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High Court of Judicature at Madras
T. MATHIVANAN
K. Indirani & Others
Versus
K. Manjula & Others
A.S.No.716 of 2008 & M.P.Nos.1 of 2008 & 1 of 2009
Decided on : 22-07-2011
PARTITION SUIT - NOMINEE - FIDUCIARY CAPACITY - LIMITATION - ADVERSE POSSESSION - OUSTER - TRUST - BENAMI TRANSACTION - Held, the first defendant is holding the property for the benefit of herself as well as the benefit of all the heirs in the fiduciary capacity. Further, the phrase 'Nominee', in Black's Law Dictionary, 6th Edition, at Page No.1050, has been defined as under: “One who has been nominated or proposed for an office. One designated to act for another to his or her place.”
Fact of the Case:
The legal character of the parties to the suit need not be changed and let them be referred as it is in the suit. 3.1. The first defendant is the mother of the plaintiffs, whereas the defendants 2 to 4 are their brothers and the 5th defendant is their sister. The defendants 6 and 7 are the legal heirs of their deceased brother Jeevarathinam. Their father Late.K.Rangaswamy was employed in the State Bank of India as Branch Manager. He got allotment of property in Plot No.21, Door No.42 (Old Door No.20), State Bank of India Officer's Colony, 2nd Street, Perambur High Road, Chennai-600 012 by the State Bank of India, Madras Circle Supervising Staff Co-operative Building Society Ltd., Chennai-600 001 (hereinafter may be referred to as the Society) and was in possession and enjoyment of the same. He died intestate on 06.09.1981 and left the property in land and building in the aforestated plot to be succeeded by his legal heirs.
Finding of the Court:
69. The phrase 'Fiduciary capacity' has been explained in the same page as follows: Fiduciary capacity:-One is said to act in a "fiduciary capacity" or to receive money or contract a debt in a "fiduciary capacity," when the business which he transacts, or the money or property which he handles, is not his own or for his own benefit, but for the benefit of another person, as to whom he stands in a relation implying and necessitating great confidence and trust on the one part and a high degree of good faith on the other part. The term is not restricted to technical or express trusts, but includes also such offices or relations as those of an attorney at law, a guardian, executor, or broker, a director of a corporation, and a public officer.
Issues: None
Ratio Decidendi: 72. From the above context, it is thus manifest that the first defendant is holding the property for the benefit of herself as well as the benefit of all the heirs in the fiduciary capacity.
Final Decision: 76. In the result, this appeal is dismissed and the Judgment and Decree dated 30.06.2008 and made in O.S.No.9491 of 2006, on the file of the learned VII Additional Judge, City Civil Court, Chennai is confirmed. Consequently, connected miscellaneous petitions are closed. No costs.
Based on the provided legal document, the key points are as follows:
The first defendant is held to be acting in a fiduciary capacity, holding the property not for her own benefit alone but for the benefit of all the heirs of the deceased, including the plaintiffs (!) (!) .
The term "nominee" is defined as a person designated to act for another, implying that the first defendant's role was to receive the property on behalf of the heirs, rather than as an absolute owner (!) (!) .
The sale deed executed in favor of the first defendant was based on her role as a nominee and trustee, and she did not acquire absolute ownership rights over the property (!) (!) .
The property was allotted to the deceased in a manner that did not confer absolute ownership during his lifetime, and the transfer in her name was in her fiduciary capacity, not as a sole owner (!) (!) .
The first defendant's claim to exclusive ownership based on her being the nominee and executing a settlement deed in her favor is not sustainable, as she was holding the property in trust for the heirs (!) (!) .
The suit filed by the plaintiffs for partition is maintainable, as they are co-sharers with a rightful claim to their respective shares, and the limitation period for such a suit has not expired (!) (!) .
The plea that the suit is barred by limitation due to the long passage of time (more than 24 years) is not convincing, given that the plaintiffs issued a legal notice and the property remained in joint possession (!) (!) .
The first defendant's settlement deed in favor of other defendants does not extinguish the plaintiffs' rights, as it was executed without absolute ownership rights and is therefore invalid (!) (!) .
