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Benami Property - Case Laws
Showing 61 to 80 of 302 Records
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2022 (8) TMI 1047 - SUPREME COURT
Constitutional validity - Amendment to Prohibition of Benami Property Transactions Act, 1988 as amended by the Benami Transactions (Prohibition) Amendment Act, 2016 - retrospective or prospective effect - Attachment of property - Punishment of impresonment for offence - HELD THAT:- In the case at hand, the authority that initiates such confiscation, is granted extensive powers of discovery, inspection, compelling attendance, compelling production of documents. They are further empowered to take the assistance of police officers, custom officers, income tax officers and other relevant officers for furnishing information. It is also pertinent to note that any person who fails to furnish information, is subjected to a penalty of ₹25,000/( Rupees TwentyFive Thousand) under Section 54(A). It is also necessary to note that a person who supplies false information before any authority, is subjected to rigorous imprisonment of upto 5 years under Section 54 of the 2016 Act.
This Court is aware of the fact that the ‘Right to Property’ is not a fundamental right, rather it is a constitutional right that can be abridged by law. However, this Court is not concerned with the constitutionality of such a measure, wherein such considerations have to be balanced. Rather, the focus is only on the characterization of retroactive confiscation, which in these facts and circumstances, are punitive.
In view of the fact that this Court has already held that the criminal provisions under the 1988 Act were arbitrary and incapable of application, the law through the 2016 amendment could not retroactively apply for confiscation of those transactions entered into between 05.09.1988 to 25.10.2016 as the same would tantamount to punitive punishment, in the absence of any other form of punishment. It is in this unique circumstance that confiscation contemplated under the period between 05.09.1988 and 25.10.2016 would characterise itself as punitive, if such confiscation is allowed retroactively. Usually, when confiscation is enforced retroactively, the logical reason for accepting such an action would be that the continuation of such a property or instrument, would be dangerous for the community to be left free in circulation.
When we come to the present enactment, history points to a different story wherein benami transactions were an accepted form of holding in our country. In fact, the Privy Council had, at one point of time, praised the sui generis evolution of the doctrine of trust in the Indian law. The response by the Government and the Law Commission to curb benami transactions was also not sufficient as it was conceded before this Court that Sections 3 and 5 of the 1988 Act in reality, dehors the legality, remained only on paper and were never implemented on ground. Any attempt by the legislature to impose such restrictions retroactively would no doubt be susceptible to prohibitions under Article 20(1) of the Constitution.
Looked at from a different angle, continuation of only the civil provisions under Section 4, etc., would mean that the legislative intention was to ensure that the ostensible owner would continue to have full ownership over the property, without allowing the real owner to interfere with the rights of benamidar. If that be the case, then without effective any enforcement proceedings for a long span of time, the rights that have crystallized since 1988, would be in jeopardy. Such implied intrusion into the right to property cannot be permitted to operate retroactively, as that would be unduly harsh and arbitrary.
We hold as under:
a) Section 3(2) of the unamended 1988 Act is declared as unconstitutional for being manifestly arbitrary. Accordingly, Section 3(2) of the 2016 Act is also unconstitutional as it is violative of Article 20(1) of the Constitution.
b) In rem forfeiture provision under Section 5 of the unamended Act of 1988, prior to the 2016 Amendment Act, was unconstitutional for being manifestly arbitrary.
c) The 2016 Amendment Act was not merely procedural, rather, prescribed substantive provisions.
d) In rem forfeiture provision under Section 5 of the 2016 Act, being punitive in nature, can only be applied prospectively and not retroactively.
e) Concerned authorities cannot initiate or continue criminal prosecution or confiscation proceedings for transactions entered into prior to the coming into force of the 2016 Act, viz., 25.10.2016. As a consequence of the above declaration, all such prosecutions or confiscation proceedings shall stand quashed.
f) As this Court is not concerned with the constitutionality of such independent forfeiture proceedings contemplated under the 2016 Amendment Act on the other grounds, the aforesaid questions are left open to be adjudicated in appropriate proceedings.
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2022 (8) TMI 426 - DELHI HIGH COURT
Benami transactions - matter was heard by one authority and the judgment was pronounced by another authority - jurisdiction of Adjudicating Authority, Mumbai - scope of notification dated 17.09.2021 extending the time period from 30.09.2021 to 31.03.2022 for pronouncing judgments in cases where hearings had been completed and orders were reserved cannot be applied to the present cases - provisional Attachment Orders were passed by the Initiating Officer under the Prohibition for Benami Property Transactions Act - HELD THAT:- The notification dated 17.09.2021, would apply to such of those officers who had reserved orders, but had not pronounced it within the time as stipulated by the notification. The said notification cannot be extended to an officer who has ceased to occupy the post. Further, the notification dated 17.09.2021 only extended the period from 30.09.2021 to 31.03.2022 to deliver judgments in cases where the Adjudicating Authority was yet to deliver its judgments.
Mr. Hari Govind Singh had not pronounced any judgment prior to 08.10.2021 and on that day, Mr. Hari Govind Singh, who was only holding additional charge ceased to be Adjudicating Authority, New Delhi.
