Karnataka High Court

Sri. D. A. Srinivas vs Smt. Manjula on 22 February, 2024

Author: Chief Justice

Bench: Chief Justice

                             1
                                             RFA 2216/2023

      IN THE HIGH COURT OF KARNATAKA AT BENGALURU

        DATED THIS THE 22ND DAY OF FEBRUARY, 2024

                        PRESENT

THE HON'B LE MR.P .S. DINES H KUMA R, C HIEF J U ST ICE

                            AN D

     THE HON'BLE MR. JUSTICE T.G.SHIVASHANKARE GOWDA

             RFA NO.2216 OF 2023 (DEC/INJ)

BETWEEN:

SRI. D. A. SRINIVAS
S/O LATE D.K.ADIKESAVALU
AGED ABOUT 46 YEARS
R/O NO.7/21, 1ST CROSS
9TH MAIN, R.M.V.EXTENSION
BENGALURU - 560 080                        ... APPELLANT

(BY SRI.JAYAKUMAR S. PATIL, SR.ADV. FOR
     SRI.H.N.BASAVARAJU, ADV.)

AND:

1.      SMT.MANJULA
        W/O LATE K.RAGHUNATH
        AGED ABOUT 46 YEARS

2.      SRI. K. R. PRADEEP
        S/O LATE K.RAGHUNATH
        AGED ABOUT 23 YEARS

3.      SRI. K. R. ROHITH
        S/O LATE K.RAGHUNATH
        AGED ABOUT 21 YEARS

        ALL ARE R/AT NO.13, 5TH MAIN
        5TH CROSS, SRI.SHIRDI LAYOUT
        BEHIND KRISHNA COMMUNITY HALL
        AYYAPPA NAGAR, K.R.PURAM
        BENGALURU NORTH
        BENGALURU - 560 038               ...RESPONDENTS
                              2
                                                      RFA 2216/2023


(BY SRI.UDAYA HOLLA, SR.ADV. FOR
    SRI.P.USMAN, ADV. FOR R1 TO R3)

     THIS RFA IS FILED UNDER SECTION 96 READ WITH
ORDER 41 RULE 1 OF CPC., AGAINS THE JUDGMENT AND
DECREE DATED 20.10.2023 PASSED ON IA NO.V IN OS
NO.246/2020 ON THE FILE OF PRINCIPAL SENIOR CIVIL
JUDGE, BANGALORE (R) DISTRICT, BANGALORE, ALLOWING
THE IA NO.V FILED UNDER ORDER VII RULE 11(a) READ WITH
SECTION 151 OF CPC AND SECTION 4 AND 6 OF THE
PROHIBITION OF BENAMI PROPERTY TRANSACTIONS ACT,
1988 FOR REJECTION OF PLAINT.


     THIS RFA HAVING BEEN HEARD AND RESERVED FOR
JUDGMENT     ON   10.01.2024     AND         COMING     ON    FOR
PRONOUNCEMENT        OF        JUDGMENT          THIS         DAY,
T.G.SHIVASHANKARE          GOWDA       J.,     DELIVERED      THE
FOLLOWING:


                   JUDGMENT

In this appeal, the plaintiff has challenged the

order dated 30.10.2023 in O.S.No.246/2020 passed

by the Principal Senior Civil Judge, Bengaluru Rural

District, Bengaluru ('the Trial Court' for short), in

allowing I.A.No.V filed by the defendants under

Order VII Rule 11 (a) and (d) of C.P.C. seeking

rejection of the plaint.

2. For the sake of convenience, parties shall be

referred as per their status before the Trial Court.

3. Brief facts of the case are, the plaintiff has

filed the instant suit seeking declaration that he is

the owner in possession of the plaint schedule

properties by virtue of the Will dated 20.04.2018,

executed by the husband of defendant No.1, father

of defendants No.2 and 3 by name K. Raghunath.

3.1. Suit properties consist of 'A' Schedule: 13

items of agricultural lands, total measuring 24 acres

31 guntas, situated at Avathi Village, Kasaba Hobli,

Devanahalli Taluk; 'B' Schedule: 10 items of

agricultural lands, total measuring 14 acres 11

guntas, situated at Bullahalli Village, Vijayapura

Hobli, Devanahalli Taluk; 'C' Schedule: 6 items of

agricultural lands, total measuring 5 acres 39

guntas, situated at Dasarahalli Village, Kasaba Hobli,

Devanahalli Taluk; 'D' Schedule: 9 items of

converted lands, total measuring 6 acres 16 guntas,

situated at Nallurahalli Village, Krishnarajapura

Hobli, Bengaluru East Taluk; 'E' Schedule: 2 items of

agricultural lands, total measuring 29 guntas,

situated at Nallurahalli Village, Krishnarajapura

Hobli, Bengaluru East Taluk (in short, 'the suit

schedule properties').

4. Plaintiff is also seeking correction of

mistakes crept in the Will in respect of 7 items of

land described in the schedule of the Will and

permanent injunction, restraining the defendants

from interfering with his lawful possession and

enjoyment.

