Everything you need to Know about Benami Property
May 18, 2017 Home Trading Steps
Real estate has seen some crucial changes in 2016. From RERA to demonetization to the recent ban on the Benami properties. Prime Minister Modi while addressing the nation on Sunday talked about the ban on Benami properties to help fight corruption and black money.
The government has already enacted the Benami Transaction (prohibition) Amendment Act, 2016, which promises a rigorous action on the culprits. Imprisonment of up to seven years or a fine leading the one fourth value of the property may be slapped on the culprit regarding the same. Not only real estate but it also holds for gold. This Act allows the government to confiscate the property registered under false name and identity.
What does Benami property mean?
Properties which are bought under the fake name and identity are known as Benami properties. It also includes the properties held by the owner or the jointly by the couple for which the amount paid was sourced from unknown sources. This type of transaction is known as Benami transaction. The real owners of such properties are difficult to trace since the registration is done under false identities. The Benami properties include buying assets which are tangible, intangible, movable, immovable, and rights or interest or legal documents.
Laws against Benami property:
The first act of benami property was passed in 1988 as the prohibition of Benami Property Transition Act, 1988. To fight the black money the Modi government decided to bring back the act. Any violation of the Act is punishable by the law along with imprisonment and fine. Properties that are held Benami are liable to be confiscated by the government without payment or compensation.
To escape the taxes, people with black money invest the money in benami property. Properties worth billions are under the Benami property. This has affected the revenue generation of the government and the development by far. It is expected that the ban on benami property will bring out the offenders and the confiscated properties will help in the real estate development. The major concern is the successful implementation of the government officers. Strict actions need to taken in this regard and it also the need of the hour.
Ban on Benami properties will not only bring forward tax offenders but will also bring out he genuine buyers who are interested in the property. The real estate market is expected to revive and some price correction is expected due to the same.
The government has already enacted the Benami Transaction (prohibition) Amendment Act, 2016, which promises a rigorous action on the culprits. Imprisonment of up to seven years or a fine leading the one fourth value of the property may be slapped on the culprit regarding the same. Not only real estate but it also holds for gold. This Act allows the government to confiscate the property registered under false name and identity.
What does Benami property mean?
Properties which are bought under the fake name and identity are known as Benami properties. It also includes the properties held by the owner or the jointly by the couple for which the amount paid was sourced from unknown sources. This type of transaction is known as Benami transaction. The real owners of such properties are difficult to trace since the registration is done under false identities. The Benami properties include buying assets which are tangible, intangible, movable, immovable, and rights or interest or legal documents.
Laws against Benami property:
The first act of benami property was passed in 1988 as the prohibition of Benami Property Transition Act, 1988. To fight the black money the Modi government decided to bring back the act. Any violation of the Act is punishable by the law along with imprisonment and fine. Properties that are held Benami are liable to be confiscated by the government without payment or compensation.
To escape the taxes, people with black money invest the money in benami property. Properties worth billions are under the Benami property. This has affected the revenue generation of the government and the development by far. It is expected that the ban on benami property will bring out the offenders and the confiscated properties will help in the real estate development. The major concern is the successful implementation of the government officers. Strict actions need to taken in this regard and it also the need of the hour.
Ban on Benami properties will not only bring forward tax offenders but will also bring out he genuine buyers who are interested in the property. The real estate market is expected to revive and some price correction is expected due to the same.
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