Q20. With reference to the ‘Prohibition of Benami Property Transaction Act, 1988 (PBPT Act)’, consider the following statements :
- A property transaction is no 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?
a) 1 only
b) 2 only
c) 1 and 3 only
d) 2 and 3 only
The correct answer is 2 only
- Benami Property Transactions Act, 1988 (PBPT Act)
- A property transaction is treated as a Benami transaction even if the owner of the property is unaware of the transaction because ignorance of the law is never an acceptable defence for breaking the law in India. Hence, statement 1 is not correct.
- Benami’s properties are subject to confiscation by the government.
- They are also subject to confiscation by the government without compensation. Hence, statement 2 is correct.
- The Adjudicating Authority and Appellate Tribunal have been established as an appeals mechanism. Hence, statement 3 is incorrect.
- Persons involved in Benami transactions may face up to 7 years in prison and a fine.
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