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2011 DIGILAW 3868 (MAD)

Prakasam v. Jeeva Ammal

2011-09-05

R.S.RAMANATHAN

body2011
Judgment :- 1. The unsuccessful defendants are the appellants. 2. The plaintiff/respondent filed the suit for declaration and recovery of possession. The case of the respondent/plaintiff was that the properties originally belonged to Subramani Chettiar, father of the defendants/appellants 1 to 3 and under a registered sale deed dated 3.3.1980, he conveyed the suit properties in favour of Parvatha Chettiar, the father of the respondent/plaintiff for a valuable consideration and eversince the date of sale, Parvatha Chettiar was in possession and enjoyment of the properties and after the death of Parvatha Chettiar, the respondent/plaintiff was in possession and enjoyment of the same and as the respondent/plaintiff settled in another place, the defendants were allowed to enjoy the properties on payment of rent and they were also paying rent regularly and since two years prior to filing the suit, they refuse to give the rent and also started questioning the title of the respondent/plaintiff. Hence, the suit was filed for declaration and recovery of possession. 3. The appellants contested the suit stating that the document dated 3.3.1980 was only a sham and nominal document and it was never intended to be acted upon and no consideration was passed under that document and that document was executed as the creditors of Subramani Chettiar were pressing Subramani Chettiar for the money advanced to him and to safeguard the properties from the creditors, the document dated 3.3.1980 was executed only as a sham and nominal document and even after the execution of the said document, possession was retained by Subramani Chettiar and after Subramani Chettiar, his sons were enjoying the properties and they were paying kist and therefore, the plaintiff cannot have any title to the suit properties. It was further stated that the defendants/appellants were enjoying the properties to the knowledge of the respondent/plaintiff for more than twenty years and thereby perfected title by adverse possession. 4. The Trial Court decreed the suit holding that the sale deed Ex.A1/B1 was not a sham and nominal document and it was a real sale deed and title was passed under that document in favour of Parvatha Chettiar and as per the contention of the defendants/appellants it was a benami transaction and in that case, after the introduction of Benami Transactions (Prohibition) Act, it was not open to the defendants to take the plea that it was a benami transaction and decreed the suit. The lower appellate court also confirmed the findings of the Trial Court and dismissed the appeal. Hence, the second appeal. 5. The following substantial questions of law were framed at the time of admission:- "1. When the appellants/defendants have specifically pleaded in the written statement that the sale deed dated 3.3.1980 was executed as a nominal sale deed without any intention to convey title thereon, whether the use of the term "Benami" will deprive them from urging the plea of "sham and nominal" insofar as the sale deed dated 3.3.1980 is concerned? 2. Have not the courts below misconstrued the plea of the appellants/defendants as one of the "Benami" whereas actually the plea is only that the transaction was sham and nominal? 3. Have not the courts below erred in denying the claim of adverse possession by the appellants/defendants on the simple ground that they have not accepted the title of respondent/plaintiff? 4. Assuming but not admitting that there was any plea of "Benami" whether the same will affect the rights of the appellants/defendants since the Benami Transaction Prohibition Act will not have any retrospective effect?" 6. Mr.R.Subramanian, learned Senior Counsel appearing for the appellants submitted that the courts below, without properly appreciating the stand taken by the appellants, erred in holding that the appellants have pleaded that it was a benami transaction and after the abolition of benami transactions, the appellants are not entitled to claim that it was a benami transaction and the courts below erred in holding that title passed under Ex.A1/B1. He further submitted that the document, Ex.A1/B1 was only a sham and nominal document and it was not a benami document and that was also pleaded in the written statement and the possession of original documents of title viz., Ex.B1, the original sale deed, the payment of kist under Exs.B6 and B7 and the original pattas issued in respect of the suit properties, Exs.B2 to B5 were produced by the appellant and that would prove that no title passed under Ex.A1/B1 and if really title had passed under Ex.A1/B1, the original document of title must have been with the plaintiff and the plaintiff would have paid kist for the suit properties and the plaintiff has not proved the payment of kist in respect of the suit properties and therefore, contended that the document was only a sham and nominal document and without appreciating the same, the courts below erred in holding that the appellants have pleaded benami transaction and decreed the suit. He also relied upon the judgments reported in N.GOVINDARAJAN AND ANOTHER v. THE INDIAN OVERSEAS BANK (1991-1-LW 649) and Dr.RAVICHANDER v. KARUNAKARAN ((2000) II MLJ 136) in support of his contention. 