Bombay High Court
S.T.KHARCHE
Mohan J.Pawar - Appellant
Versus
Arjuna N.Dighade (D) by LR - Respondent
Decided On : 10/17/2003
Specific Performance - Benami Transaction - Section 4 of the Benami Transaction (Prohibition) Act, 1988 - 4
Fact of the Case:
The plaintiff filed a suit for specific performance of a contract for the purchase of agricultural lands. The defendant, who purchased the lands in the name of his deceased wife, contested the suit on the grounds of Benami transaction and non-entitlement of the plaintiff for specific performance.
Finding of the Court:
The trial Court decreed the suit for specific performance, holding the lands to be Benami transactions and the defendant as the real owner. The appellate Court set aside the trial Court's judgment, citing Section 4 of the Benami Transaction (Prohibition) Act, 1988, and directed the return of the earnest amount to the plaintiff.
Issues: The main issue was whether a decree for specific performance of the contract can be refused on the ground of Benami transaction under Section 4 of the Act.
Ratio Decidendi: The Court held that the lands were Benami transactions and the defendant was the real owner, thus rejecting the appellate Court's interpretation of Section 4 of the Act. It emphasized that the Act's provisions did not apply retrospectively and allowed the decree for specific performance in favor of the plaintiff.
Final Decision: The appellate Court's judgment was set aside, and the trial Court's judgment decreeing specific performance was restored.
2. The short and substantial question of law that arises for consideration in this appeal is, whether a decree for specific performance of the contract can be refused on the ground that defendant No. 1 who purchased the suit field in the name of his wife Bhagirathibai is hit by the provisions of Section 4 of the Benami Transaction (Prohibition) Act, 1988 (for short the Act).
3. Brief facts are as under :
Bhagirathibai is the wife of defendant No. 1 Arjuna, Bhagirathibai died on 2-12-1976. However, defendant No. 1 Arjuna died during the pendency of this appeal and his legal heir, i.e. Yashodabai, has been brought on record. On 26-4-1971, 20-3-1972 and 15-5-1973 respectively the defendant No. 1 had purchased the agricultural lands bearing Survey No. 63/1 to the extent of 6 acres 16 gunthas and Survey No. 66/1 to the extent of 2 acres 3 gunthas by virtue of three different sale deeds and these lands were purchased in the name of Bhagirathibai. The defendant No. 1 had two wives, namely Bhagirathibai and Kasabai. The latter used to live at village Umbarda while the former used to live at Inzori. At both the places, the defendant No. 1 had his houses and both the wives were living with him. Defendant No. 2 Jijabai is the daughter of defendant No. 1. The latter had no issue except defendant No. 2. It is contended that on 27-5-1979 defendant No. 1 executed agreement of sale (Ex. 44) of the suit fields in favour of the plaintiff for the consideration at the rate of Rs. 3,000/- per acre on receiving the
earnest amount of Rs. 5,000/-. It was agreed between the parties that the balance amount of consideration would be paid on or before 31-3-1988 at the time of execution and registration of the sale deed. The possession of the land was delivered to the plaintiff on the date of execution of the agreement of sale. The plaintiff was ready and willing to perform his part of contract, but it was defendant No. 1 Arjuna who avoided to execute the sale deed on one pretext or the other, though called upon to do so by exchange of notices and, therefore, the plaintiff was constrained to file the suit for specific performance of the contract.
4. The defendant combated the pleadings and had taken a stand in defence that after the death of Bhagirathibai, defendant Nos. 1 and 2 are her heirs and the defendant No. 2 was not a party to the agreement of sale and, therefore, plaintiff is not entitled for the decree of specific performance of the contract. It is contended by defendant No. 1 that he had obtained a loan of Rs. 2,500/- from the plaintiff and by way of security for that loan he had executed the agreement of sale. The said document is a bogus document and was not intended to be acted upon. He contended that he parted with the possession only to satisfy the loan amount out of the income of the suit fields which was to be taken by the plaintiff. He further contended that the plaintiff continued to be in possession of the suit for the years 1979-80 and 1980-81 and he was not deliver the possession of the suit fields to him
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