A writ is maintainable when there is a right. In the absence of any right, a writ cannot be passed. The Appellant has not been able to demonstrate violation of any right or breach of any notification which states that an Authority should pronounce the judgment in a matter heard by it even after the person, who heard the matter, has ceased to occupy the chair. This Court, therefore, does not find any reason to interfere with the judgment passed by the learned Single Judge in the Writ Petitions.
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2022 (7) TMI 779 - MADRAS HIGH COURT
Benami Transactions - Notice and attachment of property involved in benami transaction - applicability of the principles of natural justice and fair play - HELD THAT:- Sub section (3) to section 24 states that the Initiating Officer, who is of the opinion that the person in possession of the property held benami, may alienate the property during the period specified in the notice, may, with the previous approval of the Approving Authority, by order in writing, attach the property provisionally, for a period of 90 days from the last day of the month in which the notice under section 24(1) is issued. According to section 24(4)(a)(i), the Initiating Officer, after conducting enquiry and calling for reports / evidence and taking into account all the relevant materials, shall pass an order continuing the provisional attachment of the property till the passing of the order by the Adjudicating Authority under sub section (3) of section 26. Under section 24(4)(a)(ii), the Initiating Officer may revoke the provisional attachment of the property with the prior approval of the Approving Authority. Section 24(5) requires the Initiating Officer, who passes an order continuing the provisional attachment of the property under section 24(4)(a)(i), to draw up a statement of the case and refer it to the Adjudicating Authority, within fifteen days from the date of the attachment.
As noticed earlier, the appellants in the writ proceedings, questioned the action of the first respondent under section 24(4)(a)(i) of the Act, in ordering continuance of the attachment made under section 24(3) till the final order under section 26(3) is passed by the Adjudicating Authority. Upon considering the rival submissions and the decisions relied on by the parties, the learned Judge has dismissed the writ petitions filed by the appellants, along with other connected cases, by the common order dated 25.10.2021.
As grievance of the appellants is that the first respondent did not furnish the entire documents relied on by them, nor provided any opportunity to the appellants to cross examine the persons whose statements have been referred to in the impugned proceedings and as such, the orders passed under section 24(4) of the Act, which were impugned in the writ petitions, are arbitrary, illegal and violative of the principles of natural justice. Whereas, it is the specific stand of the respondents that they have supplied the required documents to the appellants and that, there is no provision for providing an opportunity to cross examine the witnesses from whom they have collected the information regarding benami properties, at the preliminary stage and therefore, the question of violation of the principles of natural justice does not arise herein.
Concededly, in the notices dated 01.11.2019 issued under section 24(1) of the Act, the first respondent has set out the reasons for forming an opinion that the appellants are benamidars in respect of the properties in question; and they were called upon to show cause as to why the properties should not be treated as benami properties, on or before 18.11.2019. Though the appellants raised their objections to the same, failed to produce the documents called for by the first respondent, to show that the alleged transactions were reversed subsequently, but they complained that there is no fair play on the part of the respondent authorities, while passing orders under section 24(4) of the Act.
As we are of the opinion that in the absence of any provision of law as well as the compelling circumstances warranting the respondent authorities to provide an opportunity of cross examination of witnesses, whose statements have been relied on by the respondent authorities, to the appellants at the stage of section 24 proceedings, the plea raised by the appellants in this regard, cannot be countenanced. No error in the orders passed by the first respondent, under section 24(4) of the Act, as an interim measure, in order to protect the interest of the Revenue. The learned Judge has also rightly affirmed the same and directed the respondent authorities to proceed further in accordance with law. Thus, the appellants have not made out any case to interfere with the order impugned herein as well as the orders impunged in the writ petitions at this stage.
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2022 (7) TMI 530 - TELANGANA HIGH COURT
Benami transaction - 5th respondent exercising powers under Section 18(2) of the Benami Property Act has provisionally attached the properties - HELD THAT:- Adjudicating Authority is empowered to make or cause to be made inquiries and to call for reports or evidence as it deems fit. It has also the authority to take into account all relevant materials besides reply of the noticee and thereafter to take a decision one way or the other holding the property not to be a benami property and revoking the attachment order or holding the property to be a benami property and confirming the attachment order.
Considering the fact that petitioners before us are widows and facing stringent provisions of the Benami Property Act, it would meet the ends of justice if the Adjudicating Authority on receipt of application of the petitioners call for the relevant documents/evidence from authorised authorities including the Special Investigation Team and thereafter hand over copies of the same to the petitioners so as to enable them to make effective defence.
Accordingly following directions are issued:
(i) Petitioners shall submit application(s) before the Adjudicating Authority within two (02) weeks from today mentioning therein the documents required for their defence and in whose custody the documents are being kept.
(ii) On receipt of such application(s), the Adjudicating Authority shall requisition the relevant documents/evidence from the concerned authorities.
