Summary
A father, karta of an HUF, bought properties in the names of his minor sons. When one son sold part of the land, the father and daughters sued for a declaration of title. All three courts below held the suit barred by Section 4(1) of the Benami Transactions (Prohibition) Act, 1988. The Supreme Court allowed the appeal. The father proved that he paid for the properties, that the sons were minors without income and that he kept possession, with tenants paying rent to him. The second son admitted the claim, and the first son offered no evidence of his own funds. The Section 4(3)(a) exception therefore applied, and the suit was decreed.
Issues
- Whether a suit by the father claiming properties bought in his minor sons' names was barred by Section 4(1) of the Benami Transactions (Prohibition) Act, 1988, or saved by the coparcener exception in Section 4(3)(a)
- Whether the Supreme Court should interfere under Article 136 with concurrent findings that the properties were not bought for the benefit of the coparceners
Provisions considered
- Section 4(1) and 4(3)(a), Benami Transactions (Prohibition) Act, 1988The bar on suits by the real owner was held inapplicable because the property was held by a coparcener for the benefit of the HUF's coparceners, as the evidence established. (¶¶ 13, 22, 26, 29)
- Article 136, Constitution of IndiaConcurrent findings were interfered with because they ignored material evidence and were unsupportable on the record. (¶¶ 27, 28, 29)
Held
- The person alleging that property is held benami bears the burden of proof. Under the Section 4(3) exceptions that burden may be discharged by evidence or cumulatively by circumstances, guided by the source of the purchase money, possession, motive, the relationship of the parties, custody of the title deeds and later conduct. (¶¶ 21, 22)
- The father proved that he funded the purchases and that both sons were minors with no income. He also proved that he stayed in possession, and an independent tenant confirmed paying rent to him. The second son admitted the plaint throughout. The first son led no evidence of any means to buy the land, and his unsupported adverse possession plea further weakened his case. (¶¶ 14, 15, 16, 17, 18, 23, 24, 25, 29)
- The courts below plainly erred in holding that the suit was barred by Section 4(1). The elements of Section 4(3)(a) were satisfied, so the suit was maintainable. (¶¶ 26, 29)
- Although the Court rarely disturbs concurrent findings under Article 136, it will interfere where material aspects are ignored and the findings cannot be supported by the evidence. (¶¶ 27, 28, 29)
Result
Appeal allowed; the judgments below were set aside and the suit was decreed in full; no order as to costs.