Confiscation of benami properties, jail terms for offenders and a separate appellate agency to deal exclusively with benami transactions may become a reality if recommendations made by the Parliament?s standing committee on finance examining the Benami Transaction (Prohibition) Bill, 2011, are accepted. The Bill aims to check the growth of black money arising from benami property transactions.
Earlier this week, finance minister Pranab Mukherjee had said that the new Bill would effectively help keep track of transactions, which would, in turn, tackle the scourge of black money.
The Bill defines a benami transaction as one in which property is transferred to a person for a consideration paid or provided by another person. It also says that all properties arising out of prohibited benami transactions are liable to confiscation by the central government without any compensation. Strict penalties and jail terms are also outlined in this Bill for providing false information related to such transactions. The Bill recommends jail terms from six months to two years and a fine of 25% of the market value of the property involved. However, the committee said the minimum punishment for such offenders can be prescribed but the maximum imprisonment should be longer.
Mukherjee had said the Bill contains ?elaborate provisions dealing with the definition of benami transaction and benami property, prohibited benami transactions, consequences of entering into a benami transaction and the procedure for implementing the proposed law.? The introduction of this law, he said, ?will further help in our resolve to reduce the menace of black money?.
The Bill, which was cleared by the parliamentary panel last week, will now be submitted to the Lok Sabha Speaker. The Bill will replace the Benami Transactions (Prohibition) Act, 1988.
It was introduced in the Lok Sabha in August last year and sent to the panel for examination. The panel also wants the scope of this Bill to encompass all states, including Jammu & Kashmir, which is currently out of its ambit.
While the Bill calls for utilising the appellate tribunal set up to deal with cases under the Prevention of Money Laundering Act, 2002, the parliamentary panel is said to have suggested setting up a dedicated appellate tribunal exclusively under the Bill to deal with cases related with benami transactions.
In order to further strengthen the existing laws and check any illegal transactions, the parliamentary panel wants a coordinated approach from the income tax authorities and the authorities under the Prevention of Money Laundering Act, 2002.
