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2026 (2) TMI 750
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....hority are detailed as under:- S. No. Name of property (village/ Tehsil & District) Khasra No. Area (in Acre) 1 Lohrakot, Tehsil Jaijepur, Distt: Janjgir Champa 408/4, 416/4, 431/3 0.59 2 417 1 3 408/1,416/1 0.57 4 423/6 0.4 5 418/1, 423/2 0.7 6 407/6 0.06 7 403 0.1 8 423/3,418/2 0.7 9 408/2,416/2, 431/1 0.29 10 437/2 0.28 11 407/2 0.15 12 404, 405/1, 405/2 0.68 13 446/3 0.54 14 419 0.97 15 407/5 0.06 16 407/7 0.06 17 408/2, 416/2, 431/1 0.3 18 Lohrakot, Tehsil Jaijepur, Distt: Janjgir Champa 420 0.70 19 Dumarpara, Naya Baradwar, Tahsil-Sakti, Distt: Janjgir Champa (C.G) 2251/10 1.3 20 2168/4 0.33 Total 9.78 2. The facts of the case are that the Initiating Officer had information that Shri Dwarika Gupta, S/o Shri Mangali Prasad Gupta, a non-tribal person had purchased various Tribal lands in the name of a tribal Shri Laxmi Chand Maravi at Villages-Lohrakot & Dumarpara (Total-9.7 acre or 3.958 ha) Tehsil Jaijaipur/Sakti, District Janjgir Champa, Chhattisgarh. Thereaf....
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.... vi. She stated in her statement that she and her son Shri Satish Maravi have saving accounts in the Indian Overseas bank branch at Hirri, Bilha, and the account nos. 322701000005698 & 322701000009545 respectively. Her husband Shri Laxmi Chand Maravi has saving bank account in State Bank of India branch in chakrabhata bearing account no. is 32730587726. She also stated that all of these bank accounts were maintained by her husband Late Shri Laxmi Chand Maravi. Further, she stated that she does not have any knowledge of ATM and cheque book of bank account of her husband Late Shri Laxmi Chand Maravi. vii. In respect of immovable properties, she has stated that she and her family have not bought or sold any immovable property in the last 10 years. She also stated that she and her family (her son- Shri Satish Maravi, her husband- Late Shri Laxmi Chand Maravi and three daughters) did not possess any land property, except the ancestral land/home, where they are presently residing with family at village- Hardi, Tehsil-Bilha, Distt: Bilaspur. viii. Regarding the details of lands and registry deeds in the name of Shri Laxmi Chand Maravi, she stated that she does not h....
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....t, 1988 and squarely falls u/s. 2(9)(A) of the PBPT Act, 1988. The Initiating Officer further concluded that Late Shri Laxmi Chand Maravi is the benamidar and holding the said land ("benami property") for benefit of Shri Dwarika Gupta ("beneficial owner"). On that conclusion a Show Cause Notice under sub-section (1) of Section 24 of the Prohibition of Benami Property Transaction Act, 1988 dated 20.09.2023 was issued to the benamidar and the beneficial owner. In response to the Show Cause Notice, they filed reply on 31.10.2023, before the Initiating Officer. After considering their submissions, the Initiating Officer concluded that said property held by the benamidar is benami property and the beneficial owner is Shri Dwarika Gupta. Hence, Initiating Officer passed the Order u/s. 24(4) of PBPT Act on 28.12.2023 provisionally attaching the property mentioned above. After receiving the reference and going through the same, the Adjudicating Authority issued the notice u/s. 26(1) of the PBPT Act, 1988 to the Benamidar and Beneficial Owner as to why the said property should not held as Benami Property. In reply to the Show-Cause Notice, the legal heirs of Late Laxmi Chand Maravi fi....
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.... - Janjgir Champa in Khasra No. 406, 407/1, 407/2, 407/3, 408, 411, 413, 414/2, 415/1, 415/2, 416, 417/1, 418, 419, 420, 421/1, 421/2, 423/1, 423/2 and 423/3 for Dolomite Mineral for a term of 23rd February 2018 to 22nd February 2068. Again, M/s Gupta Stone Mines had taken the consent of land owners of the aforesaid land prior to conducting of the Quarry operations over the subject area in the year 2017. 6. It is submitted that all the aforesaid lands belonged to Schedule Tribe due to which M/s Gupta Stone Mines would not have been able to purchase the land directly due to bar of Section 165(6) of Chhattisgarh Land Revenue Code for mining purpose and that too instantly at the request of land owners. Further, State Government does not entertain any request for transfer of land from Schedule Tribe to General Category for the purpose of Mining under Section 165(6) of Chhattisgarh Land Revenue Code in lieu of which M/s Gupta Stone Mines was constrained to provide funds through banks to Late Laxmi Chand Marawi to act as an agent and trustee for purchasing the aforesaid lands on behalf of the undersigned. It is an admitted position that all the lands involved in the present case....
