Property Purchased in Wife’s Name Isn’t Automatically a Benami Transaction

Legal Standpoint

Under the Benami Transactions (Prohibition) Act, 1988, a benami property is one where a person purchases an asset in another’s name but has no intention of gifting it. However, an exception exists when a husband purchases a property in his wife’s name as a natural arrangement.

Court’s Decision

The court ruled that merely purchasing property in the wife’s name does not automatically make it benami. Since Rajesh and Anjali lived in the property together, and there was no evidence of a fraudulent intent, the claim was dismissed. The property legally remained in Mrs. Anjali’s name.

Key Takeaway

Ownership of property depends on intent. Transactions between spouses are not considered benami unless there is clear proof of wrongdoing.