Judicial Analysis Court Copy Headnote Facts Arguments Court observation

2025 Supreme(Online)(ATFP) 13435

APPELLATE TRIBUNAL FOR FORFEITED PROPERTY
Munishwar Nath Bhandari, Chairman, G. C. Mishra, Member
Anil Bhojwani – Appellant
Versus
Initiating Officer – Respondent
MP-PBPT-71/BPL/2024|FPA-PBPT-22/BPL/2024|MP-PBPT-73/BPL/2024|FPA-PBPT-23/BPL/2024|MP-PBPT-106/BPL/2024|FPA-PBPT-35/BPL/2024|MP-PBPT-112/BPL/2024|FPA-PBPT-26/BPL/2024

Advocates:
For the Appellants/Petitioners: Ashwani Taneja
For the Respondents: Kanhaiya Singhal

A property transaction is deemed benami if consideration is provided by one person while property is held in another's name for the provider's future benefit, regardless of subsequent attempts to characterize the arrangement as a loan or partnership absent contemporaneous written documentation.

Headnote:(A) Prohibition of Benami Property Transactions Act, 1988 - Section 2(9)(A) - Benami transaction - Ingredients - Consideration provided by one person and property held by another person - Whether property held for immediate or future benefit of person providing consideration - Held, satisfying these tests establishes a benami transaction. (Para 17)

(B) Benami Transaction - Burden of proof - Non-production of documentation - Establishing a loan agreement or collaboration - When oral assertions of a business partnership or loan are unsupported by documentary evidence, they fail to negate the statutory presumption of an arrangement to circumvent property acquisition laws. (Paras 13, 16)

Facts of the case:
Appellants challenged an order confirming the provisional attachment of properties. The respondent asserted that funds were transferred by a beneficial owner to an ostensible owner to purchase land, circumventing land regulation laws applicable to specific communities. No loan deeds or partnership agreements were present at the start of the transaction.

Findings of Court:
The tribunal concluded that the transfer of money to an ostensible owner, who lacked independent financial means, followed by the registered sale of the land, clearly met the criteria for a benami arrangement intended for future benefit. Oral claims of a loan or commercial intent were rejected due to a lack of substantiating financial records or written agreements at the time of the capital transfer.

Issues: The primary issue was whether the purchase of land by an individual financed solely by another party, for an intended future business arrangement, satisfies the statutory definition of a prohibited transaction.

Ratio Decidendi: Where an entity provides the entirety of the consideration for the purchase of a property registered in the name of a third party, and such an arrangement is made to bypass land acquisition restrictions for future commercial benefits, the transaction constitutes a benami arrangement as defined by law.

Result: Appeals dismissed.

Table of Content
1. establishing the factual basis and evidentiary trail for benami property identification. (Para 1 , 2 , 3 , 4 , 5 , 6)
2. distinguishing between legitimate commercial venture and benami transaction. (Para 7 , 8 , 9)
3. evidentiary requirements to rebut benami claims (e.g., loan agreements, financial records). (Para 10 , 11 , 12 , 13 , 14 , 15 , 16)
4. application of the statutory definition of benami transaction under section 2(9)(a). (Para 17 , 18 , 19)
5. final confirmation of the validity of provisional attachment orders. (Para 20)

The batch of appeals have been preferred to challenge the order dated 20.10.2023 passed by the Adjudicating Authority confirming the provisional attachment of the properties while answering the reference sent by the Initiating Officer.

Brief facts of the case:

2. The appellants are aggrieved by the provisional attachment of the properties said to be involved in benami transaction. The description of immovable and movable properties given at Table `A’ and `B’ of the impugned order are reproduced hereunder:

Table-A

Immovable Properties purchased/constructed in the name of Shri Suresh Kumar Uikey, S/o Shri Akloo Uikey

S. No.	Khasra No.	Area (in Hectares)	Location of Property	Date of registry/Transfer	Purchaser	Seller	Sale Value (SV) Amount & stamp duty (SD) paid (Rs.)	The then circle rate including stamp duty (Rs.)
1	78	0.13	Vill Kohka Teh Kurai, Distt. Seoni	21.06.2022	Shri Suresh Kumar Uikey S/o Shri Alkoo Uikey, R/o Tilak Ward, Nagpur Road, Seoni, M.P.	Shri Ramdas Pendor, S/o Shri Namdeo Pendor, R/o Village Kohka, Tehsil Kurai, District Seoni, M.P.	Sale Value 1,37,55,000/- (As per DVO’s report, the FMV of the property is Rs.1,90,52,242/-) Stamp Duty & other charges 25,40,019/- Total 1,62,95,019/- Mode: 1. Rs.70,00,000/- vide RTGS on 11.03.2022. 2. Rs.40,00,000/- vide RTGS on 21.06.2022. 3. Rs.24,67,450/- vide RTGS on 21.06.2022. These transactions have been done through ICICI Bank A/c No.099305500224 of Shri Suresh Kumar Uikey 4. Cash payment of Rs.1,50,000	2,92,77,019/-
2	82	1.55
3	252	5.41
4	259	0.35
5	261/2	0.38
6	267/2	0.04
7	Semi furnished Pakka Godown constructed on properties mentioned above	284 Sq. Mt.
Total		7.86 Hect

Table-B

Movable Properties i.e. Bank Account Balance in the name of Shri Suresh Kumar Uikey, S/o Shri Akloo Uikey

Bank Name	Account No.	IFSC Code	Type of Account	Balance
ICICI Bank, Seoni	099305500224	ICIC0000993	Current Account	As per bank data

3. It was alleged that the property in question was acquired in the name of benamidar, who was a low profile tribal person. He was not having sufficient means to acquire the said property worth of Rs.2,92,77,019/- with stamp duty and other charges. The benamidar and his wife were the school teachers and were not having enough savings to acquire the property. The land in question was situated in tribal area and as per the revenue laws of State of MP, it could not have been acquired by a member of any community other than of Tribal.

4. In the instant case, the beneficial owner was intended to purchase the land but he was not belonging to the Tribal community therefore, the land was purchased in the name of benamidar Shri Suresh Kumar Uikey, a member of Tribal community. The benamidar was not having sufficient means to purchase the property yet it was registered in his name on the payment of consideration provided by the beneficial owner. The payment was first made to the benamidar, who in turn made the payment to the seller of the land. The beneficial owner purchased the land for their future benefits through its firm M/s Oneness Farm and Resorts.

5. During the field investigation, the information was collected from ICICI Bank, Seoni in regard to the bank account of benamidar Suresh Kumar Uikey and the bank account of M/s Oneness Farm and Resorts. It was found that the bank account in the name of Suresh Kumar Uikey was opened on 04.03.2022 vide which the sale consideration was paid to the s

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