Verification Report and PMGKY Disclosure Lead to Quashing of Benami Attachment of Jewellery

I. Provisional Attachment under the Benami Act

Issue

Whether provisional attachment of jewellery seized during an income-tax search can be sustained under the Prohibition of Benami Property Transactions Act, 1988 (PBPTA), when a verification report proves the jewellery does not match the alleged benami transactions and the alleged beneficial owner has already disclosed the items under a government scheme (PMGKY).

Facts

The Search: During a search under the Income-tax Act at the appellant’s (Smt. Ranjana Roy) residence, jewellery weighing 3567.97 grams was found, of which 2465.60 grams were seized.
The Allegation: The Revenue alleged that the appellant and one AB (Animesh Banerjee) visited a showroom (Senco Gold) and paid ₹2 crores as an advance. They claimed the appellant was a “Benamidar” holding the jewellery for the “Beneficial Owner,” AB.
The Order: The Initiating Officer (IO) passed a provisional attachment order under Section 24, which was subsequently confirmed by the Adjudicating Authority under Section 26.
Tribunal’s Intervention: The Appellate Tribunal directed a physical verification and comparison of the seized jewellery with the showroom’s invoices and hallmark records.
Crucial Evidence: * The verification report showed that most of the jewellery did not match the sales records or hallmarks of the showroom in question.
- AB (the alleged beneficial owner) had already disclosed the purchase of jewellery from the showroom under the Pradhan Mantri Garib Kalyan Yojana (PMGKY), 2016, and the tax department had accepted this disclosure.

II. Decision & Reasoning

Verification Report (Para 8)

The Tribunal relied heavily on the Verification Report conducted in the presence of witnesses and showroom managers. Since the physical characteristics and hallmarks of the seized jewellery did not corroborate the Revenue’s theory that they were part of the ₹2 crore “advance” purchase, the link between the appellant and the alleged benami transaction was broken.

Disclosure under PMGKY

The Tribunal noted that once AB disclosed the jewellery under the PMGKY, 2016 scheme and paid the requisite taxes/penalties, those specific assets were regularized. The Revenue cannot simultaneously treat the same assets as “Benami” in the hands of a third party once the source and ownership have been voluntarily disclosed and accepted by the Department under a statutory immunity scheme.

Conclusion

In the absence of any cogent material to prove that the appellant was holding the property for the benefit of AB, the attachment could not be sustained. The Tribunal set aside the attachment order.

Outcome: In favour of the assessee.

Key Takeaways

Physical Verification is Key: In benami cases involving movable assets like jewellery, the Hallmark and Internal Sale Records of the jeweler are vital pieces of evidence that can override theoretical allegations.
PMGKY Immunity: Assets disclosed under the Pradhan Mantri Garib Kalyan Yojana (PMGKY) carry a degree of protection. If the government accepts a disclosure from a “Beneficial Owner,” it contradicts a “Benami” charge against the person holding the physical asset.
Burden of Proof: The Revenue must prove the “Benami” nature with cogent material. Mere presence during a purchase or the existence of an advance payment is not enough to label someone a benamidar if physical evidence (verification) suggests otherwise.

APPELLATE TRIBUNAL SAFEMA, NEW DELHI

Smt. Ranjana Roy

Initiating Officer, Kolkata^*

BALESH KUMAR and Rajesh Malhotra, Member

MP-PBPT-2420/KOL/2025 Misc.
FPA-PBPT-444/KOL/2019

FEBRUARY 12, 2026

R. S. Singhvi, Adv. for the Appellant. Manmeet S. Arora, Adv. for the Respondent.

ORDER

1. This Order disposes of the Appeal No. FPA-PBPT-444/KOL/2019 filed by Smt. Ranjana Roy, against the Order dated 28.02.2019 (Impugned Order) passed by the Ld. Adjudicating Authority, Office of the Competent Authority and Administrator, Kolkata, under Section 26 (3) of the Prohibition of Benami Property Transaction Act, 1988 (PBPTA). The Provisional Attachment Order (PAO) dated 17.02.2018 passed by the Initiating Officer, BPU, Kolkata was confirmed vide the Impugned Order and Reference No. R-508/2018 was thus allowed. The attached property comprised of Jewellery of 2465.60 grams.

