MANGATHAI AMMAL (DIED) THROUGH LRS AND versus RAJESWARI & OTHERS on 9 May 2019

MANGATHAI AMMAL (DIED) THROUGH LRS AND OTHERS

v.

RAJESWARI & OTHERS

(Civil Appeal No. 4805 of 2019)

MAY 09, 2019

[L. NAGESWARA RAO AND M. R. SHAH, JJ.]

Benami transactions: Transactions, whether benami or not –Determination of – Held: Payment of part sale consideration cannotbe the sole criteria to hold the sale/transaction as benami – Intentionof the person who contributed the purchase money is determinativeof the nature of transaction – Intention has to be decided on thebasis of the surrounding circumstances; relationship of the parties;motives governing their action in bringing about the transactionand their subsequent conduct – On facts, courts below erred indecreeing the suit for partition of the properties by original plaintiffs-daughter-in-law and son-in-law, claiming 3/4[th] share in the suitproperties since the father-in-law had purchased the suit propertiesin the name of his wife-defendant no.1 by selling the ancestralproperties – Courts below erred in holding that the transactions/sale deeds were benami transactions – It erred in shifting the burdenon the defendants to prove that the sale transactions were not benamitransactions – Merely because of payment of part sale considerationand stamp duty at the time of the execution of the sale deed by thefather-in-law, it cannot be said that the sale deed in favour ofdefendant no.1 was benami transaction – Furthermore, from thefacts and circumstances, it cannot be said that the suit propertieswere purchased in the name of defendant no.1 by the husband fromthe funds received by selling of the ancestral properties – Thus, theorder passed by High Court and trial court holding that the plaintiffshave 3/4[th] share in the suit properties (except Item Nos. 1 and 3 ofthe suit properties) set aside – Benami Transaction (Prohibition)Act, 1988.

Partly allowing the appeal, the Court

HELD: 1.1 Both, the trial court and the High Court haveerred in shifting the burden on the defendants to prove that thesale transactions were not benami transactions. In fact when the

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Aplaintiffs’ claim, though not specifically pleaded in the plaint, thatthe Sale Deeds in respect of suit properties, which are in thename of defendant no.1, were benami transactions, the plaintiffshave failed to prove, by adducing cogent evidence, the intentionof the NM-father to purchase the suit properties in the name ofdefendant no.1-his wife. Even the reasoning and the findingsBrecorded by the trial court confirmed by the High Court whileholding the Sale Deeds/transactions in favour of defendant no.1as benami cannot be said to be germane and or fulfilling thecircumstances as are carved out by this Court. [Para 8.4, 9][633-F-H; 634-A]

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1.2 The first reason given by the trial court while holdingthe suit properties as benami transactions is that part saleconsideration was paid by NM at the time of the purchase of theproperty vide Sale Deed. The payment of part sale considerationcannot be the sole criteria to hold the sale/transaction as benami.DWhile considering a particular transaction as benami, the intentionof the person who contributed the purchase money isdeterminative of the nature of transaction. The intention of theperson, who contributed the purchase money, has to be decidedon the basis of the surrounding circumstances; the relationshipof the parties; the motives governing their action in bringing aboutEthe transaction and their subsequent conduct etc. NM, whocontributed part sale consideration by purchasing property mighthave contributed being the husband and therefore by merecontributing the part sale consideration, it cannot be inferred thatSale Deed in favour of the defendant no.1-wife was benamiFtransaction and for and at behalf of the joint family. Therefore,the trial court as well as the High Court erred in holding the suitproperties as benami transactions/ancestral properties on thebasis of the document-Sale deed. [Para 9.1] [634-B-F]

1.3 Merely because of the stamp duty at the time of theGexecution of the Sale Deed was purchased by NM, by that itself itcannot be said that the Sale Deed in favour of defendant no.1 wasbenami transaction. Except the said two documentary evidencesno other documentary evidence/transaction/Sale Deed in favourof defendant no.1 have been considered by the trial court andeven by the High Court. [Para 9.2] [634-F-G]H

1.4 On considering the Release Deed executed by N infavour of defendant no. 1 on payment of Rs.10,000/-, the inferencedrawn by the trial court and the High Court that therefore eventhe defendant no.1 also considered the share of the daughter andconsidered the suit properties as joint family properties andtherefore plaintiffs have also share in the suit properties isconcerned, is just a mis-reading and mis-interpretation of theevidence on record. In her deposition, defendant no.1 explainedthe payment of Rs.10,000/- to N, daughter and the Release Deedexecuted by her. It is specifically stated by her that though shehad no share in the suit properties, with a view to avoid any furtherlitigation in future and to be on safer side, Rs.10,000/- is paid andthe Release Deed was got executed by N in favour of defendantno.1. Even in the Release Deed, it is so specifically stated.Therefore, merely because to avoid any further litigation in futureand though N had no share in the suit properties, Rs.10,000/-was paid and the Release Deed was got executed in favour ofdefendant no.1, by that itself, it cannot be said that defendantno.1 treated the suit properties as ancestral properties and/orJoint Family Properties. [Para 9.3] [634-H; 635-A-D]