5. The defendants entered their appearance

through their Advocate and filed I.A.No.V under

Order VII Rule 11 (a) and (d) of C.P.C. seeking

rejection of the plaint on the grounds that the plaint

did not disclose the cause of action, it is barred

under Sections 4 and 5 of the Prohibition of Benami

Transaction Act, 1988 ('Benami Act' for short); and

the relief claimed by the plaintiff cannot be granted

in the suit.

6. The plaintiff opposed the application by filing

objection statement contending inter alia that the

suit is one for declaration and injunction based on

the Will, Court has jurisdiction to try the suit and the

suit is not hit by the Benami Act.

7. The Trial Court after hearing arguments of

both sides, by impugned judgment, allowed I.A.No.V

filed by the defendants and rejected the plaint by

exercising powers under Order VII Rule 11 (a) read

with Section 151 of C.P.C. and Section 4 and 6 of the

Benami Act. Aggrieved by the same, the plaintiff has

filed the instant appeal on various grounds.

8. Heard the arguments of Sri. Jayakumar S.

Patil, learned Senior Counsel for

Sri. H.N. Basavaraju, learned counsel for the plaintiff

and Sri. Udaya Holla, learned Senior Counsel for Sri.

P. Usman, learned counsel for the defendants.

9. Sri. Jayakumar S. Patil, learned Senior

Counsel has argued that Sections 3 and 4 of Benami

Act is not applicable to the case on hand; the

plaintiff never pleaded in the plaint that the suit

schedule properties were acquired by the plaintiff

Benami in the name of Sri. K. Raghunath.

Sri. Raghunath was an employee of M/s Adikesavalu

Group of Companies. The plaintiff authorized him to

make acquisition of agricultural lands for the sake of

real estate business, the suit schedule properties

were acquired by Sri. K. Raghunath from the finance

provided by the plaintiff. Under Section 45 of the

Benami Act, Civil Court has no jurisdiction to try the

cases involving the Benami transaction, such cases

can only be adjudicated by Authorities described

under the said Act. Plaintiff also sought for

permanent injunction against the defendants.

Learned Trial Judge has not followed the decision in

Pawan Kumar -Vs.- Babulal1. The suit is based on

the Will; if the plaintiff proves the Will, he is entitled

to the relief of declaration and permanent injunction

The Trial Court has recorded that the Will is invalid.

Unless the Will is put into test, the Trial Court has no

jurisdiction to record a finding against the Will.

10. Sri. Udaya Holla, learned Senior Counsel

argued that the suit schedule properties were

purchased by Sri. K. Raghunath by his own funds.

Apart from declaration, plaintiff has sought for

rectification of contents of the Will, which is not

permissible. A criminal case is pending against the

plaintiff alleging that he has committed murder of

Sri. K. Raghunath. Under such circumstances, the

Will cannot be held as a valid one. After

Raghunath's murder, plaintiff did not obtain probate.

Therefore, the Will cannot be held as a valid one.

Learned Trial Judge has rightly rejected the plaint on

the ground that there is no cause of action and the

(2019) 4 SCC 367

suit is barred by the provisions of Benami Act and he

supported the impugned order.

10.1. To buttress his argument, he relied upon

R. Rajagopal Reddy (dead by L.Rs.) and Others

-Vs.- Padmini Chandrashekharan (dead by

L.Rs.)2 and Union of India and Another -Vs.-

Ganapati Dealcom Private Limited3.

11. We have given our anxious consideration to

the rival contentions argued on behalf of both sides

and perused the materials on record.

12. The suit schedule properties consist of

lands, measuring 42 acres 30 guntas of agricultural

lands and 6 acres 16 guntas of converted land

situated in and around Bengaluru City. These are

the properties acquired by K. Raghunath in his

name. He was an employee of M/s Adikesavalu

Group of Companies.

(1995) 2 SCC 630

(2023) 3 SCC 315

13. The plaint averments point out that the

plaintiff desired to do real estate business. That, it

was not possible for him to directly invest in the

agricultural lands. K. Raghunath was a loyal

employee and plaintiff chose him to purchase the

agricultural lands, get them converted to non-

agricultural purpose to augment his real estate

business. In this regard, a memorandum of

understanding (M.O.U.) was executed authorizing

K. Raghunath to purchase the properties in his name

from out of funds provided by the plaintiff. For

rendering such services, remuneration was fixed to

K. Raghunath. As per the terms of M.O.U., money

was paid to K. Raghunath for acquisition of lands,

getting conversion and transferring in favour of the

plaintiff. Accordingly, K. Raghunath obtained sale

deeds and he was in the process of getting the lands

converted. The entire transaction is based on the

trust between the plaintiff and K. Raghunath and he

has executed testamentary document i.e., a Will on

20.04.2018. The main contention of the defendants

seeking rejection of the plaint is that the alleged

transaction is hit by Sections 4 and 6 of the Benami

Act; the plaintiff is facing the criminal charge of

murder of K. Raghunath; and the plaint lacks cause

of action and it is not maintainable.