(iii) On receipt of the documents/evidence by the Adjudicating Authority, petitioners or their authorised representative shall be permitted to go through the same and on their request, photo copies of such documents may be made available to the petitioners or their authorised representative.
(iv) Thereafter, petitioners shall file their reply to the notice issued by the Adjudicating Authority
(v) Adjudicating Authority shall consider their reply and all other materials on record and thereafter pass an order in terms of Sub- Section (3) of Section 26 of the Benami Property Act.
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2022 (7) TMI 529 - MADRAS HIGH COURT
Benami Property Transaction - validity of continuing the provisional attachment - prime contention of the learned counsel for the appellant is that the appellant was not at all involved in the alleged transaction, which the first respondent is treating as benami transaction - grievance of the appellant is that the first respondent did not furnish the entire documents relied on by them, nor provide any opportunity to the appellant to cross examine the persons whose statements have been referred to in the impugned proceedings and as such, the order passed under section 24(4) of the Act, which was impugned in the writ petition, is arbitrary, illegal and violative of the principles of natural justice.
HELD THAT:- Applicability of the principles of natural justice and fair play, depends on the facts and circumstances of each case and is subjected to statutory provisions; and that, the proceedings under section 24 only require a recording of prima facie opinion as to the benami nature of the transaction. It is an admitted case that the appellant failed to submit his reply to the notice issued under section 24(1). As such, the first respondent, after making enquiry and calling for reports or evidence and taking into account all the relevant materials, has, with the prior approval of the Approving Authority, passed the order under section 24(4), continuing the provisional attachment of the property till the passing of the order by the Adjudicating Authority under section 26(3), which is purely provisional in nature. That apart, the provisions of law mandate the respondent authorities to furnish such documents, particulars or evidence and provide an opportunity of being heard to the appellant only at the stage of adjudication proceedings; and there is no provision under the Act to provide an opportunity to the appellant to cross examine the witnesses at the preliminary stage.
As in the absence of any provision of law as well as the compelling circumstances warranting the respondent authorities to provide an opportunity of cross examination of witnesses, whose statements have been relied on by the respondent authorities to the appellant at the stage of section 24 proceedings, the plea raised by the appellant in this regard, cannot be countenanced. Therefore, we do not find any error in the order passed by the first respondent, as an interim measure, continuing the provisional attachment order of the property till the passing of the order under section 26(3) by the adjudicating authority. The learned Judge has also rightly affirmed the same and directed the respondent authorities to proceed further in accordance with law. Thus, the appellant has not made out any case to interfere with the order impugned herein as well as the order impunged in the writ petition at this stage.
Writ appeal stands dismissed.
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2022 (7) TMI 528 - MADRAS HIGH COURT
Benami Property Transactions - provisional attachment of the property - applicability of the principles of natural justice - grievance of the appellants is that the first respondent did not furnish the entire documents relied on by them, nor provided any opportunity to the appellants to cross examine the persons whose statements have been referred to in the impugned proceedings and as such, the orders passed under section 24(4) which were impugned in the writ petitions, are arbitrary, illegal and violative of the principles of natural justice - HELD THAT:- It is an admitted case that the appellants failed to furnish the necessary documents to substantiate their stand that the alleged transactions are not benami transactions. As such, the first respondent, after making enquiry and calling for reports or evidence and taking into account all the relevant materials, has, with the prior approval of the Approving Authority, passed the separate orders under section 24(4), continuing the provisional attachment of the property till the passing of the order by the Adjudicating Authority under section 26(3), which are purely provisional in nature. That apart, the provisions of law mandate the respondent authorities to furnish such documents, particulars or evidence and provide an opportunity of being heard to the appellants only at the stage of adjudication proceedings; and there is no provision under the Act to provide an opportuity to the appellants to cross examine the witnesses at the preliminary stage
We are of the opinion that in the absence of any provision of law as well as the compelling circumstances warranting the respondent authorities to provide an opportunity of cross examination of witnesses, whose statements have been relied on by the respondent authorities, to the appellants at the stage of section 24 proceedings, the plea raised by the appellants in this regard, cannot be countenanced. Therefore, we do not find any error in the orders passed by the first respondent, as an interim measure, continuing the provisional attachment order of the property till the passing of the order under section 26(3) by the adjudicating authority. The learned Judge has also rightly affirmed the same and directed the respondent authorities to proceed further in accordance with law. Thus, the appellants have not made out any case to interfere with the order impugned herein as well as the orders impunged in the writ petition at this stage
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2022 (6) TMI 327 - MADRAS HIGH COURT
Benami transaction - availability of joint family property or income - joint family acquisition - Purchase of property in the name of wife (Mrs. A) - Presumption of joint family income and joint family funds - Whether (Mrs. A) held the property for the benefit of the joint family members? - HELD THAT:- The plaintiff has nowhere alleged that (Mrs. A) held the property for the benefit of the joint family members. Mere pleading that she was a name lender would not be sufficient. If (Mrs. A) was running the family business and was in a dominant position, then, the purchase of a property from out of the joint family funds would be in the nature of a trust. It can be stated that she was holding the property for the benefit of all the members of the joint family. But such is not a case here. (Mrs. A) was a mere housewife. It was Shanmugavel Asari who purchased the property in the name of his wife from out of the joint family funds. The statute would presume that the purchase was for the benefit of (Mrs. A) and it was not a benami purchase. Of-course, the presumption is rebuttable. To rebut the statutory presumption, there must be firm foundation in pleadings as well as evidence. In the pleadings, there is no averment that (Mrs. A) held the property for the benefit of the joint family members. (Mrs. A) examined herself as D.W.3 and not even a suggestion has been put in this regard. This is a clear case of complete lack of pleadings and lack of proofs. The very purpose of enacting the Central Act 45 of 1988 is to prohibit the benami transactions. Of-course, the statute carved out certain exceptions. But then, every benami transaction cannot be allowed to be sustained by bringing it within the scope of the exceptions.
