TaxTMI 
TaxTMI 
2023 (6) TMI 1263
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....mise, one Kulsum Bi filed a suit for partition in O.S.No.2331 of 1981 on the file of the First Additional Judge, City Civil Court, Chennai, seeking preliminary decree for partition in respect of the suit property and other properties. In the said suit, a preliminary decree was passed on 31.01.1985 based on compromise between the parties thereto. Thereafter, an interim final decree was passed on 02.05.1988, wherein, the suit properties were allotted to the parties except three items of the suit property including the present suit property. The three items including the present suit property were directed to be sold by public auction. 2.1. It was further averred by the plaintiff that in the year 2011, the 9th defendant/ husband of 1st defendant approached the plaintiff with a proposal to jointly develop the suit property. He proposed to the plaintiff that the first defendant was having 410 sq ft of undivided land in the suit property as a co-owner and she would purchase the shares of other co-owners in terms of orders passed in O.S.No.2331 of 1981 and thereafter the suit property can be developed by constructing commercial or residential buildings. The 9th defendant requested the ....
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....itution of the firm and attempted to sell the property behind the back of the plaintiff and consequently the proposed joint venture got frustrated. Therefore, the plaintiff is entitled to proportionate land, namely 21,000 sq.ft, out of 85,949 sq.ft acquired through the investment made by the plaintiff. Therefore, the plaintiff was constrained to file a suit for the above said relief. Averments found in the written statement of the defendants 1,9 and 10: 3.1. The defendants 1, 9 and 10 resisted the suit on the ground that even assuming the plaint averments were taken to be true, the suit claim is barred by Prohibition of Benami Property Transaction Act, 1988 as amended by Act 43 of 2016. It was averred by the defendants that the suit claim would fall within the meaning of 'Benami transaction' as defined under Prohibition of Benami Property Transaction Act and hence the suit is barred under Section 4 of the said Act. 3.2. The first defendant is a co-owner of the suit property with other sharers and she had acquired the shares of few other co-owners on herself. In an application filed by the first defendant in the earlier partition suit, the suit property was allotted....
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.... by the defendants that the suit claim would not fall within the purview of the commercial dispute and the plaintiff had deliberately abused the process of the Court by filing the suit before the Commercial Division. The plaintiff admittedly, is not a co-owner and he has no cause of action to maintain the present prayer. 4. Defendants 1, 9 and 10 alone filed a written statement and contested the suit. The plaintiff gave up the defendants 3 and 10 by making an endorsement to that effect on 20.08.2020 and consequently the suit was dismissed as against them. The other defendants were set ex-parte. 5. Issues: This Court after considering the pleadings of the parties framed the following issues on 30.09.2019: (i) Whether the plaintiff is entitled to the relief of declaration that the plaintiff is the owner of 21,000 sq.ft out of 85,949 sq.ft in the suit schedule property? (ii) Whether the plaintiff is entitled to the relief of partition by metes and bounds as prayed for? (iii) Whether the suit is barred by law under the provisions of Prohibition of Benami Property Transaction Act, 1988? (iv) Whether the defendants 1, 9 and 10, the parties pur....
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....making payments on various dates got falsified. 7.4. The learned senior counsel submitted that the property was purchased in the name of first defendant out of the contribution made by the plaintiff only to facilitate quick acquisition of the shares of other co-owners. The first defendant acted for the benefit of the plaintiff in fiduciary capacity and purchased the properties in her name and therefore comes under the exception recognized by Prohibition of Benami Property Transaction Act, 1988. The learned counsel further submitted that the subject matter of the dispute is with regard to the joint venture and partnership agreement and hence it would constitute a commercial dispute within the meaning of Section 2(1) (c) xi and xv of the Commercial Courts Act, 2015 and consequently, this Court can entertain the suit. 7.5. The learned Senior counsel relied on the following judgments in support of his arguments: (i) Gannmani Anasuya & Ors vs Parvatini Amarendra Chowdhary and others reported in (2007) 10 SCC 296 for the proposition that even oral partnership is recognized in law and the same could be proved by the conduct of the parties; The learned counsel also relied....
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....e that he was in joint possession of the suit property by taking this Court to the admission made by PW.1 that the suit property belonged to the family of the first defendant and that he is not in possession of the same. Hence, it is the contention of the learned senior counsel that the suit prayer for declaration and partition is under valued on the basis of the false plea that the plaintiff was in joint possession of the suit property. The learned senior counsel also by taking this Court to the evidence of PW.1 submitted that PW.1 admitted that he had received Rs. 1.41 Crores through the 9th defendant. 8.3. The learned Senior Counsel further submitted that even assuming the contributions made by the plaintiff is proved, still in view of prohibition contained under Prohibition of Benami Property Transaction Act, the plaintiff was debarred to maintain the suit for declaration as a Co-owner of the property. 8.4. In support of his contentions, the learned Senior Counsel for the defendants relied on the following Judgments: (i) Rajinder Pershad (Dead) By Lrs vs Smt. Darshana Devi reported in (2001) 7 SCC 69, for the proposition that the party is expected to cross-examin....
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....n order to prove the same, the plaintiff examined himself as PW.1. However, the plaintiff failed to examine any independent witnesses in support of the plea of oral partnership. As rightly contended by the learned senior counsel for the defendants even in the plaint averments, the plea regarding the oral partnership is very vague and bereft of material particulars. The plaintiff has not pleaded the date, place etc., in which the oral agreement was entered into. There is no plea in whose presence the oral arrangement between the parties was entered into. Even during trial, the plaintiff has not examined any independent witnesses in support of the oral partnership agreement. Therefore, except the interested testimony of PW.1, there is no other acceptable evidence available on record to suggest oral partnership agreement. In such circumstances, we cannot come to a conclusion that there was an oral partnership agreement between the plaintiff and the contesting defendants. 13. The main legal plea raised by the contesting defendants is that the plaintiff is not entitled to maintain a suit prayer that he is a co-owner of the suit property on the ground that he contributed financially f....
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....hereby declared that benami transaction shall not include any transaction involving the allowing of possession of any property to be taken or retained in part performance of a contract referred to in section 53A of the Transfer of Property Act, 1882 (4 of 1882), if, under any law for the time being in force,- (i) consideration for such property has been provided by the person to whom possession of property has been allowed but the person who has granted possession thereof continues to hold ownership of such property; (ii) stamp duty on such transaction or arrangement has been paid; and (iii) the contract has been registered. 14. Section 4 of the said Act, which 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. (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 against ....
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....r, there is no evidence available on record to support the case of the plaintiff that he contributed Rs. 2,16,38,266/- to enable the first defendant purchased the suit property to the extent of 21,000 sq.ft. 16. In any event, even assuming the suit property was purchased by first defendant out of the contribution made by the plaintiff, it is the case of the plaintiff that it was purchased in the name of the first defendant for the benefit of future business entity to be formed by plaintiff and the defendants 1, 9 and 10. Therefore, it can only be treated as property purchased in the name of first defendant for the benefit of plaintiff and the contesting defendants. In such circumstances, the same would come under the Prohibition of Benami Property Transaction Act, as per the definition contained in Prohibition of Benami Transaction Act. 17. As far as contention raised by the learned Senior Counsel for the plaintiff that the 1st defendant stands in fiduciary capacity and hence exception recognized under Benami Prohibition Act gets attracted, is concerned, as discussed earlier, this Court already concluded that the plea of oral partnership was not proved by plaintiff. Hence, th....