Benami Transactions Informants Reward Scheme

A reward scheme was introduced by the Board for informants who give information pertaining to Benami property which is actionable under Prohibition of Benami Property Transactions Act, 1988, further amended by Benami Transactions (Prohibition) Amendment Act, 2016. 

Introduction: What is Benami Transactions Informants Reward Scheme?

The Benami Transactions Informants Reward Scheme, 2018 has been introduced for the purpose of regulating the grant and payment of rewards to an informant. A person who can provide any specific information pertaining to Benami property can get rewards up to Rs. One crore. The identity of an informant is kept confidential.

According to the Prohibition of Benami Property Transactions Act, 1988, which was amended by Benami Transactions (Prohibition) Amendment Act, 2016 (referred to “the Act” for brevity), if a person acquires any kind of property in the name of a benamidar (a person who is not his close family member or in fiduciary capacity), the property is liable to be attached and confiscated and all the individuals involved in these Benami transactions will be liable to prosecution which includes imprisonment for about seven years. 

Who is known as an ‘Informant’?

With reference to this Scheme, an informant is a person, which would include either an individual or a group of people, who have provided specific information regarding movable or immovable Benami property(ies), wherein the fair market value of the property is worth more than one crore.  The person or group of individuals have to provide the information in the form that has been prescribed in Annexure-A of this scheme. 

They must also have received the ‘Informant Code’ from the respective authority. No reward will be offered to any person under the scheme if in case he isn’t an informant as per the scheme, if he has provided specific information regarding the Benami property in other ways like letter, CD, e-mail, phone, WhatsApp, SMS, phone, posting on social media or publishing in newspapers, etc.

The identity of the informant, the information shared, as well as the reward paid,  will be discreet and will not be disclosed unless required by the law or by order of the court of law. 

Information on Benami Property:

The specific information provided by an informant is treated as “specific information” only if it has verified details of the Benami property. It should also have the name and address of the individual under whose name the property is acquired. The information should be backed by supporting evidence indicating that the property is Benami.

The procedure of furnishing information: 

If any individual has information on Benami property and wishes to submit the information in the expectation of a reward, he can contact the Joint Commissioner of Income TaxiAdditional Commissioner of Income Tax (Benami Prohibition)[JCsIT/Addl. CsIT (BP)]who has jurisdiction over the area where the Benami property is located. One can obtain the list of JCsIT/Addl. CsIT (BP) having authority over various areas in Notification No. 40/20171F. No.173/42912016-ITA-I dated 18.5.2017 which has been issued by the CBDT. 

If their many Benami properties situated at different locations, the informant can provide the information to any of the JCsIT/Addl. CsIT (BP) who is having authority over any of those properties. In case the informant shares the information on Benami properties to any other Income Tax Official, such other authority has to forward the information and guide the informant to the jurisdictional JCIT/Addl. CIT (BP). 

If the information is being provided by a group of individuals, then the prescribed form, the statements, etc., has to be filled and signed by all the people, jointly and the Informant code will be provided to each of them individually. In such scenarios, the reward payable, if any, will be distributed in equal proportion, unless it has been specified otherwise by these people at the time of providing the information in the required format (Annexure -A). 

If a foreign person wishes to provide information regarding any Benami property which is actionable under the Act, he might contact the Member (Investigation), CBDT, North Block, New Delhi-l l000I either by a person or by communicating via email ([email protected] with a copy to citinv-cbdt®nic.in) or by post. He can also seek the assistance of Income Tax Overseas Units (ITOU) that work in Indian missions in a few foreign countries in this area. 

An individual can provide information regarding many Benami properties on one or multiple occasions, however, the prescribed form in Annexure-A has to be filled and signed individually on every occasion. One form can be used for many properties only if the properties have the same beneficial owner or Benamidar. However, the informant will be provided with just one Informant Code and the reward will be computed depending on the entitlement individually for every single Benami property. Additionally, if an individual wants to be rewarded for the information under this Scheme as well as the Income Tax Informants Reward Scheme, 2018, on the basis of the same facts, he will have to provide the same information separately in accordance with both the Schemes. 

When the reward will be granted and timelines of the grant?

Under the Scheme, an informant can be provided interim and the final reward only the competent authority. The interim reward will be granted if the informant has provided the specific information pertaining to the Benami property in the format prescribed in Annexure-A and has received an Informant code as well. 

The informant also must have offered assistance if required by the Addl.lJCIT (BP) or any other investigating officer to whom the JCITIAddl. CIT (BP) concerned might have assigned the investigation regarding the information provided by the informant. Pursuant to this information, the Benami property should be provisionally attached u/s Section 24(4) of the Act. 

The final reward will be granted only if certain conditions have been fulfilled:

(a) the informant has provided specific information regarding the Benami property in the format that has been prescribed in Annexure-A and has received the informant code under the scheme

(b) The informant has offered assistance if required by the Addl.lJCIT (BP) or any investigating officer to whom the JCIT/Addl. CIT (BP) concerned has assigned the investigation 

(c) the Benami property should be confiscated under Section 27 of the Act, and

(d) The confiscation of the property has become final in the judicial proceedings post the confiscation order has been passed. The confiscation will be deemed final if, from the confiscation date, two years have passed and there are no litigations pending against the confiscation.

Timelines for the grant of interim and final reward

(i) Interim reward will be granted within 4 months of actual provisional attachment of the Benami property u/s 24(4)of the Act; and 

(ii) final reward will be granted within 6 months of the confiscation order of the Benami property becoming final. The confiscation will be deemed final if, from the date of confiscation, two years have passed without any pending litigation against the confiscation.