With reference to the ‘Prohibition of Benami Property Transactions Act, 1988 (PBPT Act) consider the following statements:
- A property transaction is not treated as a benami transaction if the owner of the property is not aware of the transaction.
- Properties held benami are liable for confiscation by the Government.
- 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?
Detailed Explanation:
Answer: Option 2 — 2 only
The Prohibition of Benami Property Transactions Act, 1988 (PBPT Act) deals with transactions where property is held by one person (benamidar) but is actually owned or financed by another person (beneficial owner). Only Statement 2 is correct, as the Act explicitly provides for confiscation of benami properties by the Central Government.
❌ Statement 1 – Incorrect: A transaction is specifically treated as benami if the owner of the property (benamidar) is not aware of the transaction or denies knowledge of it; lack of awareness does not exempt it but rather characterizes it as benami.
✅ Statement 2 – Correct: Section 5 of the PBPT Act clearly states that properties held benami are liable for confiscation by the Central Government.
❌ Statement 3 – Incorrect: The Act provides for four authorities (Initiating Officer, Approving Authority, Administrator, and Adjudicating Authority) and does provide an appellate mechanism through the Appellate Tribunal and subsequently the High Court.
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