Big blow to benami property holders: IT watch tightens on high-value deals in Karnataka

In a major move to crack down on benami transactions and bring greater transparency in property dealings, the Karnataka Department of Stamps and Registration has announced strict new compliance rules for high-value real estate purchases. The department has invoked the Income Tax (IT) Act to ensure all property purchases worth Rs 30 lakh or more are closely monitored by tax authorities.

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As per the latest directive issued by Inspector General of Registration and Commissioner of Stamps, KA Dayanand, buyers of properties valued at Rs 30 lakh or above must now submit complete transaction details, including their PAN (Permanent Account Number), to the IT Department. Failure to provide the required information will result in the property not being registered by the Stamps and Registration Department.

To streamline this process, a separate declaration format has been introduced by the department, mandating buyers to furnish necessary documentation during registration. This form is expected to act as a key tool for the IT Department in identifying suspicious or benami transactions.

This step is seen as a coordinated effort between the state’s registration department and the central Income Tax Department to tighten the noose around illegal or undisclosed property dealings. The move not only targets tax evasion but also supports efforts to detect shell ownership and undisclosed income.

Officials believe the new system will significantly reduce benami transactions and promote lawful property ownership, ensuring greater accountability across the state’s real estate sector.