1.5 Even considering the Will executed by defendant no.1and the subsequent revocation of the Will is suggestive of thefact that defendant no.1 all throughout treated the suit propertyas her self-acquired property which according to her werepurchased from the Stridhana and selling of the jewellery.[Para 9.4] [635-D-E]

1.6 In the plaint the plaintiffs came out with the case thatthe suit properties purchased in the name of defendant no.1 byNM from the funds raised by selling the ancestral propertiesreceived by him. It was never the case on behalf of the plaintiffsthat the suit properties were purchased by NM in the name ofdefendant no.1 out of the income received from the ancestralproperties. However, considering the date of transactions withrespect to the suit properties and the ancestral properties soldby NM, it can be seen that all the suit properties purchased inthe name of defendant no.1 were much prior to the sale of theancestral properties by NM. The ancestral property was sold bythe NM on 11.11.1951. However, the Sale Deeds in favour of ABCD

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Adefendant no.1 were much prior to the sale of the property.Therefore, also it cannot be said that the suit properties werepurchased in the name of defendant no.1 by NM from the fundsreceived by selling of the ancestral properties. It can be said thatNM might have purchased the properties in the name of defendantno.1 in order to provide his wife with a secured life in the eventBof his death. It was the specific case on behalf of the defendantno.1 that the suit properties were purchased by her from theStridhana and on selling of the jewellery. [Para 10, 11] [635-E-H;636-A-B]

1.7 The benami transaction came to be amended in the yearC2016. As per Section 3 of the Benami Transaction (Prohibition)Act 1988, there was a presumption that the transaction made inthe name of the wife and children is for their benefit. By BenamiAmendment Act, 2016, Section 3 (2) of the Benami TransactionAct, 1988 the statutory presumption, which was rebuttable, hasDbeen omitted. The submission that in view of omission of Section3(2) of the Benami Transaction Act, the plea of statutorypresumption that the purchase made in the name of wife orchildren is for their benefit would not be available, cannot beaccepted. The Benami Transaction (Prohibition) Act would notbe applicable retrospectively. Even otherwise, the plaintiff hasEmiserably failed to discharge his onus to prove that the Sale Deedsexecuted in favour of defendant no.1 were benami transactionsand the same properties were purchased in the name of defendantno.1 by NM from the amount received by him from the sale ofother ancestral properties. [Para 12] [636-C-F]F

1.8 Once it is held that the Sale Deeds in favour of defendantno.1 were not benami transactions, in that case, suit properties,except property nos. 1 and 3, which were purchased in her nameand the same can be said to be her self-acquired properties andtherefore cannot be said to be Joint Family Properties, theGplaintiffs cannot be said to have any share in the suit properties(except property nos. 1 and 3). The impugned judgment and orderpassed by the High Court as well as the trial court holding thatthe plaintiffs have 3/4[th] share in the suit properties (except ItemNos. 1 and 3 of the suit properties) is quashed and set aside.[Para 12.1, 13] [636-F-G; 637-A-B]H

P. Leelavathi v. V. Shankarnarayana Rao (2019) 6SCALE 112 ; Jaydayal Poddar v. Bibi Hazra (Mst.)(1974) 1 SCC 3 : [1974] 1 SCR 70 ; Thakur Bhim Singhv. Thakur Kan Singh (1980) 3 SCC 72 – relied on.

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Om Prakash Sharma v. Rajendra Prasad Shewda(2015) 15 SCC 556 : [2015] 10 SCR 574 ; BinapaniPaul v. Pratima Ghosh (2007) 6 SCC 100 : [2007]5 SCR 946 ; Valliammal v. Subramaniam (2004) 7 SCC233 : [2004] 3 Suppl. SCR 966 – referred to.

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Case Law Reference

CIVIL APPELLATE JURISDICTION : Civil Appeal No. 4805of 2019.

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From the Judgment and Order dated 05.01.2016 of the HighCourt of Judicature at Madras in A.S. No. 785 of 1992.

V. Prabhakar, Ms. Jyoti Parasher, N. J. Ramchandar, S. Rajappa,Advs. for the Appellants.

G. Balaji, Adv. for the Respondents.

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The Judgment of the Court was delivered by

M. R. SHAH, J. 1. Leave granted.

2. Feeling aggrieved and dissatisfied with the impugned Judgmentand Order passed by the High Court of Judicature at Madras dated05.01.2016 passed in AS No.785 of 1992 dismissing the same andaffirming the Judgment and Decree dated 05.08.1992 passed by thelearned Subordinate Judge, Arni in O.S. No.124 of 1990 decreeing thesuit for partition by original plaintiff, the original defendant nos. 1 to 3have preferred the present appeal.

