Tirath Dass Choudhary vs Jaidevi Bai and Others

Mukul Mudgal, J.—This is an appeal against the judgment of the learned Additional District Judge dated 15th October, 1992, by which an application under Order VII Rule 11 CPC preferred by the respondent/defendant was allowed and the suit filed by the appellant/plaintiff was dismissed by virtue of operation of Section 4 of the Benami Transaction Act, 1988 (hereinafter referred to as the Act).

The briefly stated facts of the case are as follows:

a) The appellant filed a suit for declaration and injunction in the court of the learned Additional District Judge stating therein that the appellant was the owner in possession of the house built on residential plot No. 22, Block A-1, Paschim Vihar, New Delhi. The plot admeasures around 370.73 square meters in area.

b) The appellant had purchased the leasehold rights of the said property in a public auction held on 31st March 1971. The said auction was held by the DDA. The amount of Rs. 21,600/- was paid to the authority as a consideration price of the plot in question. This amount had been arranged by the appellant from banks on his own account. The appellant was employed as Assistant Central Tabulation Officer in the office of the Registrar General of India and was the only person earning a handsome salary. The elder brother of the appellant did not have sufficient means and the father of the appellant had died in 1930 and the mother of the appellant, i.e., the Respondent No. 1 was being looked after by the appellant. The mother of the appellant had no independent source of income of savings of any kind by which she could buy the property by spending the huge amount.

c) The appellant in order to give respect to his mother and out of sense of devotion and with the clear intention that the said property shall be held by her as his trustee and in a fiduciary capacity, had got the price paid at the time of bid and even finally, in her name. The appellant had even raised construction on the property in question on the said plot and was actually living with his mother in that house prior to 1988. In the year 1988, the appellant had shifted to Janakpuri and the property in dispute continued to be in possession of the mother of the appellant on his behalf.

d) The appellant submitted that the mother had never disputed his title and ownership to the property but had always accepted the fact that she was holding the property in a fiduciary capacity and for the benefit of the plaintiff and appellant and his family members. As such, the property could not be sold, transferred or possession thereof parted with by the said respondent No. 1.

e) The respondent No. 2 to 5 had acted in collusion and under undue influence and coercion and probably got some documents signed from respondent No. 1 even after kidnapping and various litigations in this regard between the parties are pending.

f) The appellant having come to know that the respondents were intending to sell and transfer the property in question and were negotiating for the sale of the superstructure, was compelled to file the suit on 9th June 1988 much before the Benami Transfer Act came into force.

g) In spite of the specific averments and during the pendency of the suit, and in spite of the affidavit on behalf of the mother (the respondent No. 1 in the suit) filed in the court by her stating therein that the appellant was the lawful owner of the property, the learned court below without considering the affidavit filed and without giving reasons for disbelieving the affidavit, dismissed the suit as not maintainable under the provisions of the Benami Transaction Act.

h) The court below did not consider the various judgments and the propositions of law which were submitted by the counsel for the plaintiff appellant in this regard and dismissed the suit of the appellant.

i) The property in question, as on date stands in the name of the mother of the appellant for and on behalf of the appellant.

j) The mother of the appellant as already submitted, has filed an affidavit wherein she had clearly stated that the appellant was the lawful owner of the property in question. In the face of the records, the court below ought not to have dismissed the suit as not maintainable under the provisions of the Benami Transaction Act.

Since the suit has been dismissed in view of the application filed under Order VII Rule 11 CPC, the relevant provisions of Order VII Rule 11 are set out as under:

3.

The plaint shall be rejected in the following cases:

(a) Where it does not disclose a cause of action.

(b) Where the relief claimed is undervalued, and the plaintiff, on being required by the court to correct the valuation within a time to be fixed by the Court, fails to do so;

(c) Where the relief claimed is properly valued but the plaint is written upon paper insufficiently stamped, and the plaintiff, on being required by the Court to supply the requisite stamp paper within a time to be fixed by the court, fails to do so;

(d) Where the suit appears from the statement in the plaint to be barred by any law.

The learned Counsel for the respondent/defendant had only relied upon Sub-clause (d) in support of the application under Order 7 Rule 11 of the CPC and contended that the statement in the plaint itself barred the suit by virtue of the operation of Section 4 of the Act, which reads as follows:

Prohibition of the right to recover property held Benami No. 1) No suit, claim or action to enforce any right in respect of any property held Benami against the person in whose name the property is held or against any other person shall lie by or on behalf of a person claiming to be real owner of such property.

