Vijoy Kumar Sanan v. Gurdayal Chand Sunda
[Citation -1986-LL-1119-6]

Citation 1986-LL-1119-6
Appellant Name Vijoy Kumar Sanan
Respondent Name Gurdayal Chand Sunda
Court HIGH COURT OF PATNA
Relevant Act Income-tax
Date of Order 19/11/1986
Judgment View Judgment
Keyword Tags transfer of property • condition precedent • benami transaction • reasonable time • benami property • real owner • sale deed
Bot Summary: With regard to the finding of prima facie case in favour of the respondent, Mr. Sinha urged that the court below recorded that in a case of benami transaction, custody of documents is one of the most important ingredients and without recording any further reasons, the court below held that the respondent had a prima facie case. According to the respondent, after he purchased the property, he filed an application for mutation of his name as well as the name of the appellant and after mutation of their names, the rent was paid by the respondent. The respondent produced in the court below the certified copy of the order of the mutation, rent receipts, correction slips and also a cutting from a local newspaper published on April 22, 1985, in which the respondent asserted that he was the real owner of the property. Prima facie as the respondent was not entitled to institute the suit, no injunction could have been granted in favour of the respondent. In view of the submission of Mr. Dey, I am not dismissing the suit as not maintainable but am giving an opportunity to the respondent to file an application in the court below regarding the facts which are required to be pleaded as provided under section 281A of the Act. If no such application for amendment of the plaint is filed by the respondent within a reasonable time to be granted by the court below, the suit shall be dismissed by it by holding that it is not maintainable. If such an application for amendment is made by the respondent and if the court below is satisfied that there has been compliance with section 281A of the Act before the institution of the suit, it shall allow the amendment.


JUDGMENT Appeal from Original Order No. 64 of 1986 (R). S. B. Sinha and M. Y. Eqbal for appellant. B. K. Dey and M. S. Chhabra for respondent. JUDGMENT SATYESHWAR ROY J.-On facts and in circumstances of this case and with consent of parties, this application is being disposed of at this stage itself on merits. Title, Suit No. 67 of 1986, was filed by respondent for declaration of his title in respect of schedule C property and also for confirmation of possession. Relief was also prayed for permanently restraining appellant from disturbing peaceful possession of respondent over suit property. averments, inter alia, on basis of which reliefs were prayed were as follows: In 1972, respondent purchased from Binod Bihari Mahto and others 26 bighas odd decimals of land described in schedule to plaint for total consideration of more than Rs. 50,000. As value of property at schedule was more than Rs. 50,000, respondent (sic) was required to obtain income-tax clearance certificate and also to pay incometax on value of land. To avoid this, respondent obtained two sale deeds from Mahtos, one in his name which is described in schedule B to plaint and other in name of appellant, his nephew, which is described in schedule C to plaint. value of schedule C property was Rs. 19,751. After purchase, respondent exercised various acts of possession. appellant had undertaken to transfer land to respondent. Instead of doing that, as appellant along with his brothers were trying to dispose of property, suit was filed. It was asserted in plaint that consideration was paid by respondent and that original sale deed was with him. In suit, application for temporary injunction was filed by respondent. In reply to notice, appellant filed his show-cause. In show-cause, appellant, inter alia, asserted that he was actual owner of property and that it was not purchased in his name by respondent as alleged in plaint. He claimed to be in possession of property. It was also asserted in show-cause that consideration was paid by appellant. So far as possession of original document by respondent was concerned, that also appellant tried to explain in show- cause. Prayer for temporary injunction was also resisted with reference to section 52 of Transfer of Property Act, 1882. During course of hearing of injunction matter, some documents were brought on record by parties. court below, after hearing parties, held that respondent has prima facie case, that balance of convenience was in his favour and that he would suffer irreparable injury, if injunction was refused. prayer for temporary injunction made by respondent was allowed by court below. That order has been challenged in this appeal. Mr. Sinha, learned counsel for appellant, submitted that although court below noticed some of documents filed by appellant in support of his case, it did not record any finding about effect of those documents. He also urged that documents filed by appellant were not noticed