Back
2019 Supreme(Del) 366
IN THE HIGH COURT OF DELHI AT NEW DELHI
RAJIV SAHAI ENDLAW, J.
Ekant Baruta @ Vikas Baruta - Plaintiff
Versus
Rakesh Baruta & Ors. - Defendants
CS(OS) 172 of 2018, IA No.15807 of 2018 & IA No.5249 of 2018
Decided On : 28-01-2019
For the Plaintiff : Mr. Rahul Bhardwaj, Adv.
For the Defendants : Mr. Kunal Madan, Mr. Manu Bakshi, Mr. Shyam Basu, Advs., Mr. Kewin Kunjappy, Adv.
The Benami Transactions (Prohibition) Act, 1988 prohibits the defense of exclusive ownership based on payment of sale consideration if the property is held in the names of other persons.
Headnote:
Benami Transactions - Partition of Property - Code of Civil Procedure, 1908 (CPC) - Benami Transactions (Prohibition) Act, 1988 - Section 2(9), Section 4
Fact of the Case:
The plaintiff filed a suit for partition of a property claiming 1/5th undivided share along with four defendants. Defendant no.2 did not appear and was proceeded against ex parte. Defendant no.1 contested the suit, claiming exclusive ownership based on the plea that the entire sale consideration was paid by him and another person, not the plaintiff and the defendants.
Finding of the Court:
The court found the defendant's plea not sustainable under the Benami Transactions (Prohibition) Act, 1988, as the property was held in the names of the plaintiff and defendants. The court passed a preliminary decree for partition, declaring the shares of the parties and also a final decree for partition and sale of the property.
Issues: The main issue was the ownership of the property and entitlement to a share in the partition.
Ratio Decidendi: The court held that the defendant's plea of exclusive ownership based on the payment of sale consideration was not allowed under the Benami Transactions (Prohibition) Act, 1988, as the property was held in the names of the plaintiff and defendants.
Final Decision: The court passed a preliminary decree for partition, declaring the shares of the parties and also a final decree for partition and sale of the property.
1. The plaintiff has instituted this suit for partition of property no.S-3B, Janta Market, Rajouri Garden, New Delhi – 110 027 claiming the plaintiff and the four defendants to be having 1/5th undivided share therein under the deed of purchase of the subject property in favour of the plaintiff and the four defendants.
2. The suit was entertained and summons thereof ordered to be issued and pleadings have been completed.
3. None has been appearing for the defendant no.2. The order dated 24th July, 2018 records that all the four defendants had been served on 19th May, 2018. No written statement has been filed on behalf of the defendant no.2. The defendant no.2 is proceeded against ex parte.
4. The plaintiff has filed IA No.15807/2018 under Order XII rule 6 of the Code of Civil Procedure, 1908 (CPC) for decree on admissions.
5. The counsel for the defendants no.3&4 states that the said defendants are supporting the plaintiff.
6. The counsel for the defendant no.1, who on the last date of hearing i.e. 29th November, 2018 had not appeared and had sent a proxy counsel to take adjournment, states that since the parties are family members, the suit be referred to mediation for exploring possibility of settlement.
7. The counsel for the plaintiff states that though the parties are family members but on account of threats meted out by the defendant no.1, recently an FIR has been registered against the defendant no.1 on 6th July, 2018.
8. The counsel for the defendant no.1 though admits registration of the FIR, states that it is false.
9. The counsel for the plaintiff and the counsel for the defendants no.3&4 state that in the circumstances there is no possibility of amicable settlement and the purport of the defendant no.1 is only to delay.
10. The counsels have been heard.
11. The counsel for the defendant no.1, in opposition to the application under Order XII Rule 6 of the CPC states that though the sale deed by which the property was purchased is in the joint names of the plaintiff and the four defendants but it is the plea of the defendant no.1 in para 9 of the preliminary objections in his written statement that the entire sale consideration of Rs.3,50,000/- for purchase of the property was paid equally by the defendant no.1 and by his brother Anil Baruta though the sale deed was executed and registered in the name of the plaintiff and the four defendants. Attention is also drawn to para 10 of the preliminary objections in the written statement of the defendant no.1 where it is pleaded that the plaintiff, on the date of sale deed i.e. 12th May, 1988, was only 2½ years of age and had made no monetary contribution towards the purchase. It is argued that the defendant no.1 and the said Anil Baruta, who is not a party to the suit, in the circumstances are the exclusive owners in the property and the plaintiff and the defendants no.2 to 4 have no share in the property.
12. The pleas aforesaid of the defendant no.1 are not sustainable in law and are barred by the Benami Transactions (Prohibition) Act, 1988 since renamed Prohibition of Benami Property Transactions Act,1988. The plea, of the sale consideration having been contributed by the defendant no.1 and Anil Baruta, does not in law constitute the defendant no.1 and Anil Baruta as owners of the property and the property in law is of the persons in whose name title with respect thereto has been recorded i.e. the plaintiff and defendants no.1 to 4. Section 2 (9) of the amended Act defines a transaction or an arrangement where a property is transferred to or is held by, a person, and the consideration for such property has been provided, or paid by, another person, as a ‘benami’ transaction. Section 4 provides that no defence based on any right in respect of any property held benami, whether against the person in whose name 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