A careful reading of the statutory scheme as applied to the factual matrix leads me to the conclusion that the purchase of the suit property was very much for the benefit of (Mrs. A) and therefore, the appellant did acquire valid title under Ex.A5. The fourth substantial question of law is answered in favour of the appellant. The impugned judgment and decree passed by the first Appellate Court is set aside. The decision of the Trial Court is restored.
As per the undertaking given by the appellant, the appellant is directed to deposit a sum of Rs.1.00 lakh within a period of six weeks from the date of receipt of copy of this judgment to the credit of the suit on the file of the Principal District Munsif Court, Sivagangai. The said amount shall remain in court deposit for a period of one year. If the plaintiff Arunachalam decides to accept this judgment, it is open for him to withdraw the said amount.
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2022 (6) TMI 287 - KARNATAKA HIGH COURT
Benami Property Transaction - title over the suit properties - application for temporary injunction to restrain the appellant from alienating the properties - purchase of a property by husband in the name of the wife - respondent is the husband of the appellant - HELD THAT:- Though the appellant has contended that she purchased the suit properties from her own income, there is no material to substantiate her contention. Rather she has admitted that loan was raised in their joint names for purchasing the property and that the respondent repaid the loan. The appellant is a housewife and for this reason, it is difficult to believe that she could purchase the suit properties. It is the clear case of the respondent that he was working as a Subedar in the Indian Army and till 2015, the appellant and the children were living with him. In this view, it may not be possible to hold at this stage that she had independent source of income.
Moreover purchase of a property by husband in the name of the wife cannot be called a benami transaction and such type of transaction falls within the exception no. 3 to clause 'A' of sub-section 9 of section 2 of the Prohibition of Benami Property Transactions Act, 1988. In this view the respondent has made out a prima facie case that he has got the right to seek declaration of his title over the suit properties.
The appellant has made her intention very clear to alienate the property. She may have stated that because the respondent neglected to maintain her and their children and this has necessitated the alienation, but this reason cannot be considered to hold that she has every right to alienate the property, especially in a circumstance where she has not produced any material to show that the suit properties can be considered as her absolute properties. Section 14 of the Hindu Succession Act does not apply to the present circumstance. In this view if the alienation takes place, certainly the respondent's interest would be affected. Circumstances indicate the balance of convenience being in favour of the respondent. The principle laid in the case of R. Dilip Kumar Vs. Ramu [1992 (6) TMI 185 - KARNATAKA HIGH COURT] is actually not helpful to the appellant. The principle that no order of injunction can be issued if the plaintiff's case is doubtful, is restated in the said decision. On the premise of the facts of that case, the co-ordinate Bench of this court declined to grant an order of temporary injunction.
As it is found that discretion is properly exercised by the trial court for granting temporary injunction, there cannot be interference in the appeal filed under Order 43 Rule 1 CPC.
Regarding the limitation period as argued by the appellant's counsel, it may be stated that the date of purchase of the property, in the facts and circumstances of the case on hand, cannot be considered as date of accrual of cause of action. The date of denial of the right of the plaintiff is what matters for reckoning the period of limitation and therefore the argument of the learned counsel cannot be accepted at this stage. The trial court may give a finding with regard to limitation if an issue is framed to that effect.
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2022 (5) TMI 1546 - GAUHATI HIGH COURT
Attachment of property of petitioner - de jure owner - violation of the procedure, including the requirement to arrive at a satisfaction before forming an opinion that the property in question may be alienated during the period specified in the notice - Section 24(3) of the Prohibition of Benami Property Transactions Act, 1988.
The petitioners submits that they are ready and willing to submit the reply to the show cause notice which is an obligation under Section 24(1) of the Act and prays for time of two weeks for the said purpose.
HELD THAT:- This Court is of the view that interest of justice would be served if a period of 10 days is granted to the petitioners to submit the reply to the show cause notice dated 30.03.2022 - In the event, the reply is filed within 10 days from today i.e., 06.06.2022, the respondent authorities would consider the same strictly in accordance with the provisions laid down in Section 24 of the Act.
Writ petition disposed off.
