Hyderabad: Prime Minister Narendra Modi’s warning on Sunday that he would take action against benami properties is not just an emotional speech.
The series of notifications issued by the Income-Tax department since October 25 regarding rules to curb benami properties and forming of an adjudicating authority reveals that a solid ground has already been prepared to take action under the amended Act, as the offence is punishable for one year, which may extend to seven years’ imprisonment and a fine which may extend to 25 per cent of the fair market value of the benami property.
Mr Modi said in Goa on Sunday, “This (demonetisation) is not an end. I have more projects in mind to make India corruption-free... We will take action against benami property. This is a major step to eradicate corruption and black money.”
Act banning benami deals came into effect on November 1
Most significantly, the amended Act of Prohi-bition of Benami Pro-perty Transactions has come into effect on November 1.
The government, in its notification on October 25, said the adjudicating authority and the appelate tribunal appointed under the Prevention of Money-Laundering Act, 2002 act shall perform similar functions under the benami Act too.
Ms Meenakshi Gosw-ami, commissioner of Income-Tax (media & technical policy) and spokesperson of the Central Board of Taxes, said, “The PBPT Act prohibits recovery of the property held benami from benamidar by the owner.”
“Properties held benami are liable for confiscation by the government,” she added. An I-T joint or additional commissioner, an assistant or deputy commissioner and a tax recovery officer in each region have been notified to perform the functions and exercise the powers of the approving authority, initiating officer and administrator, respectively under the PBPT Act.
The Act states that any person who is required to furnish information and who knowingly gives false information faces rigorous imprisonment for six months to five years and be liable to a fine.
If any person enters into a benami transaction in order to defeat the provisions of any law or to avoid payment of statutory dues or to avoid payment to creditors, the beneficial owner, benamidar and any other person who abets or induces it will be guilty of the offence of benami transaction.
What benami means
- Benami property means any property which is the subject matter of a benami transaction and also includes proceeds from such property
- Benami transaction is a transaction or arrangement where a property is transferred to, or is held by, a person, and the consideration has been provided, or paid by, another person. A transaction has been made under a fictitious name; the owner is not aware or denies knowledge; the person providing the property is not traceable.
- Special Courts will be notified for dealing with these cases
- “Benamidar” means a person or a fictitious person, as the case may be, in whose name the benami property is transferred or held and includes a person who lends his name.
