The benami (without a name) transaction refers to property purchased by a person in the name of some other person. The person on whose name the property has been purchased is called the benamdar and the property so purchased is called the benami property. The person who finances the deal is the real owner. Therefore, in a benami transaction, the name of the person who paid the money is not mentioned. Directly or indirectly, the benami transaction is done to benefit the one who pays.
Key provisions of the bill are as follows:
- Change in the definition of benami to include the transactions where a property is held by or transferred to a person, but has been provided for or paid by another person.
- Properties held benami are liable for confiscation by government without compensation. Persons indulging in benami transactions may face up to 7 years’ imprisonment and fine. Furnishing false information is punishable by imprisonment up to 5 years and fine.
- The Bill seeks to establish four authorities to conduct inquiries or investigations regarding benami transactions: (i) Initiating Officer, (ii) Approving Authority, (iii) Administrator and (iv) Adjudicating Authority.
- The Bill also seeks to establish an Appellate Tribunal to hear appeals against any orders passed by the Adjudicating Authority. Appeals against orders of the Appellate Tribunal will lie to the high court.
- Initiating Officer may pass an order to continue holding property and may then refer case to Adjudicating Authority which will then examine evidence and pass an order. Appellate Tribunal will hear appeals against orders of Adjudicating Authority.High Court can hear appeals against orders of Appellate Tribunal.