14. Both the sides did not dispute the first line

principle of Order VII Rule 11 of C.P.C. that only the

averments made in the plaint can only be read in

order to ascertain whether there is a cause of action

for the suit or not. Plaint does not disclose any

pleading which attracted Sections 4 and 6 of Benami

Act. Plaintiff has specifically pleaded that he and

K. Raghunath had entered into many M.O.Us., in

terms of which K. Raghunath was to acquire

agricultural lands, obtain conversions and to transfer

the same to the plaintiff. Plaintiff's money was spent

by K. Raghunath for the said purpose. K. Raghunath

was an employee of Adikesavalu Group of

Companies is not in dispute. As referred supra, the

extent of land acquired by K. Raghunath is more

than 49 acres, out of which, 6 acres 16 guntas were

converted into non-agricultural purposes.

15. It is not the case of the plaintiff that he has

acquired the property in the name of K. Raghunath,

and he is the owner of the suit property. The suit is

based on the Will. Proof of Will decides the fate of

relief that the plaintiff has sought for. Irrespective of

the allegation of Benami transaction and also

criminal prosecution of the plaintiff, if the plaintiff is

able to prove the execution of the Will said to have

executed by K. Raghunath bequeathing suit schedule

properties in his favour, he shall be entitled for the

relief sought in the plaint. There is no legal bar for

the plaintiff to seek such relief before the Civil Court.

16. In Pawan Kumar's case (supra), the

Hon'ble Apex Court has discussed about the

application of provisions under Sections 3(b) and 4

of Benami Act holding that it should be on the factual

matrix of each case. At para No.11 of the judgment,

it has referred to the judgment in Marcel Martins -

Vs.- M. Printer4, which reads as follows:

"11. The factual aspects of the matter were, thereafter, considered and in paras 42 and 43 it was observed:-

"42. ... ...That conclusion gets strengthened by the fact that the parties had made contributions towards the sale consideration paid for the acquisition of the suit property which they would not have done if the intention was to concede the property in favour of the appellant.

43. ... ... Reposing confidence and faith in the appellant was in the facts and circumstances of the case not unusual or unnatural especially when possession over the suit property continued to be enjoyed by the plaintiffs who would in law and on a parity of reasoning be deemed to be holding the same for the benefit of the appellant as much as the appellant was holding the title to the property for the benefit of the plaintiffs."

16.1. At para No.12, it has specifically stated

non-application of Sections 3(b) and 4 of the Benami

Act. Paras No.13 and 14 of the judgment specifically

determines that in order to examine whether the suit

falls within the purview of Section 4(3) of Benami

(2012) 3 SCC (Civ) 98

Act, the matter has to be examined on the strength

of the evidence on record.

17. In Rajagopal Reddy's case (supra), the

Hon'ble Apex Court has directly dealt with the

Benami transaction and held that no suit lies to

recover possession of the property held Benami by

the defendant.

17.1. In Ganapati Dealcom (P) Ltd.'s case

(supra), the Hon'ble Apex Court was dealing with the

property where the plaintiff seeking recovery of

possession held Benami in the name of the

defendant.

17.2. In the decisions relied upon by the

defendants, there is a direct allegation of Benami

transaction, whereas in the instant case, the suit is

based on the Will. The plaintiff's case is simple and

unambiguous that the property bequeathed by

K. Raghunath in his favour was acquired by the

testator for the benefit of the plaintiff, who is

disabled from acquiring agricultural lands for doing

real estate business. The statements of law in those

judgments are not helpful to the plaintiff in

substantiating that the suit is hit by provisions of

Benami Act. The principles laid down in Pawan

Kumar's case (supra) is aptly applicable and plaint

cannot be terminated at the initial stage.

18. We have carefully perused the impugned

order. The Trial Court has recorded a finding that

the Will is invalid as the plaintiff is seeking retransfer

of Benami properties acquired by him in the name of

K. Raghunath, which is contrary to the pleadings and

prayer made by the plaintiff. Whether the plaintiff is

seeking retransfer of the properties or whether the

plaintiff is seeking title of the suit schedule

properties in the guise of the Will cannot be decided

at the preliminary stage of the suit. When the

pleadings of the parties make it very clear that the

suit is based on the Will, not on the Benami

acquisition, the impugned order does not stand to

reason. The criminal proceedings against the

plaintiff that K. Raghunath was murdered cannot

influence the Court in deciding a civil lis. A criminal

prosecution takes its own logical conclusion after

trial, which is not a bar for an accused person to

seek the civil remedy.

19. In view of above discussion, this appeal

merits consideration. In the result, the following:

ORDER

i) Appeal is hereby allowed;

ii) Impugned order is set aside;

iii) Plaint is restored to the file of the Trial Court to the stage of pleadings;

     iv)    The   Trial   Court     is requested   to
            complete         pleadings,       frame
            necessary             issues,     afford