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2022 (5) TMI 663 - ALLAHABAD HIGH COURT
Offence under Prohibition of Benami Property Transactions - attachment/confiscation proceeding - HELD THAT:- Considering the arguments advanced by the learned counsel for the applicant, learned Special Counsel for the Income Tax Department and going through the pleadings in the application, impugned orders as well as other relevant documents, it is evident that attachment/confiscation order has already been stayed by the Tribunal vide order dated 04.12.2019, but in the complaint, this fact is not disclosed. Rather, emphasis has been made that the property of the applicant is already adjudicated and confiscation order was already remanded by the competent authority.
The matter requires consideration.
Respondent may file counter affidavit within four weeks. Rejoinder affidavit, if any, may be filed within one week thereafter.
List in the 3rd week of July, 2022.
Till the next date of listing, impugned proceedings shall remain stayed.
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2022 (5) TMI 594 - DELHI HIGH COURT
Prohibition Benami Property Transactions - change of the Adjudicating Authority - grievance of the petitioners essentially is that on more than one occasion the Adjudicating Authority constituted under the Prohibition for Benami Property Transactions Act, 1988 [“1988 Act”] has been transferred out after final hearing of matters had been concluded and orders reserved - HELD THAT:- As the change of the Adjudicating Authority firstly came about by virtue of the statutory amendments which were introduced. Further although the Adjudicating Authority of Mumbai who held additional charge of Delhi had reserved orders on 16 September 2021, no final verdict was rendered prior to appointment of Mr. Sanjog Kapoor in October 2021. From the aforesaid it is manifest that no wrongdoing can be fastened upon the respondents nor can they be held accountable for a failure on the part of the erstwhile Adjudicating Authority to have rendered final judgment prior to the appointment and posting of Mr. Sanjog Kapoor in October 2021.
The Court further finds its unable to either countenance or discern an indefeasible right which may be recognised in law as inhering in the petitioners to seek continuance of the authority who had heard the matter on 16 September 2021 despite the appointment of Mr. Sanjog Kapoor in October 2021. Once that officer came to be appointed as the competent authority for SAFEMA, he statutorily and by operation of law also became the Adjudicating Authority for the purposes of the 1988 Act. Admittedly, the authority who had heard the matter had not rendered judgment prior to 1 October 2021. The consequences which would flow from the appointment which was made on 1 October 2021 could not have possibly been interdicted by any administrative order directing the continuance of the officer who had reserved orders on 16 September 2021.
The reliance placed by learned counsel for the petitioners on certain practice directions which this Court follows while effecting transfers of Judicial Officers is noticed only to be rejected. This since the appointment of Mr. Sanjog Kapoor was validly made and in any case does not form subject matter of challenge. The petitioners as noted above cannot not claim any right which may be enforced under Article 226 of the Constitution to seek the continued posting of Mr. Hari Govind Singh notwithstanding the appointment of Mr. Sanjog Kapoor in October 2021. Regard must also be had to the undisputed fact that Mr. Hari Govind Singh was essentially appointed as the Adjudicating Authority to deal with matters placed before the Bench dealing with matters relating to the 1988 Act at Mumbai. He had only been granted additional charge of the Bench at New Delhi. Viewed in that light there was a clear and continuing imperative operating upon the respondents to make a regular appointment of an Adjudicating Authority insofar as the Bench at Delhi is concerned.
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2022 (5) TMI 263 - CALCUTTA HIGH COURT
Benami transactions - beneficial/Real owner of property - plaintiff has to establish that he has purchased the property in the name of wife or that he is holding the said property as a trustee for the benefit of his elder brother and the wives of the two brothers - HELD THAT:- We have not been shown any evidence which would prove that the said property was purchased out of the fund of the appellants or the conduct of the parties are such which would create an impression that the property was purchased for the benefit of Chanchal Kumar Dutta and wives of the two brothers. On the contrary, D.W.-1 has categorically admitted that Chanchal Kumar Dutta is the co-sharer in respect of the property over which Sanat Kumar Dutta is claiming absolute ownership. D.W.-1 is the wife of Sanat Kumar Dutta. Moreover, as noticed earlier D.W.-1 has admitted to have received fund from Chanchal Kumar Dutta to raise certain constructions in the house which would demolish the case of exclusivity of Sanat Kumar Dutta in relation to the property in question.
We have carefully examined the evidence. We do not find from evidence that the appellants have able to satisfy the aforesaid two conditions in claiming as the true owner of the suit property. On such lack of evidence and establishing his right over the property as owner thereof or that such consideration money was paid by him alone, we do not find any reason to interfere with the order passed.
