Benami transactions

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The National Assembly has passed ‘Benami’ Transactions (Prohibition) Act 2017 for the prohibition of holding property in ‘benami’ and restrict the right to recover or transfer property and provide a mechanism and procedure for the confiscation of ‘benami’ property. The law provides that no person shall enter into any ‘benami’ transaction and anybody violating this provision shall be punishable under the law and any property, which is the subject matter of ‘benami’ transactions, shall be liable to be confiscated by the federal government. Moreover, no person, being ‘benamidar’ shall transfer the ‘benami’ property held by him for the beneficial owner or any other person acting on his behalf and where any property is retransferred in contravention of the provisions of this law, the transaction of such property shall be deemed to be null and void.
This bill, once it becomes an Act, is expected to deal with the problems of tax evasion and black money especially in the real estate sector, and to target transactions that are carried out in other people’s name. It is also meant for putting an end to ‘benami’ transactions, and to empower the government to recover such property, defining ‘benami’ transactions, the legislature intends to prohibit all persons from entering into such transactions. The bill further seeks to ensure that if any person enters into a benami transaction to evade tax or avoid payment to creditors.