One argument, of course, could be raised that by purchasing the
property in the names of the wives in the family, the late Chaman Lal was
securing the interest of his own wife, as also the interest of his sons. That
argument even if raised, would also have to be rejected, because nothing
prevented him from then purchasing the property in the name of his wife and
sons, with no mention of the daughters-in-law. The very fact that he chose to
purchase the property in the name of his wife and daughters-in-law, would go
to prove that he actually intended it to be for their benefit.
That being so, it cannot be said in the context of the
circumstances of the present case, that the property was purchased by Chaman
Lal in the name of his wife and daughters-in-law, because they stood in any
fiduciary capacity to him. If that were so, he could have executed any
instrument by way of a family settlement etc. to make any such intention clear
in that regard. That no having been done, the property cannot be said to have
been purchased for the benefit of any other person, other than those in whose
names it was purchased.
IN THE HIGH COURT OF PUNJAB AND HARYANA AT
CHANDIGARH
RSA No.1504 of 2016
Date of Decision: 07.09.2016
Smt. Kanchan Jain Vs. Babita Jain
CORAM: MR. JUSTICE AMOL RATTAN SINGH
Citation: AIR 2017(NOC)73 P&H
This is the second appeal of the defendants in a suit filed by the
respondent-plaintiff, seeking partition of the suit property by metes and
bounds and separate possession thereof to the extent of her 1/4th share in the
property, which is a building standing on land measuring 154 square yards,
bearing no.B.VII 395 (old) & B.VII 269 (New) in Mohalla Mullan Shakoor,
Ludhiana.
The plaintiff further sought a decree of permanent injunction
restraining the defendants from changing the nature and construction of the
building or alienating it in any manner. Still further, she had prayed for mesne
profits qua her share in the suit property.
2. The suit having been decreed in her favour and the first appeal
filed by the present appellants having been dismissed, the present second
appeal has been filed.
3. The facts, as taken from the judgments of the learned Courts
below, are that as per the respondent-plaintiff, she and the defendants are
joint owners in possession of the suit property, with she and defendant no.2
being owners to the extent of a 1/4th share each and defendant no.1 having a
half share in the suit property.
Defendant no.1 is the mother-in-law of the plaintiff and
defendant no.2, the plaintiff and defendant no.2 being married to two
brothers.
4. It was contended by the plaintiff that after her marriage on
23.09.1990, she lived happily in her matrimonial home for some time,
alongwith her husband, the defendants and their families. Thereafter,
allegedly, the plaintiffs' husband as well as the defendants and defendant
no.2s' husband, started maltreating the plaintiff on account of insufficient
dowry, further stating that she was not beautiful, whereas her husband was a
smart and handsome boy.
Despite several attempts at mediation etc., eventually, on
25.08.2000, allegedly an attempt was made to pressurise her into accepting a
divorce from her husband, and she was turned out of her matrimonial home.
Eventually, an FIR was lodged for the alleged commission of offences
punishable under Sections 406/498-A/120-B IPC on 10.04.2001, and her
husband also filed a petition for divorce under Section 13 of the Hindu
Marriage Act.
5. In the above situation, the plaintiff sought a partition of the suit
property in which she had a 1/4th share, and upon the defendants not agreeing
to give any such possession, she filed the suit.
She also claimed that the rental value of the property was
Rs.30,000/- per month and that she was accordingly entitled to mesne profits
to the extent of 1/4th thereof.
6. Upon notice issued to them, the defendants appeared and filed
their written statements with the usual preliminary objections of non-joinder
of necessary parties etc. and on merits, contended that the property was
purchased by the late husband of defendant no.1 (father-in-law of the
plaintiff) Shri Chaman Lal, in the name of the parties to the suit and that the
entire sale consideration was paid by him.
As such, it was contended that the plaintiff having made no
contribution towards the purchase of the property, she could claim no right in
it.
7. Upon the aforesaid pleadings, the following issues were framed
by the learned Civil Judge (Junior Division), Ludhiana:-
1. Whether the plaintiff is entitled to separate possession by
the parties with respect to the suit property as prayed for?
