Prime Minister Sri.Narendra Modi`s current demonetisation drive is just the beginning of anti-corruption stir and will spur on a number of measures get rid of the corruption, may not produce immediate results, but definitely, a long term initiative and after this period of 50 days of punitive action against owners of black money, those who have deposited money and encashed Rs.500/- and Rs.1,000/- bills in large quantities will be investigated.
The next axe is set to fall against ‘benami’ property owners: a warning has already been issued and it was on the pipeline, ever since, The President of India gave his assent in October, 2016 and the Government notified and brought this Act into force from 01-11-2016.
But, an opportunity may be given to the benami property owners to pay taxes and come out clean.
Who are these benami property owners?
Well, the government wants to find out exactly that and unmask such people and punish the offenders.
The institutional framework has been strengthened by amending the original Benami Transactions Act 1988 to make the existing law more stringent. Under the Benami Transactions (Prohibition) Amendment Act 2016 that recently came into force on 1 November, a transaction is named ‘benami’ if property is held by one person, but has been provided or paid for by another person.
The Act prohibits recovery of the property held benami from benamidar by the real owner.
Benami properties are liable for confiscation by the government.
People with surplus black money had been keeping it safely hidden from the government by buying property in fictitious names, thus on paper they were not the owners but enjoyed all the benefits.
It has been found that corrupt political leaders, government officials and developers are the ones indulging most in benami transactions, apart from terrorists.
The benami property transactions see a boom during various scams which our country has been witnessing from time to time, where big amounts of money where quickly invested in properties far and away.
Black money has always found a safe haven in properties in Delhi, NCR regions, Mumbai, Hyderabad, Pune, Banglaore, Goa and Tier II, Tier III towns, albeit in unknown names to escape the law.
Now, under the amended law, all those benamdars and the real owners, who have been indulging in bogus transactions since the period the original Benami Act was formulated, will find that there is no escape route if they are identified, for not only will they will have to forego property but their property will also be impounded by the government and, moreover, they will be liable to face imprisonment or penalty as the case may be.
The amendment to the Act states a change in the earlier penalty from 1 to 3 years and from 1 year rigorous imprisonment up to 7 years, and a fine which may extend to 25 percent of the fair market value of the benami property.
The district registrars and land record departments will dig out the names of benami property holders. “What this essentially means is that a lot of responsibility lies on the initiating officer for tracking a benamidar.
The real estate sector has lately been witnessing a series of corrective measures.
First, the Real Estate (Regulation and Development) Act, then the Land Acquisition Rehabilitation and Resettlement (Amendment) Bill 2015, now the Benami Transactions Act that are all aimed at making the sector more transparent and a professionalised one.
Through the crackdown on benami property, title risks, which hitherto undermined the buyers’ confidence, will be done away with. Also, the amendment will have a greater impact on benami transactions happening on a larger scale in agriculture land.
The government strategy now comes across clear; it is fortifying the banks with cash and aims at solving the problem of scarcity of land by taking strong action against benami property as soon as the monetisation drive gets over.
The benami property investigations may begin in January 2017, as soon as the Demonetisation process comes to an end eases the common man`s temporary cash crunch.
The Real Estate Market in major cities, where, scams have taken place, have seen huge investments in the property market, may feel the pinch and Bangalore may not be much affected as most of the properties are MORTGAGE OR PROPERTIES BOUGHT ON LOANS by techies.
Even, though, Bangalore may not lose its sheen, due to the nationwide effect of Demonetisation and subsequent investigation in the benami properties may affect the prices and the prices will be down. But, it is a matter of time, may be 3 months or 6 months or years. But, the effect will remain.
The Trump effect on the real estate market will be very severe, coupled with dmonetisation and investigation into benami properties.
Large quantities of properties will be thrown open for sale in the open market in and around Bangalore, the illegal, irregular, unauthorized, revenue and buildings with deviation and violation will FACE SEVERE PROBLEMS.
The buyers, as of now, are little alert about the illegal and unauthorized structures, will never, ever buy the illegal or deviated or violated or unauthorized homes or buildings.
SO, WATCH OUT. STAY ALERT.