KARACHI: The Federal Board of Revenue (FBR) on Monday notified rules to apply Benami law, which was legislated in the year 2017.
The FBR issued SRO 326(I)/2019 to notify rules for Benami Transactions (Prohibition) Act, 2017.
The FBR has already made all arrangements for taking action against thousands of benami transactions, but was waiting for formal implementation of the law.
The Parliament on February 1, 2017 passed the Benami Transactions (Prohibition) Act, 2017 enabling the authorities to take legal action against persons taking benefits of undocumented properties, while maintaining those in possession of someone else’s name.
Previously, the FBR officials could not initiate proceedings against benami transactions due to non-availability of law.
Sources in the FBR said Broadening of Tax Base (BTB) had detected millions of transactions which were not reported by taxpayers through their annual returns.
The sources said that notices were served against these transactions, but in most of the cases that beneficiary was someone else.
They said that the proceedings in those cases were halted till the law was implemented.
Under the Benami Transaction (Prohibition) Act, 2017 the FBR has been empowered as the administrative body.
Further, an Inland Revenue officer at the position of deputy commissioner has been authorised to initiate legal proceedings in benami transactions.
The official was also authorised to initiate proceeding in the cases under Income Tax Ordinance, 2001, which would include confiscation of benami property.
As per the act, benami property has been defined as: moveable or immovable, tangible or intangible, corporeal or incorporeal, and right or interest.
The benamidar would be liable to one to seven years imprisonment besides confiscation of benami property.
The benami rules also fixed rewards for whistleblowers on pointing out the properties where the actual owners remained hidden.
