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2019 (12) TMI 742 - AT - Income TaxBenami Property - Rights of a bona-fide purchaser as given in the section 27(2) of the PBPT Act, 1988 - burden of proof of proving transaction - "Provisional Attachment Order passed u/s 24(4)(a)(i) of the PBPT Act, 1988" - HELD THAT:- Burden of proof is on the I.O. at the initial stage to establish with cogent evidence that the purchase by the Appellant of the subject property is not bona-fide. Respondent in its rejoinder dated 27.12.2018 at has itself admitted that it was in the possession of the information and documents that the subject property had been sold/transferred to the Appellant by M/s Veena Industries Ltd. Even after coming into possession of such documents the Respondent had chosen not to give any opportunity to the Appellant to explain its case in the proceedings before the Respondent. Appellant had moved an application for intervention and as such the Adjudicating Authority has powers u/s 26(6) to add name of the party whose presence before the Adjudicating Authority may be necessary to enable it to adjudicate upon and settle all questions involved in the reference. Adjudicating Authority did not exercise it powers and did not implead the Appellant as a party to the proceedings even after application was made before it by the Appellant, and the Respondent had also admitted in its rejoinder to the impleadment application that there is no legal impediment in arraying the Appellant as a party to the proceedings before the Adjudicating Authority. Appellant is an incorporated entity which has a separate and distinct legal identity to that of M/s Veena Industries Limited. Appellant had acquired the rights and interest in the subject property in its own name after payment of adequate consideration from its own funds, stamp duty and all the applicable fees, taxes and duties. At the time of execution of the Agreement to Sale on 18.03.2013, there was no common director in the two entities i.e. M/s. Veena Industries Ltd. and Kavita Infrastructure Pvt. Ltd. Thus, the allegation made by the respondent of common management/shareholding factually has no substance. The impugned order is set-aside by allowing the appeal.
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