Karnataka High Court
Babu S/O Shivajiyappa Jorapur vs Nagesh S/O Govind Badamanji on 8 December, 2023
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NC: 2023:KHC-D:14418
RSA No. 100890 of 2023
IN THE HIGH COURT OF KARNATAKA
DHARWAD BENCH
DATED THIS THE 8TH DAY OF DECEMBER, 2023
BEFORE
THE HON'BLE MRS JUSTICE K.S.HEMALEKHA
RSA NO.100890 OF 2023 (DEC/INJ)
BETWEEN:
1. BABU S/O SHIVAJIYAPPA JORAPUR
AGE. 69 YRS, OCC. BUSINESS,
R/O. SHRI SIDDHESHWAR ROAD,
NEAR SIDDHESHWAR TEMPLE,
VIJAYPUR-413004.
2. PRAKASH S/O SHIVAJIYAPPA JORAPUR
AGE. 66 YEARS, OCC. AGRICULTURE,
R/O. NINGAPPA GALLI,
KHANAPUR, DIST. BELAGAVI-591302.
... APPELLANTS
(BY SRI. PRASHANT F.GOUDAR, ADVOCATE)
Digitally
signed by
VISHAL
VISHAL NINGAPPA
AND:
NINGAPPA PATTIHAL
PATTIHAL Date:
2023.12.21
15:06:43
+0530 1. NAGESH S/O GOVIND BADAMANJI
AGE. 87 YEARS, OCC. AGRICULTURE,
R/O. PLOT NO. 23, SECTOR NO. 12,
MM EXTENSION, MAHANTESH NAGAR,
BELAGAVI-590016.
2. SAYED S/O HASANSAB MODEENSAB
AGE. ABOUT 80 YEARS, OCC. AGRICULTURE,
R/O. MALI GALLI, BELAGAVI-590001.
... RESPONDENTS
(BY SRI. V.P. ALLANNAVAR, ADV. FOR RESPONDENT/ CAVEATOR)
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NC: 2023:KHC-D:14418
RSA No. 100890 of 2023
THIS REGULAR SECOND APPEAL IS FILED UNDER
SECTION 100 R/W ORDER XLI RULE 1 OF THE CODE OF CIVIL
PROCEDURE, 1908, AGAINST THE JUDGMENT AND DECREE
DATED 13.10.2023 PASSED IN R.A.NO.32/2022 ON THE FILE OF
THE VI ADDITIONAL DISTRICT AND SESSIONS JUDGE,
BELAGAVI, DISMISSING THE APPEAL AND CONFIRMING THE
JUDGMENT AND DECREE DATED 16.04.2022, PASSED IN O.S.
NO.18/2015 ON THE FILE OF THE PRINCIPAL SENIOR CIVIL
JUDGE AND CHIEF JUDICIAL MAGISTRATE, BELAGAVI, AT
BELAGAVI, DECREEING THE SUIT FILED FOR PARTITION AND
DECLARATION AND INJUNCTION.
THIS REGULAR SECOND APPEAL, COMING ON FOR
ADMISSION, THIS DAY, THE COURT DELIVERED THE
FOLLOWING:
JUDGMENT
1. The present regular second appeal by the defendants assailing the judgment and decree of the Courts below, whereby, the suit seeking for declaration and consequential relief of perpetual injunction restraining the defendants from interfering with the possession and enjoyment of the suit land and for declaration that the sale deed, dated 25.02.2010 is not binding on the plaintiff, came to be decreed.
2. The parties herein are referred to as per their ranking before the trial Court, for the sake of convenience. -3-
NC: 2023:KHC-D:14418 RSA No. 100890 of 2023
3. The plaintiff purchased the suit land under two registered sale deeds, dated 13.06.1973 and 31.03.1975 from Mehboobbeg, Bashirahmed and Sahebjaan sons of Sardarbeg Zamadar to the extent of 3/8th share and from Mohammed son of Zafrullah Khan Noorullah Khan Hanafi to the extent of 5/8th share. The sale consideration is Rs.3,000/- and Rs.10,000/- respectively in both sale deeds. It is averred that the sale consideration amount was paid by the plaintiff, however, the sale deeds were executed in the name of Dhanaji, S/o Nemanna Tahsildar, father-in-law
- maternal uncle of the plaintiff and accordingly, M.E. No.6128 & M.E. No.6793 were mutated in the revenue records.
4. It is further averred that since the date of purchase, the plaintiff is in possession and has developed the lands and growing crops therein. It is further stated that Dhanaji son of Nemanna Tahsildar died and the names of his legal representatives came to be mutated in the revenue records. Further, when the legal representatives of -4- NC: 2023:KHC-D:14418 RSA No. 100890 of 2023 Dhanaji, S/o Nemanna Tahsildar started interfering with peaceful possession of the plaintiff, the plaintiff instituted suit in O.S. No.187/1985 against the legal representatives of deceased Dhanaji for the relief of declaration and permanent injunction and the suit came to be decreed on 30.08.1985 and the plaintiff was declared as the real owner and Dhanaji was declared as a benamidar and the legal heirs were restrained by way of permanent injunction. Pursuant to the decree drawn in O.S.No.187/1985, M.E. No.2674 was effected on 14.10.1985 entering the name of the plaintiff in the revenue records. It is further stated that defendant No.1 tried to enter his name in the revenue records in respect of the suit land during the year 2009-10 and the mutation entry effected in the name of the plaintiff was sought to be challenged before the revenue authorities. The revenue authorities, subsequently, without notice to the plaintiff appears to have entered the name of defendant Nos.2 and 3 by deleting the name of the plaintiff from the revenue records. The appeal preferred before the Assistant Commissioner, Belagavi is pending consideration. It is -5- NC: 2023:KHC-D:14418 RSA No. 100890 of 2023 further stated that the sale deed, dated 25.02.2010, executed by defendant No.1 in favour of defendant Nos.2 and 3 is not binding upon the plaintiff's legal right.
