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Showing contexts for: benami in Smt. Baljeet Kaur Kalra vs Sh. Surjeet Singh (Now Deceased) ... on 27 April, 2016Matching Fragments
8. Admittedly, in the present case, there is no plea which is set up of the existence of an HUF and this Court only has to examine as to whether the pleading of defendant no.3 falls within the scope of Section 4(3)(b) of the Benami Act. In my opinion, mere pleading of love and affection towards the mother cannot be taken as a pleading of the property being purchased by the defendant no.3 in the name of his mother as a trustee once Sections 81, 82 and 94 of the Indian Trusts Act, 1882 stand repealed by Section 7 of the Benami Act. Natural relationships no doubt have an element of trust, however, this natural element of trust on account of natural relationship is not what is the subject matter of Section 4(3)(b) of the Benami Act because this sub-Section specifically requires an averment/pleading with respect to the property being purchased as a trustee. Natural love and affection is not equivalent to possession of the property having been purchased as a trustee, and which is the only exception under Section 4(3)(b) of the Benami Act. The effect of repeal of certain provisions of the Indian Trusts Act for understating the meaning of trustee as found in Section 4(3)(b) of the Benami Act has been dealt by me in the judgment in the case of JM Kohli Vs. Madan Mohan Sahni and Anr in RFA No.207/2012 decided on 07.05.2012, and the same applies to the issue at hand and the relevant paras 6 to 10 of the said judgment are reproduced as under:-
"6. The consequences of the Benami Transactions (Prohibition) Act, 1988 were harsh as they brought to an end the ownership rights of an actual owner against the benami owner. Before passing of the Benami Act, a de jure owner could also file a suit against de facto owner and thereby claim ownership of the property on the ground that ostensible owner was only a benamidar. The legal provisions which helped the plaintiff in such a suit prior to passing of the Benami Act were inter-alia the provisions of Sections 81, 82 and 94 of the Indian Trusts Act, 1882 and as per which provisions a benami owner was actually a trustee for the real owner. Section 7 of the Benami Act specifically repeals the aforesaid sections of the Indian Trusts Act, 1882 and also Section 66 of the CPC which had similar substance.
(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."
8. In a way, therefore, there may be some ostensible conflict between the provision of Section 4(3)(b) of the Benami Act and Section 7 of the same Act which repeals the provisions of the Indian Trusts Act, 1882, however, one has to read and interpret Section 4(3)(b) in a manner which is in accord with the legislative intention to bar claims against properties held as benami. The concept of trust was always inbuilt once a transaction was a benami transaction as the benamidar was the trustee for the real owner. But in spite of the concept of trust being inbuilt in benami transactions, the Benami Act provided that no rights could be asserted in a benami property by the actual/de jure owner.
9. Two of the examples where the Supreme Court has held the property to be held as a trustee in terms of Section 4(3)(b) of the Benami Act are the judgments in the cases of C. Gangacharan V. C. Narayanan, 2000 (1) SCC 459 and P.V. Sankara Kurup V. Leelavathy Nambiar, 1994(6) SCC 68.
In the case of C. Gangacharan (supra), the Supreme Court has held that the property was held as a trustee as per Section 4(3)(b) of the Benami Act, and the person in whose name the property stood cannot take up a plea of the bar of Benami Act, inasmuch as, actually the owner had given moneys for the property to be purchased under his name, however, the moneys were in fraud utilized to get the property purchased in the name of defendants in that suit. In the case of P.V. Sankara Kurup (supra) also the obvious fraud which was perpetrated was that the property was to be purchased in the name of the plaintiff by his attorney holder and which the defendants did not do and instead got the property purchased directly in their name. In the case of P.V. Sankara Kurup (supra), the Supreme Court was dealing with Section 66 of CPC as it existed before its repeal by Section 7 of the Benami Act and in the facts of the case as stated above it was held that the purchaser had acted in fiduciary capacity as an agent and consequently the bar of the Benami Act would not apply. In the said judgment, the Supreme Court held that when the agent was employed to purchase the property on behalf of his principal, however does so in his own name, i.e. the agent‟s name then upon conveyance or transfer of the property to the agent, he stands as a trustee for the principal.