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2022 (5) TMI 262 - TELANGANA HIGH COURT
Benami transaction - Beneficial owner of property - Provisional attachment order - scope of Amendment Act of 2016 - transaction in question was arranged and executed in a planned manner by M/s.Nexus Feeds Limited, the petitioner, which has been treated as the beneficial owner so that its funds out of unknown sources get parked in the name of the benamidar in the form of shares - HELD THAT:- It is apparent that Section 2 (9) (A) and Section 2 (9) (C) are substantive provisions creating the offence of benami transaction. These two provisions are significantly and substantially wider than the definition of benami transaction under Section 2 (a) of the unamended 1988 Act. Therefore, Section 2 (9) (A) and Section 2 (9) (C) can only have effect prospectively. Central Government has notified the date of coming into force of the Amendment Act of 2016 as 01.11.2016. Therefore, these two provisions cannot be applied to a transaction which took place prior to 01.11.2016. Admittedly, in the present case, the transaction in question is dated 14.12.2011. That being the position, we have no hesitation to hold that the show cause notice dated 30.12.2019, provisional attachment order dated 31.12.2019 and the impugned order dated 30.03.2021 are null and void being without jurisdiction. Consequently, the impugned order is set aside and quashed.
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2022 (4) TMI 1575 - SUPREME COURT
Benami transactions - indulgence in prohibited transactions - second appellant passed an order provisionally attaching the property of the respondent company under Section 24(4)(b)(i) of the Act pending adjudication by the first appellant - period of limitation for filing an appeal - as mainly contended on behalf of the respondents that the orders passed by the first appellant are barred by limitation - As decided by HC [2022 (2) TMI 602 - MADRAS HIGH COURT] Learned Judge was not correct in entertaining the writ petitions, when there being an efficacious appeal remedy under Section 46 of the Act, where all the contentions, including whether the order has been passed by the Adjudicating Authority in accordance with Section 26 (7) of the Act, could have been raised and decided. As already discussed and delved in detail above, the words “date of the order” appearing in Section 46 can only be interpreted and read to mean “date of receipt of the order” for the purpose of computing the limitation for filing the appeal under Section 46 of the Act.
Learned Judge without going into the question of maintainability of the writ petitions, travelled into the case on the ground of limitation raised by the respondents / writ petitioners, as prescribed under Section 26(7) of the Act and rendered a finding on the same.
HELD THAT:- Issue notice, returnable on 18th July, 2022.
In the meanwhile, the petitioner would file an appeal before the appropriate authority on all grounds permissible including the ground pertaining to limitation. If the appeal is preferred within ten days from today, the some would not be dismissed on the ground of delay.
Dasti service, in addition, is permitted.
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2022 (4) TMI 661 - MADRAS HIGH COURT
Qualifications for appointment of Chairperson and Members of Appellate Tribunal - Constitutional validity of Sections 9 and 32(2)(a) of the Prohibition of Benami Property Transactions Act, 1988 as amended by the Benami Transactions (Prohibition) Amendment Act, 2016 - prayer is to declare Section 32(2)(a) of the Act of 1988 to be unconstitutional and to suitably amend the provision so as to make a person who had served as a Judge or the member of the Bar to be eligible to be appointed as Judicial Member of the Appellate Tribunal - HELD THAT:- The principle laid down in the case of Union of India v. R.Gandhi, President, Madras Bar Association,[2010 (5) TMI 393 - SUPREME COURT] has application to all the Tribunals and was not rendered on the fact situation alone. It is for that reason a specific direction was given that administrative support for all the Tribunals should be from the Ministry of Law and Justice. The principal issue decided qua the basic structure of constitution ensures the separation of powers and independence of the Judiciary from the clutches of the Executive.
The matter was examined by the Division Bench of this court in the case of Shamnad Basheer v. Union of India and others [2015 (3) TMI 943 - MADRAS HIGH COURT] and considering the issue that the proceedings before the Tribunal would be judicial in nature, the necessity for appointment of a member from the judiciary or the bar was realized. It was for the reason that prior to constitution of the Tribunal, the adjudication of the issue was by the courts. Therefore, with the constitution of the tribunals, they would be discharging the work earlier discharged by the courts and adopting the Westminister policy which prescribes the qualification akin to that of the judicial officer who has been dealing with such matters prior to the constitution of the tribunal. The necessity and importance of a judicial member and, that too, a person who served as a Judge or a member of the Bar was felt and, accordingly, the Division Bench of this Court held certain provisions of the Trademarks Act, 1999 and the Patents Act, 1970 to be unconstitutional.
It is true that the extent of judicial review that can be exercised in a given case is quite limited. Though a constitutional court can declare a provision to be unconstitutional, it should not give any direction to the Legislature to make an amendment in a particular way. The judicial restraint is, therefore, being hailed as a virtue. However, in a case where a direction has been given by the Apex Court to have the judicial independence, it is required to be followed by the High Courts as well as the Executive.
In view of the position aforesaid, we hold Section 32(2)(a) of the Act of 1988 to be unconstitutional.The respondent is directed to frame the provision keeping in mind the directions of the Apex Court in the case of Union of India v. R.Gandhi, President, Madras Bar Association [2010 (5) TMI 393 - SUPREME COURT]. The amended provision may be brought in immediately.
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2022 (3) TMI 1008 - CALCUTTA HIGH COURT
Benami transaction - preliminary decree passed by the learned Civil Judge - Trial Judge passed a decree disregarding the amendments made in Sections 3 and 4 of the Prohibition of Benami Property Transactions Act, 1988 - HELD THAT:- Trial Judge has failed to appreciate that the property was purchased by the father in the name of the mother and accordingly, the said property should be treated as the property of the father. On the demise of the father, the parties shall inherit the property in equal measure.
