Karnataka High Court
Babu S/O Shivajiyappa Jorapur vs Nagesh S/O Govind Badamanji on 8 December, 2023
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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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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.
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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
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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
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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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(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?"
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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
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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
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
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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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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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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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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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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].
(2004) 7 SCC 233
AIR 2011 SC 773
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(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
AIR 1996 SC 238
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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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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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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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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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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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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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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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(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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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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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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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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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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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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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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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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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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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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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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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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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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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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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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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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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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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