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.... this stage. The term "fiduciary" has been explained by Corpus Juris Secundum as under: 'A general definition of the word which is sufficiently comprehensive to embrace all cases cannot well be given. The term is derived from the civil or Roman law. It connotes the idea of trust or confidence, contemplates good faith, rather than legal obligation, as the basis of the transaction, refers to the integrity, the fidelity, of the party trusted, rather than his credit or ability, and has been held to apply to all persons who occupy a position of peculiar confidence toward others, and to include those informal relations which exist whenever one party trusts and relies on another, as well as technical fiduciary relations." 11. The word "fiduciary", as a noun, means one who holds a thing in trust for another, a trustee, a person holding the character of a trustee, or a character analogous to that of a trustee with respect to the trust and confidence involved in it and the scrupulous good faith and candour which it requires; a person having the duty, created by his undertaking, to act primarily for another's benefit in matters connected with such undertaking. Also m....
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....ship is often a subject of controversy. It has been held to apply to all persons who occupy a position of peculiar confidence towards others, such as a trustee, executor, or administrator, director of a corporation or society, medical or religious adviser, husband and wife, an agent who appropriates money put into his hands for a specific purpose of investment, collector of city taxes who retains money officially collected, one who receives a note or other security for collection. In the following cases debt has been held to be not a fiduciary one: a factor who retains the money of his principal, an agent under an agreement to account and pay over monthly, one with whom a general deposit of money is made.' 14. It is submitted that when an agent is employed to purchase the property on behalf of his principal and does so in his own name, then, upon conveyance or transfer of the property to the agent, he stands as a trustee for the principal. The property in the hands of the agent is for the principal and the agent stands in the fiduciary capacity for the beneficial interest he had in the property as a trustee in light of the Section 88 of the Indian Trust Act. Late Mr. L....
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....n the name of Sh. Laxmi Chand Maravi by utilising the amount advanced by appellant no.2 Sh. Dwarika Gupta. Moreover, both the the appellants are contesting that the case would fall under the exception (ii) pertaining to fiduciary relationship of Section 2(9)(A) of PBPT, Act. By claiming said exception, the appellants impliedly admitted that the case is covered under Section 2(9)(A) of the PBPT Act and if the said exemption wouldn't be applicable, the case would be fit for proceedings under PBPT Act. Thus, there is no doubt that the case falls under the definition of 'Benami Transaction', subject to the exemption (ii) to Section 2(9)(A) of the PBPT Act. Contention on Behalf of Appellants 4. Ld. Counsel on behalf of the Appellants contended that the aforesaid transaction falls under the category of fiduciary relationship, as mentioned in exception (ii) to Section 2(9)(A) of Benami Transaction, under The Prohibition of Benami Property Transactions Act, 1988. It is in lieu of the fiduciary relationship between the Sh. Laxmi Chand Maravi and Sh. Dwarika Gupta of M/s Gupta Stone Mines that land comprised in Khasra No. 406, 407/1, 407/2, 407/3, 408, 411, 413, 414/2, 415/1, 415/2, 41....
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.... than his credit or ability, and has been held to apply to all persons who occupy a position of peculiar confidence toward others, and to include those informal relations which exist whenever one party trusts and relies on another, as well as technical fiduciary relations". 6. Ld. Counsel for the appellants contended that in the light of the facts recorded earlier, it is clear that a real purchaser is the respondent Sh. Dwarika Gupta, and Mr. Maravi just acted as an agent/authorised attorney, had purchased the property, but ostensibly had his name entered in the Sale Certificate inadvertently and without the consent of the employer. He pointed out that as per Section 88 of the Indian Trusts Act, 1882, an agent or other person bound in a fiduciary character to protect the interests of the principal and the former would hold the property for the benefit of the principal or the person on whose behalf he acted as an agent. In this regard he relied upon the matter of P.V. Sanakara Kurup v. Leelavathy Nambiar,(1994) 6 SCC 68, wherein it has been observed that: 3. The question of benami, therefore, does not arise, though Section 4 of the Benami Transactions (Prohibition) Act, ....
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....scope of fiduciary duty. [Scott, Austin W. "The Fiduciary Principle", California Law Review 37, No. 4 (1949): 539-55.] The person so entrusted with power is required to determine how to exercise that power. [ Tamar Frankel, Fiduciary Law, Oxford University Press, 2011] Fiduciaries are identified by ascendancy, power and control on the part of the stronger party and therefore, a fiduciary relationship implies a condition of superiority of one of the parties over the other. [Ken Coghill, Charles Sampford and Tim Smith "Fiduciary Duty and the Atmospheric Trust", Ashgate (2012)] It is not necessary that the relationship has to be defined as per law, it may exist under various circumstances, and exists in cases where there has been a special confidence placed in someone who is bound to act in good faith and with due regard to the interests of the one reposing the confidence. Such is normally the case with, inter alia, attorney-client, agent- principal, doctor-patient, parent-child, trustees-beneficiaries [ Section 88, Indian Trusts Act, 1882], legal guardian-ward [Section 20, Guardians and Wards Act, 1890], personal representatives, court appointed receivers and between the Directors of....