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A3. The facts leading to the present appeal in nutshell are asunder :

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A3. The facts leading to the present appeal in nutshell are asunder :

That, one Rajeswari and Others-original plaintiffs instituted a suitbearing O.S. No.124 of 1990 for partition of the suit properties andseparate possession. It was the case on behalf of the plaintiffs that theBfirst defendant is the wife of one Narayanasamy Mudaliar. That, thesaid Narayanasamy Mudaliar and original defendant no.1 had one sonand three daughters namely Elumalai (son), Ranganayaki (daughter),Nagabushanam (daughter) and Navaneetham (daughter). That, the sonElumalai and daughter Ranganayaki had died. The first plaintiff is thewife of Elumalai, the second plaintiff and plaintiff nos. 3 to 8 are theChusband and children of the deceased Ranganayaki. That, Elumalai andthe first plaintiff did not have issue. According to the original plaintiffs,Narayanasamy Mudaliar sold the ancestral properties and purchasedthe suit property in the name of first defendant - Mangathai Ammal(wife of Narayanasamy Mudaliar). Therefore, it was the case on behalfDof the plaintiffs that Narayanasamy Mudaliar and his son Elumalai areentitled to half share of the ancestral properties. That, it was the case onbehalf of the plaintiffs that the same Narayanasamy Mudaliar had diedtwenty years back to the filing of the suit. His share in the propertieswas inherited by Elumalai, defendant nos. 1 and 2 viz NagabushanamAmmal and Ranganayaki Ammal. That, the Ranganayaki died about sixEyears before filing of suit, therefore, her legal representatives viz originalplaintiff nos.2 to 8 inherited her share in the properties. That, theNagabushanam executed the Release Deed dated 24.04.1990 in favourof the first defendant. According to the plaintiffs, the first plaintiff isentitled to 5/8th share, plaintiff nos. 2 to 8 are entitled to 1/8th share and Fthe defendants are entitled to 1/4th share in the suit properties. Accordingto the plaintiffs, since the defendant tried to claim the suit properties, theplaintiffs filed the present suit for partition.

3.1 The suit was resisted by the defendants. As per the case ofthe first defendant, except item nos. 1 and 3 of the suit properties, theGother properties are self-acquired properties of the first defendant.According to the first defendant, the first item of the suit property waspurchased out of the money provided by her in her name. According tothe first defendant, the suit properties are not the ancestral properties ofNarayanasamy Mudaliar. It was denied that the suit properties werepurchased by selling the ancestral properties. It was the case on behalfH

of the defendant no.1 that except properties in item nos. 1 and 3 ofSchedule II, the properties were purchased by the defendant no.1 out ofthe stridhana she received from her parents’ house and by selling thegold jewellery. It was also the case on behalf of defendant no.1 thatafter purchasing the property from Thangavel Gounder and others; sheconstructed a house and is in possession and enjoyment of the saidproperty. According to the defendant no.1, the deceased NarayanasamyMudaliar was entitled to 47 cents in Survey No. 218/1 and 8 cents inSurvey No. 218/3 and the deceased Ranganayaki Ammal is entitled to1/5[th] share in the suit properties. It was also the case on behalf of thefirst defendant that, similarly, the first plaintiff’s husband is also entitledto 1/5[th] share, in which, first defendant and first plaintiff are entitled tohalf share in the suit properties. According to the first defendant, thefirst defendant’s daughter Nagabhushanam executed a Release Deedin respect of her own share. It was also the case on behalf of the firstdefendant that she never acted as a manager of the joint family. Accordingto her, she executed a Will dated 11.02.1987 in favour of plaintiff nos. 1and 2 and Nagabhushanam Ammal. However, since the beneficiaries ofthe Will did not take care of the first defendant, she revoked the Will on11.06.1990.

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3.2 Defendant nos. 2 and 3 supported defendant no.1. Accordingto defendant nos. 2 and 3, defendant no.1 mortgaged the property withdefendant no. 3 for a valuable consideration, which was also known tothe plaintiffs. Defendant nos. 2 and 3 also adopted the written statementfiled by defendant no.1.

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3.3 That the learned Trial Court framed the following issues:

“1) Whether the suit schedule properties are ancestral propertiesof husband of the 1[st] plaintiff namely Elumalai and thedeceased Narayansamy?

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2) Whether it is true that the 1[st] defendant had managed the suitschedule properties being the Manager of the Family?

3) Whether it is true that the Suit Schedule properties are jointlyGenjoyed by all the family members as Joint Family Property?

4) Whether the plaintiffs are entitled to claim partition in viewof the Release Deed dated 24.04.90 executed byNagabooshanam Ammal?

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A5)Whether it is true that the 1[st] defendant had executed a Willon 11.2.87 to and in favour of plaintiffs in respect of suitschedule property and revoked the said Will on 11.6.90?