5. Pursuant to the suit summons issued by the trial Court, the defendants tendered their appearance and filed their written statement, inter alia, contending and denying that the plaintiff is the absolute owner of the suit land pursuant to the registered sale deeds and denied about the filing of the earlier suit. The defendants also contended that the suit of the plaintiff is not maintainable both in the eye of law and facts and the relief claimed by the plaintiff is not tenable as the suit of the plaintiff is hopelessly barred by time. It is further stated that the suit of the plaintiff does not come within the purview of the trial Court and the suit of the plaintiff needs to be dismissed.
6. The trial Court, on the basis of the pleadings, framed the following issues:
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NC: 2023:KHC-D:14418 RSA No. 100890 of 2023 (1) "Whether the plaintiff proves that, suit property was originally belonging to Memaboob Beig Jamadar and four others?
(2) Whether the plaintiff proves that he has purchased 3/8th share through a registered sale deed dated 13.06.1972 and 5/8th share through a registered sale deed on 31.03.1975 in the suit property Benami in the name of his maternal uncle Dhanaj, from the previous owners?
(3) Whether the plaintiff can prove benami transaction of registered sale deed in favour of his father in law Maternal uncle Dhanaji? (4) Whether plaintiff proves that, in OS No. 187/1985 he has acquired title to the property by virtue of decree against the LRs of Benami holder?
(5) Whether defendant No.2 proves that,that defendants No.2 and 3 have purchased the property from its previous owner defendant No. 1 and they are the owners in possession of suit land?
(6) Whether the present suit is maintainable under the Benami transaction (Prohibition) Act? (7) Whether the suit filed is within the period of limitation?
(8) Whether the plaintiff is entitle to the relief sought for?"-7-
NC: 2023:KHC-D:14418 RSA No. 100890 of 2023
7. In order to substantiate his claim, the plaintiff got examined himself as PW.1 and got marked the documents at Exs.P1 to P23. On the other hand, one Arun S/o Jeevanna Kunchurkar got examined as DW.1 on behalf of the defendants and got marked documents at Exs.D1 to D51.
8. The trial Court, on the basis of pleadings, oral and documentary evidence arrived at a conclusion that:
(i) the plaintiff has proved that the suit land was originally belonging to Mehaboob Beig Jamadar and others;
(ii) the plaintiff has proved that he has purchased 3/8th share and 5/8th share from the original owners in the name of his maternal uncle on 13.06.1973 and 31.03.1975;
(iii) the plaintiff proved that the benami transaction of the registered sale deed is in favour of his father-in-law - maternal uncle Dhanaji;
(iv) the plaintiff has proved that in O.S.No.187/1985, he has acquired title of -8- NC: 2023:KHC-D:14418 RSA No. 100890 of 2023 the property by virtue of the decree against the legal heirs of benami holder; &
(v) the suit is maintainable and not hit by the Benami Transactions (Prohibition) Act, 1988 (for short "the Act");
By the judgment and decree held that the plaintiff is entitled for declaration and the plaintiff is owner in possession of the suit land and restrained the defendants by way of perpetual injunction from interfering with the possession and enjoyment of the suit land.
9. Aggrieved by the judgment and decree of the trial Court, the defendants preferred an appeal before the first appellate Court.
10. The first appellate Court, while re-appreciating the appeal preferred by defendant Nos.2 and 3 independently, arrived at a conclusion that the plaintiff has proved that he is the absolute owner of the suit land and concurred with the judgment and decree of the trial Court -9- NC: 2023:KHC-D:14418 RSA No. 100890 of 2023 and dismissed the appeal preferred by defendant Nos.2 and
3.
11. Aggrieved by which, the present regular second appeal by defendant Nos.2 and 3 against the concurrent findings of the Courts below.
12. Heard Shri Prashant F.Goudar, learned counsel appearing for the appellants and Shri V.P. Allannavar, learned counsel appearing for the respondents and perused the judgment and decree of the Courts below and materials placed before this Court.
13. The undisputed facts are that:
(i) the suit land was purchased by the plaintiff in the name of his father-in-law - maternal uncle namely, Dhanaji s/o of Nemanna Tahsildar by two registered sale deeds, dated 13.06.1973 - Ex.P6 and 31.03.1975
- Ex.P7;
(ii) the suit in O.S. No.187/1985 was filed by the plaintiff against the legal heirs of the benami holder i.e., Dhanaji son of
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NC: 2023:KHC-D:14418 RSA No. 100890 of 2023 Nemanna Tahsildar for declaration and permanent injunction;
(iii) the suit was decreed on 30.08.1985 Ex.P10 and the plaintiff was declared as real owner and Dhanaji, a benamidaar.
