NA committee approves Benami Transaction (Prohibition) Bill

ISLAMABAD: The National Assembly Standing Committee on Finance on Tuesday approved the Benami Transaction (Prohibition) Bill 2016, with some amendments proposed by the members of the committee.

The meeting of the committee, presided over by Qaiser Ahmed Sheikh, discussed on the proposed draft of the bill and by and large approved the bill with certain amendments.

Sheikh said the bill would strengthen the law through empowering provisions prohibiting holding property as Benami and restrict the right to recover or transfer property held in Benami.

He said this law was being introduced by the government first time in the history of the country and a strict punishment had been proposed in the bill for the persons who would enter into any Benami transactions or who would hold the Benami property.

The officials of the Federal Board of Revenue (FBR) informed the meeting that the problem of property held Benami had causing concern to the tax authorities and past practice shows that Benami transaction had often been resorted to illegal or questionable objects including the evasion of taxes.

The assets, which are taken through illegally earned money, can be used for evasion of material amounts of taxes or something more serious like financing terrorism, the meeting was told.

The legislation defines the Benami transaction as an arrangement where property is held by a person on behalf of another person, who has paid for it or the transaction is made for a property in a fictitious name or the owner of the property was not aware of or denied knowledge of such ownership.

The bill prohibits persons from entering into Benami transactions, while any property held in Benami would be confiscated by the government. Once a property is confiscated all rights and title of such property would vest completely in the federal government and no compensation would be payable.

On complaints received by several members of the National Assembly, the committee summoned governor State Bank of Pakistan and president National Bank of Pakistan in its next meeting to discuss related issues further.

Chairman FBR would also brief the committee in its next meeting regarding property issue in the country. Moreover the committee also directed the convener of subcommittee of finance constituted to discuss Panama Leakes issue to submit its report in its next meeting.