6) Whether it is true that the plaintiffs are in joint possession ofthe suit schedule properties?B[[th]]

7) Whether the plaintiffs are entitled to get 3/4[[th]] share over thesuit schedule properties?

8) Whether the present suit is not valued properly?

9) To what relief the plaintiffs are entitled?

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C3.4 Before the Trial Court, on the side of the plaintiffs, fourwitnesses were examined and three documents Exh. A1 to A3 weremarked. On the side of the defendants, two witnesses were examinedand 19 documents Exh. B1 to B19 were marked. That, the learned TrialCourt, after taking into consideration the oral and documentary evidencesDof both the sides, passed a preliminary decree finding that the plaintiffsare entitled to 3/4[th] share in the suit properties. Feeling aggrieved anddissatisfied with the Judgment and Decree passed by the Trial Court,the original defendant nos. 1 to 3 preferred appeal before the High Court.That, by impugned Judgment and Order, the High Court has dismissedthe said appeal and has confirmed the Judgment and Decree passed byEthe Trial Court. Feeling aggrieved and dissatisfied with the impugnedJudgment and Order passed by the High Court dismissing the appealand confirming the Judgment and Decree passed by the learned TrialCourt, original defendant nos.1 to 3 have preferred the present appeal.

4. Shri V. Prabhakar, learned Counsel has appeared on behalf ofFthe appellants-original defendants and Shri G. Balaji, learned Counselhas appeared on behalf of the respondents-original plaintiffs.

5. Shri V. Prabhakar, learned Counsel appearing on behalf of theoriginal defendant nos.1 to 3 has vehemently submitted that in the factsand circumstances of the case, both, the learned Trial Court as well asGthe High Court have committed a grave error in decreeing the suit andholding that the original plaintiffs have 3/4[th] share in the suit properties.

5.1 It is further submitted by Shri V. Prabhakar, learned Counselappearing on behalf of the appellants-original defendant nos.1 to 3 thatthe suit properties were purchased by defendant no.1 out of the stridhanaHshe received from her parents and by selling the gold jewellery. It is submitted that, admittedly, the suit properties were purchased in the nameof original defendant no.1 and was in possession of defendant no.1. It issubmitted therefore, the finding that the properties were purchased byNarayanasamy Mudaliar is erroneous.

5.2 It is further submitted by Shri V. Prabhakar, learned Counselappearing on behalf of the appellants-original defendant nos.1 to 3 that ifit was the case on behalf of the original plaintiffs that the propertiespurchased in the name of defendant no.1 were the benami transactions,in that case, the onus is/was upon the plaintiffs to prove by leading cogentevidence that the transactions were benami transactions. It is submittedthat in the present case, the plaintiffs have failed to discharge the onusto prove that the transactions were benami transactions. It is submittedthat, both, the Trial Court as well as the High Court had erroneouslyshifted the burden upon the defendants to prove that the transactions/Sale Deeds in favour of defendant no.1 were not benami transactions. Itis submitted that the aforesaid is contrary to the settled proposition oflaw laid down by this Court.

5.3 It is further submitted by Shri V. Prabhakar, learned Counselappearing on behalf of the appellants-original defendant nos.1 to 3 thatin the present case, solely on considering two documents, namely, Exh.B3, Sale Deed in respect of one of the properties and Exh. B4, the SaleDeed with respect of two properties, the Courts below have consideredthe entire suit properties as ancestral properties and/or the same propertiespurchased from the funds raised by selling the ancestral properties.

5.4 It is further submitted by Shri V. Prabhakar, learned Counselappearing on behalf of the appellants-original defendant nos.1 to 3 thatmerely because some consideration or part consideration was paid bythe husband at the time of purchase of property at Exh. B3-Sale Deedand/or merely purchasing the stamp papers while purchasing the propertyat Exh. B4-Sale Deed, it cannot be said that the same properties as suchwere purchased from the funds raised by selling the ancestral propertiesand/or the same were purchased for and on behalf of joint family.

5.5 It is further submitted by Shri V. Prabhakar, learned Counselappearing on behalf of the appellants-original defendant nos.1 to 3 thatboth the Courts below have materially erred in misinterpreting the ReleaseDeed at Exh. A1. It is submitted that both the Courts below havematerially erred in holding the suit properties as joint family properties of A

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ANarayanasamy Mudaliar on the ground that execution of Release Deedat Exh. A1 by Nagabhushanam on payment of Rs.10,000/- toNagabhushanam and on such payment Nagabhushanam released hershare in the property, was good to hold that the properties are the jointfamily properties of Narayanasamy Mudaliar.

