TMI Blog2023 (7) TMI 1136X X X X Extracts X X X X X X X X Extracts X X X X ..... ssion Act therefore, as a matter of law, defendant No.2 holds the subject property as full owner and not as a limited owner, and no averment in the plaint detracts from this position. Besides, the plaintiffs' own best case, as admitted inter-alia in para 8 of the plaint, is that they routed money through third parties to buy the subject property in the name of defendant No.2. This is precisely the kind of mischief that section 4 of the Benami Transactions Act seeks to prevent, and therefore bars any claim made in respect of property so held by a third party benami for the person who funds the purchase. This in fact is the very purpose and intention of the legislature in enacting the Benami Transactions Act. Insofar as the plaintiffs' contention that defendant No.2 falls within the exception engrafted in section 2(9)(A)(ii) to the definition of benami transaction , a bare reading of the plaint would show that there is not even a whisper of an allegation that defendant No.2 was a partner of the partnership firm, the monies of which were allegedly routed for purchasing the subject property. There is also no allegation in the plaint that defendant No.2 was a partner of t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s rejection of the plaint inter-alia on the grounds that the plaint does not disclose a cause of action and that it is also barred by law. 2. In the present suit, the plaintiffs have made the following prayers : (i) Pass a decree of declaration declaring that the property bearing No. F-61, Rajouri Garden, New Delhi is joint property of Plaintiffs and Defendants, both have 50% share each in the same. (ii) Pass a decree of cancellation in favour of Plaintiffs and against Defendants thereby canceling the sale deed dated 27.03.1992 Registered in the office of Sub Registrar Delhi bearing registration No.18570, in Addl. Book No. I, Vol. No. 5686 on Page No. 109 to 122 registered on 27.03.1992 in the name of Defendant No.2. (iii) Appoint a Local Commissioner with directions to suggest the mode of partition bearing No.F-61, Rajouri Garden, New Delhi by metes and bounds and to submit a report before this Hon ble Court thereby declaring the share of the Plaintiffs in the same whereupon, this Hon ble Court may be pleased to pass a Preliminary Decree. (iv) Pass a final decree of partition on the basis of report submitted by learned Local Commissioner and the Plaintiff ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... said property was always treated as such. Defendant No.2 had no income of her own. By paying monies from the firm to third parties and thereafter receiving cheque in lieu thereof from third parties in the name of Defendant No.2, suit property has been purchased. * * * * * 12. Since the families of Plaintiff No.1 and Defendant No.1 growing, need was felt to divide the business and properties. As such in February, 2013, the parties sat together and entered into oral settlement i.e. family settlement to divide the properties between them. In fact the same was also put in writing by way of Settlement Deed as under: (a) It was agreed between the parties that property bearing No.BF-29, Tagore Garden, New Delhi will go to the share of Plaintiff No.1 and his family members and Plaintiff No.1 would pay Rs.75 Lacs to Defendant No.1 being 1.5 Cr. Total cost of construction and half of it i.e. Rs.75 Las from Plaintiff No.1 s share. (b) Ownership of Shop No. 5158 will be that of Plaintiff No.1 and Shop No. 5162 would be that of the Defendant No. 1. (c) Cash and Stock of both the shops will be divided in the ratio of 60:40 between Defendant No.1 and Plaintiff No.1. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... it was purchased in her name. As such the Plaintiff is entitled to legal character that property No.F-61, Rajouri Garden, New Delhi is a joint property of the parties in which the Plaintiffs have 50% share and the Defendants balance 50%. In the circumstances, the Plaintiffs claim decree of declaration declaring that Plaintiffs and Defendants have 50% share each in property No.F-61, Rajouri Garden, New Delhi. If the sale deed dated 27.03.1992 Registered in the office of Sub Registrar Delhi bearing registration No. 18570 in Addl. Book No. I Vol. No. 5686 on Page No. 109 to 122 registered on 27.03.1992 in the name of Defendant No.2 is left out standing, which document is voidable, serious injury will be caused to the Plaintiff. In the circumstances, the Plaintiffs seek a decree of cancellation of the aforesaid sale deed. Further direction is also sought to Sub Registrar, Delhi to cancel the said document. * * * * * 20. The cause of action arisen to file he (sic) present suit arose in favour of the Plaintiffs from time to time as explained hereinabove. The cause of action in (sic) February 2017 when the Defendant No.1 started claiming the suit property being F-61, Rajouri ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cifics, particulars or support for any of the claims, either by way of clear averments in the plaint or even by reference to the documents filed alongwith the plaint; 6.3. Insofar as the claim of the subject property being partnership property is concerned, defendant No.2 points-out that there is nothing in the plaint to explain, even by way of an averment, as to how the subject property came to be partnership property. There is no allegation in the plaint that the subject property was purchased by the partnership firm; nor that the property was purchased in the names