Sasikala did involve in benami transactions, Income Tax Dept. asserts before High Court

The Income Tax Department on Wednesday asserted before the Madras HC that it was perfectly right in initiating action under the Prohibition of Benami Properties Transaction (PBPT) Act of 1988 to attach all immovable properties that were reportedly purchased by former CM Jayalalithaa’s close aide V.K. Sasikala using demonetised currency notes to the tune of ₹1,674.50 crore between Nov 8 & Dec 30, 2016.

Deputy Commissioner of Income Tax U.N. Dilip stated that failure to transfer ownership even after receiving the consideration would fall squarely under the definition of benami transaction. He made this submission in a counter affidavit filed before Justice Anita Sumanth who is seized of a batch of cases filed by the Puducherry-based Sri Lakshmi Jewellery group’s Bonjour Bonheur Private Limited, which owns the Ocean Spray Beach Resort supposedly sold to Sasikala for ₹168 crore.

After the senior standing counsel for income tax A.P. Srinivas submitted the counter affidavit in court, the judge granted time to the petitioner company & its shareholders to filed their rejoinder, if any, by Mar 13. The petitioners had claimed that the transaction could, by no stretch of the imagination, be termed as benami since the reported purchaser had cancelled the deal after the signing of a memorandum of understanding & sought return of the money.

Refuting the claim, the Deputy Commissioner said: “The arrangement is indeed a transaction wherein ₹148 crore (out of the total accepted sale consideration of ₹168 crore) was paid to Naveen Balaji & his family members by V.K. Sasikala for the purchase of Ocean Spray Resort & for the transfer of shares of Bonjour Bonheur Private Limited. As per the transaction, the shares ought to have been transferred to the name of V.K. Sasikala or her nominees.

“However, the same hasn't been done. This establishes the intention to hide the actual ownership of the company & the resort. The above transactions are evidenced by an MoU dated Nov 22, 2016 & the same has been signed by Naveen Balaji & his family members in the capacity of directors of the company... The original MoU & original share certificates were seized from premises covered under search operation in the case of V.K. Sasikala.

“This shows the intention of V.K. Sasikala to hide the above transactions & give a colour that Naveen Balaji & his family members are still the shareholders of the company & the resort. The above modus operandi establishes the intention that on a later date, V.K. Sasikala can get the shares/property transferred to her name or her nominee’s name for her future benefit,” the counter affidavit read.

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