2022 (10) TMI 19

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.... 2. By filing this petition under Article 226 of the Constitution of India, petitioner seeks quashing of order dated 27.04.2022 passed by the adjudicating authority under Section 26(3) of the Prohibition of Benami Property Transactions Act, 1988 as amended. 3. In the instant case, alleged transaction of benami property took place on 31.03.2016 i.e., much before the amendment of 2016 came into force. 4. The issue is covered by a recent decision of this Court dated 13.09.2022 in W.P.No.33191 of 2022 and batch wherein it has been held as follows: The issue before us is no longer res integra not only in view of the law laid down by this Court in Nexus Feeds Limited v. the Assistant Commissioner of Income Tax 2022(5) TMI 262, but ....

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....ity, simply because the same was never questioned before the Court of law. We are clarifying that we are not speaking of the presumption of constitutionality as a matter of burden of proof. Rather, we are indicating the assumption taken by the Union as to the validity of these provisions in the present litigation. Such assumption cannot be made when this Court is called upon to answer whether the impugned provisions are attracted to those transactions that have taken place before 2016. After elaborate deliberation, Supreme Court came to the conclusion that Section 3 (criminal provision), Section 2(a) (definition clause) and Section 5 (confiscation proceedings) of the Benami Property Act are overly broad, disproportionately harsh an....

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....8 Act containing the penal provision, have been declared as unconstitutional. Therefore, the question of construction of the 2016 Act as retroactive qua the penal provisions under Sections 3 or 53, does not arise. Supreme Court clarified that as it has held that criminal provisions under the Benami Property Act were arbitrary and incapable of application, the law through the 2016 amendment could not retroactively apply for confiscation of those transactions entered into between 05.09.1988 to 25.10.2016 as the same would amount to punitive punishment. Finally, the Supreme Court concluded as under: In view of the above discussion, we hold as under: a) Section 3(2) of the unamended 1988 Act is declared as unconstitutional ....