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2011 (1) LW 918, 2011 (2) MWN(Civil) 28
High Court of Judicature at Madras
G. RAJASURIA
Kanchana John Bosco
Versus
A. Gandhi & Another
S.A.No.980 of 2008 & M.P.No.1 of 2008
Decided on : 20-01-2011
Benami Transactions (Prohibition) Act, 1988 - Sections 3 and 4 - The court applied the provisions of the Act to determine the validity of the settlement deed. Section 3 prohibits benami transactions, while Section 4 prohibits the right to recover property held benami. The court found that the plea of Benami put forth by the defendant was untenable and that the settlement deed was not valid.
Fact of the Case:
The plaintiff filed a suit seeking a declaration that a Power of Attorney and a settlement deed were invalid and for a permanent injunction. The trial court decreed the suit, and the appellate court confirmed the decision. The defendant filed a second appeal challenging the judgments and decrees of the lower courts. The main issue was whether the settlement deed executed by the defendant was valid. The court applied the provisions of the Benami Transactions (Prohibition) Act, 1988 and found that the plea of Benami put forth by the defendant was untenable. The court dismissed the second appeal.
Finding of the Court:
The court analyzed the facts in light of the Benami Transactions (Prohibition) Act, 1988 and relevant case law. It discussed the provisions of Sections 3 and 4 of the Act, which prohibit benami transactions and the right to recover property held benami. The court also referred to the decision in R.Rajagopal Reddy (Dead) by LRs. and Others v. Padmini Chandrasekharan (Dead) by LRs., which held that Section 4(1) of the Act is retroactive in operation. The court concluded that the settlement deed executed by the defendant was not valid and dismissed the second appeal.
Ratio Decidendi: The court held that the plea of Benami put forth by the defendant was untenable and that the settlement deed executed by the defendant was not valid.
Result: The court dismissed the second appeal and upheld the judgments and decrees of the lower courts. No costs were awarded.
1. This second appeal is filed by the plaintiffs, inveighing the judgement and decree dated dated 23.1.2008 passed by the IV Additional City Civil Judge, Madras, in A.S.No.586 of 2005 confirming the judment and decree dated 6.1.2005 passed by the 17th Assistant Judge, City Civil Court, Chennai, in O.S.No.3506 of 2003, which was filed for declaration and permanent injunction.
2. The parties, for the sake of convenience, are referred to here under according to their litigative status and ranking before the trial Court.
3. Compendiously and concisely the relevant facts absolutely necessary and germane for the disposal of this second appeal would run thus:
(a) The plaintiff, who is the first respondent herein, filed the suit seeking the following reliefs:
"to pass judgment and decree for
a) a declaration that the Power of Attorney executed and registered by Mr.M.Anthony Doss in respect of the suit property in favour of the plaintiff and I defendant by a registered deed dated in document No.353/98 in valid binding and enforceable.
b) for a declaration that the settlement deed dated in Document No.616 of 2003 by the Ist defendant in favour of the 2nd defendant thereby conveying the suit property in violation of the terms of deed of power of attorney which has been partly performed in improper and illegal and liable to be cancelled. c) for a permanent injunction for restraining the 2nd defendant from dealing with the suit property by encumbering or conveying or altering the structure in any way.
d) for costs." (extracted as such)
(b) The defendants resisted the suit by filing written statement.
(c) Whereupon the trial Court framed the issues. The plaintiff on his side, examined himself as P.W.1 along with one Periya Nayakameri Arul as P.W.2 and marked Exs.A1 to A11. The defendants on their side examined the first defendant as D.W.1 and marked Exs.B1 to B16.
(d) Ultimately the trial Court decreed the suit.
(e) Being aggrieved by and dissatisfied with the judgement and decree of the trial Court, the appeal was filed by the D2 for nothing but to be dismissed by the appellate Court confirming the judgment and decree of the trial court.
4. Challenging and impugning the judgements and decrees of the Courts below, D2 filed this second appeal on various grounds inter alia to the effect that the Courts below did not take into account the fact that D1 happened to be the real owner of the property and he was not a mere Power of Attorney holder under the Power Deed-Ex.A1 dated 26.10.1998 and D1 had no authority, during the pendency of the proceedings, to execute the cancellation deed cancelling the Settlement Deed executed by him in favour of D2 earlier. Even though the Courts below gave finding as against the appellant herein/D2, still this Court could interfere.
5. The following proposed substantial questions of law are found suggested in the grounds of appeal.
"1. Is the first defendant Arputharaj entitled to cancel the Settlement Deed executed by him in favour of the appellant valid and justifiable?
2. When the Benamidar Antonydoss himself had not raised any objection and also there is no reason for Arputharaj to cancel the Settlement Deed in favour of the appellant is justified in acting illegally and contrary to provisions of law?
3. The appellant submits that the Supreme Court has stated several times that the concurrent judgments could be interfered with if it causes loss to the affected party, is not the appellant entitled to prefer the second appeal Vide 2005(2) C.T.C.Page No.182?"
(extracted as such)
6. Heard both.
7. At the out set itself, I fumigate my mind with the following decisions of the Honourable Apex Court.
(i) (2006) 5 Supreme Court Cases 545 – HERO VINOTH (MINOR) VS. SESHAMMAL.
(ii) 2008(4) SCALE 300 – KASHMIR SINGH VS. HARNAM SINGH AND ANOTHER.
(iii) 2009-1-L.W.1 – STATE BANK OF INDIA & OTHERS vs. S.N.GOYA:
8. A bare and plain reading of those precedents would reveal and demonstrate that in second appeal, this Court
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