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Benami Law applies to ongoing Ownership, even if the Transaction occurred before 2017 --- Islamabad High Court, Islamabad

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Benami Law applies to ongoing Ownership, even if the Transaction occurred before 2017 --- Islamabad High Court, Islamabad

Islamabad 22-03-2025: The Islamabad High Court (IHC) has dismissed [Writ Petition No. 901 of 2023], challenging a show-cause notice issued under Section 22(2) of the Benami Transactions (Prohibition) Act, 2017. The notice, issued by the Deputy Commissioner Inland Revenue, Benami Zone-I, alleged that House No. 286, Sumbal Road, F-10/4, Islamabad, was a benami property held by the Petitioner.

The case originates from a 1999 transaction in which the Petitioner purchased the disputed property from Respondent No. 2 through a General Power of Attorney (GPA). The same year, NAB arrested the Petitioner, accusing him of acquiring assets beyond known sources of income. After a conviction in 2001, he was later acquitted by the Lahore High Court in 2015, a decision upheld by the Supreme Court in 2019.

Despite this, the Benami Zone-I of the Inland Revenue Department issued a notice in 2022, citing the Benami Transactions (Prohibition) Act, 2017, and questioning the legitimacy of the property ownership. The Petitioner argued that the Benami Act cannot be applied retrospectively, and that the new notice violated constitutional protections against double jeopardy under Article 13(a) of the Constitution.

In its ruling, the Islamabad High Court (IHC) rejected the petition, concluding:

Double jeopardy does not apply, as the Benami Act and NAB Ordinance cover different legal grounds. (PLD 2024 SC 795)
Benami law applies to ongoing ownership, even if the transaction occurred before 2017. (Section 2(8) of the Benami Act, 2017)
Writ Petitions against show-cause notices are not maintainable, as the Petitioner had an alternative remedy before the Adjudicating Authority. (2022 SCMR 842, 2016 SCMR 842)
Benami laws override other laws, including the NAB Ordinance. (PLD 2022 ISB 371)

This ruling reinforces the broad scope of the Benami Transactions Act, 2017, and clarifies that even older property transactions can be scrutinized under the Act if the beneficial ownership remains unchanged. It also limits judicial intervention in administrative matters, emphasizing that Writ Petitions should not bypass statutory remedies.