 |
New
Delhi: In an attempt to put a lid on benami transactions, the Union
Cabinet on Thursday approved the replacement of the existing Benami
Transactions (Prohibition) Act 1988 with a new law, Benami transactions
(Prohibition) Bill 2011, which will make benami properties liable for
confiscation.
Under the new law, properties purchased in the
name of spouse or siblings could be allowed under benami deals. It will
also ensure that a benami property is liable for confiscation after the
person involved has been given “due opportunity’’ of being heard.
Speaking after the meeting, information and broadcasting minister Ambika
Soni
pointed out that properties held by coparcener (one of two or more
persons sharing an inheritance) in a Hindu undivided family and
properties held by a person in “fiduciary’’ capacity are excluded from
the definition of benami transaction. “Properties acquired by an
individual in the name of spouse, brother or sister or any other lineal
ascendant or descendant are benami transactions which are not
prohibited,’’ she added. Consequently, they are not subject to penal
provisions.
A coparcener is an individual who holds property inherited from an ancestor, while a fiduciary is an individual who holds property in trust.
The
Cabinet, chaired by PM Manmohan Singh, approved the proposal to
introduce the Bill in the monsoon session despite, sources said,
opposition from home minister P Chidambaram who said that even in its
current form it may not be able to check benami deals. The proposal,
however, found strong support from finance minister Pranab Mukherjee and
HRD and telecom minister Kapil Sibal. According to the government, the
Bill contains elaborate provisions dealing with the definition of benami
transaction and property, as also prohibited benami transactions.
FAMILY BUSINESS
Cabinet approves proposal to bring Benami Transactions (Prohibition) Bill 2011, replacing 1988 Act
The previous Act was never implemented as the rules were not framed
Under
new Bill, benami property will be liable for confiscation after person
involved is given “due opportunity of being heard”. Punishable with jail
term of 6 months-2 years and fine New benami law proposes 6 months’ jail
New
Delhi: The Cabinet has approved the proposal to replace the Benami
Transactions (Prohibition) Act 1988 with a new law — Benami transactions
(Prohibition) Bill 2011.
Under the proposed new law, anyone
violating the rule can be jailed for not less than six months, which may
be extended to two years and also be liable to a fine.
“Where any person enters into a benami transaction in order to defeat the provisions of any law or to avoid payment
of
statutory dues or to avoid payment to creditors, the beneficial owner,
benamidar and any other person who abets or induces any person to enter
into such benami transaction, shall be punishable with imprisonment for a
term which shall not be less than six months but which may extend to
two years and shall also be liable to a fine,’’ said I&B minister
Ambika Soni.
Elaborating on the need for a fresh legislation,
the minister said, “It was found that owing to infirmities in the
(existing) law, formulation of rules would not be possible without a
comprehensive legislation by repealing the act”. TNN
|