Benami property Transactions Law

Benami property Transactions is a law which was first introduced on 5 September 1988 by Parliament of India. The updated version of this law was came on 2011 and currently came in 2016 by the parliament of India. The main aim of benami property transaction law is to prohibit any Benami transaction in which property is transferred to one person for a consideration paid by another person. The transaction usually related to real estate (property) and black money. Benami Transactions law, 1988 gives power to ban all benami transactions and the right to recover property held benami. Under this law, Persons engaged in benami transactions may face up to 7 years imprisonment and fine which may extend to 25 percent of the fair market value of the benami property. The legal framework for dealing with benami transactions in the old Benami Transactions law was weak. Now, the amended law 2016 empowers the income tax Department to inquire into any person, place, documents or property during an investigation into any matter related to a Benami property Transactions. The amendments in the law made it stronger and apart from imprisonment and penalty up to 25 percent, the benami property also be confiscated. The benami transactions include buying assets of any kind such as movable, immovable, tangible, intangible, any right or interest, or legal documents

Benefits of Benami property Transactions law:

• It helps to fight against black money in country and outside the country
• It also helps to prohibits illegal transactions
• Benami property Transactions law benefits to arrest corruption in the country

What is Benami property Transactions?

1. The benami (without a name) property transaction refers to property purchased by a person in the name of some other person. The property is purchased on the name of the person is called Benamdar (benami property holder) and the property is purchased is called Benami Property. Under this transaction, the real owner is the person who used money to buy property on the name of other person

Silent Features of Benami Property Transactions:

1. The benami (without a name) property transaction refers to property purchased by a person in the name of some other person
2. Benami property Transactions is a law which was first introduced on 5 September 1988 by Parliament of India. The updated version of this law was came on 2011 and currently came in 2016
3. Persons engaged in benami transactions may face up to 7 years imprisonment and fine which may extend to 25 percent of the fair market value of the benami property
4. The legal framework for dealing with benami transactions in the old Benami Transactions law was weak. Now, the amended law 2016 empowers the income tax Department to inquire into any person, place, documents or property during an investigation into any matter related to a Benami property Transactions
5. Under this law, the benami property also be confiscated

Which is not Benami transactions?

1. Property held under the name of spouse or child, for which the amount is being paid through a known source of income is not a banami property
2. A joint property with brother, sister or other relatives for which the amount is paid through a known source of income is not a banami property
3. Property held by someone in a fiduciary capacity; that is, transaction involving a trustee and a beneficiary
4. If a property is purchased with joint ownership using fund sources that are known and can be accounted for, the property is not a benami property

References & Details:

1. For more details about Benami property Transactions visit: http://indiacode.nic.in/