2023 (5) TMI 266 - HC - Benami Property

Cancellation of gift deed in respect of the suit schedule property - perpetual Injunction restraining respondents from interfering with the suit schedule property - suit claim is barred under Section 4 of The Benami Transactions (Prohibition) Act, 1988 or not? - HELD THAT - It is to be seen whether the suit claim of respondent No.1 falls within the purview of Section 4 of the Act. As per the entire averments of the plaint, it is manifest that respondent No.1 has purchased the suit schedule property in the name of his mother and subsequently, she executed registered release deed in favour of the respondent No.1-plaintiff on 24.07.2013 severing her rights over the suit schedule property and declared him as the beneficiary and the rightful owner, as all the charges, taxes were borne by him and paid entire sale consideration in respect of the same. In view of the said pleadings, it can be said that the contention of learned counsel for the petitioner that the suit claim is barred under Section 4 of the Act is not tenable. The suit claim is not barred under Section 4 of the Act. Therefore, the plaint cannot be rejected under Order VII Rule 11 (d) read with Section 151 of C.P.C. - the Civil Revision Petition is dismissed.

Summary

Issues:
- Application to reject the plaint under Order VII Rule 11 (d) read with Section 151 of CPC
- Interpretation of Section 4 of The Benami Transactions (Prohibition) Act, 1988
- Validity of the trial court's order dismissing the application

Analysis:
1. The petitioner filed an application to reject the plaint, citing that it is barred by law under The Benami Transactions (Prohibition) Act, 1988. The petitioner claimed to have purchased the suit property in the name of his mother, who later relinquished her rights in his favor. The petitioner alleged that a gift settlement deed obtained by the respondent was fraudulent and violated the Act.

2. The respondent, on the other hand, contested the claim, stating that he had purchased the property in his mother's name but had been in possession and enjoyment of it since the purchase. The respondent argued that the Act did not apply to the circumstances of the case and that the petitioner had fraudulently obtained the gift settlement deed.

3. The trial court dismissed the application to reject the plaint, leading to the filing of a revision. The petitioner contended that the suit was not maintainable and was barred under Section 4 of the Act. The petitioner relied on a previous legal decision to support the argument.

4. The respondent's counsel supported the trial court's decision, stating that there was no error in the order. The court, after hearing both sides, deliberated on whether the impugned order was legally sustainable.

5. The court examined the provisions of Section 4 of the Act, which prohibits suits to enforce rights in benami properties. After reviewing the facts presented, including the purchase of the property in the mother's name and subsequent release deed in favor of the respondent, the court concluded that the suit claim did not fall under the purview of Section 4 of the Act.

6. Consequently, the court found that the suit claim was not barred under the Act, and the application to reject the plaint was dismissed. The court upheld the trial court's order, stating that it did not have any legal defects warranting intervention.

7. In conclusion, the Civil Revision Petition was dismissed, with no costs imposed. Any pending miscellaneous applications were to be closed as well. The judgment clarified the application of the Benami Transactions Act and upheld the trial court's decision in the matter.