(iv) the M.E. No.2674 was registered on 14.10.1985 as per Ex.P11.
(v) the inter se arrangements between the family members of the plaintiff in O.S. No.269/1996 as per Ex.P21;
(vi) the suit land was held to be self acquired property of the plaintiff;
(vii) the name of defendant No.1 Syed son of Hasansab Modeensab was entered in the revenue records and the said Syed executed a sale deed on 25.02.2010 at Ex.D8 equivalent to Ex.P15 in the name of defendant Nos.2 and 3.
14. The plaintiff owns agricultural land known as the "suit land" acquired through legal transaction despite having a legal victory confirming their ownership, the plaintiff has faced challenges from the legal heirs of the
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NC: 2023:KHC-D:14418 RSA No. 100890 of 2023 former benami holder and the defendants, who allegedly created a fictitious deed of sale in the year 2010 to claim the suit land. Plaintiff contends that the defendants, through the collusion with the revenue officials, have entered their names in the revenue records and attempting for unlawful transaction. To protect their title and possession, the plaintiff filed suit seeking for declaration and permanent injunction against the defendants and claims ownership over the suit land.
15. The main contention of the appellants is that, Section 4(1) of the Act, 1988, prohibits the right to recover the property held benami and no suit, claim or action to enforce any right in respect of any property held benami against the person in whose name the property is held or against any other person shall lie by or on behalf of the persons claiming to be a real owner of the suit land and the suit of the plaintiff ought to have been dismissed by the trial Court at the threshold. Learned counsel would contend that the suit in O.S.No.187/1985, wherein the legal heirs of
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NC: 2023:KHC-D:14418 RSA No. 100890 of 2023 Dhanaji S/o Nemanna Tahsildar conceded the title of the plaintiff in a compromise, is not the rights of the plaintiff that have been established in the Court of law and the Courts below were not justified in holding that the appellants - defendant Nos.2 and 3 cannot question the same.
16. Learned counsel would contend that the plaintiff has not impleaded the necessary parties to establish the benami transaction and would contend that the burden of proving the benami transaction lies upon the persons claiming it with the assistance of guiding factor such as, source of purchase money, nature of possession, motive for benami transaction, custody of title, conduct of parties and in the instant case, there being no pleadings or evidence to establish the existence of benami transaction in favour of the plaintiff. The only evidence presented by the plaintiff is the collusive decree, which was admittedly inadmissible against the present appellants and would contend that the plaintiff has failed to establish the benami transaction. In
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NC: 2023:KHC-D:14418 RSA No. 100890 of 2023 support of his contention, learned counsel places reliance upon the decision of the Apex Court in the case of Valliammal (D) by L.Rs. Vs. Subramaniam and others1 [Valliammal]
17. Per contra, learned counsel appearing for the respondent would justify the judgment and decree of the Courts below and would contend that the Courts below have rightly held that the suit of the plaintiff is not hit by Section 4 of the Act, 1988 since the transaction is prior to the Act, 1988 came into force. The right of the plaintiff has been declared at an undisputed point of time in the year 1985 itself and the defendants cannot question the transaction between the plaintiff, the real owner and the benami holder, namely, Dhanaji S/o Nemanna Tahsildar. In support of his contention, learned counsel has placed reliance on the following decisions of the Apex Court:
(i) Samitrri Devi and another vs. Sampuran Singh and another2 [Samitrri Devi].1
(2004) 7 SCC 233 2 AIR 2011 SC 773
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NC: 2023:KHC-D:14418 RSA No. 100890 of 2023
(ii) R.Rajagopal Reddy (dead) by L.Rs. and others vs. Padmini Chandrasekharan (dead) by L.Rs.3[R.Rajagopal Reddy].
18. This Court has carefully considered the rival contentions urged by the learned counsel appearing for the parties and perused the judgment and decree of the trial Court.
19. In order to answer the contention raised by the learned counsel appearing for the parties, the relevant provisions of the Act, 1988 needs to be considered. Section 4 of the Act, 1988 reads as under:
"4. Prohibition of the right to recover property held benami.- (1) No suit, claim or action to enforce any right in respect of any property held benami against the person in whose name the property is held or against any other person shall lie by or on behalf of a person claiming to be the real owner of such property.
(2) No defence based on any right in respect of any property held benami, whether against the person in whose name the property is held or 3 AIR 1996 SC 238
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NC: 2023:KHC-D:14418 RSA No. 100890 of 2023 against any other person, shall be allowed in any suit, claim or action by or on behalf of a person claiming to be the real owner of such property.
(3) Nothing in this section shall apply,-
(a) where the person in whose name the property is held is a coparcener in a Hindu undivided family and the property is held for the benefit of the coparceners in the family; or
(b) where the person in whose name the property is held is a trustee or other person standing in a fiduciary capacity, and the property is held for the benefit of another person for whom he is a trustee or towards whom he stands in such capacity."
20. Sub-sections (1) & (2) of Section 4 states that no suit, claim or action to enforce any right in respect of any property held benami against the person in whose name the property is held or against any other person shall lie by or on behalf of a person claiming to be the real owner of the suit property.