B5.6 It is further submitted by Shri V. Prabhakar, learned Counselappearing on behalf of the appellants-original defendant nos.1 to 3 thateven considering the documentary evidences on record, more particularly,Exh. B3 to B7, it can be seen that the suit properties were purchased inthe name of defendant no.1 were purchased much prior to the sale ofsome of the ancestral properties of Narayanasamy Mudaliar. It isCsubmitted that, therefore, the case on behalf of the plaintiffs that the suitproperties were purchased in the name of defendant no.1 out of thefunds raised on selling the ancestral properties of NarayanasamyMudaliar, cannot be accepted. Relying upon paragraph 10 of the decisionof this Court in the case of Om Prakash Sharma v. Rajendra PrasadDShewda, (2015) 15 SCC 556, it is submitted by Shri V. Prabhakar, learned

Counsel appearing on behalf of the appellants that as the transactions/Sale Deeds in favour of defendant no.1 were prior to the enactment ofthe Hindu Succession Act and the amendments made thereto from timeto time, even it can be said that the intention of the NarayanasamyMudaliar to purchase the properties in the name of defendant no.1-hisEwife was in order to provide the wife with a secured life in the event ofhis death.

5.7 Shri V. Prabhakar, learned Counsel appearing on behalf of theappellants-original defendant nos.1 to 3 submitted that even otherwise,the plaintiffs have failed to prove by leading cogent evidence that theFtransactions of sale in favour of defendant no.1 were benami transactions.It is submitted by Shri V. Prabhakar that even in the plaint also therewere no specific pleadings that the sale transactions of the suit propertiesin favour of defendant no.1 were benami transactions. It is submittedthat even the learned Trial Court also did not frame any specific issueGwith respect to benami transactions. It is submitted that even otherwiseon merits also and on considering the recent decision of this Court in thecase of P. Leelavathi v. V. Shankarnarayana Rao (2019) 6 SCALE112, in which after considering the earlier decisions of this Court in thecase of Jaydayal Poddar v. Bibi Hazra (Mst.) (1974) 1 SCC 3; ThakurBhim Singh v. Thakur Kan Singh (1980) 3 SCC 72; Binapani Paul v.

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Pratima Ghosh (2007) 6 SCC 100 and Valliammal v. Subramaniam(2004) 7 SCC 233, it cannot be said that the Sale Deeds executed infavour of defendant no.1 were benami transactions.

5.8 Making above submissions and relying upon above decisionsit is prayed to allow the present appeal.

6. Present appeal is vehemently opposed by Shri G. Balaji, learnedCounsel appearing on behalf of the respondents-original plaintiffs.

6.1 Shri G. Balaji, learned Counsel appearing on behalf of therespondents-original plaintiffs has vehemently submitted that onappreciation of entire evidence on record, both, learned Trial Court aswell as the High Court, have rightly held that the transactions of sale infavour of defendant no.1 were benami transactions as the said propertieswere purchased by Narayanasamy Mudaliar in the name of defendantno.1 out of the funds received from selling the ancestral properties. It issubmitted that on considering the documentary evidences Exh. B3, B4and even Exh. A1, the High Court has rightly observed and held that thetransactions/Sale Deeds in favour of defendant no.1 were benamitransactions and therefore the plaintiffs are entitled to 3/4[th] share in thesuit properties which were purchased in the name of defendant no.1 butpurchased out of the funds received from selling the ancestral propertiesby Narayanasamy Mudaliar.

6.2 It is further submitted by Shri G. Balaji, learned Counselappearing on behalf of the respondents-original plaintiffs that in the presentcase, all the conditions to prove the transactions as benami transactionsas laid down by this Court in the case of P. Leelavathi (Supra) havebeen satisfied.

6.3 It is vehemently submitted by Shri G. Balaji, learned Counselappearing on behalf of the respondents-original plaintiffs that in the presentcase, even from the intention and conduct of the parties it is proved thatthough the properties were in the name of defendant no.1, they werepurchased and enjoyed as Joint Family Properties. It is submitted thatotherwise the Nagabhushanam would not have released her share infavour of defendant no.1, if the daughter Nagabhushanam had no share.It is submitted that execution of the Release Deed by Nagabhushanamin favour of defendant no.1 suggests that defendant no.1 also consideredthe share of the daughter Nagabhushanam by treating the suit propertiesas Joint Family Properties.

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A6.4 It is further submitted by Shri G. Balaji, learned Counselappearing on behalf of the respondents-original plaintiffs that the Willdated 11.02.1987, executed by defendant no.1, also included even theproperties exclusively belonging to Narayanasamy Mudaliar. It issubmitted, therefore, the intention can be gathered from Exh. B8 andExh. B9 that the suit properties are Joint Family Properties and thereforeBliable for partition and not exclusive properties of defendant no.1.

6.5 It is further submitted by Shri G. Balaji, learned Counselappearing on behalf of the respondents-original plaintiffs that the suitproperties were purchased in the name of defendant no.1 during thelifetime of Narayanasamy Mudaliar. It is submitted that original defendantCno.1 had no independent income. It is submitted that NarayanasamyMudaliar had ancestral properties/agricultural lands which weregenerating income and he purchased all the properties in the name of hiswife-defendant no.1 from the income generated from the ancestralproperties and by selling some of the ancestral properties.

