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?

The Prohibition of Benami Property Transactions Act, 1988 (PBPT Act) was amended by the Benami Transactions (Prohibition) Amendment Act, 2016.

Statement 1: The principle that "ignorance of the law is no excuse" applies. Therefore, a transaction can still be considered benami even if the property owner is unaware of it. Statement 1 is incorrect.

Statement 2: Properties held benami are indeed liable for confiscation by the Government without compensation. Statement 2 is correct.

Statement 3: The PBPT Act includes an appellate mechanism with an Adjudicating Authority and an Appellate Tribunal. Statement 3 is incorrect.

Hence, only statement 2 is correct.

Sources:

• PIB - Amendment to Benami Property Transactions Act