2019 (4) TMI 661 - SC - Indian Laws

Nature of transaction - benami transaction or not - Whether in the facts and circumstances of the case and merely because some financial assistance has been given by the father to the sons to purchase the properties, can the transactions be said to benami in nature? - Held that - In the case of Thakur Bhim Singh 1979 (12) TMI 158 - SUPREME COURT OF INDIA , it is observed and held by this Court that while considering a particular transaction as benami, the intention of the person who contributed the purchase money is determinative of the nature of transaction. It is further observed by this Court as to what the intention of the person who contributed the purchase money, has to be decided on the basis of the surrounding circumstance; the relationship of the parties; the motives governing their action in bringing about the transaction and their subsequent conduct etc. The High Court has rightly come to the conclusion that the plaintiff has failed to prove that the purchase of the suit properties Item Nos. I(a) to I(c) in the names of defendant Nos. 1 to 3 were benami in nature. It is true that, at the time of purchase of the suit properties Item Nos. I(a) to I(c), some financial assistance was given by Late G. Venkata Rao. However, as observed by this Court in various decisions, that cannot be the sole determinative factor/circumstance to hold the transaction as benami in nature. The plaintiff has miserably failed to establish and prove the intention of the father to purchase the suit properties for and on behalf of the family, which were purchased in the names of defendant Nos. 1 to 3. The intention of Late G. Venkata Rao to give the financial assistance to purchase the properties in the names of defendant Nos. 1 to 3 cannot be said to be to purchase the properties for himself and/or his family members and, therefore, as rightly observed by the High Court, the transactions of purchase of the suit properties Item Nos. I(a) to I(c) in the names of the defendant Nos. 1 to 3 cannot be said to be benami in nature. The intention of Late G. Venkata Rao was to provide the financial assistance for the welfare of his sons and not beyond that. None of the other ingredients to establish the transactions as benami transactions, as held by this Court in various decisions, are satisfied, except that some financial assistance was provided by Late G. Venkata Rao. The purchase of the suit properties Item Nos. I(a) to I(c) in the names of defendant Nos. 1 to 3 cannot be said to be benami transactions and, therefore, as rightly observed and held by the learned trial Court and confirmed by the High Court, the plaintiff has no right to claim 1/4th share in the suit properties Item Nos. I(a) to I(c) which were purchased by the sons in their names by separate sale deeds. Petition dismissed.

Summary

Issues Involved:
1. Whether the suit schedule immovable and movable properties are self-acquired properties of Late G. Venkata Rao.
2. Whether the properties listed in the suit schedule are the self-acquired properties of the defendants.
3. Whether the bank deposits mentioned in the suit schedule are the personal properties of the defendants.
4. Whether the plaintiff is entitled to partition and possession of her 1/4th share in the suit schedule properties.
5. Whether the claim of the plaintiff is barred by Section 2 of the Benami Transaction (Prohibition of Right to Recover Property) Ordinance, 1988.

Detailed Analysis:

1. Whether the suit schedule immovable and movable properties are self-acquired properties of Late G. Venkata Rao:
The original plaintiff, Smt. P. Leelavathi, claimed that the properties in question were joint family properties funded by her father, Late G. Venkata Rao, and thus she was entitled to a 1/4th share. However, the trial court found that the properties were not self-acquired by G. Venkata Rao but were the self-acquired properties of the defendants. This decision was confirmed by the High Court, which held that the transactions were not benami in nature and the properties were indeed self-acquired by the defendants.

2. Whether the properties listed in the suit schedule are the self-acquired properties of the defendants:
The defendants contended that the properties listed in the suit schedule were their self-acquired properties and did not belong to their deceased father. The trial court and the High Court both upheld this contention, concluding that the properties were purchased by the defendants in their names and were not benami transactions funded by G. Venkata Rao.

3. Whether the bank deposits mentioned in the suit schedule are the personal properties of the defendants:
The trial court found that the bank deposits mentioned in the suit schedule were the personal properties of the defendants. This finding was upheld by the High Court, which noted that the plaintiff failed to provide sufficient evidence to prove that these deposits were part of the joint family estate or funded by G. Venkata Rao.

4. Whether the plaintiff is entitled to partition and possession of her 1/4th share in the suit schedule properties:
The plaintiff's claim for partition and possession of her 1/4th share was dismissed by the trial court, which found that the properties were not part of the joint family estate. The High Court confirmed this decision, stating that the plaintiff failed to prove that the properties were benami transactions and thus she had no entitlement to a share in the properties.

5. Whether the claim of the plaintiff is barred by Section 2 of the Benami Transaction (Prohibition of Right to Recover Property) Ordinance, 1988:
The High Court observed that the provisions of the Benami Transactions (Prohibition) Act, 1988 are retroactive in application. It held that the plaintiff's claim was barred by this Act, as the transactions in question were not proven to be benami in nature.

Conclusion:
The Supreme Court, upon reviewing the evidence and the findings of the lower courts, concluded that the plaintiff failed to prove that the transactions were benami in nature. The financial assistance provided by Late G. Venkata Rao to his sons for purchasing the properties did not establish a benami transaction. The properties were self-acquired by the defendants, and the plaintiff had no right to claim a share in them. The appeal was dismissed, and the judgments of the lower courts were upheld.