7. On the other hand, Mr.T.R.Rajaraman, learned counsel for the respondent/plaintiff would submit that both the courts below have concurrently held, after discussing the oral and documentary evidence, that the plaintiff's father purchased the suit property under Ex.A1/B1 and having regard to the relationship between the parties, the possession of document of title with the appellant has no relevance and when title passed as per the recital in the documents, the purchaser became the owner of the property even though there was no consideration paid under the document and in this case, the parties are closely related and the plaintiff was residing at a different place and therefore, the properties were allowed to be enjoyed by the appellants and hence, the courts below rightly decreed the suit. He also relied upon the judgments reported in BISHUNDEO NARAIN RAI v. ANMOL DEVI ( AIR 1998 SC 3006 ), ANNAMALAI MUDALIAR & 2 OTHERS v. KRISHNAVENI AMMAL & 5 OTHERS (2002-1-LW 425), CHELLAPPA GOUNDER v. RAMASAMI GOUNDER ALIAS KARUPPA GOUNDER ((1998) IIIS MLJ 372) and NAVANEETHAMMAL v. ARJUNA CHETTY ( AIR 1996 SC 3521 ) in support of his contention. 8. Heard both the counsel. 8. Heard both the counsel. Having regard to the contentions raised by both the counsel, in my considered opinion, we will have to see whether Ex.A1/B1 is a sham and nominal document as contended by the appellants. According to me, the courts below erred in holding that Ex.A1/B1 was contended as benami transaction and therefore, after the introduction of Benami Transactions (Prohibition) Act, 45 of 1988, it was not open to the appellants to contend that the document was a benami transaction. 9. In the judgment reported in 1991-1-LW 649 (cited supra) this court has held as follows:- "Again, in Bhim Singh v. Kansingh ( AIR 1980 SC 727 ), the Supreme Court dealt with the kinds of benami transactions generally recognized in this country. In that context, the Supreme Court observed at page 732 as follows:- "... Two kinds of benami transactions are generally recognized in India. Where a person buys a property with his own money but in the name of another person, without any intention to benefit such other person, the transaction is called benami. In that case, the transferee holds the property for the benefit of the person who has attributed the purchase money, and he is the real owner. The second case, which is loosely termed as a benami transaction, is a case, where a person who is the owner of the property, executes a conveyance in favour of another, without the intention of transferring the title to the property thereunder. IN this case, the transferor continues to be the real owner. The difference between the two kinds of benami transactions referred to above lies in the fact that whereas in the former case there is an operative transfer from the tranferor to the transferee though the transferee holds the property for the benefit of the person who has contributed the purchase money, in the latter case, there is no operative transfer at all and the title rests with the transferor, notwithstanding the execution of the conveyance. One common feature, however, in both these cases is that the real title is divorced from the ostensible title and they are vested in different persons. One common feature, however, in both these cases is that the real title is divorced from the ostensible title and they are vested in different persons. The question whether a transaction is a benami transaction or not mainly depends upon the intention of the person, who has contributed the purchase money in the former case and upon the intention of one person, who has executed the conveyance in the latter case. The principle underlying the former case is also statutorily recognized in S.82 of the Indian Trusts Act, 1882, which provides that where property is transferred to person, for a consideration paid or provided by another person and it appears that such other person did not intend to pay or provide such consideration for the benefit of the transferee, the transferee must hold the property for the benefit of the person paying or providing the consideration ..." From the aforesaid decisions of the Supreme Court, it is clear that the two types of transactions, which can be regarded as 'benami' are (i) where a person buys property with his own funds or money, but in the name of another without any intention to benefit such other person, and (ii) where a person executes a conveyance in favour of another, without any intention to transfer the beneficial interest in the property to that person. The first type of transaction, according to the Supreme Court, is without doubt, a benami transaction. However, the second type of transaction which is only a transaction as such in name and not in reality, is do in a loose and erroneous sense, called a benami." 