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NC: 2023:KHC-D:14418 RSA No. 100890 of 2023
21. Section 82 of the Indian Trust Act was in force prior to coming into force of the Act, 1988. Section 82 of the Indian Trust Act, which comes almost for a period of century or more, legal right to the real owner to claim against the purported owner, that the consideration was by the real owner and the transferee held the property for the benefit of the person paying the consideration for supporting the transaction. The facts are very relevant to be considered in the present scenario, the plaintiff seeks his right against one Dhanaji S/o Nemanna Tahsildar contending that the plaintiff has purchased the suit land by paying consideration, however, in the name of Dhanaji, father-in-law-maternal uncle of the plaintiff way back in the year 1973-74.
22. There is a presumption in law that the person who purchases the property is the owner, the presumption can be displaced by successfully placing and proving that the document was taken benami in the name of another person for some reason and the person whose name
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NC: 2023:KHC-D:14418 RSA No. 100890 of 2023 appears in the document is not the real owner, but only a benami. Heavy burden lies on the person, who pleads that the recorded owner is a Benami holder and against whom it has to be established that he is the person in whose name the property is purchased and not against any third person. When a dispute was raised by the legal heirs of Dhanaji, a suit was instituted in O.S.No.187/1985 for declaration and permanent injunction and the said suit came to be decreed. The relevant aspect that needs to be considered is that, in the said suit, regarding Dhanaji being the benamidar and the plaintiff to be the true owner and the relevant paragraph Nos.3, 4, 5 & 7 reads as under:
"3) At the time of purchasing the said properties they ware purchased in the name of Dhanaji nemanna Tashildar, benami. Ever since the purchase the suit lands are, in possession and enjoyment of the plaintiff, who has levelled the land by using bull-
dozer and has been raising crops like paddy and is taking the income as owner. From the time of registration of the sale deeds the original documents of title are with the plff. It is the plaintiff who paid the consideration for the purchase of these lands,
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NC: 2023:KHC-D:14418 RSA No. 100890 of 2023 though the sale deeds ware taken benami in the name of Dhanaji Nemanna Tashildar.
4) The said Dhanaji Nemanna Tashildar is the plaintiff's mother's brother and also the father-in- law, and therefore, the plaintiff had full and implicit faith in him. The plaintiff who was carrying on business by installing lathe machines, he felt that since he was engaged in business of a work-shop; purchase of agricultural land in his name may create some legal complications. Moreover the adjacent land was in possession and cultivation of Dhanaji and thinking that no legal complications would arise if the Land is purchased in his name, the sale deed was taken by the plaintiff in his name. The plaintiff never intended that Dhanaji should become the owner of this property. The said Dhanaji also never asserted title to this property till his death and the property all along has been in the possession, cultivation and enjoyment of the plaintiff, even though it stands in the name of Dhanaji in a paper.
5) The defendants are the legal representatives of deceased Dhahnji Nemanna Tashildar. The plaintiff is finding it difficult to put the suit land to more profitable use by bringing it under irrigation. The plaintiff wanted to avail agricultural loan on the security of this property, and he was told that unless the document stands in his name he cannot get any
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NC: 2023:KHC-D:14418 RSA No. 100890 of 2023 loan, and therefore, he is constrained to institute this suit for a declaration that he is the absolute owner of the suit property and that deceased Dhanaji Nemanna Tashildar was only a benamider.
6. xxxxx
7. The plaintiff requested the defts to execute a document, declaring that the plaintiff is the absolute owner of the suit property, but they are postponing the same on one or the other around. He, therefore, apprehends some trouble from the defendants and threat to his peaceful possession. Hence this suit.
(Emphasis supplied)
23. The plaintiff's prayer in the said suit was to declare that the plaintiff as the absolute owner and the defendant, namely, Dhanaji S/o Nemanna Tahsildar as a benamidar. The suit was instituted before coming into force of the Act, the legal heirs of the benamidar and the plaintiff entered into a compromise on 30.08.1985 and the plaintiff was declared as an absolute owner of the suit land, Dhanaji was declared as the benamidar; the suit, the compromise entered was at an undisputed point of time, the plaintiff was declared as an absolute owner of the suit
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NC: 2023:KHC-D:14418 RSA No. 100890 of 2023 land against the person in whose name the property was purchased namely, Dhanaji. The said Dhanaji having not disputed the title, ownership of the plaintiff, the defendant having no valid right and in the absence of any challenge to the sale deed in the name of Dhanaji, the defendant cannot dispute the ownership of the plaintiff. The trial Court and the first appellate Court examined the entire oral and documentary evidence and arrived at a conclusion that the contention of the defendants, that the suit is not maintainable under the Act is unsustainable, holding that the Act is prospective and not retrospective and by virtue of the decreetal of the suit in O.S.No.187/1985, the plaintiff has already been declared as a real owner and Dhanaji was declared as a benamidar, on that count also, the applicability of the Act cannot be in the instant facts. The pleading of the plaintiff is that the plaintiff is the actual owner and in light of disturbance made by the defendants, the plaintiff had to narrate all these aspects in his pleadings in the instant suit.