It is true, that the learned Trial Judge has relied upon the unamended Sections 3 and 4 of the Prohibition of Benami Property Transactions Act, 1988 in arriving at a finding that the plaintiff no.1 is the co-owner of 8 anas share of the 'kha' schedule property. However, by reason of amendment, to which our attention is drawn by Mr. Prasad, the mother becomes the absolute owner of the 'kha' schedule property which was purchased in her name by her husband. Mr. Prasad submits that the property was purchased in the joint names of the plaintiff no.1 and her husband. Although, the learned Trial Judge has referred to the unamended provision but the new amended provision conclusively vested the right in favour of her towards her 8 anas claim in 'kha' schedule property.
In view thereof, the order of the learned Trial Judge is upheld, however, for the reason recorded in this order. The appeal fails.
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2022 (3) TMI 1007 - SIKKIM HIGH COURT
Benami transaction - absolute owner of suit property - Respondent No.2 in his written statement denied and disputed the Suit of the Appellant as being based on falsity and concealment of facts - Whether the Defendant No.1 is the bona fide and absolute owner of the suit property having purchased the same from her Stridhan and had the right to sell the suit property to Defendant No.2? - HELD THAT:- As perused documents Exhibit P1 to Exhibit P206 relied on by the Appellant. The documents have no connection whatsoever with the instant matter in which the Appellant is primarily to prove that he is the owner of the suit premises as claimed by him.
Appellant is neither the applicant nor does the document mention him. Exhibit P194 is a money receipt executed between Respondent No.1 and Respondent No.2 for purchase of the suit properties for a consideration value of ₹ 3,00,00,000/- (Rupees three crores) only. The Appellant is a witness to the execution of this document of his own volition, thereby well aware of what transpired between the Respondents regarding sale and purchase of the suit property. He lodged no complaint of having been coerced by the Respondents to execute any document before any authority.
The other documents relied on by the Appellant being Exhibit 1 to Exhibit 187 pertain to the lottery business of M/s. Bindhya Agency with its Office in Lajpat Nagar, New Delhi, and lend no credence to the claim of the Appellant with regard to purchase and ownership of the suit properties. Similarly, Exhibit 189 to Exhibit 206 are of no assistance whatsoever to establish even the prima facie case of the Appellant, this despite walking meticulously through the evidence and documents relied on by him. It thus emerges with clarity that he has no documentary evidence whatsoever to verify his claim of ownership over the suit property. To a large extent the documents indicate amounts of money received by the Appellant from his lottery business, but this alone does not suffice to establish that he purchased the suit property sans specific trail of income, investment, viz., purchase of the suit property, and registration of it in his name.
It thus stands to conclude that the Appellant failed to establish even a prima facie case and his Suit was rightly dismissed. The concurrent findings of the Learned Courts below are upheld. The impugned Judgment and Decree of the Learned First Appellate Court warrants no interference.Appeal dismissed.
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2022 (3) TMI 1006 - MADHYA PRADESH HIGH COURT
Benami Transaction - suit filed claiming the suit property as Joint Hindu Family Property - whether under Order 7 Rule 11 or under Order 14 Rule 2 of Code of Civil Procedure if the same can be decided without taking evidence of the parties? - HELD THAT:- This is a well settled legal position as expounded by Hon'ble Supreme Court in the case of Nusli Neville Wadia Vs. Ivory Properties and Others [2019 (10) TMI 1314 - SUPREME COURT] that, for disposal of an application filed under Order 7 Rule 11 of CPC, the averment of plaint can only be taken into consideration. The version of defendant (s), either in their application or written statement, cannot be looked into for the purpose. Further, the suit or the part thereof, can be disposed of on the basis of pure legal issue whether under Order 7 Rule 11 or under Order 14 Rule 2 of Code of Civil Procedure if the same can be decided without taking evidence of the parties. However, the mixed issues of law and facts cannot be decided preliminarily and in that situation, the court has to decide all the issues after the evidence is adduced by the parties.
Indisputedly, present suit has been filed claiming the suit property as Joint Hindu Family Property and as per the legal position expounded in the judgment cited on behalf of the respondent/plaintiff, the bar of Section 4 of Benami Transaction Act 1988 is not attracted in case of joint family property. The judgments cited on behalf of the petitioners are not related to the joint family property, therefore, the same are not applicable to this case. Thus, the objection in this regard is not tenable.
Trial court after taking into consideration the averments of plaint has rightly concluded that the issue of limitation is a mixed question of law and fact which can be decided only after evidence of the parties. The supportive facts raised with regard to limitation by the petitioners cannot be taken into consideration at this initial stage. Therefore, the trial court has not committed any illegality on this count also.
Trial court has primarily concluded that the valuation of the suit has been made properly and adequate court fee has been paid accordingly. The issue of court fee has also been kept open for the later stage, therefore, looking to the frame of plaint, the finding with regard to court fee cannot be faulted with at this stage.
