SATYAJIT SAHA AND 9 ORS vs. THE UNION OF INDIA AND 3 ORS

Page No.# 1/17 GAHC010278962025

THE GAUHATI HIGH COURT (HIGH COURT OF ASSAM, NAGALAND, MIZORAM AND ARUNACHAL PRADESH) Case No. : ITA/1/2026 SATYAJIT SAHA AND 9 ORS SON OF LATE BINOD LAL SAHA, RESIDENT OF TARANAGAR, P.O- MOHANPUR BAZAR, P.S- SIDHA WEST TRIPURA 799211 2: BHUPAL DEBNATH SON OF LATE HARALAL DEBNATH RESIDENT OF VILLAGE- LAL CHARRA P.O- KHOWAI DISTRICT- KHOWAI WEST TRIPURA- 799201 3: KAJAL SAHA SON OF LATE MANINDRA CHANDRA SAHA RESIDENT OF VILLAGE- USHA BAZAR P.O- AGARTALA WEST TRIPURA- 799009 4: SURENDRALAL ROY SON OF LATE MANINDRALAL ROY RESIDENT OF CHARAKHOWAI DISTRICT- KHAWAL TRIPURA- 799201 5: KRISHNA DAS BANIK SON OF LATE BIRENDRA CHANDRA BANIK RESIDENT OF TOWN- PRATAPGARH ROAD NO 1 P.O- AGARTALA WEST TRIPURA- 799001 6: NIRMAL GHOSH SON OF LATE JAGDISH CHANDRA GHOSH RESIDENT OF VILLAGE- SEKERKOTE P.O- SEKERKOTE

Page No.# 2/17 WEST TRIPURA- 799130 7: GOPAL CHANDRA SAHA SON OF LATE SRIMANTA KUMAR SAHA RESIDENT OF TOWN- PRATAPGARH ROAD NO 1 P.O- AGARTALA WEST TRIPURA- 799001 8: NANDA DULAL SAHA SON OF LATE PRAFULLA KUMAR SAHA RESIDENT OF SHIBNAGAR NEAR UDICI CLUB P.O- COLLEGE TILLA WEST TRIPURA- 799004 9: SUBHASH DEBNATH SON OF LATE SUNIL DEBNATH RESIDENT OF VILLAGE- RADHA NAGAR P.O- PURBA NAGAON P.S- RANIR BAZAR WEST TRIPURA- 799035 10: KARUN ROY SON OF LATE KAMAL RANJAN ROY RESIDENT OF JIRANIA P.O- BIRENDRA NAGAR WEST TRIPURA- 79904 VERSUS THE UNION OF INDIA AND 3 ORS REPRESENTED BY THE SECRETARY TO THE GOVERNMENT OF INDIA, MINISTRY OF FINANCE, DEPARTMENT OF REVENUE, NEW DELHI 2:THE ADDITIONAL COMMISSIONER OF INCOME TAX (BP) CUM APPROVING AUTHORITY AYAKAR BHAWAN CHRISTIAN BASTI G.S. ROAD GUWAHATI- 781005 3:THE ASSISTANT COMMISSIONER OF INCOME TAX (BP) CUM INITIATING OFFICER AYAKAR BHAWAN CHRISTIAN BASTI G.S. ROAD GUWAHATI- 781005

Page No.# 3/17 4:THE INITIATING OFFICER DEPUTY COMMISSIONER OF INCOME TAX (BENAMI PROHIBITION) GUWAHATI NER ROOM NO 313 3RD FLOOR AAYAKAR BHAWAN G.S. ROAD CHRISTIAN BASTI GUWAHATI ASSAM- 78100 Advocate for the Petitioner : MR. H. BURAGOHAIN, MS. H BORAH,MS A DEVI Advocate for the Respondent : DY.S.G.I., SC, INCOME TAX

BEFORE HONOURABLE MR. JUSTICE MICHAEL ZOTHANKHUMA HONOURABLE MR. JUSTICE KAUSHIK GOSWAMI ORDER 30.01.2026 (M. Zothankhuma, J)

Page No.# 4/17 viii) FPA-PBPT-970/GWH/2019, ix) FPA-PBPT-973/GWH/2019 & x) FPA-PBPT- 974/GWH/2019.

Page No.# 5/17 provisional attachment order dated 25.06.2018 in this Court, by way of WP(C) 4886/2018, where the parties names as per the Cause Title, was as follows : “Sonamura Foreign Liquor Shop No.2 and Another vs. The Union of India and Others”.

Page No.# 6/17 the 2016 Act could only be applied prospectively and not retrospectively have been clearly stated in paragraph 127.1 and 127.4. The entire paragraph 127 of the above judgment is reproduced hereinbelow as follows : “127. In view of the above discussion, we hold as under:

127.1. Section 3(2) (sic Section 3) of the unamended 1988 Act is declared as unconstitutional for being manifestly arbitrary. Accordingly, Section 3(2) of the 2016 Act is also unconstitutional as it is violative of Article 20(1) of the Constitution.

