PTI govt moves to unearth benami assets

Published: October 24, 2019
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Representational image. PHOTO: REUTERS

Representational image. PHOTO: REUTERS

ISLAMABAD: In a bid to tighten the noose around those who have accumulated wealth through illegal means, the federal cabinet has approved enlisting anti-corruption agencies as whistle-blowers for purpose of unearthing Benami properties.

The federal cabinet on Tuesday approved issuing the Benami Transaction (Prohibition) (Amendment) Ordinance 2019 aimed at expanding the definition of a whistle-blower.

Against the existing definition of a person, the cabinet approved including an entity and agency as a whistle-blower for the purpose of the Benami law.

The information obtained during the investigation by the National Accountability Bureau and the Federal Investigation Agency can now be used as a legal source of information for the purpose of tracing and identifying the real owners of Benami properties.

The Benami properties are the ones that the real owners have retained on somebody else’s name either to hide the source of income or evade taxes.

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After the cabinet’s approval, President Arif Alvi is now expected to promulgate the Ordinance any time before the commencement of the Senate session.

An ordinance is an ad-hoc mode of legislation that has a life of only four months and can be further extended for only once for another four months.

The government has also decided to amend the Benami Transaction rules to make rewards for whistle-blowers more attractive.

Against the current reward money that is linked with the income tax-related reward money, it has now been decided to give a percentage of the recovered taxes to the whistle-blower, said the sources.

They said that the summary has already been moved to the federal cabinet to amend the Benami rules.

However, the PTI government’s focus so far remains to make the laws stringent as it, like its predecessor, remains unable to effectively and impartially apply the laws.

The government has extended the period of provisional attachment of properties allegedly owned by bigwigs of the PML-N and PPP after its investigators failed to make any headway in filing the references against accused persons within statutory deadlines, sources told The Express Tribune.

The first provisional attachment period ended on October 1, 2019.

On July 2, the Federal Board of Revenue had provisionally attached properties worth billions of rupees for a period of three months allegedly owned by the PML-N’s Senator Chaudhry Tanveer and the Omni Group.

Under the Benami law of 2017, initiating officers were bound to file reference against those persons and companies within two months. Both the deadlines of provisional attachment and filing of references have expired.

The FBR has extended the attachment period of the properties and references are now expected to be filed now within a month, according to the sources in the FBR.

At the three-month expiry date of provisional attachment, the initiating officer has two options, “pass an order continuing the provisional attachment of the property with prior approval of the approving authority, till the passing of the order made by the adjudicating authority under Sub-section 3 of Section 24 or revoke the provisional attachment of the property with prior approval of the approving authority, stated the 2017 Benami law.

So far, the PTI government’s drive against benami asset holders has been severely hampered due to a lack of human and financial resources.

As of the end of last month, the FBR could submit just one reference within the two-month statutory deadline in the two politically high-profile cases.

Section 22(3) of the Benami law states “the initiating officer can provisionally attach the property for three months from the date the show-cause notice is issued”.

Benami Ordinance

The Benami Transaction (Prohibition) (Amendment) Ordinance is among eight ordinances that the federal cabinet had approved on Tuesday.

Due to its minority in the Senate, the PTI government is not able to make laws through parliament.

An ordinance is promulgated by bypassing parliament, although eventually, an ordinance has to be laid before parliament within the maximum limit of eight months to give it a permanent legal cover.

The cabinet approved to amend Section 2 of the original 2017 Benami law through the ordinance to expand the definition of a whistle-blower.

The new definition states, the whistle-blower includes a person, entity, or an agency who files a complaint under any law for the time being in force or otherwise gives information under this act, with regard to the existence of any property held as benami in relation to the commission of offences:

Of corruption and corrupt practices under the National Accountability Bureau Ordinance 1999, of a scheduled offence under the Federal Investigation Agency Act 1974, under the Anti-Money Laundering Act 2010, under the Securities Act 2015 in relation to public listed companies and cognizable under the Federal and Provincial anti-corruption laws.

An amendment has also been made in Section 62 of the Benami Transactions Prohibition Act of 2017 to delete the existing definition that is “whistle-blower means a person who reports any property held benami to the board”.

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