(2) No defence based on any right in respect of any property held Benami, whether against the person in whose name the property is held or against any other: person shall be allowed in any suit, claim or action by or on behalf of a person claiming to be the real owner of such property.

(3) Nothing in this section shall apply:

(a) Where the person in whose name the property is held is a coparcener in a Hindu Undivided family and the property is held for the benefit of the coparceners in the family; or

(b) Where the person in whose name the property is held is a trustee or other person standing in a fiduciary capacity and the property is held for the benefit of another person for whom he is a trustee or towards whom he stands in such capacity.

The learned Counsel for the respondent has submitted that a bare perusal of the plaint shows that any suit for any right to claim the property held benami against the person namely the mother of the plaintiff, Jaidevi, who was the registered owner of the suit property was clearly barred. Reliance has been placed upon the following averments in the plaint:

That the plaintiff is owner in possession of all that residential plot No. 22, 317.73 sq. meters in area, situate in Block A-1, Paschim Vihar, New Delhi

That as Charan Dass, the elder brother of the plaintiff did not have sufficient income to support even his wife and children, the plaintiff''s mother has all along been with maintained by the plaintiff and it was at her behest that the plaintiff acquired the plot in question to have house of his own for the family to accommodate his said brother and his family in times of need.

That the plaintiff purchased the plot in the name of his mother, defendant No. 1, as a mark of respect and devotion to her last he should feel neglected and uncared for.

That she has accordingly remained owner of the plot in name and has not at any time here before denied the ownership of the plaintiff of the plot in suit.

That the plaintiff is the owner of the plot in fact and besides payment of the premium of Rs. 21,600/- to the D.D.A. he has all along been paying the taxes, levied by the Municipal Corporation of Delhi and none else has contributed even a shell towards the payment of the price of the plot, or the taxes so far levied thereon.

The following prayer was made in the plaint:

It is therefore prayed that it may kindly be declared that defendants have no right or title to sell or transfer the plot bearing No. A-1/22, Paschim Vihar, New Delhi and any document executed by defendant No. 1 with respect to the plot in suit in favour of defendants 2 to 5 or any of them, is not binding on the plaintiff and defendants No. 2 to 5 may be restrained from interfering with the rights and title of the plaintiff to the plot in suit.

The sum and substance of the defence taken by the respondent to the suit, the contents of which have been extracted above was that the defendants had no right or title to sell or transfer the suit property.

The learned Counsel for Respondent No. 1/Defendant No. 1 Smt. Jai Devi Bai submitted as follows that in the written statement the following case was set up by the defendant:

a) The plaintiff/appellant has no locus standi to file and maintain the present suit because :

(i) He is neither the owner nor the lessee of the suit property bearing No. 22, Block A-1, Paschim Vihar, New Delhi admeasuring 317.33 sq. mtr.

(ii) Defendant No. 1, Jai Devi Bai bid for and purchased the suit property in a public auction on 31.3.71.

(iii) The suit property was registered in the name of the defendant No. 1 vide document No. 19150 in Addl. Book No. 1, Vol. Nol. 2439 on pages 190 to 196. The entire consideration of Rs. 21,611/- was paid by defendant No. 1 out of stridhan and lifetime savings on 3rd November, 1974.

(iv) The defendant No. 1 was in actual possession of the suit property from 22nd December, 1989 i.e. the date of allotment. Thus, at no point of time the plaintiff was in possession of the suit property.

(v) The defendant No. 1 entered into an agreement to sell the suit property as its absolute owner with Nand Lal & Sons HUF through its Karta Nand Lal son of Shri R.D. Pruthi, resident of A-3/70, Paschim Vihar, New Delhi on 22nd February, 1988 for the total consideration of Rs. 3,90,000/- with clear terms and conditions that the said purchaser shall bear half of the penalty amount payable to the DDA.

(vii) The defendant No. 1 received in cash Rs. 30,000/- as earnest money as execution of "Agreement to Sell" and issued receipt thereof to Shri Nand Lal.