of the partners; nor that defendant No.2 is one of the partners in the partnership firm; nor even that the subject property has been shown in the Income Tax Returns or any other returns or documents filed, as the property of the partnership firm; 6.4. It is further pointed-out that there is also no averment in the plaint to show how defendant No.2 is holding the subject property in a fiduciary capacity for the plaintiffs. It is submitted that nowhere is it stated in the plaint that defendant No.2 was one of the partners of the partnership firm. On point to fact, it is the admitted case between the parties that d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cener of any such HUF; nor any allegation that the subject property was declared as joint family property in any official filings or records; 6.6. Insofar as the allegation in the plaint that the subject property is being held by defendant No.2 as part of a family settlement , it is submitted on behalf of defendant No. 2 that this allegation also does not require any consideration for the reason firstly, that defendant No.2 is not a signatory to the said alleged family settlement; secondly, the alleged document purporting to be a family settlement does not record that it is a memorandum recording an oral family settlement, and if by way thereof, title to the subject property was conferred in favour of defendant No. 2, the alleged family settlement ought to have been registered as required in law, which it is not. It is contended, that by reason of non-registration, the purported family settlement is inadmissible in evidence. It is pointed-out that even assuming the alleged family settlement to be genuine and admissible, there is no averment in the plaint to say how the subject property came to be transferred solely in the name of defendant No.2 by way of a registered sale d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... claiming to be the real owner of such property. Furthermore, it is submitted that defendant No.2 also does not fall within the exception to the definition of benami property engrafted in section 2(9)(A)(ii) of the Benami Transactions Act. The relevant exception reads as follows : 2. Definitions. In this Act, unless the context otherwise requires, * * * * * (9) benami transaction means, (A) a transaction or an arrangement (a) where a property is transferred to, or is held by, a person, and the consideration for such property has been provided, or paid by, another person; and (b) the property is held for the immediate or future benefit, direct or indirect, of the person who has provided the consideration, except when the property is held by (i) a Karta, or a member of a Hindu undivided family, as the case may be, and the property is held for his benefit or benefit of other members in the family and the consideration for such property has been provided or paid out of the known sources of the Hindu undivided family; (ii) a person standing in a fiduciary capacity for the benefit of another person towards whom he stands in such ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 2 as full owner. 7. In view of the above submissions, defendant No.2 contends that the plaint deserves to be rejected, firstly since the plaint does not disclose a cause of action; and secondly the suit appears from the statements in the plaint to be barred by law, viz. by the above-cited provisions the Limitation Act, the Benami Transactions Act as also the Hindu Succession Act. 8. In support of its case, defendant No.2 has cited the following judicial precedents : 8.1. Aparna Sharma Ors. vs. Sidhartha Sharma Ors. MANU/DE/2205/2018 at paras 5, 7 , Pushpa Kanwar vs Urmil Wadhawan Ors MANU/DE/2993/2009 at paras 13-15 on the proposition that the meaning of fiduciary capacity is no longer general and expansive, and only transactions between certain relationships having fiduciary capacity as stated in section 2(9)(A)(ii) would be covered within the exception and will not be hit by the Benami Transactions Act; 8.2. Surender Kumar Khurana vs. Tilak Raj Khurana Ors. 2016 (155) DRJ 71 at paras 5,8-9 on the proposition that joint funds or joint properties are not equal in law to HUF funds or HUF properties; 8.3. J.M. Kohli vs. Madan Mohan Sahni Ors. MANU/DE/ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r the sale, motives governing their action in bringing about the transaction and their subsequent conduct; that the burden of proving that the property was benami is on the person asserting the claim; and the mere payment of consideration by a third person will not necessarily make the transaction benami; 8.10. Lalsa Prasad Singh vs. Chanderwala Ors. MANU/DE/3113/2017 at para 6 on the proposition that where one party claims it to be a case of benami transaction arising from an HUF, it is necessary that the existence of the HUF is properly pleaded, especially when the person holding the property is not a member of the HUF but is a relative of such member; 8.11. Leena Mehta vs. Vijaya Myne Ors. 2009 SCC OnLine Del 3577 at paras 7-11 on the proposition that a combined reading of section 3(2) of the Benami Transactions Act and section 14 of the Hindu Succession Act would show that the law presumes that a property purchased in the name of the wife or unmarried daughter is purchased for her benefit, and that she would be the absolute owner of the property in terms of the title deed; 8.12. Nikhil Batra vs. Diwakar Batra Ors. 2019 SCC OnLine Del 8253 at para 15 on the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... smissed as withdrawn as