Supreme Court Refuses To Entertain PIL Seeking Transfer Of Benami Act Appeals To ITAT, Allows Representation

The Supreme Court on Tuesday declined to entertain a PIL seeking transfer of appellate jurisdiction under the Prohibition of Benami Property Transactions Act, 1988 (PBPT Act) from the Appellate Tribunal constituted under the Prevention of Money Laundering Act (PMLA) to the Income Tax Appellate Tribunal (ITAT).

It, however, granted liberty to the petitioner to pursue his pending representation before the Union Government.

At present, appeals under the PBPT Act are heard by the Appellate Tribunal constituted under the PMLA. The tribunal exercises jurisdiction under multiple statutes, including the PBPT Act, and functions through a single bench in New Delhi.

A bench of Chief Justice Surya Kant and Justices Joymalya Bagchi and Vipul M. Pancholi was hearing the PIL filed by Parveen Kumar Bansal, former Vice President of the ITAT.

Besides seeking transfer of appellate jurisdiction to the ITAT, the petition alternatively sought establishment of regional benches to hear benami appeals.

At the outset, the bench remarked, "You have a genuine issue. I understand. But you are asking us to amend the law."

The court observed that the petition essentially sought a legislative change in the appellate framework under the PBPT Act. It added that Parliament may have had multiple reasons for vesting appellate jurisdiction in the existing tribunal.

Appearing for the petitioner, counsel submitted that the ITAT is a specialised body that deals with income-tax matters. He argued that proceedings under the PBPT Act predominantly arise from income-tax proceedings. According to him, they involve examination of financial records, accounting entries, source of funds and transactions, making the ITAT the more appropriate appellate forum.

When the bench expressed its inability to rewrite the statutory scheme, the counsel alternatively requested a direction for expeditious consideration of his pending representation.

"A representation has been made... If Your Lordships may kindly direct them to consider the representation in a time-bound manner," he submitted.

Taking note of the submission, the bench permitted the petitioner to pursue the representation before the competent authority instead of entertaining the PIL.

Background

The petition filed by Parveen Kumar Bansal, former Vice President of the Income Tax Appellate Tribunal (ITAT), under Article 32 of the Constitution seeks transfer of appellate jurisdiction under the Prohibition of Benami Property Transactions Act, 1988 (PBPT Act) to the ITAT or alternatively, the establishment of regional benches.

The petitioner contends that the present appellate framework has created recurring structural and access related issues due to the centralised tribunal structure, institutional design and consolidation of appellate jurisdiction, affecting litigants, advocates, chartered accountants and government authorities while impairing effective access to justice.

Highlighting the nature of benami proceedings, the petition states:

"Proceedings under the PBPT Act predominantly involve examination of financial records, accounting entries, source of funds, and transactional structures that originate from income-tax proceedings. However, the present tribunal structure has evolved primarily to adjudicate forfeiture and enforcement-centric statutes. This institutional design is misaligned with the fiscal, accounting-intensive nature of benami adjudication, resulting in procedural inefficiencies and placing an undue burden on parties and professionals to repeatedly explain foundational financial and accounting concepts."

The plea further states that although the Appellate Tribunal exercises jurisdiction under multiple statutes, including the PBPT Act, it functions with only a single bench in New Delhi, resulting in delays and increased litigation costs.

"The Appellate Tribunal exercising jurisdiction under the PBPT Act presently functions with a single bench located in New Delhi. This centralised structure compels litigants, Advocates, Chartered Accountants, witnesses, and government officers from across the country to travel to the national capital for appellate proceedings. The resulting financial, logistical and time-related burdens disproportionately affect individual litigants, small businesses, and professionals based outside Delhi, rendering the statutory appellate remedy difficult to access in practice and impairing effective access to justice.", the petition states. 

For Petitioner: Advocate Samarvir Singh, Naman Tandon, AOR