Benami Transactions (Prohibition) Act - A Study in Comparison
Benami Transactions (Prohibition) Amendment Act, 2016 covers comprehensively all aspects of transactions or arrangements where the source of funding for acquisition of a benami property has no permissible links to the ownership structure. The article in this issue of Corporate Amicus highlights amendments like inclusion of ‘arrangements’ in the definition of ‘benami transactions’, relaxations to certain type of transactions and new concepts like ‘benami property’, ‘benamidar’, ‘beneficial owner’, ‘fair market value’ and ‘transfer’. Amendments including creation of several authorities, provision for opportunity to show cause, penal provisions, have also been deliberated. According to the authors the Amendment Act, passed in the midst of growing public sentiments against corruption, would effectively curb purchase of unaccounted property in India.
Notifications & Circulars
- Mergers & Acquisitions provisions, covering sections on “Compromises, Arrangements and Amalgamations” and “winding up” under Companies Act, is effective from 15-12-2016.
- Companies (Transfer of Pending Proceedings) Rules, 2016 have been notified consequent to establishment of National Company Law Tribunal and National Company Law Appellate Tribunal.
- Insolvency and Bankruptcy Board of India (Liquidation Process) Regulations, 2016, providing for processes/procedures involved in liquidation of a corporate debtor till passing of a dissolution order, have been notified.
- Insolvency and Bankruptcy Board of India (Insolvency Resolution Process for Corporate Persons) Regulations, 2016, providing for eligibility criteria for appointment of insolvency professionals, have been notified.
- National Company Law Tribunal (Procedure for Reduction of Share Capital of Company) Rules, 2016, prescribing certain new forms, have been notified.
- National Company Law Tribunal (Amendment) Rules, 2016, which prescribe certain procedural changes, have been notified.
- Central legislation shall have precedence over State legislation – Supreme Court.
- SARFAESI Act applicable in the State of Jammu and Kashmir – Supreme Court.
- Foreign award cannot be enforced in the absence of arbitration agreement – Delhi High Court.