(viii) On 22nd December, 1989 actual physical possession was handed over to the purchaser and on 12th September, 1990 after payment of balance consideration of Rs. 3,60,000/- the said purchaser became the sole owner with lease hold rights of the said plot vide document No. 35075 in Addl. Book No. IV Vol. No. 2315 on page No. 138.

b) In the absence of any cause of action the suit is liable to be dismissed/ rejected under Order VII Rule 11 CPC.

c) The suit has become infructuous and is not legally maintainable as the defendant No. 1 had already sold the suit property prior to the filing of the instant suit.

d) The plaintiff used to receive money from defendant No. 1 with malafide intention to grab the deposit of dues of DDA by issuing cheques and procure bank drafts under his signature.

e) Since the plaintiff was not in possession of the suit property or any part thereof at any point of time, the suit is not maintainable and is liable to be dismissed on this score alone.

f) Since the suit has not been properly valued for the purposes of court fee and jurisdiction and proper court fee has not been paid by the plaintiff for the relief claimed this Court Court has no jurisdiction to entertain and try the present suit.

g) The suit is not maintainable and is liable to be dismissed since it is against the provisions of the lease deed executed between the DDA and the defendant No. 1.

h) The suit is liable to be dismissed for misjoinder of the necessary parties.

i) The suit is against the Benami Transactions (Prohibition of the Right to Recovery Property) Ordinance 1988.

j) The plaintiff has suppressed material facts from this Hon''ble Court and has not come with clean hands before this Court.

The learned Counsel for the appellant/plaintiff Mr. Ravi Gupta has contested the finding about the applicability of either Order VII Rule 11 Sub-clause (d) of the C.P.C or Section 4 of the Act and contended that he is fully covered by Clause 3(b) of the said Section 4 which takes out the present proceedings out of the ambit of Section 4 and hence makes the prayer made in the application under Order VII Rule 11 C.P.C, without merit. The learned Counsel for the appellant/plaintiff has thus relied upon Sub-clause (3)(b), which reads as follows:

(3) Nothing in this section shall apply:

(b) Where the person in whose name the property is held is a trustee or other person standing in a fiduciary capacity and the property is held for the benefit of another person for whom he is a trustee or towards whom he stands in such capacity.

It has been submitted that the property was held by the appellant''s mother as a trustee and in a fiduciary capacity. The learned Counsel for the appellant was asked to take us to the averment in the plaint which according to him averred that the property was held in a fiduciary capacity or as a trustee by his mother.

The learned Counsel for the appellant has relied upon the averments in paragraphs 4 to 6 of the plaint which have been extracted above to contend his mother''s trusteeship and fiduciary capacity. In our view, none of the averments in paragraphs 4 to 6 contain the averment of fiduciary capacity or trusteeship. In fact the appellant''s averment in paragraph 1 of the plaint to the effect that he is the owner in possession of the suit property and the averment in paragraph 6 of the plaint to the effect that the appellant''s mother has remained the owner of the plot only in name, is clearly covered under the prohibition imposed by Section 4 of the Act. Accordingly, there is no merit in the plea of the learned Counsel for the appellant and the appeal being wholly devoid of merits is liable to be dismissed.

Before parting with the matter, we are constrained to remark upon the conduct of the case by the appellant in the Court below and particularly in this Court. The learned Counsel for the defendant has stressed that in spite of the knowledge that the property had been sold to the defendants 2 to 5, the appellant deliberately did not make M/s Nand Lal & Sons , who is the necessary party, as a party in this Court and to prolong the litigation has belatedly moved the application being CM No. 103/1996 for impleadment of the said M/s Nand Lal & Sons (HUF), in the year 1996 where indeed Nand Lal & Sons HUF has been termed as a necessary party. The averments made in paragraph 6 of the said application have been relied upon by the learned Counsel for the defendants, which reads as follows:

It is submitted herein that M/s Nand Lal & Sons (HUF) were not made a party in the suit No. 163 of 1988 filed by the appellant before the Court of the Addl. District Judge because to the appellant''s knowledge it only transpired that respondents No. 2 to 5 had started carrying out negotiations for the sale of the aforesaid property. But the appellant was not actually aware of the identity of the said person. A perusal of the written statement filed by the respondents in the above mentioned suit would also show that M/s Nand Lal & Sons have not been mentioned anywhere. Therefore, the fact that negotiations for disposal of the aforesaid plot was the M/s Nand Lal & Sons was not known to the appellant. Hence, M/s Nandlal & Sons could not have been impleaded as defendants in the appellant''s suit against the respondents.