127.2. In rem forfeiture provision under Section 5 of the unamended 1988 Act, prior to the 2016 Amendment Act, was unconstitutional for being manifestly arbitrary.

127.3. The 2016 Amendment Act was not merely procedural, rather, prescribed substantive provisions.

127.4. In rem forfeiture provision under Section 5 of the 2016 Act, being punitive in nature, can only be applied prospectively and not retroactively.

127.5. The authorities concerned cannot initiate or continue criminal prosecution or confiscation proceedings for transactions entered Into prior to the coming into force of the 2016 Act viz. 25-10-2016. As a consequence of the above declaration, all such prosecutions or confiscation proceedings shall stand quashed.

127.6. As this Court is not concerned with the constitutionality of such independent forfeiture proceedings contemplated under the 2016 Amendment Act on the other grounds, the aforesaid questions are left open to be adjudicated in appropriate proceedings.”

Page No.# 7/17 short), New Delhi, seeking quashing of the proceedings initiated against them under the Act, in light of the decision of the Hon’ble Supreme Court in the case of Ganpati Dealcom Private Limited (supra).

Page No.# 8/17 being punitive in nature, can only be applied prospectively and not retroactively. e) Concerned authorities cannot initiate or continue criminal prosecution or confiscation proceedings for transactions entered into prior to the coming into force of the 2016 Act, viz., 25.10.2016. As a consequence of the above declaration, all such prosecutions or confiscation proceedings shall stand quashed. f) As this Court is not concerned with the constitutionality of such independent forfeiture proceedings contemplated under the 2016 Amendment Act on the other grounds, the aforesaid questions are left open to be adjudicated in appropriate proceedings".

In the light of the facts available on record, we find that the appeals are covered by the Judgment of the Apex Court in the case of "Union of India & Anr. vs M/s. Ganpati Dealcom Pvt. Ltd." (supra). Therefore, the orders of the Adjudicating Authority confirming the action of Initiating Officer needs to be interfered and accordingly the impugned order and the proceedings initiated by the respondent in reference to the alleged benami transactions of a period prior to the Amendment Act of 2016 are set aside. These appeals are allowed in view of the aforesaid. It is however made clear that if the Apex Court reviews its judgment, the respondent would be at liberty to take appropriate remedy pursuance to it which includes filing a review petition before this Tribunal. It is also made clear that if the Department has an independent right to initiate the action taking the Amendment Act, 2016 to be prospective and does not offend the judgment of the Apex Court in the case of "Union of India & Anr. v/s M/s. Ganpati Dealcom Pvt. Ltd." (supra) then this order would not come in their way as otherwise action can be governed by para 130 I of the judgment (supra).”

Page No.# 9/17 11. Thus, while the issue had died a natural death, in view of the order dated 07.12.2022 passed by the learned Appellate Tribunal, which had been made in terms of the decision of the Hon’ble Supreme Court on 23.08.2022 in Ganpati Dealcom Private Limited (supra) (2023) 3 SCC 315, a review application was moved before the Hon’ble Supreme Court by the Union of India in Ganpati Dealcom Private Limited (supra) in the year 2024. The Hon’ble Supreme Court thereafter allowed the review petition in Union of India and Another vs. Ganpati Dealcom Private Limited, reported in 2024 SCC OnLine SC 2981, by recalling it’s earlier judgment and order dated 23.08.2022, vide judgment and order dated 18.10.2024, by holding as follows:- “5. It is not disputed that there was no challenge to the constitutional validity of the unamended provisions. This is also clear from the formulation of the question which arose for consideration before the Bench in paragraph 3 of the judgment, which has been extracted above. In the submissions of parties which have been recorded in the judgment, the issue of constitutional validity was not squarely addressed. 6. A challenge to the constitutional validity of a statutory provision cannot be adjudicated upon in the absence of a lis and contest between the parties. We accordingly allow the review petition and recall the Judgment dated August 23, 2022. Civil Appeal No 5783 of 2022 shall stand restored to file for fresh adjudication before a Bench to be nominated by the Chief Justice of India on the administrative side. 7. Where any other proceedings have been disposed of by relying on the judgment of this Court in Union of India & Another vs. Ganpati Dealcom Private Limited, reported in (2023) 3 SCC 315, liberty is granted to the aggrieved party to seek a review in view of the present judgment.”

Page No.# 10/17 herein submitted review petitions praying for recalling the common order dated 07.12.2022 and for condoning the delay in filing the review petition before the learned Appellate Tribunal.

