Tue 21st of November 2017
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What is Benami?
What constitutes Benami property?
Property that does not stick to the following criteria:
a) Property held in the name of spouse or child for which the amount is paid out of known sources of income
b) A joint property with brother, sister or other relatives for which the amount is paid out of known sources of income
c) Property held by someone in a fiduciary capacity
This means, by law, if you buy a property in name of your parents, too, can be declared as benami.
In August, Parliament had passed the Benami Transactions (Prohibition) Act, with the assurance from Finance Minister Arun Jaitley that genuine religious trusts would be kept out of the purview of this new legislation. The new legislation will make a provision of seven year imprisonment and fine, replacing the three-year jail term, or fine, or both.
What is Benami Act?
First, a benami transaction is one where a property is held by one person and the amount for it is paid by another person. Therefore, in a benami transaction, the name of the person who paid the money is not mentioned. Directly or indirectly, the benami transaction is done to benefit the one who pays.
What isn’t a benami transaction?
1. Property held under the name of spouse or child, for which the amount is being paid through a known source of income.
2. A joint property with brother, sister or other relatives for which the amount is paid out of known sources of income.
3. Property held by someone in a fiduciary capacity; that is, transaction involving a trustee and a beneficiary.
What falls under benami transaction?
Assets of any kind — movable, immovable, tangible, intangible, any right or interest, or legal documents. As such, even gold or financial securities could qualify to be benami.
How it affects the people?
It is being done to curb on black money. People with unaccounted income will sure have a tough time ahead. As for the general public, it won’t be much of an issue if their transactions are legal.
Prelims Question of the Day
With reference to 'Natural Rate of Unemployment', consider the following statements.
1. It is the level of unemployment in an economy that is just consistent with a stable rate of Inflation.
2. It is the unemployment that prevails when all markets in the economy are in equilibrium.
(a)1 and 2
(d)None of the above
Mains Question of the Day
1.GS-No party in power can afford to ignore Directive Principles of State Policy. Comment.(200 Words)
2.Political Science - Explain the role of non state actors, like IMF, World Bank, European Union and MNCs, in modulating and transforming the broad dynamics of international relations. (250 Words).
3.SOCIOLOGY - What is the impact of Globalization on the structure and mobilization of the working class in India? (250 Words).