TaxTMI 
TaxTMI 
1991 (7) TMI 19
X X X X Extracts X X X X
X X X X Extracts X X X X
....th the plaintiff and defendant since the defendant was the only son of the plaintiff and since the plaintiff wanted to leave the half share to him after her death. The defendant (since deceased) was the only son of the plaintiff. Everything went on well till his marriage. However, of late, the defendant and his wife started cooking separately for themselves and the plaintiff had to make her own arrangement for her cooking though both have been in the same house. It is, therefore, no longer possible for the parties to live in the same way, and the plaintiff, therefore, suggested to the defendant that the property could be divided into two parts as northern half and southern half and he could take the southern half since that portion contained sufficient open space to park his car. Her notice to that effect to the defendant was not replied to. Therefore, she filed the suit claiming the reliefs referred to hereinabove. The defendant resisted the suit of the plaintiff denying that the suit schedule property was purchased from the money belonging to the plaintiff. The allegation in the plaint that the plaintiff had given cash and from such cash the suit schedule house had been purcha....
X X X X Extracts X X X X
X X X X Extracts X X X X
....hat the said defence is hit by the mischief of the provisions of section 4(2) of the Benami Transactions (Prohibition) Act, 1988. The points for consideration in this appeal are as under: (i) Whether the plaintiff is entitled to any share in the suit schedule property and, if so, entitled to what share ? (ii) What is the impact of the provisions of section 4 of the Benami Transactions (Prohibition) Act, 1988, with reference to the suit claim and the defence taken in that behalf? (iii) What order? Points Nos. 1 and 2 Having regard to the submissions made at the Bar by learned counsel on either side, we find that points Nos. 1 and 2 are inextricably mixed up with each other. We, have, therefore, taken these two points for discussion together. Before considering the question relating to the impact of the provisions of section 4 of the Benami Transactions (Prohibition) Act, 1988 (hereinafter referred to as " the Act "), it would be indeed necessary to have a clear idea as regards the claim made by the plaintiff and the defence taken by the defendant (since deceased). The details of the pleadings of the parties to the suit are already alluded to earlier. In pith and....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ruth. Bearing this in mind, it will have to be seen as to where the truth lies. At the earliest point of time, as reflected in the notice dated March 5, 1980, exhibit P-5, the plaintiff has taken the stand that she has purchased the property with her own money. In para 3 of her plaint, she has reiterated the same with a further assertion that she had given the cash into the hands of the defendant and that the defendant has issued a cheque to the vendors. At this juncture, it is necessary to remember that the plaintiff had not remotely whispered about her having taken loan of Rs. 25,000 from P.W.-2, Parthasarathy, much less on her having executed a promissory note at exhibit P-2. However, in the course of her evidence, she has come out with a version as can be seen from para 2 of her deposition that she had taken the loan from PW-2, Parthasarathy, and had executed a promissory note as per exhibit P-2 in that behalf. Even here, it is significant to note that it was not the version of the plaintiff that she and the defendant had together taken the loan or had together executed the promissory note. Further, as can be seen from para 9 of her deposition in the course of her cross-exam....
X X X X Extracts X X X X
X X X X Extracts X X X X
....s more than one that the evidence of this witness is also tarred with the same brush. PW-2, Parthasarathy, has tried to support the plaintiff's version in his examination-in-chief. He has stated in para 2 of his deposition that he had paid a loan to the plaintiff and that the plaintiff had executed a pro-note in his favour as per exhibit P-2 and she paid Rs. 15,000 and Rs. 9,000 and the balance was paid by her in small sums of money. He has stated that the entire debt was repaid by the plaintiff and lie has made an endorsement in that behalf on the pro-note. However, his cross-examination at para 5 of his deposition would go to show as to how he has come out with a different version. He has stated at para 5 of his deposition in the course of his cross-examination as under : " 5. 1 have not given any loan to the plaintiff. I gave loan to both plaintiff and defendant together for purchasing the house. Both had asked me for a loan. I gave loan of Rs. 25,000 by issue of a cheque in favour of the defendant. On the same day, in repayment of the loan, the defendant gave me an undated cheque for Rs. 27,000. I see exhibit D-1. It is the same cheque for Rs. 27,000 which defendant had issu....
