Benami Act, FBR can seize Benami Assets, rewards for Whistle Blowers

Real Estate is one of the major sector for generation & investment of unaccounted money known as “black money”. The Benami Act is to curb black money transactions to ensure that all real estate transactions are conducted in the name of the actual owner where the consideration is paid from his known sources.

Parliament approved the law in January 2017 and the president gave his stamp of approval the next month. In the last two years, bureaucrats and politicians successfully delayed application of the law on flimsy grounds. The decision to make the law operational was taken last month during a meeting chaired by Prime Minister Imran Khan.

For Details about Benami Property, Check:  Benami Act to be operational this week

The Federal Board of Revenue (FBR) on Monday issued an SRO with regard to Benami Transactions (Prohibition) Act 2017, that would finally make the law operational after a gap of two years, empowering taxmen to confiscate whole properties, expensive vehicles and bank accounts registered with fictitious individuals.

Documents stated that the FBR will give a handsome reward to people disclosing benami properties.

With notification of rules, the Benami Transactions Prohibition Act of 2017 has come into force. The law authorises the FBR to confiscate all those properties that have been held in others’ name. It is generally presumed that such assets are either created through black or tax evaded money.

اب ایف بی آر کو اختیارات مل گئے ہیں کہ اب ان افراد کیخلاف کارروائی کر سکے گا جنہوں نے ٹیکس سے بچنے کیلئے دوسروں کے نام جائیداد خرید رکھی ہے یا بینک اکائونٹس کھولے ہوئے ہیں،رولز کے مطابق بے نامی جائیداد کی نشاندہی کرنیوالوں کو نقد انعام دیا جائیگا،20لاکھ یا اس سے کم کی پراپرٹی پر انعام کی رقم 5فیصد ہو گی،جبکہ 20لاکھ تک کی پراپرٹی پر ایک لاکھ اور جائیداد کی رقم کا 4فیصد،جبکہ جائیداد کی قیمت 20لاکھ سے 50لاکھ کی جائیداد پر انعام 2لاکھ 20ہزار اور جائیداد کی قیمت کا 3فیصد انعام دیا جائیگا-

فیڈرل بورڈ آف ریونیو بے نامی جائیداد ضبط اور فروخت بھی کر سکے گا۔ بے نامی جائیداد کی خبر دینے پر انعام کیساتھ جائیداد کی مالیت کا 2 سے 5 فیصد تک کا حصہ دیا جائے گا۔

ایف بی آر نوٹی فیکیشن کے مطابق بے نامی جائیداد 90 دن تک بے نامی ضبط رہے گی۔ اس اس دوران جائیداد کو ریگولرائز نہیں کروایا جاتا تو فروخت کر کے رقم قومی خزانے میں جمع کروا دی جائے گی۔ زمین کے علاوہ زیورات اور ہیرے جواہرات بھی اگر نام پر نہیں ہیں تو ضبط کر لیے جائیں گے۔ بے نامی جائیدادوں اور ٹرانزیکشن سے متعلق مقدمات کی اپیلوں کیلئے فیڈرل اپلیٹ ٹرایبونل بھی قائم ہو گا۔

The Federal Government has also announced cash awards for whistleblowers in detection of benami property. Three slabs of cash award have been notified.

If the price of a benami property is less than Rs2 million, the amount of reward will be 5pc of the price of the property. Similarly, for property that is worth over Rs2 million and less than Rs5 million, the amount of reward would be Rs0.1 million plus 4pc of the price of the property.

Moreover, if the price of a benami property is over Rs5 million, then the amount of reward would be Rs0.22 million plus 3pc of the price of the property.

The documents stated that the amount of reward shall be sanctioned after confiscation of the benami property under section 25.

One FBR official said there are a number of people in the tax net who are also involved in benami transactions and own benami properties. if any person unveils a benami property, he would get the reward and his name would be kept confidential.

The price of benami property will be determined at fair market value, which is defined in the Income Tax Ordinance of 2001. Its section 68 says: “The fair market value of any property or rent, asset, service, benefit or perquisite at a particular time shall be the price which the property or rent, asset, service, benefit or perquisite would ordinarily fetch on sale or supply in the open market at that time”.

To curb this practice, the government has also decided to give tax authorities access to the family tree database of citizens in a bid to catch these dodgers.

The affected persons can file appeals before an Appellate Tribunal, to be set up under the Benami law.

The adjudicating authority will comprise chairpersons and members. The chairperson will be entitled to pay and allowance of its pay scale and a monthly adjudicating authority allowance of Rs300,000. The members will be entitled to Rs200,000 monthly allowance, in addition, to pay and allowance admissible prior to their appointment. The chairperson of the tribunal will also be entitled to Rs400,000 monthly allowance in addition to his regular salary. The members of the tribunal will be paid Rs300,000 monthly allowance.