By S&S Co. Advocates & Solicitors · Published 18 March 2026 · Informational content, not legal advice
About this article: A general explainer prepared by S&S Co. Advocates & Solicitors on a recurring type of dispute. It does not report a specific judgment or order, names no parties and gives no case citation, so it should not be cited as authority. Law and practice change; please verify against the current statute and primary sources before relying on it.
A benami transaction is one in which property is held by one person while the consideration is paid by, and the benefit intended for, another. The Benami Transactions (Prohibition) Act, 1988, substantially amended in 2016, prohibits such transactions and provides for confiscation of benami property.
Section 4 bars any suit, claim or action by or on behalf of a person claiming to be the real owner to enforce a right in respect of benami property against the person in whose name it is held, or against anyone else. The Supreme Court has repeatedly emphasised that this bar is strict, and that proving that the real owner supplied the money does not by itself overcome it.
The statute recognises limited exceptions, mainly property held by a coparcener in a Hindu Undivided Family for the benefit of the other coparceners, and property held by a trustee, executor, partner or other person in a fiduciary capacity for the person to whom the duty is owed. Courts read these exceptions narrowly, and the party relying on one must show that its conditions are met. The 2016 amendments also changed the operation of the Act for transactions before and after its commencement, so the date of the transaction matters.