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24. The reliance of the judgment placed by the learned counsel for the appellant in the case of Valliammal stated supra, the Apex Court has held at paragraph Nos.12 & 13 as under:
"12. There is a presumption in law that the person who purchases the property is the owner of the same. This presumption can be displaced by successfully pleading and proving that the document was taken benami in the name of another person from some reason, and the person whose name appears in the document is not the real owner, but only a benami. Heavy burden lies on the person who pleads that the recorded owner is a benami-holder.
13. This Court in a number of judgments has held that it is well- established that burden of proving that a particular sale is benami lies on the person who alleges the transaction to be a benami. The essence of a benami transaction is the intention of the party or parties concerned and often, such intention is shrouded in a thick veil which cannot be easily pierced through. But such difficulties do not relieve the person asserting the transaction to be benami of any part of the serious onus that rests on him, nor justify the acceptance of mere conjectures or surmises, as a substitute for proof. Referred to Jaydayal Poddar Vs. Bibi Hazra, 1974 (1) SCC 3;
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NC: 2023:KHC-D:14418 RSA No. 100890 of 2023 Krishnanand Vs. State of Madhya Pradesh, 1977 (1) SCC 816; Thakur Bhim Singh Vs. Thakur Kan Singh, 1980 (3) SCC 72; His Highness Maharaja Pratap Singh Vs. Her Highness Maharani Sarojini Devi & Ors., 1994 (Supp. (1) SCC 734; and Heirs of Vrajlal J. Ganatra Vs. Heirs of Parshottam S. Shah, 1996 (4) SCC 490. It has been held that in the judgments referred to above that the question whether a particular sale is a benami or not, is largely one of fact, and for determining the question no absolute formulas or acid test, uniformly applicable in all situations can be laid. After saying so, this Court spelt out following six circumstances which can be taken as a guide to determine the nature of the transaction:
(1) the source from which the purchase money came;
(2) the nature and possession of the property, after the purchase;
(3) motive, if any, for giving the transaction a benami colour;
(4) the position of the parties and the relationship, if any, between the claimant and the alleged benamidar;
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RSA No. 100890 of 2023
(5) the custody of the title deeds
after the sale; and
(6) the conduct of the parties
concerned in dealing with the property after the sale."
25. The Apex Court in the case of Valliammal stated supra placing reliance upon the decisions of the Apex Court in the case of Jaydayal Poddar Vs. Bibi Hazra4, Krishnanand Vs. State of Madhya Pradesh5, Thakur Bhim Singh Vs. Thakur Kan Singh6, & Heirs of Vrajlal J. Ganatra Vs. Heirs of Parshottam S. Shah7 has held and spelt out six circumstances, which can be taken as a guide to determine the nature of transaction. It is well settled that the intention of the parties is the essence of benami transaction and the money must have been provided by the party invoking the doctrine of benami, this entire exercise has been dealt by the plaintiff, in the suit in O.S.No.187/1985 against the benamidar holder and against
4. 1974 (1) SCC 3
5. 1977 (1) SCC 816
6. 1980 (3) SCC 72
7. 1996 (4) SCC 490
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NC: 2023:KHC-D:14418 RSA No. 100890 of 2023 whom, the benami is pleaded, his LRs accepted the plaintiff to be the true owner. The proposition of law laid down in the case of Valliammal stated supra is applicable to the present facts and the Courts below have rightly held that the plaintiff has proved the ownership of the property purchased and Dhanaji was declared to be the benamidar. Other than the benamidar, the third person cannot question the ownership of the property purchased. The presumption that the person who purchases the property is the owner of the same, has to be displaced, by the person in whose name the document is purchased and whether the particular sale is benami or not is in reality for the benefit of the another was to be established by the plaintiff and the benamidar, namely, Dhananji or his LRs and not the defendants herein and the defendants cannot dispute the plaintiff's claim to the title of the suit land.