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6.6 It is further submitted by Shri G. Balaji, learned Counselappearing on behalf of the respondents-original plaintiffs that even thestatutory presumption which was rebuttable under Section 3 (2) of theBenami Transaction Act, 1988 has been omitted by Benami AmendmentAct of 2016. It is submitted that therefore as on date, there is no suchEstatutory presumption that the purchase made in the name of wife orchildren is for their benefit.

6.7 Making above submissions and relying upon above decisionsit is prayed to dismiss the present appeal.

7. Heard the learned Counsel appearing on behalf of the respectiveFparties at length. We have gone through and considered in detail thefindings recorded by the learned Trial Court as well as the High Court.We have also considered in detail the evidences on record both oral aswell as documentary.

7.1 At the outset, it is required to be noted that the original plaintiffsGinstituted the suit before the learned Trial Court for partition of the suitproperties and claiming 3/4[th] share with the pleadings that the suitproperties were ancestral properties and that the Narayanasamy Mudaliarhas purchased the suit properties in the name of his wife-defendant no.1out of the funds derived through selling his share of the property acquiredthrough ancestral nucleus to some other person and that the suit propertiesH

were in absolute possession and enjoyment of the Joint Family Propertysince the date of purchase. From the pleadings, it appears that it was notspecifically pleaded by the plaintiffs that the Sale Deeds/transactions infavour of defendant no.1 were benami transactions. It was also notpleaded that the suit properties were purchased in the name of defendantno.1 by Narayanasamy Mudaliar from the income derived out of theancestral properties. Even the learned Trial Court did not specificallyframe the issue that whether the transactions/Sale Deeds in favour ofdefendant no.1 are benami transactions or not? Despite the above, learnedTrial Court and the High Court have held that the transactions/Sale Deedsin favour of defendant no.1 were benami transactions. The aforesaidfindings recorded by the Trial Court confirmed by the High Court andthe consequent relief of partition granted in favour of the plaintiffs is thesubject matter of the present appeal.

8. While considering the issue involved in the present appeal viz.whether the transactions/Sale Deeds in favour of defendant no.1 can besaid to be benami transactions or not, the law on the benami transactionsis required to be considered and few decisions of this Court on theaforesaid are required to be referred to.

8.1 In the case of Jaydayal Poddar (Supra) it is specificallyobserved and held by this Court that the burden of proving that a particularsale is benami and the apparent purchaser is not the real owner, alwaysrests on the person asserting it to be sold. It is further observed that thisburden has to be strictly discharged by adducing legal evidence of adefinite character which would either directly prove the fact of the benamitransaction or establish circumstances unerringly and reasonably raisingan interference of that fact. In paragraph 6 of the aforesaid decision,this Court has observed and held as under :

“6. “It is well-settled that the burden of proving that a particularsale is benami and the apparent purchaser is not the real owner,always rests on the person asserting it to be so. This burden hasto be strictly discharged by adducing legal evidence of a definitecharacter which would either directly prove the fact of benami orestablish circumstances unerringly and reasonably raising aninference of that fact. The essence of a benami is the intention ofthe party or parties concerned; and not unoften, such intention isshrouded in a thick veil which cannot be easily pierced through.But such difficulties do not relieve the person asserting the AB

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Atransaction to be benami of any part of the serious onus that restson him; nor justify the acceptance of mere conjectures or surmises,as a substitute for proof. The reason is that a deed is a solemndocument prepared and executed after considerable deliberation,and the person expressly shown as the purchaser or transferee inthe deed, starts with the initial presumption in his favour that theBapparent state of affairs is the real state of affairs. Though thequestion whether a particular sale is benami or not, is largely oneof fact, and for determining this question, no absolute formulae oracid tests, uniformly applicable in all situations, can be laid down;yet in weighing the probabilities and for gathering the relevantCindicia, the courts are usually guided by these circumstances:(1)the source from which the purchase money came; (2) the natureand possession of the property, after the purchase; (3) motive, ifany, for giving the transaction a benami colour; (4) the position ofthe parties and the relationship if any, between the claimant andthe alleged benamidar; (5) the custody of the title deeds after theDsale and (6) the conduct of the parties concerned in dealing withthe property after the sale.In the case of Thakur Bhim Singh (Supra) this Court inparagraph 18 observed and held as under :

E“18. The principle governing the determination of the questionwhether a transfer is a benami transaction or not may be summedup thus: (1) the burden of showing that a transfer is a benamitransaction lies on the person who asserts that it is such atransaction; (2) it is proved that the purchase money came from aperson other than the person in whose favour the property isFtransferred, the purchase is prima facie assumed to be for thebenefit of the person who supplied the purchase money, unlessthere is evidence to the contrary; (3) the true character of thetransaction is governed by the intention of the person who hascontributed the purchase money and (4) the question as to whathis intention was has to be decided on the basis of the surroundingGcircumstances, the relationship of the parties, the motives governingtheir action in bringing about the transaction and their subsequentconduct, etc.”

