New Law To Track Benami Transactions
The new law, Benami Transactions (Prohibition) Bill , 2011, will replace the earlier legislation which was enacted in 1988. In a bid to deal with the menace of black money, the government is likely to consider the possibility of enacting a new law to track benami transactions at the meeting of the union Cabinet. The new law will empower the authorities to track benami transactions and confiscate such properties.
Benami transaction is referred to those deals which are undertaken by unscrupulous people in the name of fictitious persons to park unaccounted funds.
After the approval by the Cabinet, The new law Benami Transactions (Prohibition) Bill 2011 is likely to be introduced in the monsoon session of Parliament, sources said.
The new law is also likely to put in place a time-bound mechanism to try cases of benami transactions. The effort to update benami transaction will form part of the exercise by the government to unearth black money.
The union cabinet is expected to approve amendments to the law on benami property law on Thursday to demonstrate its seriousness in fighting the menace of black money. It is believed that a substantial portion of the black money generated is parked in real estate in the names of friends and family.
The new law will set up an authority and empower it to confiscate an asset deemed to be benami if the owner fails to provide proven source of earning to acquire that property. Under the new law the government will seize benami property, auction them and pass on the proceeds to states, where the property is located, for development activities. The act will also make it mandatory for all property deeds to be verified by a CA.
“This will reduce black money and boost government revenue and requirement for a mandatory audit will make it simpler for the authorities to keep track of deals,” an official said.
Source: Economic Times
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