A day after the Lok Sabha, Rajya Sabha also approved the Benami Transactions (Prohibition) Bill, 2016 Tuesday. The bill is aimed at curbing the use of black money in acquiring property in other person’s name.
Replying to the debate in the Rajya Sabha, Finance Minister Arun Jaitley said the Benami Transactions Bill is aimed at seizing benami property besides prosecuting those indulging in such activities as the provisions for prosecution could not be operationalised in want of rules in the 1988 Act.
He said the government was bringing amendment as if it would have brought a new Act “penal provisions could not apply retrospectively and those guilty of violations would have got scot-free.”
The 1988 Act, which also has provisions for prosecution, has not been operationalised as the rules in this regard have not been framed, he said and added Law Ministry has suggested amendment for entire functioning of the Bill and accordingly rules have to be framed.
The Minister said while the 1988 Act has nine sections, the amended law would have 71 sections. Under Article 20 of the Constitution, penal provisions cannot be applied retrospectively, he said.
He said the government has accepted the Parliamentary Standing Committee’s suggestion to change the words in the Bill from “known sources of income” to “known sources” with a view to further strengthen the provisions.
Jaitley said that offences under the amended law would be non-cognisable as the government does not want multiple agencies to get involved and harass people.
Besides bonafide religious trusts, he said there are few exceptions relating to Hindu Undivided Family and trusts owning properties.
Participating in the debate, Shamsher Singh Dullo (Cong) demanded digitising the land records and bringing in black money transactions in real estate.
He said the capital in the country was concentrated in the hands of 15-20 persons only and demanded that as per the Prime Minister’s announcement, the government should bring in black money kept in foreign and provide Rs 15 lakh each to the accounts of people.
Bhupender Yadav (BJP) applauded the move for Benami bill saying it will check the parallel economy.
Jaitley said that fiduciary and trustee holding is allowed under the Benami bill but the investment should be made from the known sources of income.
He said the law also provides for those genuine property purchases which could have been funded by family members or other sources as a loan.
The earlier term of “known source of income” has been replaced with “known sources” with regard to purchase of property, the Finance Minister added.
He said the property outside the country will not be covered under the Benami law but will be dealt with under the black money law.
The Finance Ministry said that sufficient safeguards have been put in place to prevent any misuse provisions of the Benami law, which seeks to confiscate such properties.
“Four layers of officers and an appeal tribunal has been created since this is a major power,” he said, adding it is being done because there were apprehensions that one officer might end up being corrupt.
Talking about the properties in tribal areas, he said those can be exempted from the purview of the law by the Governor of the respective state.
On concerns being expressed over mandatory use of PAN Card for purchase of high value properties, he said already 22-23 crore cards have been issued out of 25 crore families and anyone spending lakhs of rupees could obtain it online.
Further, he added that states are digitalising the land records which will help in dealing with the black money.