Though maintainability of the present suit has been questioned but such objection as to maintainability of the suit has not been taken before the trial court and no written statement has been filed as yet, therefore, this court refrains to consider the same straight way in this petition.
While maintaining the impugned order, the petition is disposed of with a direction that the defendants/petitioners shall file written statement by the next date fixed by the trial court in the matter. They may take all the grounds as to maintainability of the present suit. The trial court shall not grant any further adjournment for the purpose. After filing of written statement, the trial Court, without further loss of time, shall frame the issues
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2022 (2) TMI 683 - MADRAS HIGH COURT
Benami transaction - real owners of suit property - non-consideration of the Will set up by the defendants - When the 1st defendant has died pending suit and the suit properties will devolve on the legal heirs whether the Will pleaded by the defendants have to be proved or not for claiming exclusive right? - HELD THAT:- Though the first defendant has not produced any relevant document to show how can she purchased the property, that would not defeat the case of the first defendant. In fact, the pleadings set out in the plaint, the plaintiffs have not averred about the income derived from the joint family property. Therefore, on that score alone, the evidence let in by the plaintiffs cannot be taken into account. Therefore, in view of the above, this Court cannot be termed that the suit schedule property, is the joint family property of the plaintiffs and the defendants' family.
As far as the relief of injunction also, being the reason that the plaintiffs have not proved their case, as the suit property is the joint family property of the plaintiffs and the defendants, they cannot ask such a relief as against the first defendant, who is having a title. Therefore, in all, the evidence let in by the plaintiffs have not shown that the property has been purchased by utilising the funds realised from the ancestral property of the plaintiffs and defendants. Since the title and possession have not been proved by the plaintiffs, they are not entitled to the relief of injunction. The Courts below had also traversed in the same line and concurrently held that the plaintiffs have not proved their case.
While at the time of framing the substantial questions of law, the alleged Will executed by the first defendant has been mentioned as the same has not been answered. In this regard, on going through the judgment rendered by the Court below, after the death of the first defendant, the plaintiffs have not taken any steps to amend the plaint, and impleaded the legal representatives of the deceased first defendant.
It is well settled that without any pleading, the evidence let in on that score, cannot be looked into. Herein also, without producing the alleged Will and without amending the pleading in respect to the death of the first defendant and in respect to the execution of the Will, it is not necessary for the Court below to decide whether the suit property will devolve upon the legal representatives of the deceased first defendant. In this regard, the only option available for the plaintiffs is to file a suit for partition and in otherwise, answering the said issue, is not necessary in this Second Appeal.
Substantial questions of law, are all answered in favour of the respondents and thereby, the Second Appeal is dismissed.
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2022 (2) TMI 602 - MADRAS HIGH COURT
Benami transactions - indulgence in prohibited transactions - second appellant passed an order provisionally attaching the property of the respondent company under Section 24(4)(b)(i) of the Act pending adjudication by the first appellant - period of limitation for filing an appeal - as mainly contended on behalf of the respondents that the orders passed by the first appellant are barred by limitation - HELD THAT:- Learned Judge was not correct in entertaining the writ petitions, when there being an efficacious appeal remedy under Section 46 of the Act, where all the contentions, including whether the order has been passed by the Adjudicating Authority in accordance with Section 26 (7) of the Act, could have been raised and decided. As already discussed and delved in detail above, the words “date of the order” appearing in Section 46 can only be interpreted and read to mean “date of receipt of the order” for the purpose of computing the limitation for filing the appeal under Section 46 of the Act.
Learned Judge without going into the question of maintainability of the writ petitions, travelled into the case on the ground of limitation raised by the respondents / writ petitioners, as prescribed under Section 26(7) of the Act and rendered a finding on the same. Therefore, this Court has to necessarily test the said order under appeal in the light of the provisions of the Act and the applicable legal principles. Accordingly, on such application, this Court has reached the firm conclusion that the orders passed by the first appellant do not suffer from infirmity on the ground of alleged violation of Section 26 (7) of the Act. In other words, the orders impugned in the writ petitions are well within the timeline as stated under Section 26 (7) and is immune from attack on this ground.
Since the other aspects on the merits of the case are not the subject matter of this batch of appeals and all these intra court appeals have arisen from the order of the Learned Judge, where the only ground taken by the respondents/ writ petitioners was on the limitation as per Section 26(7) of the Act, this Court is not rendering any finding on the merits of the orders passed by the first appellant / Adjudicating Authority under Section 26 (3) of the Act.
As therefore left open to the parties to challenge the orders impugned in the writ petitions before the Appellate Authority under Section 46 of the Act, which authority shall entertain the appeal, if it is filed within 45 days from the date of receipt of this judgment, so as to exclude the time consumed in litigation, in the interest of parties, and in consonance with the general principles of the law of limitation. Except the issue decided by this Court with regard to the validity of the orders passed by the first appellant in accordance with section 26(7) of the Act, all other issues are left open to be decided by the Appellate Authority, in accordance with law.
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