2 years ago (2016-09-12 14:35:31)

BENAMI TRANSACTIONS (PROHIBITION) AMENDMENT ACT, 2016

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Earlier the benami transactions are defined as a “transaction where a property is held by or transferred to a person, but has been provided for or paid by another person”. This Act has amended this definition by to add other transactions which qualify as benami, such as property transactions or arrangement where:

A.      i. where a property is transferred to, or is held by, a person, and the consideration for  
            such property has been provided, or paid by, another person

        ii. the property is held for the immediate or future benefit, direct or indirect, of the person who has                          provided the consideration

B.      the transaction is made in a fictitious name,

C.       the owner is not aware of denies knowledge of the ownership of the property, or

D.      the person providing the consideration for the property is not traceable.

 The Bill also specifies certain cases which will be exempt from the definition of a benami transaction. These include cases when a property is held by:

(i) a Karta, or a member of a Hindu undivided family, as the case may be, and the property is held for his benefit or benefit of other members in the family and the consideration for such property has been provided or paid out of the known sources of the Hindu undivided family;

(ii) a person standing in a fiduciary capacity for the benefit of another person towards whom he stands in such capacity and includes a trustee, executor, partner, director of a company, a depository or a participant as an agent of a depository under the Depositories Act, 1996 and any other person as may be notified by the Central Government for this purpose;

(iii) any person being an individual in the name of his spouse or in the name of any child of such individual and the consideration for such property has been provided or paid out of the known sources of the individual;

(iv) any person in the name of his brother or sister or lineal ascendant or descendant, where the names of brother or sister or lineal ascendant or descendant and the individual appear as joint-owners in any document, and the consideration for such property has been provided or paid out of the known sources of the individual

 This new law has also increased the penal provisions for, Read More at https://lexcomply.com/blog/highlights-on-the-benami-transactions-prohibition-amendment-act-2016/


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