8.2 In the case of P. Leelavathi (Supra) this Court held asunder :H

8.2 In the case of P. Leelavathi (Supra) this Court held asunder :H

“9.2 In Binapani Paul case (Supra), this Court again had anoccasion to consider the nature of benami transactions. Afterconsidering a catena of decisions of this Court on the point, thisCourt in that judgment observed and held that the source of moneyhad never been the sole consideration. It is merely one of therelevant considerations but not determinative in character. ThisCourt ultimately concluded after considering its earlier judgmentin the case of Valliammal v. Subramaniam (2004) 7 SCC 233that while considering whether a particular transaction is benamiin nature, the following six circumstances can be taken as a guide:

“(1) the source from which the purchase money came;

(2) the nature and possession of the property, after the purchase;

(3) motive, if any, for giving the transaction a benami colour;

(4) the position of the parties and the relationship, if any, betweenthe claimant and the alleged benamidar;

(5) the custody of the title deeds after the sale; and

(6) the conduct of the parties concerned in dealing with the propertyafter the sale. (Jaydayal Poddar v. Bibi Hazra (supra), SCC p.7, para6)”

8.3 After considering the aforesaid decision in the recent decisionof this Court in the case of P. Leelavathi (Supra), this Court has againreiterated that to hold that a particular transaction is benami in naturethe aforesaid six circumstances can be taken as a guide.

8.4 Applying law laid down by this Court in the aforesaid decisionsto the facts of the case on hand and the reasoning given by the TrialCourt confirmed by the High Court, it appears that both, the learnedTrial Court and the High Court have erred in shifting the burden on thedefendants to prove that the sale transactions were not benamitransactions. As held hereinabove in fact when the plaintiffs’ claim, thoughnot specifically pleaded in the plaint, that the Sale Deeds in respect ofsuit properties, which are in the name of defendant no.1, were benamitransactions, the plaintiffs have failed to prove, by adducing cogentevidence, the intention of the Narayanasamy Mudaliar to purchase thesuit properties in the name of defendant no.1 – his wife.

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A9. Even the reasoning and the findings recorded by the Trial Courtconfirmed by the High Court while holding the Sale Deeds/transactionsin favour of defendant no.1 as benami cannot be said to be germane andor fulfilling the circumstances as carved out by this Court in the aforesaiddecisions.B9.1 The first reason which is given by the learned Trial Court B9.1 The first reason which is given by the learned Trial Courtwhile holding the suit properties as benami transactions is that part saleconsideration was paid by Narayanasamy Mudaliar at the time of thepurchase of the property vide Sale Deed Exh. B3. As held by this Courtin catena of decisions referred to hereinabove, the payment of part saleconsideration cannot be the sole criteria to hold the sale/transaction asCbenami. While considering a particular transaction as benami, the intentionof the person who contributed the purchase money is determinative ofthe nature of transaction. The intention of the person, who contributedthe purchase money, has to be decided on the basis of the surroundingcircumstances; the relationship of the parties; the motives governingDtheir action in bringing about the transaction and their subsequent conductetc. It is required to be noted that Narayanasamy Mudaliar, whocontributed part sale consideration by purchasing property at Exh. B3,might have contributed being the husband and therefore by merecontributing the part sale consideration, it cannot be inferred that SaleDeed in favour of the defendant no.1-wife was benami transaction andEfor and at behalf of the joint family. Therefore, the Trial Court as well asthe High Court have committed a grave error in holding the suit propertiesas benami transactions/ancestral properties on the basis of the documentat Exh. B3.

9.2 Similarly, merely because of the stamp duty at the time of theFexecution of the Sale Deed at Exh. B4 was purchased by NarayanasamyMudaliar, by that itself it cannot be said that the Sale Deed at Exh. B4 infavour of defendant no.1 was benami transaction. It is required to benoted that except the aforesaid two documentary evidences at Exh. B3and B4, no other documentary evidence/transaction/Sale Deed in favourGof defendant no.1 have been considered by the learned Trial Court andeven by the High Court.

