Question
With reference to the ‘Prohibition of Benami Property Transaction Act, 1988 (PBPT Act)', consider the following statements :
1. A property transaction is no treated as a benami transaction if the owner of the property is not aware of the transaction.
2. Properties held benami are liable for confiscation by the Government
3. The act provides for three authorities for investigations but does not provide for any appellate mechanism
Which of the statements given above is/are correct?
(a) 1 only
(b) 2 only
(c) 1 and 3 only
(d) 2 and 3 only
Answer:
B
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Explanation:
The correct answer is (b) 2 only.
Let's analyze each statement:
A property transaction is not treated as a benami transaction if the owner of the property is not aware of the transaction: This statement is incorrect. According to the Prohibition of Benami Property Transactions Act, 1988, a property transaction can still be treated as a benami transaction even if the owner is not aware of it. The act defines a benami transaction as a transaction where a property is held by one person, but the consideration for it has been provided by another person, and the property is held for the immediate or future benefit of the person providing the consideration. The knowledge or awareness of the owner is not a determining factor in identifying a benami transaction.
Properties held benami are liable for confiscation by the Government: This statement is correct. The PBPT Act provides for the confiscation of benami properties by the government. If a property is determined to be a benami property, the act empowers the government to seize and confiscate such properties. The purpose of this provision is to discourage and prevent the holding of properties in benami names.
The act provides for three authorities for investigations but does not provide for any appellate mechanism: This statement is incorrect. The Prohibition of Benami Property Transactions Act, 1988, does provide for an appellate mechanism. The act establishes several authorities, including the Initiating Officer, the Approving Authority, and the Adjudicating Authority, to investigate and adjudicate benami property cases. It also provides for an Appellate Tribunal where aggrieved parties can appeal against the decisions of the Adjudicating Authority.