It has been submitted that in an application filed in January, 1996, the appellant has submitted that he was not aware of the identity of the intending purchaser. In fact a statement has been made that in the said C.M. No. 103/1996 that the identity of the purchaser, M/s Nand Lal & Sons has not been mentioned anywhere. For the sake of ready reference, the learned Counsel for the M/s Nand Lal & Sons relied upon the following averment in the written statement on behalf of the respondent No. 1/defendant No. 1, which reads as follows:

...So the defendant No. 1 was left with no other alternative except to sell and transfer the said property/plot to any intending purchaser and finally on the threat of Delhi Development Authority for cancellation of the plot on account of committing continuous breach of lease for not constructing building, the defendant No. 1 entered into an agreement to sell with M/s Nand Lal & Sons HUF through its Karta Nand Lal son of Shri R.D. Pruthi, resident of a-3/70, Paschim Vihar, New Delhi on 22nd February, 1988 for the total consideration of Rs. 3,90,000.00 (Rupees Three Lakhs and Ninety thousand only) with clear terms and conditions that the purchaser shall 50% of the penalty amount payable to the Delhi Development authority and received the earnest money from the purchaser and in token of the same issue valid receipt thereof in favour of the said purchaser, in the presence of the plaintiff....

Inspite of this written statement filed by the respondent No. 1 in the year 1988, the appellant has been bold enough to make a statement in 1996 in the application for impleadment, being CM No. 103/1996 to the effect that a perusal of the written statement filed by the defendant shows that the name of M/s Nand Lal & Sons has not been mentioned anywhere. In our view, such a statement clearly appears to be a deliberately false statement and the Court may consider the initiation of Section 340 Cr.P.C. proceedings against the deponent of the said affidavit.

The learned Counsel for the appellant has relied upon the judgment of the learned Single Judge of this Court in IA No. 9987/2006 in CS(OS) No. 1593/2006 titled Sh. Sarabjit Singh Anand and Ors. v. Sh. Manjit Singh Anand and Ors. to contend that when the property is held in a fiduciary capacity or in the capacity of a trustee, the provisions of Section 4 of the Act does not apply. The said judgment interpreted Section 4 of the Act correctly, but is not applicable to the facts of the present matter as the plaint does not contain any averment averring trusteeship or fiduciary capacity.

The learned Counsel for the appellant has also relied upon the judgment of the learned Single Judge in CS(OS) No. 690/2004 titled S.M. Wahi and Ors. v. Ms. Reeta Wahi. The said judgment also does not apply to the facts of the present appeal because the plaint has not been found by us to have the requisite averments about holding of the suit property by defendant No. 1 as a trustee or in a fiduciary capacity.

The conduct of the case and indeed the entire plaint demonstrates patent lack of bonafide on behalf of the original plaintiff and his legal heirs in this Court.

The appellant has enjoyed an interim order dated 9th August, 1995, restraining the respondents from alienating, transferring or parting with possession of the suit property. Even otherwise, the said application is liable to be dismissed as the appellant has in spite of being aware of the name of the intending purchaser M/s Nand Lal & Sons (HUF) at least in 1988 had deliberately not chosen to make them a party till 1994. The omission is not innocent and it appears to be totally deliberate so as to delay the proceedings. We have also noticed the fact that plaint was not filed along with the appeal memo which in our view is a most essential document alongwith the written statement in a challenge to a successful application under Order VII Rule 11 CPC and the plaint was only filed in the year 2007 after repeated mandatory orders of this Court dated 3rd May, 2007 and 29th August, 2007. The only explanation given for the delay was a disruption due to fire which still does not explain why the plaint was not filed from 1995 upto 2007. This also shows that the conduct of the appellant is less than bonafide and deserves not only severe censure but also substantial exemplary costs. The reason for not filing the plaint is not far to seek as the absence of the necessary averments in the plaint about trusteeship and fiduciary capacity would knock out the very foundation of their approval.

Taking into account the fact that the appeal has been pending in this Court since 1993 and the 38 number of hearings taken place and that the appellant has enjoyed the interim order of this Court, we are left with no alternative but to impose costs quantified at Rs. 30,000/- on the appellant while dismissing the appeal. The costs are required to be paid not later than four weeks from today, failing which the said amount of Rs. 30,000/- will carry interest @ 9% p.a. from the date of the judgment until payment of the said amount.

The appeal is dismissed and stands disposed of in the above terms.