2. Ld. Authorized Representative (AR) for the Appellant contended that there is no case of any Benami Property or Benami Transactions and the confirmation of the provisional attachment of Jewellery is not sustainable. The Initiating Officer having failed to establish the existence of Benami Property with cogent material, the Order holding the Appellant to be Benamidar is based on conjectures and surmises. Ld. A. R. maintained that the source of attached Jewellery has been fully explained. He further contended that in the absence of identification of Beneficial Owner, the complete case fails. Moreover, the Beneficial Owner as identified by the Initiating Officer, had stated that the entire Jewellery was purchased from M/s SENCO Gold which was disclosed to the Department and subjected to Tax in the hands of the alleged Beneficial Owner. Ld. A. R. therefore pleaded to allow the Appeal.

3. Ld. Counsel for the Respondent stated that Shri Animesh Banerjee and the Appellant Smt. Ranjana Roy had visited the showroom of M/s SENCO Gold at Gariahat, Kolkata in November, 2016. They paid Rs. 2 Crores as advance for purchase of gold ornaments during the period of post-demonetization 2016. The Bills were prepared in the name of various customers. Audio Visual of Gariahat showroom corroborated this. The residential premises of the Appellant at P-167, Rashbehari Road, Jashoda Bhavan-2, Flat No. 1, Kolkata-700019 was searched on 29.12.2016 under the provisions of the Income Tax Act, 1961. During the search in Jewellery weighing 3567.97 grams was found. The Appellant in a statement dated 29.12.2016 admitted having visited the Gariahat showroom of M/s SENCO Gold in November, 2016. She was unable to recollect the date of making the advance payments, but remembered that delivery of 1 Necklace and 1 Earring Set, 1 Necklace and 1 Diamond Ring were made in December, 2016. She stated that she visited the showroom with Mr. Animesh Banerjee, but did admit having made any advance amounting to Rs. 2 Crores. She clarified that for the Jewellery deliver to her in December, 2016 Mr. Animesh Banerjee paid for it. Out of 3567.97 grams, only Jewellery weighing 2465.60 grams was seized and the rest of the Jewellery was not seized. Ld. Counsel stated that the Appellant could not give any explanation as to the source of founding the seized Jewellery. Thus, there was the reasons to believe that the seized Jewellery was taken from SENCO Gold by Shri Animesh Banerjee and the Appellant. The Appellant was allegedly the Benamidar and Shri Animesh Banerjee was Beneficial Owner. Ld. Counsel pleaded that the Ld. A.A. after having considered the explanation of the Appellant and the rejoinder filed by the Department, dismissed the subsequent explanation by the Appellant as an afterthought. Ld. Counsel stated that the Impugned Order is therefore well reasoned and accordingly the Appeal may be dismissed.

4. We have considered the rival submissions and the material on record. In view of the challenge by the Appellant to the argument from the Respondent that the Jewellery seized was obtained by her from SENCO Gold as Benamidar for the alleged Beneficial Owner Shri Animesh Banerjee, she submitted that the photographs of the Jewellery, being invoices relating thereto and the seized Jewellery may be verified, so as to unearth the truth. This Tribunal vide Order dated 09.10.2024 allowed to do the necessary verification under proper procedure.

5. Ld. Counsel for the Respondent Department submitted Report on 09.01.2026. The aforementioned verification was conducted on 29.12.2025 at Aayakar Bhawan (Annexe), P-13, Chowringhee Square, Kolkata-700069. The Deputy Commissioner of Income Tax, Central Circle, 4 (1), Kolkata in his letter dated 05.01.2026 addressed to the Initiating Officer stated the following:

“In compliance with the directions issued by the Hon’ble Tribunal in the matter of FPA-PBPT/444/Kol/2019 arising out of R-508/2018 in the case of Smt. Ranjana Roy (PAN: AAJPR1646N).

