2020 (9) TMI 754 - HC - Benami Property

Benami transaction - Prohibition of the right to recover property held benami - fifth defendant raised plea that in view of the introduction of the Prohibition of Benami Property Transactions Act, 1988, the entire transaction is hit under Section 4(2) of the said Act - whether the first plaintiff is entitled to raise plea in view of the introduction of Prohibition of Benami Property Transactions Act, 1988 ? - HELD THAT - In the case on hand, even before the said Act, the suit was filed and therefore the suit is very much maintainable and Section 4 (2) of the said Act is not applicable to the case on hand. Further, in case of G.Mahalingappa Vs. G.M.Savitha 2005 (8) TMI 688 - SUPREME COURT held that it is not permissible to the High Court in the second appeal to come to contrary findings of its own only on the basis of arguments of learned counsel without considering the findings of the trial court as well as the first appellate court. The High Court in the second appeal is not entitled to interfere with the concurrent findings of fact arrived at by the courts below until and unless it is found that the concurrent findings of fact are perverse and not based on the sound reasoning. This Court does not find that the concurrent findings of the fact arrived at by the courts below are either perverse or without any reason or based on the non consideration of important piece of evidence or admission of some of the parties. Therefore, this Court is of the view that there is absolutely no warrants to interfere with the concurrent findings of fact arrived at by the courts below, which rendered on consideration of pleadings as well as the oral and documentary evidence on record. Accordingly, this Court is of the considered opinion that no substantial questions of law are involved in the second appeal. Be that as it may, all the substantial questions of law formulated by this Court in this Second Appeal, are answered in favour of the plaintiffs and as against the defendants.

Summary

Issues Involved:
1. Benami Transaction
2. Partition and Injunction
3. Legal Heirship and Share Entitlement
4. Applicability of Prohibition of Benami Property Transactions Act, 1988
5. Bar under Order 2 Rule 2 of CPC
6. Limitation and Maintainability of the Suit
7. Concurrent Findings of Fact

Detailed Analysis:

1. Benami Transaction:
The plaintiffs claimed that the suit property was purchased by the first plaintiff’s husband, Panchacharam, in the name of their son, Viswanathan, as a benami transaction. The defendants countered that Viswanathan purchased the property with his own funds. The court evaluated the oral and documentary evidence, including the testimony of the vendor (P.W.2), who confirmed that Panchacharam paid the sale consideration. The court concluded that the transaction was indeed benami, with the property being purchased by Panchacharam in Viswanathan’s name.

2. Partition and Injunction:
The plaintiffs sought partition and injunction, asserting their entitlement to the suit property. The trial court initially granted the first plaintiff a 1/5 share, but upon remand, it was determined that the plaintiffs collectively were entitled to a 3/4 share. The court dismissed the injunction request. The appellate court upheld the trial court’s decision, confirming the plaintiffs' entitlement based on their legal heirship.

3. Legal Heirship and Share Entitlement:
The plaintiffs, being the mother and sisters of the deceased Viswanathan, claimed shares in the suit property. The defendants argued that the property belonged solely to Viswanathan and thus to his immediate family (defendants 1 to 4). The court recognized the plaintiffs as legal heirs of Panchacharam, thereby entitling them to a share in the property.

4. Applicability of Prohibition of Benami Property Transactions Act, 1988:
The defendants contended that the suit was barred by the Prohibition of Benami Property Transactions Act, 1988. However, the court noted that the suit was filed before the Act came into force, making the Act inapplicable. The court cited relevant Supreme Court judgments (C.Gangacharan Vs. C.Narayanan and G.Mahalingappa Vs. G.M.Savitha) to support this conclusion.

5. Bar under Order 2 Rule 2 of CPC:
The defendants argued that the suit was barred under Order 2 Rule 2 of CPC, as the first plaintiff had previously filed a suit (O.S.No.2735 of 1986) regarding the terminal benefits of Viswanathan. The court found that the earlier suit did not preclude the current suit for partition and share entitlement, as the issues were distinct.

6. Limitation and Maintainability of the Suit:
The defendants asserted that the suit was barred by limitation, given the timeline of events. The court dismissed this argument, noting that the suit was filed within a reasonable period after the deaths of Panchacharam and Viswanathan. The court also addressed the maintainability of the suit, confirming that it was properly filed and pursued.

7. Concurrent Findings of Fact:
The appellate court emphasized that the concurrent findings of fact by the trial court and the first appellate court were based on sound reasoning and evidence. The court reiterated that it is not permissible for the High Court to overturn these findings in a second appeal unless they are perverse or unsupported by evidence, which was not the case here.

Conclusion:
The court dismissed the second appeal, upholding the concurrent findings of the lower courts that the plaintiffs were entitled to a 3/4 share in the suit property. The court affirmed that the suit was not barred by the Prohibition of Benami Property Transactions Act, 1988, or Order 2 Rule 2 of CPC, and was filed within the limitation period. The court found no substantial questions of law warranting interference with the lower courts' decisions.