OPP
2. Whether plaintiff is entitled to the relief of permanent
injunction as prayed for? OPP
3. Whether the plaintiff is entitled to mesne profit from the
defendant? If so, at what rate and from which party? OPP
4. Whether suit is bad for non joinder of necessary parties?
OPP
5. Whether suit is not properly valued for the purposes of
court fee and jurisdiction? OPD
6. Whether plaintiff has no locus standi or cause of action to
file this suit? OPD
7. Relief.
8. The plaintiff examined herself and her father Darshan Kumar
Jain, and exhibited a copy of the sale deed of the suit property and the FIR
lodged, as Exs. P1 and P2 respectively.
The defendants examined defendant no.2 as DW1.
9. Upon appraising the pleadings of the parties and the evidence
led, the learned Civil Judge found that the defence taken by the defendants
was that the property had been purchased benami in the name of the plaintiff.
However, it was held that even if the property was purchased
from the fund of the late Chaman Lal only, the plea of a benami transaction
was barred in terms of Sections 3 and 4 of the Benami Transactions
(Prohibition) Act, 1988 (hereinafter to be referred to as the Act).
It was further found that the only two exceptions to the aforesaid
bar, as per the Act itself, were, firstly, if the person in whose name the
property is held is a coparcener in a Hindu Undivided Family, or second, if
the person in whose name the property is held is a trustee or stands in a
fiduciary capacity to the person who actually purchased it. It was held that the
petitioner was neither a coparcener nor in a fiduciary capacity to the
purchaser, the late Shri Chaman Lal.
10. On the issue of mesne profits, the plaintiff not having been able
to lead any evidence that the property had actually been tenanted out for
Rs.30,000/- per month, eventually, the contention of the defendants was
accepted that they were receiving Rs.1500/- per month in the property and
accordingly, the plaintiff was held entitled to a 1/4th share of Rs.375/- per
month, by way of mesne profits.
11. Thus, the issues on the partition and separate possession having
been held in favour of the plaintiff, (the plea of a benami transaction being
barred), the suit was decreed in her favour, further restraining the defendants
from changing the existing nature and construction of the property.
12. In the first appeal filed by the present appellants, the learned
Additional District Judge, Ludhiana, after considering the judgment of the
learned Civil Judge, as also the evidence adduced by both sides, referred to a
judgment of the Supreme Court in Bina Pani Paul v. Pratima Ghosh and
others 2007 (2) RCR (Civil) 801, and also eventually came to the same
conclusion, that the plaintiff was neither a coparcener in the Hindu Undivided
Family of the deceased Chaman Lal, nor was in any fiduciary relationship to
him and as such, in view of the bar contained in the Act, the suit property, to
the extent of share of the plaintiff, would have to be treated as her own
property.
Consequently, the first appeal was dismissed.
13. Before this Court, Mr. Naveen Bawa, learned counsel for the
appellants, essentially reiterated the arguments raised before the Courts below
on behalf of the appellants and submitted that once it was not denied by the
plaintiff that the consideration towards the purchase of the suit property was
entirely paid by the late Shri Chaman Lal, it would not be a case of a benami
transaction, but the holding over of the property by the plaintiff in trust for
the deceased.
14. Having considered the aforesaid argument, as well as the
judgments of the learned Courts below, first of all the provisions of the Act
need to be considered. Sections 3 and 4 thereof read as follows:-
“3. Prohibition of benami transactions- (1) No person shall enter
into any benami transaction.
(2) Nothing in sub-section (1) shall apply to -
(a) the purchase of property by any person in the name
of his wife or unmarried daughter and it shall be presumed,
unless the contrary is proved, that the said property had been
purchased for the benefit of the wife or the unmarried daughter;
(b) the securities held by a -
(i) depository as registered owner under sub-section (1)
of section 10 of the Depositories Act, 1996
(ii) participant as an agent of a depository.
Explanation.- The expressions “depository” and “Participants
shall have the meanings respectively assigned to them in clauses
(e) and (g) of sub-section (1) of section 2 of the Depositories Act,
1996.
(3) Whoever enters into any benami transaction shall be
punishable with imprisonment for a term which may extend to
three years or with fine or with both.
(4) Notwithstanding anything contained in the Code of Criminal
Procedure, 1973, an offence under this section shall be noncognizable
and bailable.
4. Prohibition of the right to recover property held benami-
(1) No suit, claim or action to enforce any right in respect of
any property held benami against the person in whose name the
property is held or against any other person shall lie by or on
behalf of a person claiming to be the real owner of such property.
(2) No defence based on any right in respect of any property
held benami, whether against the person in whose name the
property is held or against any other person, shall be allowed in
any suit, claim or action by or on behalf of a person claiming to
be the real owner of such property.
