2004 (11) TMI 326 - HC - Companies Law

Summary

Issues Involved:
1. Joint ownership of the disputed property.
2. Plaintiff's share in the disputed property.
3. Entitlement for partition of the disputed property.
4. Applicability of Section 31 of the Foreign Exchange Regulation Act (FERA).

Issue-wise Detailed Analysis:

1. Joint Ownership of the Disputed Property:
The plaintiff filed a civil suit for partition and possession of Bungalow No. 2 Cantt., Jabalpur. Upon the death of Charles Bernard and his wife Geraldine, their descendants became entitled to their share in the property. The plaintiff claimed joint ownership along with her daughter and siblings. The trial court determined that the plaintiff was indeed a joint owner of the property.

2. Plaintiff's Share in the Disputed Property:
The plaintiff asserted an 11/36th share in the suit property based on her lineage and inheritance rights. The trial court, after evaluating the evidence, decreed that the plaintiffs were entitled to a 1/9th share in the property. This decision was based on the genealogical details and the inheritance rights of the parties involved.

3. Entitlement for Partition of the Disputed Property:
The plaintiff sought partition of the property by metes and bounds due to threats of eviction from the defendant No. 1. The trial court granted the partition, recognizing the plaintiff's entitlement to her share of the property. The court upheld the plaintiff's right to partition and possession of her inherited share.

4. Applicability of Section 31 of the Foreign Exchange Regulation Act (FERA):
The defendant No. 1 argued that the plaintiff, being a non-citizen of India, could not hold immovable property in India without prior permission from the Reserve Bank of India as per Section 31 of FERA. The court examined the preamble and penalty provisions of FERA, concluding that Section 31 aimed at protecting revenue rather than prohibiting inheritance rights. It was noted that the FERA had been repealed and replaced by the Foreign Exchange Management Act (FEMA), but the provisions of FERA were still applicable to this case.

The court referenced several judgments, including Smt. Janki Bai Chunilal v. Ratan Melu and Ajit Prashad Jain v. N.K. Widhani, which clarified that the imposition of penalties under FERA did not imply prohibition of property rights through inheritance. The court also considered a notification from the Reserve Bank of India dated 26-5-1993, which granted general permission to foreign citizens of Indian origin to acquire property by inheritance.

Conclusion:
The court upheld the trial court's judgment and decree, affirming the plaintiff's right to a 1/9th share in the property and entitlement to partition. The appeal was dismissed, and the judgment emphasized that Section 31 of FERA did not restrict the plaintiff's inheritance rights. The court found no infirmity in the trial court's decision and dismissed the appeal with no orders as to costs.