X X X X Extracts X X X X
X X X X Extracts X X X X
....perty mentioned therein was sold altogether for a different purpose. Further, according to the version given by P.W.-2, the amount towards his loan was paid by the plaintiff once in the month of June, 1973, and for the second time in the year 1977, as disclosed from his evidence at para 9 of his deposition. We have shown earlier as to how P.W.-2 himself has admitted in crystal clear terms at para 7 of his deposition as regards the payment of the several items of amount by the defendant. Under these circumstances, we have no hesitation whatsoever in holding that the version given by the plaintiff and P.W.-2 in this behalf cannot be countenanced at all. On the other hand, the version given by the defendant is corroborated by the answers given by P.W.-2. in the course of his cross-examination particularly at para 7. Further, he has stated that, as recorded in the memo of calculation at exhibit D-2, he had issued a cheque for Rs. 2,000 and Rs. 4,000 in the name of his sister, Sulochana, and that she encashed the cheque and paid the amount in cash to P.W.-2 as desired by P.W.-2 himself. It is necessary to recall here that P.W.-2 has admitted in the course of his cross-examination tha....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... the context of the totality of the circumstances which we have alluded to earlier with reference to the execution of the promissory note at exhibit P-2, we are inclined to accept the explanation. The fact that the plaintiff did not make any mention about the execution of the promissory note either in the notice at exhibit P-5 or in the plaint, and the fact that she has not stated in her evidence that the promissory note was executed by the plaintiff and the defendant and the fact that the promissory note itself suffers from certain inherent infirmities and the answers elicited in the cross-examination of P.W.-1 and P.W.-2 which are culled out hereinabove, if appreciated together, would unmistakably go to show that exhibits P-2 and P-3 are tainted. Under these circumstances, we have no hesitation whatsoever in concurring with the conclusion reached by the lower court that these are got up documents. Thus, on a reappraisal of the totality of the evidence on record, we have no hesitation to hold that the loan in fact was given to the defendant (since deceased) and the loan was repaid by the defendant alone to P.W.-2. If that be so, the next question which would arise for consid....
X X X X Extracts X X X X
X X X X Extracts X X X X
....what his intention was has to be decided on the basis of the surrounding circumstances, the relationship between the parties, the motives governing their action in bringing about the transaction and their subsequent conduct, etc. Section 2(a) (Act No. 45 of 1988) of the Benami Transactions (Prohibition) Act, 1988 (hereinafter referred to as " the Act "), defines a " benami transaction " as any transaction in which property is transferred to one person for a consideration paid or provided by another person. A perusal of the provisions of section 2(a) of the Act would go to show that the same has brought into being an element of change with reference to the meaning to be assigned to " benami transaction " in that it does not have any reference to the intention of the parties. However, one thing is very clear and that is that, before a transaction can be termed a " benami transaction ", the property should be transferred to one person for consideration paid or provided by another person. It is, therefore, necessary to see whether the transaction in the instant case, viz., the transaction reflected in exhibit P-1 sale deed - is such as would come within the compass of section 2(a....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ners are equally affected by the disability provision irrespective of the time of creation of the right. It is further pointed out by the Supreme Court that the subsequent events can be taken note of. It is further pointed out by the Supreme Court that, where a suit filed by the real owner for a declaration that certain property is held by the defendant benami and that the plaintiff is the real owner was decreed by the lower court but an appeal by special leave against the same was pending before the Supreme Court on the date of the commencement of the Act, the appellate court is competent to take into account legislative changes since the decision under appeal was given and its power is not confined only to see whether the lower court's decision was correct according to the law as it stood at the time when its decision was given. It is further pointed out therein that once the decree of the High Court has been appealed against, the matter became sub judice again and, thereafter, the Supreme Court had seisin of the whole case. In view of the provisions of the Act, therefore, the plaintiff's suit or action could not be decreed under the law. It is therefore clear that the said ratio....
X X X X Extracts X X X X
X X X X Extracts X X X X
....r of such property. " Under the circumstances, it would follow that it is not permissible for the defendant to contend that the plaintiff has no share in the property on the ground that consideration towards sale price proceeded from him alone and that the plaintiff is only a benamidar or a name-lender. Sri Ullal, however, argued that if the transaction discloses a benami transaction then section 4(3)(b) of the Act will apply to the facts of this case and section 4(2) of the Act will not apply at all. Section 4(3)(b) of the Act reads as under : " 4. Prohibition of the right to recover property held benami - . . . (3) Nothing in this section shall apply - . (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. " A perusal of the aforesaid provision would indeed go to show that the same has no application having regard to the fact that the conjunctive ingredients do not co-exist in the instant case as between the plaintiff and the defendant. In the light of what is stated here....