(3) Nothing in this section shall apply,--
(a) where the person in whose name the property is held is
a coparcener in a Hindu undivided family and the property
is held for the benefit of the coparceners in the family; or
(b) where the person in whose name the property is held is
a trustee or other person standing in a fiduciary capacity,
and the property is held for the benefit of another person
for whom he is a trustee or towards whom he stands in
such capacity.
14-A. Section 6 of the Act may also be noticed, wherein it is stipulated
that nothing in the Act shall affect the provisions of Section 53 of the
Transfer of the Property Act, 1882, or any law relating to transfers for an
illegal purpose. However, Section 53 of the Act of 1882 is not seen to be
applicable to the present circumstances of the case and hence, is not referred
to, except to notice that the said provision pertains to fraudulent transfers.
There being no issue raised of any fraudulent transfer in the present case,
nothing further need be said on that.
15. As regards Section 3(2) of the Act, undoubtedly, defendant no.1
was the wife of the late Chaman Lal and as such, half the property, as was
purchased by him in her name, would obviously be deemed to be for her
benefit and not for the benefit of either the plaintiff or defendant no.2, they
being his daughters-in-law.
Coming then to the exceptions carved out in Section 4(3) of the
Act, by which property held in the name of a coparcener in a Hindu
Undivided Family, or in the name of a person standing in a fiduciary capacity
to the purchaser, have been held to be not affected by the provisions of
Section 4(1) & (2).
It is, therefore, to be seen whether the respondent-plaintiff was a
coparcener in the Hindu Undivided Family, at the time when the property was
purchased during the life time of the late Chaman Lal, or whether she stood in
any fiduciary capacity to him.
16. As regards her being a coparcener in the Hindu Undivided
Family, firstly, of course, no contention whatsoever is seen to have been
raised that the property was ancestral in the hands of Chaman Lal, so as to
make even his sons to be coparceners in the property.
Hence, the question of the respondent-plaintiff enjoying only a
life interest in such coparcenary property also does not arise, other than the
fact that a daughter-in-law, is not a coparcener herself.
In this regard, if any reference is to be quoted, passages from
Mulla on Hindu Law, 22nd edition, can be referred to. (Reference Chapter XII
on coparceners, page 315).
“210. Joint Hidnu Family.-(1) A joint Hindu family consists of
all person lineally descended from a common ancestor, and
includes their wives and unmarried daughters. A daughter ceases
to be a member of her father's family on marriage, and becomes a
member of her husband's family.”
“211. Hindu coparcenary.- A Hindu coparcenary is a much
narrower body than the joint family. It includes only those
persons who acquire by birth an interest in the joint or
coparcenary property. These are the sons, grandsons and greatgrandsons
of the holder of the joint property for the time being,
in other words, the three generations next to the holder in
unbroken male descent (see 217). The above propositions must
be read in the light of what has been stated in the note at the top
of this chapter. After the amendment of the Hindu Succession
Act in 2005, a daughter of a coparcener has been included as a
coparcener along with the sons of the coparcener. The
commentary will not have to be read accordingly.”
“Ancestral property is a species of coparcenary
property. As stated above, if a Hindu inherits property from his
father, it becomes ancestral in his hands as regards his son. In
such a case, it is said that the son becomes a coparcener with the
father as regards the property so inherited, and the coparcenary
consists of the father and the son. However, this does not mean
that coparcenary can consist only of the father and his sons. It is
not only the sons, but also the grandsons and great-grandsons,
who acquire an interest by birth in the coparcenary property.
“212. Formation of coparcenary. -(1) The conception of a joint
Hindu family constituting a coparcenary is that of a common
male ancestor with his lineal descendants in the male line within
four degrees counting from, and inclusive of, such ancestor (or
three degrees exclusive of the ancestor). No coparcenary can
commence without a common male ancestor, though after his
death, it may consist of collaterals, such as brothers, uncles,
nephews, cousins, etc.
(2) A coparcenary is purely a creature of law; it cannot be
created by act of parties, save in so far that by adoption a
stranger may be introduced as a member thereof.
(3) No female can be a coparcener, although a female can be
a member of a joint Hindu family (see 215).This was the position
prior to the amendment of the Hindu Succession Act in 2005. By
virtue of the amendment, the daughters of a coparcener are
included as coparceners along with his sons and are recognized
as coparceners in their own right.”