26. The position of law as held in Mithilesh Kumari & Anr vs Prem Behari Khare8 [Mithilesh Kumari] was
8. (1989) 2 SCC 85
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NC: 2023:KHC-D:14418 RSA No. 100890 of 2023 governing the field that the provisions of the Benami Transactions (Prohibition) Act, 1988 were retroactive, it was held that the prohibition under Section 4 of the Act to recover the benami property was applicable to the suit, claims or action pending on the date of commencement of the Act. The decision in the case of Mithilesh Kumari stated supra has been overruled by the Bench of Three Judges of the Apex Court in the case of R.Rajagopal Reddy stated supra, wherein the Apex Court at paragraph Nos.13, 14 & 15 has held as under:
"13. So far as Section 4(2) is concerned, all that is provided is that if a suit is filed by a plaintiff who claims in his favour and holds the property in his name, once Section 4(2) applies, no defence will be permitted or allowed in any such suit, claim or action by or on behalf of a person claiming to be the real owner of such property held benami. The disallowing of such a defence which earlier was available, itself, suggests that a new liability or restriction is imposed by Section 4(2) on a pre- existing right of the defendant. Such a provision also cannot be said to be retrospective or retroactive by necessary implication. It is also pertinent to note that Section 4(2) does not expressly seek to apply
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NC: 2023:KHC-D:14418 RSA No. 100890 of 2023 retrospectively. So far as such a suit which is covered by the sweep of Section 4(2) is concerned, the prohibition of Section 4(1) cannot apply to it as it is not a claim or action filed by the plaintiff to enforce right in respect of any property held benami. On the contrary, it is a suit, claim or action flowing from the sale deed or title deed in the name of the plaintiff. Even though such a suit have been filed prior to 19.5.1988, if before the stage of filing of defence by the real owner is reached, Section 4(2) becomes operative from 19th May, 1988, then such a defence, as laid down by Section 4(2) will not be allowed to such a defendant. However, that would not mean that Section 4(1) and 4(2) only on that score can be treated to be impliedly retrospective so as to cover all the pending litigations in connection with enforcement of such rights of real owners who are parties to benami transactions entered into prior to the coming into operation of the Act and specially Section 4 thereof. It is also pertinent to note that Section 4(2) enjoins that no such defence 'shall be allowed' in any claim, suit or action by or on behalf of a person claiming to be the real owner of such property. That is to say no such defence shall be allowed for the first time after coming into operation of Section 4(2). If such a defence is already allowed in a pending suit prior to the coming into operation of Section 4(2), enabling an issue to
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NC: 2023:KHC-D:14418 RSA No. 100890 of 2023 be raised on such a defence, then the Court is bound to decide the issue arising from such an already allowed defence as at the relevant time when such defence was allowed Section 4(2) was out of picture. Section 4(2) nowhere uses the words "No defence based on any right in respect of any property held benami whether against the person in whose name the property is held or against any other person, shall be allowed to be raised or continued to be raised in any suit." With respect, it was wrongly assumed by the Division Bench that such an already allowed defence in a pending suit would also get destroyed after coming into operation of Section 4(2). We may at this stage refer to one difficulty projected by learned advocate for the respondents in his written submissions, on the applicability of Section 4(2). These submissions read as under :-
Section 4(1) places a bar on a plaintiff pleading 'benami', while Section 4(2) places a bar on a defendant pleading 'benami', after the coming into force of the Act. In this context, it would be anomalous if the bar in Section 4 is not applicable if a suit pleading 'benami' is already filed prior to the prescribed date, and it is treated as applicable only to suit which he filed thereafter. It would have the effect of classifying the so-called 'real' owners into two classes - those who stand in the position of
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NC: 2023:KHC-D:14418 RSA No. 100890 of 2023 plaintiffs and those who stand in the position of defendants. This may be clarified by means of an illustration. A and B are 'real' owners who have both purchased properties in say 1970, in the names of C and D respectively who are ostensible owners viz. benamidars. A files a suit in February 1988 i.e. before the coming into force of the Act against C, for a declaration of his title saying that C is actually holding it as his benamidar. According to the petitioner's argument, such a plea would be open to A even after coming into force of the Act, since the suit has already been laid. On the other hand, if D files a suit against B at the same for declaration and injunction, claiming himself to be the owner but B's opportunity to file a written statement comes in say November 1988 when the Act has already come into force, he in his written statement cannot plead that D is a benamidar and that he, B is the real owner. Thus A and B, both 'real' owners, would stand on a different footing, depending upon whether they would stand in the position of plaintiff or defendant. It is respectfully submitted that such a differential treatment would not be rational or logical.
14. According to us this difficulty is inbuilt in Section 4(2) and does not provide the rationale to hold that this Section applies retrospectively. The legislature itself thought it fit to do so and there is no challenge to the vires on the ground of violation
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NC: 2023:KHC-D:14418 RSA No. 100890 of 2023 of Article 14 of the Constitution. It is not open to us to re-write the section also. Even otherwise, in the operation of Section 4(1) and (2), no discrimination can be said to have been made amongst different real owners of property, as tried to be pointed out in the written objections. In fact, those cases in which suits are filed by real owners or defences are allowed prior to corning into operation of Section 4(2), would form a separate class as compared to those cases where a stage for filing such suits or defences has still not reached hy the time Section 4(1) and (2) starts operating. Consequently, latter type of cases would form a distinct category of cases. There is no question of discrimination being meted out while dealing with these two classes of cases differently. A real owner who has already been allowed defence on that ground prior to coming into operation of Section 4(2) cannot be said to have been given a better treatment as compared to the real owner who has still to take up such a defence and in the meantime he is hit by the prohibition of Section 4(2). Equally there cannot be any comparison between a real owner who has filed such suit earlier and one who does not file such suit till Section 4(1) comes into operation. All real owners who stake their claims regarding benami transactions after Section 4(1) and (2) came into operation are given uniform treatment by these provisions, whether they come as plaintiffs
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NC: 2023:KHC-D:14418 RSA No. 100890 of 2023 or as defendants. Consequently, the grievances raised in this connection cannot be sustained.