recorded in order dated 02.11.2017, with the court observing that a counter-claim qua a non-party to the suit is not maintainable . Moreover, it is pointed-out that even in that counter-claim, the alleged family settlement had neither been mentioned nor filed by the present plaintiffs. Counsel submits, that in fact certain claims made by the plaintiffs in the present suit are contrary to what is stated in the written statement filed by the present plaintiff No. 1 (who is defendant No. 1) in CS(OS) No. 466/2017. Ms. Kaur also submits that though it is the plaintiffs own case that construction on the subject property began in 2014, the present suit has been filed only on 10.09.2018, whereby the suit is clearly time-barred. Submissions on behalf of the plaintiffs 11. Opposing the application seeking rejection of the plaint, the plaintiffs have raised the following contentions : 11.1. The plaintiffs contend that the subject property was purchased on 27.03.1992 from the funds of the partnership firm M/s Sujan Singh Sons. which was started by the father of the concerned parties. It is submitted that though the subject property was purchased i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 11 CPC, the court must proceed only on a demurrer and see whether, accepting the averments made in a plaint, a suit is barred by law; and that disputed questions cannot be decided when considering an application under Order VII Rule 11 CPC. In the present case, it is argued, that reading the averments in the plaint as a whole it cannot be said that the suit is barred by law, whether it be the Benami Transactions Act or the Limitation Act; 11.5. Insofar as the contention that, in any case, defendant No.2 holds the subject property as absolute owner in view of section 14 of the Hindu Succession Act, it is argued that a challenge to the right of the woman under section 14 is entertainable if it is proved that though a property was purchased in her name, it was not for her benefit, which is the case here. Furthermore, it is contended that since section 67 of the Benami Transactions Act gives overriding effect to that statute and recites that the provisions of that statute shall have effect notwithstanding anything inconsistent contained in any other law for the time being in force, and the Benami Transactions Act of 1988 being a later statute, it must prevail over the Hindu Successi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... vant parts of the plaint, is impermissible; 13.3. Srihari Hanumandas Totala vs. Hemant Vithal Kamat Ors. (2021) 9 SCC 99 at paras 16, 19-22 , Soumitra Kumar Sen vs. Shyamal Kumar Sen (2018) 5 SCC 644 at paras 6, 9, 10 , Shakti Bhog Food Industries Ltd vs. Central Bank of India Anr. (2020) 17 SCC 260 at para 7 , Saleem Bhai Ors. vs. State of Maharashtra Ors. (2003) 1 SCC 557 at paras 7, 9 , Church of Christ Charitable Trust Educational Charitable Society (supra) (2012) 8 SCC 706 at para 11 on the proposition that what is stated in the written statement cannot be gone into while deciding an application under Order VII Rule 11 CPC; 13.4. Marcel Martins vs. M Printer Ors. (2012) 5 SCC 342 at paras 31-38 , Pawan Kumar vs. Babulal since deceased through LRs Ors. (2019) 4 SCC 367 at paras 8, 10, 13 and Neeru Dhir (supra) MANU/DE/2444/2020 at para 20 on the proposition that fiduciary capacity implies a relationship analogous to that between a trustee and a beneficiary of a trust and has wide import, extending to situations where parties are in a position founded on confidence, trust and good faith. The contention being that a disputed question of fiduciary re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... roperty is purchased in the name of wife it is for her benefit and she becomes the absolute owner of the property. It does not mean that the property would still remain a benami property of the husband and every other legal heir of the husband would have a share in the property. Section 14 of the Hindu Succession Act, 1956 makes it further abundantly clear that if any property is possessed by a female Hindu whether it is acquired before or after the commencement of Act it shall be held by her as full owner and not as a limited owner unless and until the instrument by which the property has been acquired prescribes a restriction on her ownership of such property. In the present case, the conveyance deed executed by DDA was in the name of defendant no.1, there was no restriction placed in the conveyance deed about the right of ownership of defendant no.1. Defendant no.1 was absolute owner of the property in terms of the title deed in her favour. The property cannot be considered to be either of her husband or of anyone else after 31 years of execution of the title deed in her favour. (emphasis supplied) 14.2. On section 2(9)(A)(ii) of the Benami Transactions Act, in Savita Anand ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nce to the entrusted thing, the fiduciary has to act in confidence and is expected not to disclose the thing or information to any third party. 40. There are also certain relationships where both the parties have to act in a fiduciary capacity treating the other as the beneficiary. Examples of these are: a partner vis- -vis another partner and an employer vis- -vis employee. ... 41. In a philosophical and very wide sense, ... 