The legal character of the property and the fiduciary relationship of the first defendant with the heirs support the conclusion that the plaintiffs are entitled to their share in the property (!) (!) .
The appeal filed by the first defendant and other defendants is dismissed, and the original judgment confirming the plaintiffs' entitlement to a share in the property is upheld (!) (!) .
In summary, the court has held that the first defendant was acting as a trustee and nominee for the heirs of the deceased, and her actions do not establish absolute ownership. The plaintiffs' claim for partition and their right to their respective shares are recognized, and the appeal is dismissed accordingly.
1. The appellants are the defendants 1 to 4, 6 and 7 in the suit in O.S.No.9491 of 2006, on the file of the learned VII Additional Judge, City Civil Court, Chennai.
2. Impugning the Judgment and Decree dated 30.06.2008, granting preliminary decree that the plaintiffs are entitled to 3/9th share in the plaint schedule property, the appellants have preferred this appeal before this Court.
3.The facts, which absolutely necessary for the disposal of this appeal are as under:
The legal character of the parties to the suit need not be changed and let them be referred as it is in the suit.
3.1. The first defendant is the mother of the plaintiffs, whereas the defendants 2 to 4 are their brothers and the 5th defendant is their sister. The defendants 6 and 7 are the legal heirs of their deceased brother Jeevarathinam. Their father Late.K.Rangaswamy was employed in the State Bank of India as Branch Manager. He got allotment of property in Plot No.21, Door No.42 (Old Door No.20), State Bank of India Officer's Colony, 2nd Street, Perambur High Road, Chennai-600 012 by the State Bank of India, Madras Circle Supervising Staff Co-operative Building Society Ltd., Chennai-600 001 (hereinafter may be referred to as the Society) and was in possession and enjoyment of the same. He died intestate on 06.09.1981 and left the property in land and building in the aforestated plot to be succeeded by his legal heirs.
3.2. Since the first defendant is the nominee of their father Late.K.Rangaswamy, the Society had issued a Sale Deed dated 14.07.1982 in the name of the first defendant and however the property is for the benefit of the entire family members viz. the legal heirs of Late.K.Rangaswamy. The plaintiffs and the defendants as the legal heirs of Late.K.Rangaswamy are entitled to the suit property and as such they are entitled to get their respective shares viz. each 1/9th share (plaintiffs 1 to 3 and the defendants 1 to 5 each entitled to get 1/9th share, whereas the defendants 6 and 7 are jointly entitled to get 1/9th share) since their respective shares are governed and ascertained as per the Hindu Succession Act, 1956.
3.3. The third plaintiff is in possession of the part of the suit property and is permanently residing there in exercise of her right to her share in the suit property. The plaintiffs as Class-I legal heirs and as daughters of the deceased Late.K.Rangaswamy are entitled to 1/9th share in the suit schedule property.
4. The fifth defendant had not chosen to contest the suit as she remained exparte before the Trial Court. The defendants 1 to 4, 6 and 7 have alone filed their written statement and contended that the plaint is liable to be rejected under Order VII Rule 11 of the Code of Civil Procedure as there is no cause of action for filing the suit and apart from this they have also contended that the suit is barred by limitation. The pleadings are to be struck down under Order VI Rule 16 of the Code of Civil Procedure especially under Order VI Rule 16(a) and Order VI Rule 16(c).
4.1. Mr.K.Rangaswamy had passed away on 06.09.1981. At the time of his death, he had no title in the suit schedule property. He had only a right to get the property from the Society by virtue of allotment. Even during his lifetime, he could not have transferred the property to anyone under Section 6(e) of the Transfer of Property Act. Before his death, he had nominated his wife Smt.K.Indirani, who is the first defendant, and by virtue of her nomination she became the shareholder of the Society. The sale deed was registered by the Society only on 14.07.1982 in the name of the first defendant. The suit was filed on 02.12.2006. Hence, it is thus clear that the suit schedule property never intended for the benefit of the family.
4.2. The nomination is only in respect of share so as to enable the first defendant to become a member of the Society. The question of co-ownership does not arise in this case as the first defendant became the sole and absolute owner
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