10. In this case also, in the written statement, it has been specifically stated that no consideration was passed for the sale transaction and it was stated that the transaction was only a benami transaction between Subramani Chettiar and Parvatha Chettiar. Therefore, using of the term 'benami transaction' in the written statement will not lead to the conclusion that the defendants/appellants stated that the transaction was a benami transaction and therefore, hit by the provisions of the Benami Transactions (Prohibition) Act, 45 of 1988. Therefore, having regard to the stand taken by the defendants/appellants in the written statement and in evidence, I am of the opinion that the defendants/appellants have taken a plea that the transaction was only a sham and nominal document and it was not a benami transaction. 11. Therefore, having regard to the stand taken by the defendants/appellants in the written statement and in evidence, I am of the opinion that the defendants/appellants have taken a plea that the transaction was only a sham and nominal document and it was not a benami transaction. 11. The next question that arises for consideration is whether Ex.A1/B1 was a sham and nominal document as contended by the defendants/appellants. As held by the Honourable Supreme Court in the decision reported in AIR 1980 SC 727 , in the case of sham and nominal document, no consideration passed, the title was retained by the vendor and the vendor continues to be the real owner. It was contended by Mr.R.Subramanian, learned Senior Counsel for the appellants/defendants that the possession of the original document of title, Ex.B1, payment of kist under Exs.B6 and B7 and the production of pattas in respect of properties by the defendants/appellants would prove that the document Ex.A1/B1 was not intended to be acted upon as the sale deed and it was only a sham and nominal document created for the purpose of protecting the properties from the clutches of the creditors and that was also spoken to by D.Ws.2 and 3, the attesting witnesses to Ex.A1/B1 and PW2, the husband of the plaintiff also admitted in evidence that Subramani Chettiar was having debts. The learned Senior Counsel, therefore, contended that having regard to the evidence of DW2 and DW3 and the production of original documents of title, payment of kist and patta would prove that title never passed under Ex.A1/B1 and therefore, the plaintiff cannot claim that she is the owner of the property. 12. On the other hand, Mr.T.R.Rajaraman, learned counsel for the respondent/plaintiff submitted that under section 54 of the Transfer of Property Act, when a document was executed conveying title, irrespective of payment of consideration, the title passes to the purchaser as held by this court in the judgment reported in 2002-1-LW 425, and AIR 1998 SC 3006 . 13. To find out whether Ex.A1/B1 is a sham and nominal document or a real document, we will have to see various circumstances. One of the circumstances is production of original sale deed, payment of tax in respect of the property and possession of the property. 13. To find out whether Ex.A1/B1 is a sham and nominal document or a real document, we will have to see various circumstances. One of the circumstances is production of original sale deed, payment of tax in respect of the property and possession of the property. According to me, when the respondent filed the suit for declaration, having regard to the plea taken by the defendants that the sale deed Ex.A1/B1 was only a sham and nominal document and was not a real document, the burden is on the defendants to prove the same. Though DW2 and DW3 have stated in evidence that no consideration was passed under Ex.A1/B1 and they have also stated that Ex.A1/B1 was executed by Subramani Chettiar, father of the appellants to save the property from the clutches of the creditors, having regard to the recitals in Ex.A1/B1, I am of the opinion that the document cannot be considered as a sham and nominal document. In Ex.A1/B1, it was stated that the consideration of Rs.40,000/= consists of Rs.20,000/= payable to one R.Venkatachalam, son of Raja Govindaraja Chettiar, Rs.15,000/= payable to the purchaser as per the pronote executed by Subramani Chettiar in favour of the purchaser for his son's marriage and Rs.5000/= received under that document. If really the document was a sham and nominal one, there was no need to mention about the loan payable to R.Venkatachalam as part of the sale consideration. Further, as rightly submitted by the learned counsel for the respondent/plaintiff, except the oral evidence of D.Ws.2 and 3 and the pleading, no evidence was adduced by the appellants to prove that Subramani Chettiar was pressed by the creditors to pay off his dues and therefore, to escape from the clutches of the creditors and to save the property, he has executed that sale deed. The defendants could have produced some notices to prove the action taken by the creditors which prompted Subramani Chettiar to execute the sale deed in favour of the plaintiff's father. Further, no attempt was made by Subramani Chettiar or by his sons, the defendants/appellants to set aside the sale deed Ex.A1/B1 after the crisis was over. The defendants could have produced some notices to prove the action taken by the creditors which prompted Subramani Chettiar to execute the sale deed in favour of the plaintiff's father. Further, no attempt was made by Subramani Chettiar or by his sons, the defendants/appellants to set aside the sale deed Ex.A1/B1 after the crisis was over. Therefore, having regard to the specific recital in the sale deed viz., payment of consideration, viz., discharge of loan to R.Venkatachalam and payment of cash under the sale deed, I am of the opinion that the transaction was only a real transaction and the document was not a sham and nominal document as contended by the appellants. 