Benami transactions are transactions where the immovable property is held by or transferred to a person who becomes the ostensible owner thereof, but in reality the transaction is entered into on behalf of or in guise of some other person who is the real owner of the property, since he pays the amount of consideration for such property.
To curb the generation of domestic black money, the Benami Transactions (Prohibition) Amendment Bill, 2015 was introduced in Lok Sabha on May 13, 2015 by the Finance Minister, Mr. Arun Jaitley. The Bill seeks to amend the Benami Transactions Act, 1988. The Act prohibits Benami transactions and provides the ground for verification and confiscating the Benami land or property in India.
The Bill seeks to: (i) amend the definition of Benami transactions, (ii) establish adjudicating authorities and an Appellate Tribunal to deal with Benami transactions, and (iii) specify the penalty for entering into Benami transactions.
The proposed law is applicable to individuals, partnership firms, un-incorporated entities and companies.
Prepared by Aastha Salgotra