31. Though the Supreme Court was in RBI vs. Jayantilal N Mistry Others, MANU/SC/1463/2015 : (2016) 3 SCC 525 considering the question of disclosure by the Reserve Bank of India of information received by it from other banks about clients/loan defaulters, etc., under the Right to Information Act, 2005, it is apposite to refer to its observations on what constitutes fiduciary relationship and capacity, ... It also referred to the definition of fiduciary relationship given by The Advanced Law Lexicon 3rd Edition 2005 and also set down the scope of fiduciary relationship in paras 57 58, which are reproduced for convenience: 57. The Advanced Law Lexicon, 3rd Edn., 2005, defines fiduciary relationship as: Fiduciary relationship ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ook over her responsibility. No duty or obligation is stated to have been taken by D1 to advice the appellant or that the appellant was completely dependent on D1 for such advice. Rather, according to the appellant, her husband had all along helped D1 in dealing with the suit property. There is no pleading to the effect that a Trust had been created for the children of late Yashpal Sain and D1 had been appointed its Trustee. (emphasis supplied) 14.3. As for the claim for cancellation of the sale deed being time-barred, in Renu Khhullar (supra) a Division Bench of this court had this to say on Article 59 of the Limitation Act : 19. Learned counsel for the appellant, although, has argued that the period of limitation for the cancellation/annulment of a settlement deed dated 11.11.1980 is covered under Article 59 of the Limitation Act and not under Article 58 of the Limitation Act, however, the perusal of the plaint shows that not a single averment is made in the plaint regarding the period of limitation. The appellant has not pleaded any fact claiming exemption of any period to be excluded while calculating the period of limitation for seeking cancellation of the docum ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... imitation Act, it is still required to be filed within three years from the date of knowledge of execution of this settlement deed qua the appellant. In the absence of any averments in the plaint to the contrary, the period of limitation naturally has to begun from the date when family settlement was executed and signed by the appellant, admittedly which date is 11.11.1980. 22. In the light of this settled proposition of law, the claim of the appellant that the period of limitation is to be reckoned from the date of cause of action i.e. when there arose a need to challenge the instrument, has no force in it. The period of limitation to challenge the instrument once start running does not stop. The plaint is bereft of any facts, showing as to why it should be reckoned from the date of alleged cause of action and not from the date of execution of the instrument. (emphasis supplied) 15. Upon a careful consideration of the submissions made on both sides, and in particular, on a close and meaningful reading of the averments contained in the plaint, in the backdrop of the position of law as discussed above, in the opinion of this court the following inferences can be drawn : ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... clear mandate of the section 14 of the Hindu Succession Act therefore, as a matter of law, defendant No.2 holds the subject property as full owner and not as a limited owner, and no averment in the plaint detracts from this position; 15.3. Besides, the plaintiffs own best case, as admitted inter-alia in para 8 of the plaint, is that they routed money through third parties to buy the subject property in the name of defendant No.2. This is precisely the kind of mischief that section 4 of the Benami Transactions Act seeks to prevent, and therefore bars any claim made in respect of property so held by a third party benami for the person who funds the purchase. This in fact is the very purpose and intention of the legislature in enacting the Benami Transactions Act; 15.4. Insofar as the plaintiffs contention that defendant No.2 falls within the exception engrafted in section 2(9)(A)(ii) to the definition of benami transaction , a bare reading of the plaint would show that there is not even a whisper of an allegation that defendant No.2 was a partner of the partnership firm, the monies of which were allegedly routed for purchasing the subject property. There is also no allegatio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ly in relation to property that stood exclusively in defendant No. 2 s name, is to be considered only to be rejected. Here again, no cause of action is disclosed even going by the averments contained in the plaint; 15.7. In fact it is anathema in this day and age to diminish the autonomous status of a woman by treating her merely as an adjunct to her husband, least of all in relation to what the law recognises to be her absolute property; 15.8. The sale deed, of which cancellation is sought, was admittedly executed on 27.03.1992. The settlement deed, on which the plaintiffs place reliance, by their own reckoning came to be signed in February 2013. The present suit was filed on 10.09.2018 i.e., more than 21 years after Sale Deed dated 27.03.1992 was executed conveying the subject property to defendant No. 2; and some 05 years after the signing of the settlement deed comprising the family agreement. It is the plaintiffs own case that the alleged oral family settlement happened even before the settlement deed was signed in February 2013. Clearly therefore, the present suit is way beyond the limitation of 03 years stipulated in Article 59 of the Schedule of the Limitation Act, w ..... X X X X Extracts X X X X X X X X Extracts X X X X
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