With reference to the ‘Prohibition of Benami Property Transactions Act, 1988 (PBPT Act) consider the following statements: 1. A property transaction is not treated as a benami transaction if the owner of the property is not aware of the transaction. 2. Properties held benami are liable for confiscation by the Government. 3. 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?
Explanation
Statement 1 is Incorrect: Under the PBPT Act, a transaction is specifically defined as benami if the person in whose name the property is held (the benamidar) is unaware of the transaction or denies knowledge of it. Therefore, lack of awareness does not exempt a transaction; rather, it is one of the conditions that characterizes a benami transaction.
Statement 2 is Correct: Section 5 of the Act provides that any property which is the subject matter of a benami transaction shall be liable to be confiscated by the Central Government.
Statement 3 is Incorrect: The Act provides for four authorities for the purpose of the Act: the Initiating Officer, the Approving Authority, the Administrator, and the Adjudicating Authority. Furthermore, the Act does provide for an appellate mechanism; any person aggrieved by an order of the Adjudicating Authority can appeal to the Appellate Tribunal, and subsequently to the High Court.