Thus, obviously a daughter-in-law cannot be a coparcener and
consequently, the respondent-plaintiff is not ousted by the exception carved
out in Section 4(3(a) of the Act.
16. Coming then to the question of whether the property purchased
in her name, by Chaman Lal, was purchased in trust, if she stood in any
fiduciary capacity to him.
Though no specific arguments have been addressed before this
Court on that issue, however, it needs to be seen that if the intention of
Chaman Lal had been to purchase the property for the welfare of the entire
Hindu Undivided Family, he could simply have purchased it in his own or in
his wifes' name or in their joint names. The very fact that he chose to
purchase the property in the name of his wife and two daughters-in-law, goes
to show that he intended to ensure the financial security of the female
members of his family.
The issue of what relationship can be termed to be a “fiduciary”
one came up for consideration before the Supreme Court in Sri Marcel
Martins v. M. Printer and others (2012(2) RCR (Civil) 922, wherein their
Lordships observed as follows:-
“21. We may at this stage refer to a recent decision of this
Court in Central Board of Secondary Education and Anr. V .
Adiya Bandopadhyay and Ors., 2011(3) RCR (Civil) 914: 2011
(4) Recent Apex Judgments (R.A.J.) 371: (2011) 8 SCC 497,
where Ravindeeran, J. speaking for the Court in that case
explained the term 'fiduciary' and 'fiduciary relationship' in the
following words:
“39. The term “fiduciary” refers to a person having a
duty to act for the benefit of another, showing good faith
and candour,where such other person reposes trust and
special confidence in the person owing or discharging the
duty. The term “fiduciary relationship” is used to describe
a situation or transaction where one person (beneficiary)
places complete confidence in another person (fiduciary)
in regard to his affairs, business or transaction(s). The term
also refers to a person who holds a thing in trust for
another (beneficiary). The fiduciary is expected to act in
confidence and for the benefit and advantage of the
beneficiary,and use good faith and fairness in dealing with
the beneficiary or the things belonging to the beneficiary.
If the beneficiary has entrusted anything to the fiduciary,to
hold the thing intrust or to execute certain acts in regard to
or with reference to the entrusted thing, the fiduciary has
to act in confidence and is expected not to disclose the
thing or information to any third party.”
22. It is manifest that while the expression “fiduciary
capacity” may not be capable of a precise definition, it implies a
relationship that is analogous to the relationship between a
trustee and the beneficiaries of the trust. The expression is in fact
wider in its import for its extends to all such situations as place
the parties in positions that are founded on confidence and trust
on the one part and good faith on the other.”
17. Thus, whether any one person stood in a fiduciary capacity to
another, in the context of a particular property transaction, has to be seen in
the circumstances of individual cases.
One argument, of course, could be raised that by purchasing the
property in the names of the wives in the family, the late Chaman Lal was
securing the interest of his own wife, as also the interest of his sons. That
argument even if raised, would also have to be rejected, because nothing
prevented him from then purchasing the property in the name of his wife and
sons, with no mention of the daughters-in-law. The very fact that he chose to
purchase the property in the name of his wife and daughters-in-law, would go
to prove that he actually intended it to be for their benefit.
That being so, it cannot be said in the context of the
circumstances of the present case, that the property was purchased by Chaman
Lal in the name of his wife and daughters-in-law, because they stood in any
fiduciary capacity to him. If that were so, he could have executed any
instrument by way of a family settlement etc. to make any such intention clear
in that regard. That no having been done, the property cannot be said to have
been purchased for the benefit of any other person, other than those in whose
names it was purchased.
18. Finally, though I agree with learned counsel for the appellants
that there is no specific pleading shown by which the respondent-plaintiff
denied that the property had been purchased from the funds of her father-inlaw
and not from her own funds, however, no provision in the Act carves out
an exception by which, if it is shown that a property is purchased from the
funds of one person, in the name of another person, such property would not
fall within the prohibition and bar stipulated in Sections 3 and 4 of the Act.
19. That being so, I find absolutely no error in the judgments of the
learned Civil Judge and the learned Additional District Judge, in decreeing
the suit of the plaintiff and in dismissing the appeal filed by the present
appellants-defendants.
Consequently, finding no merit in this appeal, it is dismissed in
limine, with no order as to costs.
(AMOL RATTAN SINGH)
September 7, 2016 JUDGE
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