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of <h1>High Court overturns trial court ruling on Prohibition of Benami Property Act, stresses need for factual inquiry.</h1> <h3>Jyoti Agrawal, Minor Anjali Agrawal Versus Indu Bai, Rakesh Kumar, State Of Chhattisgarh Through Collector</h3> Jyoti Agrawal, Minor Anjali Agrawal Versus Indu Bai, Rakesh Kumar, State Of Chhattisgarh Through Collector - TMI Issues Involved:1. Legality and propriety of the order rejecting the application under Order 7 Rule 11 of CPC.2. Whether the suit is barred under Section 4(1) of the Prohibition of Benami Property Transactions Act, 1988.3. Determination of whether the transaction in question is a benami transaction.4. Applicability of Order 14 Rule 2 of CPC regarding preliminary issues.Detailed Analysis:1. Legality and Propriety of the Order Rejecting the Application under Order 7 Rule 11 of CPC:The Defendants filed a revision petition under Section 115 of the CPC challenging the order dated 11.10.2018 by the Civil Judge Class-I, Bhatapara, which rejected their application under Order 7 Rule 11 of CPC. The Defendants argued that the suit should be dismissed as it was barred by the provisions of the Prohibition of Benami Property Transactions Act, 1988.2. Whether the Suit is Barred under Section 4(1) of the Prohibition of Benami Property Transactions Act, 1988:The Plaintiff claimed exclusive ownership of the property, asserting it was purchased from her Stridhan. The Defendants contended that this claim constituted a benami transaction, thus barred by Section 4(1) of the Act, 1988. The trial court, however, held that the transaction appeared to benefit family members, thus not falling under the benami transaction prohibition. The High Court noted that the applicability of Section 4 hinges on whether the transaction is indeed benami, which requires factual determination.3. Determination of Whether the Transaction in Question is a Benami Transaction:The High Court emphasized that the definition of a 'benami transaction' under Section 2(9) of the Act, 1988 includes transactions where the property is held by one person but paid for by another, except in specific family-related scenarios. The Plaintiff must prove that the property was purchased with her Stridhan to claim it is not a benami transaction. The trial court prematurely concluded the transaction was not benami without sufficient evidence, which should be determined at trial.4. Applicability of Order 14 Rule 2 of CPC Regarding Preliminary Issues:Order 14 Rule 2 allows courts to decide on preliminary issues of law, such as jurisdiction or legal bars to the suit. The High Court noted that the trial court should have reserved the determination of whether the suit is barred under Section 4 of the Act, 1988, for trial. The trial court's decision to reject the application under Order 7 Rule 11 was deemed premature and was set aside.Conclusion:The High Court set aside the trial court's finding that the suit was not barred by Section 4 of the Act, 1988, emphasizing the need for a factual determination at trial. The revision petition was disposed of with these observations, and no costs were awarded.
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