Page No.# 11/17 CPC, which has been clarified by the decision of the 3 Judges of the Hon’ble Supreme Court in the case of Government of NCT of Delhi vs. K.L. Rathi Steals Limited and others, reported in (2024) 7 SCC 315 and the subsequent decision of the 2 Judges Bench of the Hon’ble Supreme Court in Deputy Director of Income Tax (BPU Unity) and others vs. Kokilaben Chhaganbhai Patel, reported in 2025 SCC OnLine SC 2622.

Page No.# 12/17 Single Bench of this Court, though Section 260B of the Income Tax Act, 1961 provides that an appeal under Section 260A of the Income Tax Act, 1961 can be heard only by a Division Bench of this Court.

Page No.# 13/17 Petition on the basis of the liberty granted by the Supreme Court, without examining whether such liberty could override the statutory limitations under Section 114 read with Order 47 CPC, 1908 and Section 40(2)(f) PBPT Act?

(2014) 5 SCC 75 and Beghar Foundation vs. K.S. Puttaswami, reported in (2021) 3 SCC 1, – has held that in terms of the Explanation to Order 47 Rule 1 CPC, if the decision on a question of law on which the judgment of the Court is based, is subsequently reversed or modified by a subsequent decision of a Superior Court in any other case, it shall not be a ground for review of such judgment. Even an erroneous decision cannot be a ground for a Court to undertake a review and that change in the law or subsequent decision/judgment of a coordinate Bench or a larger Bench by itself, cannot be a ground for review.

Page No.# 14/17 K.L. Rathi Steels Limited (supra) are reproduced hereinbelow as follows : “57. This Court in Subramanian Swamy vs. State of T.N, reported in (2014) 5 SCC 75 has read the the Explanation as follows: (SCC pp. 96- 97, para 52)

"52. ... The Explanation to Order 47 Rule 1 of the Code of Civil Procedure, 1908 provides... that if the decision on a question of law on which the judgment of the court is based, is reversed or modified by the subsequent decision of a superior court in any other case, it shall not be a ground for the review of such judgment. Thus, even an erroneous decision cannot be a ground for the court to undertake review, as the first and foremost requirement of entertaining a review petition is that the order, review of which is sought, suffers from any error apparent on the face of the order and in absence of any such error, finality attached to the judgment/order cannot be disturbed." (emphasis in original) 58. The final one is a decision of the Constitution Bench in Beghar Foundation vs. K.S. Puttaswami, reported in (2021) 3 SCC 1 (Aadhaar Review-5 J.). The majority was of the following view: (SCC p. 5, para 2)

"2. The present review petitions have been filed against the final judgment and order dated 26-9-2018. We have perused the review petitions as well as the grounds in support thereof. In our opinion, no case for review of judgment and order dated 26-9-2018 is made out. We hasten to add that change in the law or subsequent decision/judgment of a coordinate or larger Bench by itself cannot be regarded as a ground for review. The review petitions are accordingly dismissed."

Page No.# 15/17 23. In the case of Kokilaben Chhaganbhai Patel (supra), the two Judges Bench of the Supreme Court, vide order dated 12.02.2025, expressed their inability to agree with the observations made by the three Judges Bench of the Supreme Court in the case of Union of India & Another vs. Ganpati Dealcom Private Limited, reported in 2024 SCC OnLine 2981, wherein it had been held as “Where any other proceedings have been disposed of by relying on the judgment of this Court in Union of India & Another vs. Ganpati Dealcom Private Limited, reported in (2023) 3 SCC 315, liberty is granted to the aggrieved party to seek a review in view of the present judgment.”

Page No.# 16/17 Limited, reported in 2024 SCC OnLine SC 2981 cannot be followed, as the same was apparently per incuriam. When the Hon’ble Supreme Court in the case of Kokilaben Chhaganbhai Patel (supra) has already decided as to which decision of the conflicting 3 Judges Bench is to be followed, we are bound to follow the above interpretation given by the Hon’ble Supreme Court. Further, in the case of National Insurance Company Limited vs. Pranay Sethi & Others, reported in (2017) 16 SCC 680, the Hon’ble Supreme Court has held that when there are conflicting decisions of equal Benches of the Supreme Court, the earlier decision would have to be followed by the High Court.

Answer – In terms of the judgment of the Supreme Court in K.L. Rathi Steels Limited (supra) and Kokilaben Chhaganbhai Patel (supra), the learned Appellate Tribunal could not have allowed the review petition only on the basis of the liberty granted by the Hon’ble Supreme Court in Union of India & Another vs. Ganpati Dealcom Private Limited, reported in 2024 SCC

Page No.# 17/17 OnLine SC 2981, without taking a decision as to whether the provisions of Order 47 of the CPC was attracted.

JUDGE JUDGE Comparing Assistant