Benami s.2(9)(A)

Benami s.2(9)(A) — the law in short

What the courts have decided on section Benami s.2(9)(A), in one screen. Read this first; open an entry when you need the facts, the reasoning and the source.

• Shyamsundar Sharma v ACIT High CourtHelps departmentNo later treatment found
  The Initiating Officer has issued a s.24 notice and attached my accounts on the strength of a spreadsheet found in someone else's search. Will the High Court interfere now?
  Not where the officer has set out his material. The Delhi High Court dismissed the writ petition, holding that the Initiating Officer had written in detail the reasons for believing the petitioner to be a benamidar — spreadsheets of bogus expenses recovered in a search, corroborated by statements of the beneficial owners — and that the Court would not interfere with that opinion when an efficacious remedy lay before the Adjudicating Authority under s.26, which can also revoke the attachment.
• Nexus Feeds Ltd v ACIT High CourtHelps taxpayerNo later treatment found
  The transaction the Department calls benami was done in 2011. Can it use the 2016 definitions against me?
  No, on this judgment. The Telangana High Court held that ss.2(9)(A) and 2(9)(C) are substantive, offence-creating provisions and not machinery provisions, that the 2016 Amendment Act was brought into force on 1 November 2016 by the notification of 25 October 2016 with nothing to give it effect from an earlier date, and that applying those definitions to a transaction of December 2011 would offend Article 20(1). All the writ petitions were allowed.
• Harvinder Pal Miglani v Initiating Officer, ACIT (BPU) ITATCuts both waysNo later treatment found
  My client handed demonetised notes to a trader who banked them and sent the money back the same day. Is that a benami transaction, and does the PMGKY declaration help?
  On this order it is a benami transaction, and the declaration helps only on quantum. The Appellate Tribunal held that cash is property under s.2(26), that handing it over to the trader and its deposit in his account was a transfer and holding of property making him a benamidar under s.2(10), and that all the ingredients of s.2(9)(A) were made out. But because the declarant had already paid tax under the Pradhan Mantri Garib Kalyan Yojana and locked part of the sum in the interest-free bond, attachment could extend only to what was left.

Listed strongest first: Supreme Court, then High Court, then Tribunal, then CBDT. Nothing here has yet been read in full by a chartered accountant — open an entry to see where it came from.