Supreme Court strikes down one of the provisions of 1988 Benami Law

India

oi-PTI

New
Delhi,
Aug
23:
The
Supreme
Court
Tuesday
struck
down
one
of
the
provisions
of
the
Benami
Transactions
(Prohibition)
Act
of
1988,
which
provides
for
the
punishment
of
a
maximum
jail
term
of
three
years
or
a
fine
or
both
for
those
indulging
in
benami’ transactions.

The
apex
court
termed
the
provision
unconstitutional
on
the
ground
of
being
manifestly
arbitrary.

“We
hold
section
3(2)
of
the
Benami
Transactions
(Prohibition)
Act,
1988
as
unconstitutional,”
a
bench
comprising
Chief
Justice
N
V
Ramana
and
Justices
C
T
Ravikumar
and
Hima
Kohli
said.

Section
3
of
the
statute
deals
with
the
issue
of
Prohibition
of
benami
transactions
and
its
impugned
sub-section
(2)
says:
Whoever
enters
into
any
benami
transaction
shall
be
punishable
with
imprisonment
for
a
term
which
may
extend
to
three
years
or
with
fine
or
with
both.

SC
refers
matter
relating
to
Shiv
Sena
rebellion
to
Constitution
Bench

The
verdict
came
on
the
appeal
of
the
Centre
challenging
the
Calcutta
High
Court
judgement
in
which
it
was
held
that
the
amendment
made
in
the
1988
Act
in
2016
would
be
applicable
with
prospective
effect.

The
1988
Act
was
made
to
prohibit
benami’ transactions
and
the
right
to
recover
property
that
is
held
to
be
‘benami’.