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1919 Supreme(Mad) 113
IN THE HIGH COURT OF MARAS
Amrutam Venkatappa
Versus
Vavilala Jalayya
Decided On : 7 April, 1919
An agreement for the purchase of property in the name of one party, with the understanding that it would be conveyed to another party, may not necessarily constitute a benami transaction.
Headnote:
Benami Transaction - Specific Performance - The court held that the agreement for the purchase of property in the name of the defendant, with the understanding that half of it would be conveyed to the plaintiff, did not constitute a benami transaction. The court emphasized that the plaintiff's allegation of the auction-purchaser being a benamidar did not bar the plaintiff from maintaining the suit for specific performance.
Fact of the Case:
The defendant agreed to purchase property in their name with the understanding that half of it would be conveyed to the plaintiff after obtaining the sale certificate. The plaintiff alleged that the auction-purchaser was a benamidar for him.
Finding of the Court:
The court found that the agreement did not constitute a benami transaction and that the plaintiff was not barred from maintaining the suit for specific performance.
Issues: The main issue was whether the agreement for the purchase of property in the name of the defendant, with the understanding that half of it would be conveyed to the plaintiff, constituted a benami transaction.
Ratio Decidendi: The court held that the plaintiff's allegation of the auction-purchaser being a benamidar did not bar the plaintiff from maintaining the suit for specific performance, as the agreement was not inconsistent with the auction-purchaser's own title.
Final Decision: The court answered the question in the negative, indicating that the suit for specific performance could be maintained by the plaintiff.
1. We do not think that this is a suit against the auction purchaser on the ground that the purchase was made on behalf of the plaintiff within the meaning of Section 66, Civil Procedure Code. The finding is that the defendant agreed that the property should be purchased in the name of the defendant and that one half of it should be conveyed by the defendant to the plaintiff after the sale certificate had been obtained. This in our opinion is not a benami transaction at all. The mere fact that the plaintiff alleges in the plaint that the auction-purchaser was a benamidar for him has not in our opinion the effect of debarring the plaintiff under Section 66, Civil Procedure Code from maintaining his suit for specific performance of an agreement by the auction purchaser subsequent to the purchase to convey the property to the plaintiff. Such an agreement is not inconsistent with auction-purchasers own title, but rather the reverse. We answer the question in the negative.
