1997 Supreme(Cal) 289

High Court Of Calcutta
GITESH RANJAN BHATTACHARJEE, DIBYENDU BHUSAN DUTTA
CHANDRA SEKHAR SAMANTA - Appellant
Versus
COMMISSIONER, SANCHAITA INVESTMENTS - Respondent
Matter 260  Of  1993
Decided On : 07/28/1997

Headnote:

ATTACHMENT - OBJECTION - BENAMI - BENAMI TRANSACTIONS (PROHIBITION) ACT, 1988 - SECTION 4 - IMMOVABLE PROPERTY - TRANSFER OF PROPERTY ACT, 1882 - SECTION 53 - Held, the plea of benami cannot be hit by the mischief of Section 4 of the Benami Transactions (Prohibition) Act, 1988, as suggested on behalf of the objectors. Section 4 came into force retrospectively with effect from May 19, 1988. According to sub-section (1) of Section 4 of the Act, 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 and on behalf of the person claiming to be the real owner of such property.

Fact of the Case:

In this case, the Commissioner of Sanchaita Investments attached a three-storeyed building at premises No. 17, Colonel Biswas Road, Calcutta, along with the land measuring three kattas underneath and all other appurtenances attached thereto, being of the prima facie opinion that the said property was of the ownership of the firm Sanchaita Investments and/or its partnes, agents, sub-agents, transferees and benamdars. The Commissioner served this order of attachment upon five persons namely, Chandra Sekhar Samanta, his wife Kalpana Samanta, his son Ananta Narayan Samanta and Dr. M. S. Ghosh and his wife Dr. (Mrs.) Ghosh, inviting objections from them. In response, three written objections were filed against the attachment on 30-11-92 - one by Chandra Sekhar Samanta, one by his wife and son namely Kalpana Samanta and Ananta Samanta respectively and one by Dr. M. S. Ghosh and Dr. (Mrs.) M. S. Ghosh. The objections are more or less on the same lines. Chandra Sekhar Samanta did not claim any right, title or interest in the attached property. Dr. M. S. Ghosh and his wife Mrs. Ghosh claimed beneficial ownership over the entire first floor of the attached premises. They claimed to have acquired right, title and interest in respect of the said portion of the attached property by virtue of a registered deed of sale dated 29-7-92 for a price of Rupees three lacs, paid by seven instalments by cheques between 26-7-89 and 29-11-90, following an agreement which they entered into with Kalpana Samanta and Ananta Samanta on 26-7-89. According to them, they paid the consideration out of their own independent income and earning and they had nothing to do with the Sanchaita Investments or its partners, agents, sub-agents, transferees and benamdars. They also claimed to be bona fide purchasers for value without notice. The first floor of the building concerned was not of the ownership of Sanchaita Investments or its partners, agents etc. and was owned by them and as such is liable to be released from attachment. The case made out by Kalpana Samanta and his son Ananta Samanta is that they jointly acquired the land comprised within the premises No. 17, Colonel Biswas Road, for a consideration of Rs. 80,000/- on 17-6-81 and got the premises mutated in their names on 11-12-81. They got a building plan sanctioned by the Calcutta Municipal Corporation on 4-8-82 and made the construction of the three-storeyed building which commenced in the year 1986-87 and was completed in the year 1990-91. They constructed the building with their own independent fund and sold the first floor of the building for Rupees three lacs to Dr. M. S. Ghosh and his wife Dr. (Mrs.) Ghosh, prior to the attachment, by a deed of conveyance dated 29-7-92 as alleged by Dr. Ghosh and his wife Mrs. Ghosh. They (Kalpana and Ananta) are the beneficial owners of the ground and the second floors of the building together with the land underneath comprised in the premises under attachment Chandra Sekhar Samanta is not, in any way, concerned with any part of the property under attachment. This property is also not of the ownership of Sanchaita Investments or its partners, agents, sub-agents, transferees and bemanders and was not liable to be attached. The property is thus liable to be released from attachment. Chandra Sekhar Samanta has supported the versions of his wife Kalpana and son Ananta and also their transferees Dr. Ghosh and Mrs. Ghosh. In each of the written objections, the objectors annexed the same set of documents, namely (1) a copy of the conveyance by virtue of which Kalpana and Ananta are alleged to have acquired the land comprised within the attached premises, (ii) a copy of the assessment book of Calcutta Corporation in support of the mutation in the names of Kalpana and Ananta, and (iii) a copy of the conveyance dated 29-7-92 whereby the Ghosh couple are alleged to have acquired the first floor of the attached premises.

Finding of the Court:

The Court held that the plea of benami cannot be hit by the mischief of Section 4 of the Benami Transactions (Prohibition) Act, 1988, as suggested on behalf of the objectors. The Court also held that the acquisition of properties by Sanchaita Investments, if there be any, in the benami of others by diversion of its funds in order to defraud its depositors and other creditors will be hit by the mischief of Section 53 of the Transfer of Property Act, even though such acquisitions do not constitute 'transfer' in the strict sense of the term, with the result that such transaction will be protected by Section 6 of the Benami Transactions (Prohibition) Act, 1988. Further, the Court held that the objections of Chandra Sekhar Samanta, his wife Kalpana Samanta and son Ananta Samanta would fail, while the objections of Dr. M. S. Ghosh and his wife Dr. (Mrs.) Ghosh would succeed.

Issues: Whether the plea of benami can be hit by the mischief of Section 4 of the Benami Transactions (Prohibition) Act, 1988.

Ratio Decidendi: The Court held that the plea of benami cannot be hit by the mischief of Section 4 of the Benami Transactions (Prohibition) Act, 1988, as suggested on behalf of the objectors. The Court also held that the acquisition of properties by Sanchaita Investments, if there be any, in the benami of others by diversion of its funds in order to defraud its depositors and other creditors will be hit by the mischief of Section 53 of the Transfer of Property Act, even though such acquisitions do not constitute 'transfer' in the strict sense of the term, with the result that such transaction will be protected by Section 6 of the Benami Transactions (Prohibition) Act, 1988.

Final Decision: The Court dismissed the objections filed by Chandra Sekhar Samanta, Kalpana Samanta and Ananta Samanta and allowed the objections filed by Dr. Ghosh and his wife Dr. (Mrs.) Ghosh. The entire first floor of the premises No. 17, Colonel Biswa Road which forms the subject-matter of attachment effected by the Commissioner by his order dated 14-9-92 passed in case No. 163 of 1992 is hereby released from the attachment. The attachment in respect of the remaining part of the attached premises is hereby affirmed and made absolute.