by court below. With regard to finding of prima facie case in favour of respondent, Mr. Sinha urged that court below recorded that in case of benami transaction, custody of documents is one of most important ingredients and without recording any further reasons, court below held that respondent had prima facie case. According to respondent, after he purchased property, he filed application for mutation of his name as well as name of appellant and after mutation of their names, rent was paid by respondent. respondent produced in court below certified copy of order of mutation, rent receipts, correction slips and also cutting from local newspaper published on April 22, 1985, in which respondent asserted that he was real owner of property. In order to show that original sale deed was with him and was given to respondent at his request, appellant produced letter dated December 15, 1972, alleged to have been written by firm to him while latter was at Batala. That is annexure 3 to this memorandum of appeal. It is case of parties that they constituted partnership firm known as G. S. Refractories. He also filed affidavit alleged to have been shown by Santhosh Mahto, one of transferors, in support of fact that property was not purchased benami by respondent. court below did not notice effect of letter and affidavit. most important fact which is required to be considered in case of benami is source of consideration, besides other factors, namely, custody of original sale deed, motive for benami purchase, possession of property, relationship between parties and conduct of parties. court below was impressed by fact that original sale deed was produced by respondent without considering value of letter dated December 15, 1972. No prima facie finding was recorded by it about source of consideration. court below was also required to see effect of other documents filed by respondent and appellant for recording finding on question of prima facie case. As that has not been done, finding on that point cannot be sustained. It appears from impugned order that court below held other two points in favour of respondent as it found prima facie case in his favour. For these reasons, order of court below cannot be sustained. Section 281A of Income-tax Act, 1961 ("the Act" for short), as amended with effect from April 1, 1984, and as it stood on date suit was filed has very significant bearing on this case. That section puts bar institution of suit by claimant on ground of benami, except suit of value not exceeding rupees two thousand triable by Presidency Small Cause Court or Provincial Small Cause Court, unless provisions of section are complied with. It provides for giving notice in prescribed form and containing prescribed particulars in respect of benami property to Commissioner of Income-tax by person claiming to be real owner. With regard to property acquired by claimant benami before March 1, 1984, notice is required to be given within one year from that date. statute prohibits institution of suit by alleged real owner of property unless something is done in manner prescribed before institution of suit. language used in section is absolute and suit may be instituted only after requirement of section has been complied with. Compliance with section is condition precedent to institution of suit by claimant. There is no averment in plaint that respondent complied with section 281A of Act before institution of suit. Prima facie, therefore, as respondent was not entitled to institute suit, no injunction could have been granted in favour of respondent. For aforesaid reasons, this appeal is allowed and order impugned is set aside. There shall be no order as to costs. After I had dictated order, Mr. Dey, learned counsel for respondent, submitted that he has no instruction whether notice as required under section 281A of Act was given before institution of suit. He, therefore, submitted that if notice had been given, respondent shall file application for amendment of plaint. If any such application for amendment is filed, court below shall dispose of same in accordance with law. In view of submission of Mr. Dey, I am not dismissing suit as not maintainable but am giving opportunity to respondent to file application in court below regarding facts which are required to be pleaded as provided under section 281A of Act. If no such application for amendment of plaint is filed by respondent within reasonable time to be granted by court below, suit shall be dismissed by it by holding that it is not maintainable. If such application for amendment is made by respondent and if court below is satisfied that there has been compliance with section 281A of Act before institution of suit, it shall allow amendment. It shall, if such prayer is made on behalf of respondent, thereafter hear injunction matter again. In that case, it shall keep in view observations made above and shall also consider effect of section 52 of Transfer of Property Act. *** Vijoy Kumar Sanan v. Gurdayal Chand Sunda
Report Error