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Benami Transactions Prohibition Act, name changed to Prohibition of Benami Property Transactions Act, by section 3 of the amendment  is an Act of the Parliament of India that prohibits certain types of financial transactions. The act defines a 'benami' transaction as any transaction in which property is transferred to one person for consideration paid by another person.
The act bans all benami transactions and gives the government the right to recover property held benami without paying any compensation. The act came into force on 5 September Although benami transactions are now illegal, the act had limited success in curbing them. Updated versions were therefore passed in and , seeking to more comprehensively enforce the prohibitions.
Benami is an Urdu word that means "without name" or "no name". In this Act, the word is used to define a transaction in which the real beneficiary is not the one in whose name the property is purchased. In , the Law Commission of India after studying various Acts and prevailing benami system, recommended formulating an Act to tackle the issue. Accordingly, the Benami Transactions Prohibition Act, was enacted by the Parliament which came into force on 19 May However, due to various deficiencies in the Act, the rules required for operationalizing the Act were not framed.
To address these deficiencies, several years later, in , the Govt of India introduced "Benami Transactions Prohibition Bill, ". In an attempt to curb black money, in July , Modi government decided to amend the original act  which was subsequently passed by the Parliament of India as "The Benami Transactions Prohibition Amendment Act, ".
Thereafter, the Government notified the provisions of the act to come into force from 1 November The Act also has safeguard mechanisms such as the adjudicating authority and the appellate mechanism for appeals. The Act establishes four authorities who will be able to conduct inquiries regarding benami transactions  :. From Wikipedia, the free encyclopedia. An Act to prohibit benami transactions and the right to recover property held benami and for matters connected therewith or incidental thereto.
The Gazette of India. Retrieved 10 January Archived from the original PDF on 22 October Retrieved 22 October Archived from the original PDF on 12 August Universal Law Publishing.
Retrieved 12 July Retrieved 17 February The Times Of India. Retrieved 28 October Retrieved 26 July Taxation in India. Indian legislation. Hidden categories: Use dmy dates from July Use Indian English from July All Wikipedia articles written in Indian English Pages using collapsible list with both background and text-align in titlestyle.
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Benami Transactions (Prohibition) Act, 1988
How Benami law changes impact both old and new property buyers
Parliament has conveyed its intention that the word benami transaction is not confined to one section alone and also that the definition would contain only one category tripartite of benami transaction. The parliament has choosen to confine the definition to one category only. The idea was to make the intention abundantly clear that parliament did not want to encircle the second category i. Sumanthykutty v.
Benami Transactions (Prohibition) Act - A Study in Comparison
Please contact customerservices lexology. The Amendment Act seeks to cover comprehensively all aspects of transactions or arrangements where the source of funding for acquisition of a benami property has no permissible links to the ownership structure. The inclusion of arrangements has thus widened the definition of benami transaction and has effectively plugged the loophole in the Act. Benami transactions also include transactions carried out in fictitious names or where the person providing the consideration is not traceable. This may not be feasible given the recent crackdown on licenses granted by the Government of India under the Foreign Contribution Regulation Act, and the stringent views taken in relation to such not-for-profit organizations.
Benami Act provisions to come into force from 1 November
Benami Transactions Prohibition Act, name changed to Prohibition of Benami Property Transactions Act, by section 3 of the amendment  is an Act of the Parliament of India that prohibits certain types of financial transactions. The act defines a 'benami' transaction as any transaction in which property is transferred to one person for consideration paid by another person. The act bans all benami transactions and gives the government the right to recover property held benami without paying any compensation. The act came into force on 5 September