15. At this stage, we may also usefully refer to Section 7(1) of the Act which lays down that Sections 81, 82 and 94 of the Indian Trusts Act, 1882 (2 of 1882), Section 66 of the Code of Civil Procedure, 1908 (5 of 1908), and Section 281-A of the Income Tax Act 1961 (43 of 1961), are thereby repealed. We have already seen Section 82 of the Indian Trusts Act which gave almost for a period of a century or more a legal right to the real owner to claim against the purported owner that the consideration paid was by the real owner and the transferee held the property for the benefit of the person paying consideration for supporting the transaction. It is this right which got destroyed by Section 7 of the Act with effect from 19th May, 1988. If any suits or proceedings were pending prior to that date, invoking Section 82 of the Indian Trusts Act, what is to happen to such suits is not answered by Section 4(1) of the Act or by any other provisions of the Act. We have, therefore, to turn the General Clauses Act, 1897 for finding out an answer. Section 6 of the General Clauses Act lays downed where this Act, or any (Central Act) or Regulation made after the commencement of this Act, repeals any enactment hitherto made or hereafter to be made,
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NC: 2023:KHC-D:14418 RSA No. 100890 of 2023 then, unless a different intention appears the repeal shall not -
(a) revive anything not in force or existing at the time at which the repeal takes effect; or
(b) affect the previous operation of any enactment so repealed or anything duly done or suffered thereunder; or
(c) affect any right, privilege, obligation or liability acquired, accrued or incurred under any enactment so repealed; or
(d) affect any penalty, forfeiture or punishment incurred in respect of any offence committed against any enactment so repealed; or
(e) affect any investigation, legal proceeding or remedy in respect of any such right, privilege, obligation, liability, penalty, forfeiture or punishment as aforesaid; and any such investigation, legal proceeding or remedy may be instituted, continued or enforced, and any such penalty, forfeiture or punishment may be imposed as if the repealing Act or Regulation had not been passed". It becomes, therefore, obvious that the Act by Section 7 has effected a repeal
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NC: 2023:KHC-D:14418 RSA No. 100890 of 2023 of Section 82 of the Indian Trusts Act and while repealing this provision no different intention appears from the Act to affect any right, privilege or liability acquired under Section 82 by either side or any pending proceedings regarding such obligation or liability. Therefore, such pending proceedings will have to be continued or enforced as if the repealing Act had not been passed. A conjoint reading of Section 82 of the Indian Trusts Act and Section 6(b), (d) and (e) of the General Clauses Act clearly enjoins that if suits are pending wherein the plaintiffs have put forward claims under the then existing Section 82 of the Indian Trusts Act such proceedings are to be continued by assuming that the repealing of Section 82 of the Indian Trusts Act has not been effected in connection with such pending proceedings. Unfortunately, this aspect was not pressed for consideration before the Division Bench and, therefore, the view taken by the Division Bench is likely to result in an incongruous situation. If a view is to be taken that a pending suit wherein plaintiff might have contended that the real consideration flowed from him and the defendant was not the real owner and held the property benami as per Section 82 of the Indian Trusts Act, 1882, has to be continued by ignoring the present Act, it will be inconsistent with the conclusion reached by the Division Bench. As per the Division Bench, such suits
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NC: 2023:KHC-D:14418 RSA No. 100890 of 2023 must necessarily be dismissed at whatever stage they might be pending between the parties. Therefore, interpretation of Section 4(1) by the Division Bench would directly conflict with the legislative scheme emanating from Section 82 of the Indian Trusts Act, 1882 read with Section 6 of the General Clauses Act discussed above. Even otherwise, it is now well-settled that where a statutory provision which is not expressly made retrospective by the legislature seeks to affect vested rights and corresponding obligations of parties, such provision cannot be said to have any retrospective effect by necessary implication. In Maxwell on the Interpretation of Statutes, 12th Edition (1969), the learned author has made the following observations based on various decisions of different Court, specially in Re Athlumney (1898) 2 Q.B. 551, at pp. 551, 552:-
"Perhaps no rule of construction is more firmly established than this - that a retrospective operation is not to be given to a statute so as to impair an existing right or obligation, otherwise than as regards matters of procedure, unless that effect cannot be avoided without doing violence to the language of the enactment. If the enactment is expressed in language which is fairly capable of either interpretation, it ought to be construed as prospective only." The rule has, infact, two aspects,
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NC: 2023:KHC-D:14418 RSA No. 100890 of 2023 for it "involves another and subordinate rule, to the effect that a statute is not to be construed so as to have a greater retrospective operation than its language renders necessary."
(Emphasis supplied)
27. The Apex Court in the case of R. Rajagopal Reddy held that Sub-Sections (1) of (2) of Section 4 are not retrospective, suit on behalf of the person claiming to be the real owner of the property to enforce right against the property held benami is prior to coming to force of Section 4 (1), Section 4(1) does not apply and Mithilesh Kumar's decision stated supra, which held the field for quite a long time, was over ruled.
28. In the case of Samitrri Devi stated supra, the Apex Court at paragraph Nos.16 & 17 has held as under:
"16. The High Court has clearly erred in ignoring the binding judgment of a Bench of three Judges of this Court in R. Rajagopal Reddy (supra). By this decision, this Court had reversed its earlier judgment in Mithilesh Kumari (supra) and had held in terms that suits filed prior to the application of the act would not be hit by the prohibition under Section
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NC: 2023:KHC-D:14418 RSA No. 100890 of 2023 4 of that act. Section 4(1) of the Benami Transactions (Prohibition) Act 1988 reads as follows:
"Prohibition of the right to recover property held benami.- (1) No suit, claim or action to enforce any right in respect of any property held benami against the person in whose name the property is held or against any other person shall lie by or on behalf of a person claiming to be the real owner of such property."
