Monsoons are bonanza for home buying
A Persian word ‘Benami’ stands for proxy. Benami basically means purchasing any asset using another person as a proxy and these transactions are known as Benami transactions. Benami Transaction Amendment 2016, came in force on 1st of November, while the legislation was first enacted in 1988, this time the centre is serious to catch hold of all the culprits.
How it affects you?
As official report says, there are plenty of unaccounted transactions not only in lands but also in terms of jewellery, plots and bank accounts. The centre has also confiscated some Benami properties of senior officials through corruption and black money. This act is implemented to curb corruption.
Benami is implemented on corporeal and incorporeal, tangible and intangible, moveable and immovable assets. As investing in land is always preferred mostly people invest their finance in land and use the proxy name to save and get rid of taxes. Hence this leads to Benami transactions which boosts the property rates and makes it unaffordable for average Indian masses.
Under Benami law, based on an order of confiscating the property, the administrator will receive and manage the property in a manner and subject to conditions as prescribed. There is imprisonment up to 3 years and fine or either of any. The bill also has right to change the penalty to strict imprisonment of 1 year to upto 7 year and a fine which may extend to 25% of the market value of the Benami property. A penalty for providing false information leads to harsh imprisonment of 6 months to upto 5 years and fine extent to 10% of the market value.
Government’s attempt to curb Benami Properties:
The govt. is actively catching hold of culprits found guilty for Benami properties as it can be used to make affordable housing a reality. So beware!
As the budget 2017 has the aim of achieving affordable housing by 2022, Benami properties are appropriate to achieve the objective of affordable housing. So, just a suggestion do not involve yourself with Benami properties as you could be imprisoned, instead help the government make India affordable ;)