TaxTMI 
TaxTMI 
TaxTMI 
2024 (12) TMI 238
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....ency notes of Rs. 1000 and 500, jewellers were the first to be approached by high network individuals for purchase of gold. The appellant Nitin Gupta was also contacted by many individuals. The appellant Nitin Gupta was however, not involved in sale of gold bullions thus, he introduced parties to one Mohit Garg who had promised commission to the appellant in lieu of introducing the individuals for purchase of gold bullions. b) Sh. Mohit Garg in association with Rajeev Kushwaha and others deposited the cash into bank accounts of various firms namely Sunrise Trading Company, Himalaya International and RD Traders controlled by Rajeev Singh Kushwaha along with Devendra Kumar Jha and Raj Kumar Sharma. The amount was then transferred to M/s Bengal Marketing Pvt. Ltd. and finally to gold bullions trading firms being Aadi Traders, Siddhivinayak Jewellers, Yash enterprises and S.K. Impex. c) The income tax authorities conducted search and seizure on the residence of the appellant but no material or document was found so as to invoke the provisions of the Act of 1988. It came to the notice of the appellant that Rs. 3,70,89,400/- was provided by various buyers to Mohit Garg and that amoun....
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....ence to the definition of "benami transaction" amended by the Act of 2016 was given and for that specifically section 2(9)(A) was referred. A reference to clause (b)(ii) of the aforesaid provision was given to indicate exception to the aforesaid provision. In case, the property is given to other person on trust then, it would be taken to be under fiduciary capacity and thereby, would not be considered to be a case of benami transaction. The respondents ignored the aforesaid aspect and therefore, the impugned order deserves to be set aside. 5. The learned counsel for the appellant made reference of the judgment of this Tribunal in the case of FPA-PBPT-1124/CHN/2020 Initiating Officer, DCIT, BPU, Chennai vs. Sivashankari & Anr. and also, of the Supreme Court in the case of Sri Marcel Martins vs. M. Printer & Ors. reported in AIR 2012 SC 1987 to support his argument. 6. The learned counsel for the appellant further submitted that what has been seized and attached is demonetized cash which had no fair market value in terms of section 2(16) of the Act of 1988 thus, it could not have been considered to be property in terms of section 2(26) of the Act of 1988. The reference of the dates....
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....e property is held for his benefit or benefit of other members in the family and the consideration for such property has been provided or paid out of the known sources of the Hindu undivided family; (ii) a person standing in a fiduciary capacity for the benefit of another person towards whom he stands in such capacity and includes a trustee, executor, partner, director of a company, a depository or a participant as an agent of a depository under the Depositories Act, 1996 (22 of 1996) and any other person as may be notified by the Central Government for this purpose; (iii) any person being an individual in the name of his spouse or in the name of any child of such individual and the consideration for such property has been provided or paid out of the known sources of the individual; (iv) any person in the name of his brother or sister or lineal ascendant or descendant, where the names of brother or sister or lineal ascendant or descendant and the individual appear as joint owners in any document, and the consideration for such property has been provided or paid out of the known sources of the individual; or (B) a transaction or an arrangement in respect of a property ca....
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....han legal then, can it fall under one of the exceptions under section 2(9)(A) of the Act of 1988. The answer to the issue is that if the money has been given or passed on to others for illegal purposes or the purpose other than legal then, holding of the property cannot be said to be in fiduciary capacity. It can be when it is given to a person to hold it and not for its use further for any purpose. In the instant case, the currency note was not given to Mohit Garg, Raj Kumar Sharma and Devendra Kumar Jha for its retention on trust but for conversion of demonetized money to monetized. The evidence available on record proves it because the money was channelized through shell companies and for that the accounts were opened so that cash amount of demonetized currency can be deposited in the account and thereupon, through banking channels, it is transferred so as to make it monetized money. The purpose aforesaid is apparent and cannot be accepted that the appellant Nitin Gupta has given the currency notes to three others under trust rather it was for purpose of getting it converted to monetize, thus we do not find that the case in hand would fall under one of exception to section 2(9)(....
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....a copy of the notice under sub-section (1) the beneficial owner if his identify is known. In the instant case, the identity of the beneficial owner was not known at the time of issuance of the notice. It could be revealed during the process of adjudication in pursuance to the notice under Section 24(1) of the Act of 1988 of which a copy was served on appellant Nitin Gupta as is required under section 24(2) of the Act of 1988 thus, we find no illegality in the order. It is also a fact that even if notice specifies a wrong provision or does not make a reference of any provision, the order would not vitiate in pursuance of it if material available on record shows jurisdiction of the authority and material otherwise available to decide the case on merits. In this regard we may refer to the judgment of Apex Court in the case of Md. Shahabuddin vs. State of Bihar & Ors. reported in MANU/SC/0203/2010 where the challenge to the notice was made on the similar grounds and has not been accepted by the Apex court. It has been held that mere reference of the wrong provision or non-reference does not vitiate the order if otherwise, the authority is competent to pass the order based on the materi....
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....time of issuance of the notice, the IO had relied on the material available on record at the relevant time. However, during the course of adjudication, there was change in the statement of appellant Nitin Gupta and accordingly the order was passed holding him to be the beneficial owner. The appellant Nitin Gupta in his statement dated 26.09.2018 u/s 19(1)(b) of the Act of 1988 stated that he has made a declaration of his income under the Pradhan Mantri Garib Kalyan Yojana, 2016. The appellant Nitin Gupta thus, changed his stand and stated that the money was belonging to him. In view of the changed stand and the plea raised before the Adjudicating Authority, he was transformed from benamidar to beneficial owner. The appellant is trying to seek benefit of his own default of change in his version and accordingly for that reason also, we are unable to accept the second ground raised by the appellant. 14. The impugned order has been challenged even in reference to section 2(16) and 2(26) of the Act of 1988. Both the provisions are quoted hereunder for ready reference: "2(16) "fair market value", in relation to a property, means- (i) the price that the property would ordinarily fetc....