Section 7 of the Benami Act: Adjudicating Authority
Section 7 of the Prohibition of Benami Property Transactions Act, 1988 identifies the authority that acts as the Adjudicating Authority under the Act. The provision was substantially changed in 2021 and the earlier 2016 wording is no longer the current law.
Current-law update: With effect from 1 July 2021, Section 7 was substituted by the Finance Act, 2021. The present provision no longer states that the Central Government will appoint one or more Adjudicating Authorities. Instead, it designates the competent authority authorised under Section 5(1) of the Smugglers and Foreign Exchange Manipulators (Forfeiture of Property) Act, 1976 as the Adjudicating Authority for the Benami Act.
Current text and effect of Section 7
Section 7 - Adjudicating Authority: Under the current provision, the competent authority authorised under Section 5(1) of the Smugglers and Foreign Exchange Manipulators (Forfeiture of Property) Act, 1976 is the Adjudicating Authority for exercising the jurisdiction, powers and authority conferred by or under the Prohibition of Benami Property Transactions Act, 1988.
The statutory definition in Section 2(1) of the Benami Act also refers to the Adjudicating Authority mentioned in Section 7. The authority forms part of the statutory machinery for determining whether property alleged to be involved in a benami transaction is liable to be treated in accordance with the Act.
What does the Adjudicating Authority do?
The Adjudicating Authority is a statutory authority operating within the Benami Act framework. Its role must be read together with the provisions dealing with attachment, adjudication and confiscation, particularly Sections 24 to 27.
- Section 24 deals with notice and attachment of property alleged to be involved in a benami transaction.
- Section 26 deals with adjudication of benami property after a reference is received under the statutory procedure.
- Section 27 deals with confiscation and vesting of benami property after an adjudication order, subject to the Act.
- Section 18 identifies the authorities under the Act, including the Initiating Officer, Approving Authority, Administrator and Adjudicating Authority.
How Section 7 changed after the Finance Act, 2021
The 2016 amendment had provided for one or more Adjudicating Authorities to be appointed by the Central Government. That institutional structure was later changed by the Finance Act, 2021. From 1 July 2021, the competent authority under Section 5(1) of SAFEMA, 1976 became the Adjudicating Authority under the Benami Act.
As part of the same restructuring, Sections 8 to 17 of the Benami Act, which had dealt with the composition, qualifications, benches, procedure, tenure and staffing of the earlier Adjudicating Authority structure, were omitted with effect from 1 July 2021.
Why this matters: A page describing Section 7 only in the language introduced in 2016 is now incomplete and outdated. For present-day reference, Section 7 must be read in its post-1 July 2021 form.
Official statutory source
For the latest consolidated text, refer to the Prohibition of Benami Property Transactions Act, 1988 on India Code. The official text records the substitution of Section 7 by the Finance Act, 2021 with effect from 1 July 2021.
Frequently asked questions
What is the Adjudicating Authority under Section 7?
Under the current law, it is the competent authority authorised under Section 5(1) of the Smugglers and Foreign Exchange Manipulators (Forfeiture of Property) Act, 1976, which exercises the jurisdiction, powers and authority assigned to the Adjudicating Authority under the Benami Act.
Does the Central Government still appoint one or more Adjudicating Authorities under Section 7?
Not under the current wording of Section 7. That was the earlier formulation introduced in 2016. The provision was substituted with effect from 1 July 2021.
Are Sections 8 to 17 still in force?
No. Sections 8 to 17 were omitted by the Finance Act, 2021 with effect from 1 July 2021.
This page is a general legal information resource. For a specific proceeding, notice, attachment or adjudication under the Benami Act, the current statute, applicable rules, notifications and case law should be examined in the context of the facts.