9.3 Now, so far as the findings recorded by the Trial Court andthe High Court on considering the Release Deed at Exh. A1 viz. theRelease Deed executed by Nagabushanam in favour of defendant no. 1Hon payment of Rs.10,000/- and therefore inference drawn by the learned Trial Court and the High Court that therefore even the defendant no.1also considered the share of the daughter and considered the suitproperties as joint family properties and therefore plaintiffs have alsoshare in the suit properties is concerned, the said finding is just a mis-reading and mis-interpretation of the evidence on record. In herdeposition, defendant no.1 has explained the payment of Rs.10,000/- toNagabushanam, daughter and the Release Deed executed by her. It isspecifically stated by her that though she had no share in the suitproperties, with a view to avoid any further litigation in future and to beon safer side, Rs.10,000/- is paid and the Release Deed was got executedby Nagabushanam in favour of defendant no.1. Even in the ReleaseDeed at Exh. A1, it is so specifically stated. Therefore, merely becauseto avoid any further litigation in future and though Nagabushanam hadno share in the suit properties, Rs.10,000/- was paid and the ReleaseDeed was got executed in favour of defendant no.1, by that itself, itcannot be said that defendant no.1 treated the suit properties as ancestralproperties and/or Joint Family Properties.

9.4 Even considering the Will executed by defendant no.1 dated11.02.1987 and the subsequent revocation of the Will is suggestive ofthe fact that defendant no.1 all throughout treated the suit property asher self-acquired property which according to her were purchased fromthe Stridhana and selling of the jewellery.

10. It is required to be noted that in the plaint the plaintiffs cameout with the case that the suit properties purchased in the name ofdefendant no.1 by Narayanasamy Mudaliar from the funds raised byselling the ancestral properties received by him. It was never the caseon behalf of the plaintiffs that the suit properties were purchased byNarayanasamy Mudaliar in the name of defendant no.1 out of the incomereceived from the ancestral properties. However, considering the dateof transactions with respect to the suit properties and the ancestralproperties sold by Narayanasamy Mudaliar, it can be seen that all thesuit properties purchased in the name of defendant no.1 were muchprior to the sale of the ancestral properties by Narayanasamy Mudaliar.The ancestral property was sold by the Narayanasamy Mudaliar (Exh.A3) on 11.11.1951. However, the Sale Deeds at Exh. B3, B4, B5, B6and B7 which are in favour of defendant no.1 were much prior to thesale of the property at Exh. A3. Therefore, also it cannot be said that thesuit properties were purchased in the name of defendant no.1 by A

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ANarayanasamy Mudaliar from the funds received by selling of theancestral properties.

11. Even considering the observations made by this Court inparagraph 10 in the case of Om Prakash Sharma (Supra) it can be saidthat Narayanasamy Mudaliar might have purchased the properties inBthe name of defendant no.1 in order to provide his wife with a securedlife in the event of his death. It is required to be noted that it was thespecific case on behalf of the defendant no.1 that the suit propertieswere purchased by her from the Stridhana and on selling of the jewellery.

12. It is required to be noted that the benami transaction came toCbe amended in the year 2016. As per Section 3 of the Benami Transaction(Prohibition) Act 1988, there was a presumption that the transactionmade in the name of the wife and children is for their benefit. By BenamiAmendment Act, 2016, Section 3 (2) of the Benami Transaction Act,1988 the statutory presumption, which was rebuttable, has been omitted.It is the case on behalf of the respondents that therefore in view ofDomission of Section 3(2) of the Benami Transaction Act, the plea ofstatutory presumption that the purchase made in the name of wife orchildren is for their benefit would not be available in the present case.Aforesaid cannot be accepted. As held by this Court in the case ofBinapani Paul (Supra) the Benami Transaction (Prohibition) Act wouldEnot be applicable retrospectively. Even otherwise and as observedhereinabove, the plaintiff has miserably failed to discharge his onus toprove that the Sale Deeds executed in favour of defendant no.1 werebenami transactions and the same properties were purchased in the nameof defendant no.1 by Narayanasamy Mudaliar from the amount receivedby him from the sale of other ancestral properties.F

12.1 Once it is held that the Sale Deeds in favour of defendantno.1 were not benami transactions, in that case, suit properties, exceptproperty nos. 1 and 3, which were purchased in her name and the samecan be said to be her self-acquired properties and therefore cannot besaid to be Joint Family Properties, the plaintiffs cannot be said to haveGany share in the suit properties (except property nos. 1 and 3). At thisstage, it is required to be noted that the learned Counsel appearing onbehalf of defendant no.1 has specifically stated and admitted that thesuit property Item nos. 1 and 3 can be said to be the ancestral propertiesand according to him even before the High Court also it was the case on H

behalf of the defendant no.1 that item nos. 1 and 3 of the suit propertiesare ancestral properties.

13. In view of the above and for the reasons stated above, thepresent appeal is partly allowed. The impugned judgement and orderpassed by the High Court as well as the Trial Court holding that theplaintiffs have 3/4[th] share in the suit properties (Except Item Nos. 1 and3 of the suit properties) are hereby quashed and set aside. It is observedand held that except Item Nos. 1 and 3 of the suit properties, the plaintiffshave no share in other suit properties. Preliminary Decree directed to bedrawn by the learned Trial Court, confirmed by the High Court, is herebydirected to be modified accordingly. The present appeal is partly allowedto the aforesaid extent. No costs.

Nidhi Jain

Appeal partly allowed.

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