MADRAS HIGH COURT
GOVINDA MENON,RAMASWAMI
P.Krishna Bhatta
Versus
Mundila Ganapathi Bhatta (died) and others
Appeals Nos.499 and 500 of 1950
Decided On : 15 July, 1954
CIVIL PROCEDURE CODE - S.66 - BENAMI PURCHASE - JOINT FAMILY FUNDS - PURCHASE BY MANAGING MEMBER - SUIT BY OTHER MEMBERS - MAINTAINABILITY - S.66, C.P.C., BARS SUIT - AGENCY - NOT ESTABLISHED.
Fact of the Case:
The dispute in this case relates to three items of properties, viz., two parcels of land used for raising paddy and arecanut in Kedila village and a coffee estate in Coorg, ten miles from Mercara. The plaintiff, representing the joint family of Bheemayya, claimed that the two items of Kedila properties were purchased benami in the name of Ganapathi Bhatta with joint family funds and that the coffee estate was purchased jointly by the joint family and Ganapathi Bhatta. Ganapathi Bhatta denied the benami nature of the transactions and claimed to be the real owner of the properties. The lower court held that the two items of Kedila properties were benami and that the coffee estate was jointly owned by the joint family and Ganapathi Bhatta. Ganapathi Bhatta appealed the decision, and the joint family cross-appealed, challenging the finding of benami in respect of the coffee estate.
Finding of the Court:
The court held that the two items of Kedila properties were not benami and that Ganapathi Bhatta was the real owner. The court also held that the coffee estate was jointly owned by the joint family and Ganapathi Bhatta, but modified the lower court's decree to reflect this finding.
Issues: 1. Whether the two items of Kedila properties were purchased benami in the name of Ganapathi Bhatta with joint family funds. 2. Whether the coffee estate was purchased jointly by the joint family and Ganapathi Bhatta. 3. Whether S.66, C.P.C., bars a suit by other members of the joint family to recover the two items of Kedila properties purchased benami in the name of the managing member.
Ratio Decidendi: 1. The court held that the two items of Kedila properties were not benami based on the following factors: (i) there was no motive for the joint family to put the properties benami in the name of Ganapathi Bhatta; (ii) the source of purchase money was not conclusively established to be the joint family funds; (iii) Ganapathi Bhatta was in possession of the properties and not the joint family; (iv) the title deeds were in the custody of Ganapathi Bhatta and not the joint family. 2. The court held that the coffee estate was jointly owned by the joint family and Ganapathi Bhatta based on the evidence of the sale deed and the fact that Ganapathi Bhatta had contributed to the purchase price. 3. The court held that S.66, C.P.C., bars a suit by other members of the joint family to recover the two items of Kedila properties purchased benami in the name of the managing member. The court reasoned that the managing member of a Hindu family cannot be considered to have made the purchase on behalf of all the members of the family and therefore the purchase cannot be considered to have been made "on behalf of the plaintiff" within the meaning of S.66, C.P.C.
Final Decision: The court dismissed the appeal filed by Ganapathi Bhatta and modified the decree of the lower court in respect of the coffee estate to reflect the finding that it was jointly owned by the joint family and Ganapathi Bhatta.
RAMASWAMI, J.:-These are two connected appeals arising from the decrees and judgment of the learned Subordinate Judge of South Kanara in O.S. Nos.115 of 1947 and 127 of 1948.
2. The dispute in this case relates to three items of properties, viz., two parcels of land used for raising paddy and arecanut in Kedila village and a coffee estate in Coorg, ten miles from Mercara.
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3-14. (After discussing the facts of the case His Lordship proceeded.)
The points which fall for consideration are two-fold, viz., whether in regard to these items of properties Ganapathi Bhatta was benamidar and apparent owner and whether S.66, C.P.C. applies to the transactions relating to the two items of Kedila properties, in regard to which two sale certificates have been issued in favour of Ganapathi Bhatta.
15. On a careful consideration of the entire circumstances of the case we have come to the same conclusion as the learned Subordinate Judge in regard to the two items of Kedila properties and in regard to the coffee estate we have come to the conclusion that as per the even tenor of the sale deed which has not in any way been rebutted and shown to be what it is not, defendants 8 and 9 differing from the learned Subordinate Judge, should be held to be the real as well as apparent owners in moieties. Here are our reasons.
16. We shall take up the two items of Kedila properties first. In regard to them there are several circumstances clearly showing that Ganapathi Bhatta was not only the apparent but also the real owner. 17. The question of the greatest difficulty that arises in dealing with the benami transactions is how to distinguish the real from the benami. For indeed it is a matter of common experience that in these benami transactions, the proceedings which would attend a real transfer are carefully gone through in order to throw a veil of reality, and all the subordinate parts are notoriously fitted in to correspond with the benami agreement in its entirety. The same motive which dictated an ostensible ownership would naturally dictate an apparent course of dealing in accordance with such ownership - Rohee Lall v. Dindayal Lall, 21 Suth W R 257 (A). And the subsequent acts done in the name of the nominal owner would be explained by a reference to the original transaction.
18. The essential characteristic of the benami transaction is that it is not intended to be operative. When a transaction is once made out to be benami, the benamidar absolutely disappears for the title. He is merely a name-lender in the transaction. In other words, his name is simply an alias for that of the person beneficially interested. The first thing therefore that has got to be done is to find out the real intention of the parties.
19. In order to find out what is the real intention of the parties to a transaction, no hard and fast rule can be laid down, but each case, as it arises, mut be decided according to its own peculiar circumstances and probabilities. In scanning the circumstances and weighing the probabilities, the consensus of legal decisions lay down that we must have regard to the following facts, viz., (i) the source from which the purchase money was derived; (ii) the possession of the property, i. e., (a) the party in possession, and the nature and character of his possession ; (b) whether possession was taken after the alleged gift or purchase-If not taken, why not; (iii) the position of the parties and their relation to one another; (iv) the circumstances, pecuniary or otherwise, of the alleged transferor; (v) his motive in making the alleged transfer; (vi) the custody and production of the title-deed; and (vii) the previous and subsequent conduct of the parties. But it must be noted here that each of these circumstances taken by itself is of no particular value and affords no conclusive proof of the intention to transfer the ownership from one person to the other. One of them may be of greater value than the other; for instance, the source of the
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