Benami property case against Bhujbals closed

The HC in 2021 dismissed a complaint against the NCP leader and minister and his son and nephew regarding alleged benami assets held by three companies, including properties in Mumbai and Nashik’s Girna sugar mills

MUMBAI: Two months after the Bombay high court quashed the benami property complaint against Chhagan Bhujbal and his son and nephew, a special MP/MLA court on Wednesday closed the proceedings. Special judge R N Rokade disposed of the case in the wake of the high court order.

The high court, while quashing the complaint, however, granted the income-tax department the liberty to revive proceedings if a pending review petition before the Supreme Court was allowed. (Hindustan Times)

The HC in 2021 dismissed a complaint against the NCP leader and minister and his son and nephew regarding alleged benami assets held by three companies, including properties in Mumbai and Nashik’s Girna sugar mills.

The income-tax (benami prohibition unit) department had lodged a complaint against the Bhujbals and their firms—M/s Armstrong Infrastructure Private Limited, Parvesh Constructions Private Limited and M/s Devisha Constructions Private Limited—under the amendment to the Prohibition of Benami Property Transactions Act. The department charged that the assets were allegedly created by the Bhujbals using a maze of about four dozen shell companies. Based on the complaint, the magistrate had initiated criminal proceedings against the trio on November 17, 2021.

Additionally, the Central Board of Direct Taxes (CBDT) attached the Girna sugar mills in Nashik, valued at over ₹80.97 crore, and a multi-storeyed residential building, Solitaire, in Mumbai’s Santacruz West area valued at more than ₹11.30 crore. Other assets attached included the Habib Manor and Fatima Manor buildings in Bandra West valued at over ₹43.61 crore (benamidar: Parvesh Construction Pvt Ltd) and a plot of land in Panvel in Raigad valued at over ₹87.54 crore (benamidar: Devisha Infrastructure Pvt Ltd).

The total cost of attached properties was valued at over ₹223 crore. However, the department claimed that the market value of these was more than ₹300 crore.

Subsequently, the Bhujbals and the three firms approached the Bombay high court seeking quashing of the complaint, which was ultimately allowed by the court in December 2023. In its order, the high court cited the 2016 amendment to the Benami Transactions Prohibition law, stating that it did not have retrospective effect. The income tax department had initiated proceedings against Armstrong and its directors, including the NCP minister, as benamidars, alleging that they were beneficial owners involved in benami transactions during the financial years 2008-09 and 2010-11.

The high court, while quashing the complaint, however, granted the income-tax department the liberty to revive proceedings if a pending review petition before the Supreme Court was allowed.