Summary
Refusal to reject the plaint under Order VII Rule 11 CPC in a family suit for partition of alleged joint Hindu family properties was upheld: whether the properties are held benami, or fall within the exceptions to a benami transaction under Section 2(9) of the Benami Transactions (Prohibition) Act, 1988, is a question of fact to be decided on evidence and not on the plaint alone, and Section 14 of the Hindu Succession Act, 1956 bars no suit. Special leave petitions by a defendant who had never sought rejection and by a subsequent purchaser were dismissed.
Issues
- Whether the plaint in a suit for partition, declaration and injunction over alleged joint Hindu family properties is liable to be rejected under Order VII Rule 11(d) CPC as barred by Section 4 of the Benami Transactions (Prohibition) Act, 1988.
- Whether defendant No. 2, who neither moved the application under Order VII Rule 11 nor challenged its rejection in revision, could assail the orders before the Supreme Court.
- Whether subsequent purchasers of some of the suit properties were the appropriate persons to seek rejection of the plaint on the ground that the properties were held benami.
- Whether a plea that the suit is barred by Section 14 of the Hindu Succession Act, 1956, raised for the first time in the special leave petition, could be entertained, and whether that provision bars such a suit.
- Whether any prejudice or miscarriage of justice warranted interference under Article 136 of the Constitution.
Provisions considered
- Order VII Rule 11(d), Code of Civil Procedure, 1908Clause (d) permits rejection of a plaint only where it appears from the statements in the plaint, without doubt or dispute, that the suit is barred by law. As the plaint described the suit properties as joint Hindu family properties acquired from the family nucleus or joint business income, and their alleged benami character and the applicability of the statutory exceptions were disputed questions of fact, the plaint could not be rejected at the threshold. (¶¶ 13, 22, 28, 29, 32)
- Section 4(1), Benami Transactions (Prohibition) Act, 1988Bars any suit, claim or action to enforce a right in respect of property held benami, brought by or on behalf of a person claiming to be its real owner. The Court held that the bar operates only on 'property held benami'; whether the suit properties are benami is itself the question of prime consideration and cannot be assumed from the plaint, which nowhere describes them as benami. (¶¶ 23, 24, 25, 27)
- Sections 2(8) and 2(9), Benami Transactions (Prohibition) Act, 1988'Benami property' is property that is the subject matter of a 'benami transaction', which excludes certain holdings such as property held in a fiduciary capacity for another's benefit. A suit is barred only if the property is benami and does not fall within the exceptions in Section 2(9); that is an issue to be decided on evidence, which the defendants must adduce, and not on plaint averments. (¶¶ 21, 26, 27)
- Section 14, Hindu Succession Act, 1956Provides that property possessed by a female Hindu is held by her as full owner and not as a limited owner. The Court held that the provision does not bar or prohibit a suit in respect of such property, so the plaint could not be rejected as barred by law on this ground; moreover, the plea had never been raised before the courts below. (¶¶ 20, 30, 31)
- Article 136, Constitution of IndiaSince the defendants remain free to have issues framed, including on any statutory bar, and to contest the suit on merits after evidence, they suffered no prejudice or miscarriage of justice justifying the exercise of the Court's discretionary jurisdiction. (¶¶ 32, 33)
Held
- A defendant who neither applied for rejection of the plaint under Order VII Rule 11 CPC nor challenged the order rejecting such an application filed by co-defendants is not a person aggrieved and cannot assail those orders; by choosing to contest the suit on merits she acquiesced in the jurisdiction of the trial court. (¶ 17)
- Subsequent purchasers of some of the suit properties, who can have no personal knowledge whether the properties in the hands of the original owners were joint Hindu family property, individual property, benami holdings or the absolute property of a female Hindu, are not the right persons to seek rejection of the plaint as barred by Section 4 of the Benami Act. (¶ 18)
- The bar in Section 4 of the Benami Act applies only to property held benami. Where the plaint throughout describes the suit properties as joint Hindu family properties purchased from the family nucleus or from the income of the joint family business, they cannot ex facie be treated as benami so as to render the suit not maintainable. (¶¶ 23, 24, 25)
- Whether a property is benami must be examined not under Section 4 alone but together with the definitions in Sections 2(8) and 2(9), including the exceptions; only property that is benami and outside those exceptions attracts the bar. That is a disputed question of fact to be decided on evidence, so the plaint cannot be rejected at the Order VII Rule 11 stage (Pawan Kumar v. Babu Lal followed). (¶¶ 26, 27, 28, 29)
- A plea that the suit is hit by Section 14 of the Hindu Succession Act, not taken in the Order VII Rule 11 application and never argued before the courts below, cannot be raised for the first time in a special leave petition without any foundation; in any event, Section 14 only makes a female Hindu the full owner of property possessed by her and contains no bar to a suit. (¶¶ 30, 31)
- Refusal to reject the plaint leaves the parties at liberty to contest the suit on merits and to have the relevant issues framed, including whether the suit is barred by any law, to be decided after evidence; no prejudice or miscarriage of justice therefore arose to justify interference under Article 136. (¶¶ 32, 33)
Result
Special leave petitions dismissed; the orders of the trial court and of the High Court in revision refusing to reject the plaint under Order VII Rule 11 CPC stand, and the suit is to proceed on merits.