While reversing the earlier decision of this Court in Mithilesh Kumari (supra), a bench of three Judges observed in para 11 of R. Rajagopal Reddy (supra) as follows:-
"Before we deal with these six considerations which weighed with the Division Bench for taking the view that Section 4 will apply retrospectively in the sense that it will get telescoped into all pending proceedings, howsoever earlier they might have been filed, if they were pending at different stages in the hierarchy of the proceedings even up to this Court, when Section 4 came into operation, it would be apposite to recapitulate the salient feature of the Act. As seen earlier, the preamble of the Act itself states that it is an Act to prohibit benami transactions and the right to
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NC: 2023:KHC-D:14418 RSA No. 100890 of 2023 recover property held benami, for matters connected therewith or incidental thereto. Thus it was enacted to efface the then existing right of the real owners of properties held by others benami. Such an Act was not given any retrospective effect by the legislature. Even when we come to Section 4, it is easy to visualise that sub- section (1) of Section 4 states that no suit, claim or action to enforce any right in respect of any property held benami against the person in whose name the property is held or against any other shall lie by or on behalf of a person claiming to be the real owner of such property. As per Section 4(1) no such suit shall thenceforth lie to recover the possession of the property held benami by the defendant. Plaintiff's right to that effect is sought to be taken away and any suit to enforce such a right after coming into operation of Section 4(1) that is 19-5-1988, shall not lie. The legislature in its wisdom has nowhere provided in Section 4(1) that no such suit, claim or action pending on the date when Section 4 came into force shall not be proceeded with and shall stand abated. On the contrary, clear legislative intention is seen from the words "no such claim, suit or action shall lie", meaning thereby no such suit, claim or action shall be
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NC: 2023:KHC-D:14418 RSA No. 100890 of 2023 permitted to be filed or entertained or admitted to the portals of any court for seeking such a relief after coming into force of Section 4(1)."
(Emphasis supplied)
17. In the impugned judgment, the High Court nowhere refers to the judgment in R. Rajagopal Reddy's case (supra) although the same was very much referred to and relied upon by the appellant to counter the contrary submission of the respondent No. 1. The High Court has therefore, committed a serious error of law in holding that the Additional District Judge has misread the evidence on record while coming to the conclusion that the suit property was the Benami Property of the plaintiff-appellant No.1 herein and that her suit to enforce the right concerning the same shall not lie. In fact there was no such misreading of evidence on the part of the first appellate court, and hence there was no occasion for the High Court to frame such a question of law in view of the prevailing judgment in R. Rajagopal Reddy which had been rightly followed by the first appellate court."
29. The Apex Court in Samitrri Devi stated supra held that suit for recovery of property held benami and suit filed prior to enforcement of the Act would not hit by prohibition under Section 4 of the Act.
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NC: 2023:KHC-D:14418 RSA No. 100890 of 2023
30. In the light of the decisions stated supra and the facts narrated above, the provision of the Act are not made applicable to the present facts and circumstances of the case and the defendants cannot take up a contention that the plaintiff is not the true owner, it is only the person in whose name a purchase was made or his legal heirs can only contend and say that it is a transaction of benami and the plaintiff was not the true owner. The privilege is not available to the defendants as rightly held by the Courts below, more particularly the first appellate Court.
31. The appellant sought to produce certain documents under Order 41 Rule 27 by filing I.A.No.2 and I.A.No.10. By I.A. No.2, the appellant sought to produce the plaint, decree and compromise petition in O.S.No.187/1985 and by way of I.A.No.10 documents sought to be produced were- appeal 275/1927, the judgment of the High Court of Judicature at Mumbai, Hukkumnama of I Class Sub-ordinate Judge, M.E. No.5793 dated 25.06.1975 purchase made by Dhanaji, sale deed
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NC: 2023:KHC-D:14418 RSA No. 100890 of 2023 executed by defendant No.2 and 3 in favour of Arun Jeevanna Kunchukar. The First Appellate Court by considered order held that the documents referred to in I.A.No.2 and I.A.No.10 are the documents which are already marked in evidence and considered by the Trial Court, more particularly, the decree in O.S.No.187/1985, the appeal-275/1927 and the Trial Court considering the documents has passed the order. The other documents according to the first appellate Court do not throw much light on the questions involved in the suit, and the first appellate Court was of the opinion that the documents sought to be produced are not necessary for proper adjudication of the actual dispute between the parties.
32. The first appellate court being the last fact finding Court has considered the entire oral and documentary evidence in a proper perspective and the manner in which the Courts below have considered the entire material on record, more particularly, the first appellate Court, this Court is of the considered view that
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NC: 2023:KHC-D:14418 RSA No. 100890 of 2023 the plaintiff has established, that he is the absolute owner of the suit land and defendant Nos.2 and 3 do not have any subsisting right and this Court is of the view that the concurrent findings of facts of the Courts below do not warrant any interference and there arises no substantial question of law to be dealt with under Section 100 CPC and accordingly, this Court pass the following:
ORDER
(i) The regular second appeal is hereby dismissed.
(ii) The impugned judgment and decree of the Courts below stands confirmed.
In view of the dismissal of the appeal, pending applications, if any, do not survive for consideration and the same are accordingly disposed of.
Sd/-
JUDGE VNP, CT: UMD List No.: 1 Sl No.: 29