Meaning of Benami Transaction

The Benami Transactions (Prohibition) Act, 1988

(9) “benami transaction” means,–
(A) a transaction or an arrangement-
(a)where a property is transferred to, or is held by, a person, and the consideration for such property has been provided, or paid by, another person; and
(b)the property is held for the immediate or future benefit, direct or indirect, of the person who has provided the consideration, except when the property is held by-

(i)a Karta, or a member of a HinduHindu A geographical name given by non-Hindus, who came to visit Bharatvarsha (Hindusthan). Sanatan Dharma is the actual Dharmic tradition of the Hindus. People who live in Hindusthan are Hindu, whether they Follow Islam, Chris, Buddha, Mahavira, or Nanaka. In this way, Tribals are also Hindu. undivided family, as the case may be, and the property is held for his benefit or benefit of other members in the family and the consideration for such property has been provided or paid out of the known sources of the Hindu undivided family;

(ii)a person standing in a fiduciary capacity for the benefit of another person towards whom he stands in such capacity and includes a trustee, executor, partner, director of a company, a depository or a participant as an agentAgent An agent is a person employed to do any act for another or to represent another in dealings with third persons. The person for whom such act is done, or who is so represented, is called the principal. Indian Contract Act of a depository under the Depositories Act, 1996 (22 of 1996) and any other person as may be notified by the Central Government for this purpose;

(iii)any person being an individual in the name of his spouse or in the name of any child of such individual and the consideration for such
property has been provided or paid out of the known sources of the individual;

(iv)any person in the name of his brother or sister or lineal ascendant or descendant, where the names of brother or sister or lineal ascendant or descendant and the individual appear as joint-owners in any document, and the consideration for such property has been provided or paid out of the known sources of the individual; or

(B)a transaction or an arrangement in respect of a property carried out or made in a fictitious name; or
(C)a transaction or an arrangement in respect of a property where the owner of the property is not aware of, or, denies knowledge of, such ownership;
(D)a transaction or an arrangement in respect of a property where the person providing the consideration is not traceable or is fictitious;

Explanation.-For the removal of doubts, it is hereby declared that benami transaction shall not include any transaction involving the allowing of possession of any property to be taken or retained in part performance of a contractContract An agreement enforceable by law is a contract. All agreements are contracts if they are made by the free consent of parties competent to contract, for a lawful consideration and with a lawful object, and are not hereby expressly declared to be void. Indian Contract Act. referred to in section 53A of the Transfer of Property Act, 1882 (4 of 1882), if, under any law for the timeTime Where any expression of it occurs in any Rules, or any judgment, order or direction, and whenever the doing or not doing of anything at a certain time of the day or night or during a certain part of the day or night has an effect in law, that time is, unless it is otherwise specifically stated, held to be standard time as used in a particular country or state. (In Physics, time and Space never exist actually-“quantum entanglement”) being in force,-

(i)consideration for such property has been provided by the person to whom possession of property has been allowed but the person who has granted possession thereof continues to hold ownership of such property;
(ii)stamp duty on such transaction or arrangement has been paid; and
(iii)the contract has been registered.