Summary
The Supreme Court restored a son’s property suit rejected as barred by the Benami Transactions Act. Under the pre-2016 statutory framework considered, whether the father held title in a fiduciary capacity required evidence. The pleaded payment of consideration by the son and the father’s written acknowledgement could not be rejected through a disputed factual assessment on an Order VII Rule 11 application. Ownership and the statutory exception remained for trial.
Issues
- Whether the alleged fiduciary arrangement could be rejected at the threshold.
- Whether the plaint itself established an undeniable statutory bar.
Provisions considered
- Section 4(3)(b), as then applicable, Benami Transactions (Prohibition) Act, 1988The fiduciary-capacity exception required examination in the factual setting on evidence, rather than a conclusive rejection of the plaint. (¶ 9–13)
Held
- A fiduciary relationship depends on the factual context and may extend beyond formal trusteeship to arrangements founded on confidence and an obligation to act for another’s benefit. The pleaded arrangement required fuller consideration under the then-applicable exception. (¶ 10–13)
- Rejection for a statutory bar proceeds on acceptance of the plaint’s averments. Disputed questions cannot be resolved at that stage. On these allegations, the suit was not demonstrably barred on its face. (¶ 13)
- The rejection application had to be dismissed, with the trial court independently determining the merits after evidence. Expedition was directed because the suit had been pending since 2006. (¶ 14–15)
Result
Appeal allowed without costs. Orders rejecting the plaint set aside and the second defendant’s Order VII Rule 11 application dismissed. Trial expedited, preferably within six months; merits left for independent determination.