bearer Bonds which was put into the account of M/s. Morni Merchants Ltd. The said son has not been arrayed as an abettor in the present proceedings. He submits that at best prosecution against amassing wealth through illegal means may well lie against the petitioner but such sins, if any, cannot be visited for the son. Detailed Assessment Orders examining 37 properties, which was far in excess of few properties arrayed in....
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....6 SCC 628; (5) D.S.P., Chennai v. K. Inbasgaran (2006) 1 SCC 420; (6) State of Maharashtra v. Pollonji Darabshaw Daruwalla 1987 (Supp) SCC 379; (7) Mohd. Mumtaz v. Nandini Satpathy and Ors. (1987) 1 SCC 279; 12. The Court would note that each of the aforesaid cases dealt with appeals either against conviction or acquittals and not on framing charge. The learned counsel for the CBI submits that allegations against the accused would be made out during trial. He submits that statement of witnesses, in particular, of Anit Mehta to the effect that he had assisted Puneet Sabharwal in filing of returns and monies for purchase of properties were paid from the account of Mr. Puneet Sabharwal. It is argued that in the Income Tax proceedings, the CBI was not a party. It was only a complainant. The CBI relies upon the P. Nallammal vs State (1999) 6 SCC 559 to contend that trial could be done of not only the offence punishable under the PC Act but also of conspiracy, attempt or abatement of such an offence. In the process private individuals too could be prosecuted on the ground that they have abetted or conspired with in the criminal misconduct by a public servant....