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....epository under the Depositories Act, 1996 and any other person as may be notified by the Central Government for this purpose". The second part starts with the word "and" which gives the list of persons covered under the fiduciary capacity. It means that the fiduciary relationship is as such as akin to the relationship existing between trustee-trust, executor-executee, partner-firm, director- company, depository, or a participant as an agent of a depository. Thus, besides the nature of the relationship as mentioned in the said exclusion clause, no other relationship can exist on the ground of fiduciary capacity, unless the same is notified by the Central Government. 8. Ld. Counsel for the respondent contended that in the present case, the Beneficial owner and the benamidar are in a relationship of a Master- Servant or employee-employer. It would have been wrong to say that the parties shared the fiduciary relationship, as the same was not notified by the Central Government and its nature is not akin to the relationship included in the statute. Reference of section 56(1) of the PBPT Act, 1961 is also drawn which says that Sections 81, 82 & 94 of the Indian Trusts Act, 1882, secti....
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....ld that section 170 of the CLR Code provides for avoidance of transfer in contravention of Section 165 of the CLR Code. 11. He pointed out that the purchase of the impugned lands in the name of the Appellant no.1 was just a way to defeat the provisions of Chhattisgarh Land Revenue Code. The real motive behind entering into the said benami transaction was that the sellers of the land were tribal persons and according to the Section 165 of Chhattisgarh Land Revenue Code, the tribal land can only be acquired by a tribal person. As the Beneficial Owner Sh. Dwarika Gupta is not a tribal person, so he got the land registered in the name of his employee i.e. the appellant Sh. Laxmi Chand Maravi, who is a tribal person (Since deceased). Section 53 of the said PBPT Act provides that where any person enters into a benami transactions in order to defeat the provisions of any law, the Beneficial Owner, the Benamidar and any other person, who abets or induces any person to enter into the benami transaction shall be guilty of the offence of benami transaction, which is liable to be punished with rigorous imprisonment for a term of 1 to 7 years and also fine of up to 25 percent of the fair mar....
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....lationship in the capacity of a duty appointed agent, was a pre-existing fact in that case. The substantial questions of law before the Hon'ble Court were whether the title to the suit property vests in the petitioner or his principal (respondent), and whether she is entitled to the declaration and recovery of possession sought in that behalf. It was held that though the sale-certificate ostensibly stands in his name, he obviously obtained it while acting as an agent and power-of-attorney of the respondent. It was obtained without her knowledge and consent, playing fraud on her. 47. In Central Public Information Officer, Supreme Court of India vs. Subhash Chandra Agarwal MANU/SC/1561/2019 (13.11.2019) it was held as follows: "200........ It is not necessary that the relationship has to be defined as per law, it may exist under various circumstances, and exists in cases where there has been a special confidence placed in someone who is bound to act in good faith and with due regard to the interests of the one reposing the confidence. Such is normally the case with, inter alia, attorney-client, agent- principal, doctor-patient, parent-child, trustees- beneficiar....
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....o protect the interest of other persons' included a large variety of relationships. The heart and soul of the matter is that wherever as between two persons one is bound to protect the interests of the other and the former availing of that relationship makes a pecuniary gain for himself, the provisions of Section 88 would be attracted, irrespective of any designation which is immaterial. "20. the fiduciary capacity cannot be used as an exception in all the circumstances which may include transfer of property for or is held for illegal purpose. It cannot be even when there is a concluded contract which pass on the title to others then keeping the property by the person on whose favor title gets transferred would not keep it in "fiduciary capacity" rather with the transfer of the title, the relationship would also change and those cases would not fall in the sweep of the exception of fiduciary capacity. It would be simpliciter in those cases where the money has been kept with other persons on trust for safe custody." 56. In the present case not only was there a transfer of title to the property in the name of the Benamidar, Sh. Onkar Singh but also the same was ....
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....the PBPT Act. There was no Special or General Power of Attorney executed by Sh. Dwarika Gupta in his favour. Hence, in absence of the same, question of execution of the sale deed in favour of Sh. Dwarika Gupta was not possible. The impugned sale deed is silent that Vendee Laxmi Chand Maravi purchased the land for the benefit of Sh. Dwarika Gupta or tendered the sale consideration on his behalf. Also, the appellant no.2 should have been present in-person at the time of execution of sale-deed, in absence of Power of Attorney, however, he was not present. No permission from competent authority was taken before execution of said sale deed for granting permission in favour of Sh. Dwarika Gupta i.e., by a tribal in favour of non-tribal. Further, the details of the transactions in the bank account of the benamidar made by the beneficial owner and subsequent transfer made by the benamidar, to various sellers/ vendors of the tribal lands is clearly evident. Also, it is on record that only the appellant Late Laxmi Chand Maravi, had moved an application on 29.09.2021 seeking permission of the District Collector, Janjgir Champa (C.G.) for sale of certain parcels of lands in the name of Sh. Dwa....