( 1 ) THESE theree IAS have been moved on identical grounds on behalf of the defendants 2, 3 and 5. Therefore, this order will dispose of all these IAS.

( 2 ) IT is alleged in these IAS that the present suit is directed against defendant No, 1 who is alleged to have taken some loan from the plaintiff. The substance of the allegations in the plaint are that defendant No. 1 diverted the loan amounts to defendants 2, 3 and 5 and acquired assets in their names. In other words the plaintiff, so it is alleged, has set up the case of benami against the defendants. It is then alleged that without prejudice to the rights and contentions of the defendants herein and also without admitting in any manner, any of the allegations made in the plaint, the defendants submit that in view of the Benami Transactions (Prohibition) Act, 1988 (hereinafter called the first Act), the plaintiff is not entitled to maintain any suit on the basis of the plea of benami. Therefore the suit of the plaintiff should be dismissed against defendants 2, 3 and 5. The replies in these IAS on behalf of the plaintiff are identical. It was denied that the present suit was directed against defendant No. I only. In fact it is filed against all the defendants. The case is that defendant No 1 in order to defraud the plaintiff company did not apply the loan amount directly for purchasing immoveable property in his name for which purpose the loan was asked for and sanctioned to him by the plaintiff company. It is then contended that defendant No. 1 after having obtained the loan diverted the same to defendants 2 to 5 and another. Defendant No. 2 is the son of defendant No. 1 Defendants 3 to 5, the three companies, have been floated by defendants 1 and 2 and are controlled by them. Majority of the shares of these companies are held-by defendants. 2 and 2, their family members, close relations and friends. It is further the case of the plaintiff that the cefendant No. I has resorted to the subterfuge of diverting the funds to other defendants to perpetuate a fraud. It is further stated in the reply that in the present case the main question is about the lifting of the corporate veil in order to see the reality behind. It was denied as incorrect that the plaintiff company had set up a case of benami against defendants 2,3 and 5. The application were misconceived and should, therefore, be dismissed.

( 3 ) I have heard arguments advanced by learned counsel for the partics First of all I must. point out another fact which was sought to be highlighted by learned counsel for defendants before arguing on the above applications, On 16-10-89 learned counsel for the defendants insisted that vide order dated 16-11-79 in 2897/76 Issue No. 4 regarding cause of action qua defendants 2 to was treated as a preliminary issue and, therefore, before commencing the recording of evidence in this case, for which purpose it was fixed for that date, arguments should be heard on that preliminary issue. Learned counsel for the plaintiff opposed the request of learned counsel for the defendants by saying that already by an order of the Division Bench of this Court in appeal against the order of a learned Single Judge, the question had remained open and, therefore, this Issue should cot be treated as a preliminary issue But to avoid all controversy and also because of the fact that the matter was listed for the first time before me on that date, arguments on Issue No. 4 were heard. However on going through the file I find that the request made on behalf of the defendants was really unreasonable. The Seamed Single Judge vide order dated 16-11-79 had held that there was no privity of contract between the plaintiff and these defendants, and there was thus, no question of attaching the assets of defendants 2 to 5. There was an appeal against that order and by a very elaborate and detailed judgment reported in AIR 1982 Delhi 125 in the matter of Shri Shital Prasad Jain v. P. N. B. Finance Lim