14. Further, the relationship between the parties will also determine the character of the transaction. Admittedly, Subramani Chettiar, the father of the appellants married the sister of Parvatha Chettiar. Therefore, Subramani Chettiar is the brother-in-law of Parvatha Chettiar. Parvatha Chettiar died and the plaintiff/respondent was his only daughter and she was also married. Hence, the possession of the original document of title by the vendor Subramani Chettiar will not determine the nature of the transaction. Further, the payment of kist as well as production of pattas by the appellants/defendants also will not strengthen the case of the appellants/defendants having regard to the relationship between the parties. In this case, Exs.B2 to B5 are patta Numbers 263, 121and 176. Ex.B2 and B5 relate to S.No.85/2B and patta in respect of the same is 176 which is a joint patta. In the suit properties, items 7 and 8 relate to S.No.85/2B having an extent of 66 cents and 77 cents out of 8.96 acres. As per Exs.B2 and B5, Subramani Chettiar was said to be the owner of 77 cents in S.No.85/2B and the remaining extent was owned by various other persons. Ex.B4 is in respect of S.No.134/5, 134/2A, 134/2B, 134/6, 144/8, 154/3, 154/4 and 155. They are in respect of items 2, 3, 4 and 5. Survey Nos.154/3 and 154/4 mentioned in patta 263 are not related to the suit properties. Similarly, patta 121 in respect of S.No.154/1 is also not related to the suit property. Further, Ex.B6 kist receipts do not relate to the above said patta numbers as evidenced by Exs.B2 to B5. They are in respect of items 2, 3, 4 and 5. Survey Nos.154/3 and 154/4 mentioned in patta 263 are not related to the suit properties. Similarly, patta 121 in respect of S.No.154/1 is also not related to the suit property. Further, Ex.B6 kist receipts do not relate to the above said patta numbers as evidenced by Exs.B2 to B5. Further, Exs.B2 to B5 were issued in the year 1980 when Ex.A1/B1 was also executed and therefore, the production of patta books by the defendants/appellants will not support their case that they continued to be the owners of the properties even after execution of Ex.A1/B1. As regards Ex.B7, the house tax receipts are concerned, no doubt, the receipts were issued in the name of Subramani Chettiar and according to me, having regard to the relationship between the parties, the production of house tax receipts will not lead to the conclusion that no title passed under Ex.A1/B1. Further, the house was in respect of item No.10 and item Nos.9, 11 and 12 are vacant sites and no proof was adduced that the vacant sites are in the enjoyment of the defendants/appellants. Therefore, having regard to the fact that the parties are closely related and in the sale deed, Ex.A1/B1, specific recitals regarding consideration was mentioned, viz., the loans to be discharged to the third parties, would prove that the document Ex.A1/B1 was a real transaction and not a sham and nominal transaction. 15. Further, as submitted by the learned counsel for the respondent, under section 54 of the Transfer of Property Act, from the recitals stated in the document, the intention can be gathered and mere non delivery of registration receipt by vendor to the purchaser will not lead to the conclusion that the document was not intended to be acted upon. I, therefore, hold that the document Ex.A1/B1 was not a sham and nominal document and it was a real sale deed intended to be acted upon and was acted upon and therefore, the plaintiff/respondent got title to the suit properties and as the defendants are in possession of the same, the plaintiff is entitled to recovery of possession. Further, the appellants cannot claim adverse possession to the suit properties having pleaded that they are the real owners of the suit properties. 16. Further, the appellants cannot claim adverse possession to the suit properties having pleaded that they are the real owners of the suit properties. 16. Therefore, substantial questions of law 1, 2 and 4 are answered against the appellants that the sale deed dated 3.3.1980 was not a sham and nominal document as contended by the appellants and it was also not a benami transaction as contended by the defendants/appellants and it was a real document and title passed under Ex.A1/B1 and the plaintiff got absolute title under Ex.A1/B1. The third substantial question of law is also answered against the appellants and I hold that the appellants are not entitled to the suit properties by adverse possession as the claim of ownership and the claim of adverse possession will not go together. In the result, the concurrent judgment of the courts below are confirmed. The second appeal is dismissed. In the circumstances of the case, there is no order as to costs.