Hello,
No, it won't create any problem or make the property Benami, since the individual(proprietor) and proprietorship firm is considered as one.
I hope that this answer satisfies your requirements.
Regards,
CA Hunny Badlani
Benami
Iam having a propitorship business keshav advertisers.. whose propitor is me name pardeep kumar.. I have a current account in the firm name keshav advertiser.. my question is that last year i bought a house that is personal house for my use.. the consideration of which i paid through my current account ..would the property be consider as benami or some other problem will occur for me in future bcz the current account is in the name of my firm kesahv advertiser whose propitor is me... so would it create any problem bcz the cheque no mentioned in deed is of my firm current account .. ?
Asked 5 years ago in Income Tax
Dear Sir,
When a person buys a property with his own money but in the name of of another person without any intention to benefit such other person, the transaction is called Benami and the property is called Benami Property.
In your case, it would not be considered as benami property.
Hello Mr. Pardeep Kumar,
According to the details provided by you, there is no such provisions in the Benami Act who applicable on your transaction and consider your property as benami.
Moreover for your better understanding - any individual and its proprietorship firm are considered to be single entity, accordingly anything purchased by you through your current account will belongs to you because proprietorship firm is not considered as separate entity so cant hold any property in its name.
Thanks and Regards
Divya Chugh
No its not benami as you the payment is made by a individual from his proprietary firm. In proprietary business both persons are same so this question never arises.
Hope you find the information helpful if you do please rate it 5 and provide your valuable feedback for my improvement.
Thank you.
Benami transaction means payment made by one person on behalf of other person and enjoys the benefits out of such property. In your case, sole proprietorship and individual is considered as same person. Only for business point of view both are considered separately therefore payment made by you from current account does not make the transaction benami.
No. It will not create any issue. Show the amount as personal drawings
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