In the said operation the assessee, Mrs. Ranjana Roy, was duly present along with two witnesses, viz. Mr. Kaushik Mukherjee and CA Vivek Gupta. The jewellery box was opened by the Ld. Deputy Director of Income Tax, Unit2(2), Kolkata (in charge of strong room). Concerned personnel from M/s Senco Gold Limited, namely Mr Tamal Pal, Inventory Manager, attended the inspection and examined all 66 packets of jewellery. He identified 4 (four) items of jewellery sold by Senco Gold Limited which were corroborated by hallmark. Reference can be drawn to the photograph of RR 2. RR 3 & RR 42. The photographs of the seized jewellery were captured one by one bearing ID Marks in presence of the assessee. A copy of the coloured Photograph is also enclosed herewith for your kind reference. Further. Report on this behalf by the Senco Gold Limited has also been enclosed herewith for your kind consideration.”

6. The Deputy Commissioner of Income Tax, Central Circle, 4 (1), Kolkata enclosed the Minutes of Proceedings as follows:

“Case: Mrs. Ranjana Roy (PAN: AAJPR1646N)

Appeal No.: FPA-PBPT/444/Kol/2019 arising out of R-508/2018

Date of Operation: 29th December 2025

Venue: Aayakar Bhawan(Annexe), P-13.Chowringhee Square, Kolkata-700069.

Attendance:

• Assessee: Mrs. Ranjana Roy

• Witnesses:

o Witness 1-Mr. Kaushik Mukherjee

o Witness 2-CA Vivek Gupta

• Representative from Senco Gold Ltd.: Mr. Tamal Pal, Inventory Manager

Proceedings:

• Operation commenced at 11:45 AM.

• 66 packets of jewellery were opened and examined.

• All photographs of seized jewellery were provided to the assessee.

• Mr. Tamal Pal (Senco Gold Ltd.) conducted an inspection and confirmed 4 items as jewellery sold by Senco Gold Ltd., based on hallmark verification.

• Assessee furnished Invoice Copy already submitted before the Hon’ble Tribunal, cross-referenced with coloured photographs provided during the operation.

Findings:

• Out of 66 packets, four items matched Senco Gold Ltd. provenance.

• Balance jewellery are Personal and belong to family members but does not belong to Senco Gold Limited.

• Documentation and photographs duly acknowledged by the assessee.

Conclusion:

Operation completed in the presence of the assessee, witnesses, and the representative of Senco Gold Limited. Findings recorded and report submitted for kind perusal and necessary action.”

7. The Deputy Commissioner of Income Tax, Central Circle, 4 (1), Kolkata further enclosed letter received on 05.01.2026 from the Authorised Signatory of M/s SENCO Gold. The said letter from the aforementioned findings that four items Jewellery were identified as having been sold by SENCO Gold Ltd., which were confirmed by SENCO’s Hallmark and internal sale records. For the remaining Jewelleries subjected to inspection, the same were not identifiable as having been sold by SENCO Gold Ltd., based on Hallmark verification, physical characteristics and available sale records.

8. On the basis of the aforementioned verification exercise, it is clear that the seized Jewelleries were not being held as Benami by the alleged Benamidar Smt. Ranjana Roy. Even for the four items of Jewellery the subsequent submissions made by the Appellant do not appear to be afterthought. Her submissions that these Jewelleries were obtained from her own sources of funds appear to be correct. We also observe that Shri Animesh Banerjee had disclosed subsequently the entire Jewellery purchased from M/s SENCO Gold showroom under Pradhan Mantri Gareeb Kalyan Yojana, 2016. Ld. Counsel for the Appellant pleaded that Shri Animesh Banerjee made aggregate disclosure of Rs. 2,47,00,000/-[Rs. 60,62,191/- held in cash + Bank balance of Rs. 1,86,37,809/-received from sale of entire Jewellery purchased from M/s Senco Gold showroom at Gariahat under the PMGKY, 2016 and the same has been accepted by the Income Tax Department. In the light of the Verification Report, we are unable to sustain the attachment of the seized Jewellery under PBPTA as Benami Property.

9. In view of the aforementioned discussions and analysis, we set aside the Impugned Order. The Appeal No. FPA-PBPT-444/KOL/2019 filed by Smt. Ranjana Roy is therefore allowed. Applications pending, if any, are disposed of accordingly.