Benami Transactions Act not to apply on past transactions, amnesty scheme: FAT

ISLAMABAD: Federal Appellate Tribunal, Special Bench Karachi has declared that the Benami Transactions (Prohibition) Act, 2017 would not be applicable on benami properties created out of past transactions as well as properties declared under the amnesty scheme.

In this regard, the two-member bench of Federal Appellate Tribunal, Special Bench Karachi has issued a detailed order against the Benami Adjudication Authority Karachi.

The case is related to the alleged benami property transactions being carried out by a developer and builder of Karachi.

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Federal Appellate Tribunal, Special Bench Karachi has further ruled that a Benami Property can be confiscated only in case it is subject matter of a benami transaction after the enactment of the BTPA 2017 for its violation and does not apply to the transactions executed before the promulgation of the BTPA 2017 therefore we hold that the provisions of the Benami (Prohibition) Act, 2017 are not applicable upon the alleged property created out of the transactions executed before the BTPA.

There is no mechanism and procedure for confiscation of property held benami, which is outcome of a transaction executed before the promulgation of the Benami Act, 2017 when such transactions were not prohibited, the tribunal declared.

Tribunal also hold that the Benami Transactions (Prohibition) Act, 2017 is also not applicable upon the property declared under the Asset Declaration Ordinance, 2019 (the Amnesty Scheme).

Tribunal also declared that the Transactions (Prohibition) Act, 2017 is not applicable upon the benami properties created out of the past transaction as well as declared under the Amnesty Scheme, therefore there is no need to evaluate the facts and evidences evaluated by the Respondents (departments) in the light of the grounds raised by the Appellants as to the determination of the benami property, the benamidar, the beneficial owners and the of the proceedings as per the provisions of the BTPA 2017.

Further, the issue before this Tribunal was only with respect to the Adjudication Order confirming confiscation of the alleged benami property, which is held to be not sustainable under law.

In conclusion, this Tribunal finds that the Initiating Officer as well as Benami Adjudicating Authority exceeded its jurisdictional capacity by applying the law retrospectively to transactions dating prior to the ACT, which have since become past and closed transactions and vested right has accrued in respect of the beneficial owners who so ever that may be as determined in accordance with their civil rights.

Federal Appellate Tribunal also do not agree with the Adjudication Order confirming the confiscation of the alleged benami property. It is held that the reference and related proceedings of Attachment/confiscation of the subject property suffered basic lacunas as discussed supra and the said reference before the Benami Transaction Adjudicating Authority is held not sustainable under the law, the tribunal added.

Federal Appellate Tribunal, Special Bench Karachi has also set-aside the orders of the adjudication authorities and attachment orders of the involved properties.

Copyright Business Recorder, 2025