JUDGMENT The judgment and decree impugned in this 2nd appeal are rendered in 1st appeal No. 19A/93 by 2nd Addl. District Judge. Dewas, whereby the judgment and decree passed by the trial Court decreeing the suit of the appellants-plaintiffs for partition and possession, were set aside and the suit was dismissed. . This appeal has been admitted on following substantial questions of law : (i) Whether provisions of S. 4 of Benami Transaction (Prohibition) Act. 1988 are applicable to the suit in question? (ii) Whether the judgment and decree, which is being assailed suffers, from infirmity or perversity in not considering the effect of provisions of S. 4 of Benami Transactions (Prohibition) Act, 1988 ? Admittedly, the property in dispute was purchased in the name of Mangilal, the defendant No. 1, who has since died during the pendency of the 1st appeal. The appellants-plaintiffs claim partition of the property on the averments that Mangilal was a mere Benamidar and that the property was HUF property of the plaintiffs and the defendants. The trial Court up-held the plaintiff's contention and decreed the suit for partition. However, in appeal the judgment and decree passed by the trial Court were reversed solely on the ground that in view of the provisions of the Benami Transactions (Prohibition) Act 1988 the suit was not maintainable. Admittedly the sale-deed in question was executed much before coming into force of the Act of 1988. Not only this the suit giving rise to this appeal was also filed wayback in 1979 whereas the Act of 1988 has come into force on 2.9.88. The question, therefore, arises is whether the Act is retrospective in operation and would embrace the suit filed prior to coming into force of section 4(1) of the Act. The point projected is resolved by a Supreme Court decision in R. Rajgopal Reddy (Dead) by LRs v. Padmini Chandrasekharan (Dead) by LRs (1995) 2 SCC 630 , wherein it is held that -- "The Act was enacted to efface the then existing right of the real owners of properties held by others benami. Such an Act was not given any retrospective effect by the legislature.
Such an Act was not given any retrospective effect by the legislature. In this respect clear legislative intention is seen from the words 'no such claim, suit or action shall lie' in section 4(1) meaning thereby no such suit, claim or action shall be permitted to be filed or entertained or admitted to the portals of any Court for seeking such a relief after the coming into force of section 4(1). The word 'lie' in connection with the suit, claim or action having not been defined by the Act, going by the dictionary meaning it would mean that such suit, claim or action to get any property declared benami will not be admitted on behalf of such plaintiff or applicant against the defendant concerned in whose name the property is held on and from the date on which this prohibition against entertaining of such suits comes into force. The view that section 4(1) would apply even to such pending suits which were already filed and entertained prior to the date when the section came into force and which has the effect of destroying the then existing right of plaintiff in connection with the suit property cannot be sustained in the face of the clear language of section 4 retrospective. Then to imply by necessary implication that section 4 would have retrospective effect and would cover pending litigations filed prior to coming into force of the section would amount to taking a view which would run counter to the legislative scheme and intent projected by various provisions of the Act. It is, however, true as held by the Division Bench of the Supreme Court in Mithilesh Kumari case that on the express language of section 4(1) any right inhering in the real owner in respect of any property held benami would get effaced once section 4(1) operate eve if such transaction had been entered into prior to the coming into operation of section 4(1), and hence after section 4(1) applied no suit can lie in respect to such a past benami transaction. To that extent the section may be retroactive.
To that extent the section may be retroactive. But from this it does not logically follow that the then existing rights got destroyed and even though suits by real owners were filed prior to coming into operation of section 4(1) they would not survive." The Ist Appellate Court was, therefore, wrong in holding that the suit was barred by section 4(1) of the Act of 1988. The judgment and decree passed by the appellate Court below, therefore, deserve to be set aside. Since no judgment is passed on merits of the case the appeal deserves to be remanded back to the Ist appellate Court below for decision afresh on merits. Accordingly, this appeal is allowed and the judgment and decree passed in Ist appeal No. 19A/93-by IInd ADJ Dewas, Camp Kannod are set-aside. The appeal shall go back to the appellate' Court below for decision afresh in accordance with law and keeping in view the legal position extracted above. Parties are directed to appear before the 1st appellate Court below on 5.3.99. No order is made as to the costs of this appeal.