Benami transactions essentially mean black money is invested in properties in the names of others, even though the benefits are enjoyed by the investor concealing his/her ownership in the tax returns.
Over 1,500 ‘benami’ properties worth Rs 43 billion have been attached in the past 18 months by the Income Tax Department.
The properties have been attached in wake of the ‘benami legislation’ that was passed during the same time. According to a Business Standard report, Jaipur and Mumbai top the list, with attachments of 200 properties each.
Patna has seen the least number of attachments at 30, followed by Lucknow at 50, while in Kolkata, Chandigarh, and Hyderabad, 144, 110, and 100 properties got attached, respectively, the report added.
Benami transactions essentially mean black money is invested in properties in the names of others, even though the benefits are enjoyed by the investor concealing his/her ownership in the tax returns.
While the department has attached the properties, a report earlier this month suggested that over 780 benami asset attachments worth crores of rupees run the risk of being invalidated. The reason is the failure of the government to form an adjudicating authority for over a year-and-a-half since the stringent law was enforced.
The Benami Property Transaction Act, enacted in 1988, was revived and enforced by the current government from November 1, 2016, the month that also saw demonetisation of two big currencies of the country by a declaration made by Prime Minister Narendra Modi.
Section 7 of this law, that attracts a rigorous imprisonment of up to seven years and fine up to 25 per cent of the fair market value of the property, requires the government to create an independent 3-member Adjudicating Authority (like the one for PMLA) that will decide on the validity of the attachment of properties made under this legislation by the Income Tax Department (ITD).
In the absence of such an authority for over 1.5 years now, the government has entrusted the task of handling these cases on an ad-hoc basis and as a "transitional" arrangement to the already short-staffed and over-burdened Adjudicating Authority for the Prevention of Money Laundering Act (PMLA), a stringent law enforced by the Enforcement Directorate.
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