2023 (4) TMI 882 - BOMBAY HIGH COURT

Benami Transactions - family arrangement - exception in Section 4(3)(a) of the Benami Act - “Jurisdiction of the Court to entertain” under Section 9A of the CPC - Suit filed as barred under the provisions of the Benami Transactions (Prohibition) Act, 1988) - Whether the suit is barred by limitation ? - Scope of preliminary issue under Section 9A - requirement of evidence to decide the preliminary issues - The learned Single Judge observed that the issues of limitation and benami were mixed questions of fact and law requiring evidence - whether plaint was ex-facie barred by limitation on the basis of the admissions in the plaint itself? - HELD THAT:- The bar of Benami under Benami Act requires examination of factual aspects including the exceptions to Section 2(9) and 4(3). The question whether a transaction is Benami or not is therefore one of fact requiring evidence.

There is, therefore, no dispute that limitation and benami transactions being mixed questions of fact and law, require evidence. That being the position, such questions in view of paragraphs 50, 54, 56 of Nusli Neville Wadia vs. Ivory Properties [2019 (10) TMI 1314 - SUPREME COURT] cannot be decided under Section 9A.

In view of the law settled in the case of Nusli Neville Wadia vs. Ivory Properties (supra), we have no doubt in holding that, in the facts of this case, limitation and benami transactions are not covered within the ambit of “jurisdiction of the Court to entertain” under Section 9A of the CPC and cannot be decided as preliminary issues under Section 9A of the CPC. Section 9A only deals with issues of whether the Court does or does not have jurisdiction to entertain a suit.

Respondent’s interpretation is misplaced. A plain reading of the order clearly indicate that although the learned Single Judge kept importuning the Appellant to lead evidence as the same was necessary to decide the issues but the appellant refused to do so. There is a difference between refusing to lead evidence and evidence not being required to be led. In the facts of the case as borne out from the orders, the evidence was necessary to be led to decide the preliminary issues. Just because now that the Appellant can raise a point in the light of the Apex Court decision in the case of Nusli Neville Wadia vs. Ivory Properties (supra), objection cannot be raised to state that decision on preliminary issues on the basis of admission and pleadings ought to be considered without having to lead evidence. It is also evident from the above order that the Plaintiff, the Appellant herein, did not wish to lead evidence on either of the two preliminary issues.

Therefore, whether or not the appellant gave consent or elected to have the preliminary issues decided, that cannot come in the way of the law settled in the case of Nusli Neville Wadia vs. Ivory Properties (supra) being applied. The law laid down in Nusli Neville Wadia vs. Ivory Properties (supra) was always the law and the Appeal/ impugned order will have to be tested on that basis.

The present Appeal being tested on the touchstone of Section 9A in the light of the decision in the case of Nusli Neville Wadia vs. Ivory Properties (supra), and [2015 (9) TMI 1606 - BOMBAY HIGH COURT] clearly holding the requirement of evidence to decide the preliminary issues will have to be set aside and is hereby set aside.