If a person is building a property by accumulating black money, then how can a complaint be made about it?

If you suspect that someone is constructing a property using black money (i.e., unaccounted or untaxed income), there are clear legal avenues in India for making a complaint. Let me walk you through the process, relevant laws, and practical steps, along with some context from case law and statutory provisions.

Legal Overview:

In India, the use of black money for property transactions is a serious offence, attracting the attention of both tax authorities and law enforcement agencies. The primary statutes governing such matters are:

1. The Income Tax Act, 1961

2. The Prevention of Money Laundering Act, 2002 (PMLA)

3. The Benami Transactions (Prohibition) Act, 1988 (as amended in 2016)

4. The Indian Penal Code, 1860 (for offences like cheating, forgery, and fraud)

How to Make a Complaint:

Income Tax Department:

The most direct way is to file a complaint with the Income Tax Department. The department has a dedicated mechanism for reporting tax evasion and black money. You can do this:

Online via the Income Tax Department’s e-filing portal

By writing to the local Income Tax Investigation Wing or the Directorate of Income Tax (Investigation) in your city

You may file the complaint anonymously, but providing your details can help if follow-up is needed.

Enforcement Directorate (ED):

If you believe the funds are linked to money laundering, you can approach the Enforcement Directorate under the Prevention of Money Laundering Act, 2002. The ED investigates and prosecutes offences involving proceeds of crime, including those related to black money.

Benami Prohibition Unit:

If the property is suspected to be held in someone else’s name (benami), you can report it to the Benami Prohibition Unit, which operates under the Income Tax Department. The Benami Transactions (Prohibition) Act, 1988 (as amended) empowers authorities to seize such properties.

Local Police or Anti-Corruption Bureau:

If there is an element of criminality—such as forgery, cheating, or corruption (especially if a public servant is involved)—you can file a complaint with the local police under relevant sections of the Indian Penal Code, 1860 (for example, Sections 420 for cheating, 468/471 for forgery).

Relevant Legal Provisions and Case Law:

Income Tax Act, 1961:

Section 132 empowers authorities to conduct search and seizure operations if they suspect tax evasion or possession of undisclosed income/assets.

Prevention of Money Laundering Act, 2002:

Section 3 defines the offence of money laundering, and Section 4 prescribes punishment. The ED can attach and confiscate properties involved in money laundering.

Benami Transactions (Prohibition) Act, 1988 (as amended):

Section 2(9) defines a benami transaction, and Sections 24-27 provide for attachment and confiscation of benami properties.

Indian Penal Code, 1860:

Sections 420 (cheating), 406 (criminal breach of trust), and 468/471 (forgery and use of forged documents) may be invoked if there is evidence of fraud or deception.

Judicial Precedents:

While there are no Supreme Court cases directly on the process of complaining about black money in property construction, courts have repeatedly upheld the right of authorities to investigate and confiscate properties acquired through illegal means. For example, in Kartar Singh v. State of Punjab [(1994) 3 SCC 569], the Supreme Court emphasized the importance of stringent action against economic offences, including those involving black money.

Similarly, in Union of India v. Hassan Ali Khan [(2011) 10 SCC 235], the Supreme Court recognized the gravity of black money and the need for effective investigation and prosecution.

Practical Advice:

Gather Evidence:

Before making a complaint, try to collect as much information as possible—such as the address of the property, details of the person involved, and any suspicious transactions or activities you have observed.

Anonymity and Protection:

You can file complaints anonymously, but providing your identity may help authorities seek clarifications. Whistleblower protection is available in some cases, especially if you are a government servant.

Follow Up:

After filing a complaint, you can follow up with the relevant authority to check on the status of your case. However, investigations into black money are confidential, and you may not always receive detailed updates.

No Direct Civil Remedy:

As a private citizen, you cannot directly file a civil suit to challenge the use of black money in someone else’s property unless you have a direct legal interest (e.g., you were defrauded in a transaction). The remedy is primarily through reporting to authorities.

In Summary:

If you have credible information that someone is constructing a property using black money, you should report it to the Income Tax Department, Enforcement Directorate, or the Benami Prohibition Unit, depending on the nature of the offence. The authorities are empowered under various statutes to investigate, attach, and confiscate properties acquired through illegal means. While you may not have a direct civil remedy unless you are personally affected, your complaint can trigger a formal investigation and possible prosecution.

If you need help drafting a complaint or identifying the correct authority in your area, feel free to ask for more specific guidance.

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Disclaimer: All opinions and views are personal.

Best wishes,

Advocate Rajeev K Jha

Contact Us | Technical & Environmental due diligence || Sarve Permits

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