Full Judgment
M. JAGANNADHA RAO, J. :
Civil Appeal No. 6486 of 1983 is filed by Smt. Rebti Devi (since deceased) and is being continued by her son Sri Mahesh Dutt Gupta, claiming to be her sole legatee under a registered will dt. 18th December, 1972. This appeal is preferred against the judgment of the Allahabad High Court in Regular Second Appeal No. 1001/1973, dt. 29th February, 1980, arising out of Suit No. 1263 of 1968. In the Civil Appeal the respondents are the legal heirs of the brother of Mahesh Dutt Gupta, i.e., late Ram Dutt Gupta.
Special Leave Petition No. 17883 of 1997 is filed by the legal representative of Ram Dutt Gupta (brother of Mahesh Gupta) impleading Mahesh Gupta and other family members against the judgment of the Allahabad High Court in First Appeal No. 378 of 1996, dt. 30th May, 1997, allowing the appeal of Mahesh Dutt Gupta and granting probate in respect of the will dt. 18th December, 1972, of Rebti Devi in his favour. Learned counsel or the petitioners in SLP has fairly stated that the SLP and IA 1 of 1996 therein are not being pressed. Therefore, we are left only with Civil Appeal No. 6486 of 1983 and in view of the dismissal of SLP. Mahesh Dutt Gupta can continue the said Civil Appeal in the place of his deceased mother Rebti Devi. The result also is that Mahesh Dutt can also claim as heir to such interest which Rebti has, even if her case of being real owner of the property is rejected once again in this Court.
2. The Suit No. 1263 of 1968 out of which the Civil Appeal arises was filed by Smt. Rebti Devi for possession of property from the occupation of one of her sons Ram Dutt Gupta. The plaintiff has impleaded Ram Dutt Gupta as 1st defendant and his son Surendra Nath Gupta is 2nd defendant. She claimed that she purchased the suit property on 1st June, 1955, under a registered sale deed for Rs. 5,000 out of the money acquired by sale of her jewellery and ornaments and money given to her by her relatives and also out of the income derived by her by lending her money regularly. She also pleaded that her husband Ujagar Lal had no movable or immovable property. Apart from Ram Dutt, she has other children Brahm Dutt, Ramesh Dutt, Mahesh Dutt and daughters Prem Devi, Chandrakanta. She claims that the sons separated and that in 1960 she permitted Ram Dutt to occupy the ground floor of the suit property for his business and as Ram Dutt did not vacate, she was suing for possession. The defence of Ram Dutt and his son was that the property was purchased by his father Ujagar Lal in the name of Ram Dutts mother Rebti Devi benami on 1st June, 1955, and that the entire consideration was paid by his father, that his father was the real owner and that after his death, the property has devolved on his wife (plaintiff) and other children in accordance with law.
Both sides led evidence. The trial Court accepted the plaintiffs case in its judgment dt. 18th November, 1971, and held that the plaintiff was not a benamidar and her husband was not the real owner. But on appeal, the appellate Court, in a well considered judgment, reversed the judgment and decree and dismissed the suit on 9th March, 1973. That judgment was affirmed by the High Court in Second Appeal on 29th February, 1980. Plaintiff preferred this Civil Appeal in this Court.
3. Learned counsel for the plaintiff-appellant (legal representative of Rebti Devi) submitted that the property was standing in the name of Rebti Devi and that the defendants who had come up with a plea of benami had not discharged the onus that was on them. It was also contended, referring to Benami Transactions (Prohibition) Act, 1988, that the plea of benami raised in defence was not open to the defendants and that in Nand Kishore Mehra vs . Sushila Mehra : [1995]215ITR218(SC) (which is a three judge judgment), the principles decided in R. Rajagopala Reddy vs . Padmini Chandrasekharan : [1995]213ITR340(SC) (which is also decision of three learned judges) have been doubted and hence, the said Act is applicable to the facts of the case even though the defence of benami was raised long before 19th May, 1988, when the Act came into force. Learned counsel for the respondent contended that the finding of fact arrived at by the first appellate Court was not rightly interfered with by the High Court, and that it did not call for any interference under Art. 136 of the Constitution of India. It was also submitted that R. Rajagopala Reddys case (supra) holds good and has not been doubted in Nand Kishore Mehra case (supra).
4. So far as the first submission of the appellants counsel is concerned, we are of the view that it is true that the respondent-defendants who have raised a defence of benami in their written statement have to discharge the initial burden of proof and establish the plea of benami. Parties adduced oral and documentary evidence. The lower appellate Court had considered the evidence adduced by both sides and arrived at a conclusion that the defendants had discharged the said burden. When both sides had adduced evidence, the question of burden of proof pales into insignificance. The High Court was, therefore, right in not interfering with the said finding. The said finding of fact cannot be canvassed in this Civil Appeal by the plaintiff or her legal representative.
5. In order to appreciate the second submission, we have to start here with Rajagopala Reddys case (supra) and find out what it actually decided in regard to the Benami Transactions (Prohibition) Act, 1988 (hereinafter called the Act). Secs. 3, 5 and 8 of the Act came into force at once, i.e., w.e.f. 5th September, 1988, while the remaining provisions were deemed to have come into force from 19th May, 1988. The principles decided in that case, while overruling Mithilesh Kumari vs. Prem Behari Khare (1989) (2) SCC 951 can be summarised as follows :
'(1) Firstly, while s. 4(1) prohibited a plea of benami to be raised in a suit, claim or action and again s. 4(2) precluded a defence of benami in suits claims or actions, these two provisions did not come in the way of a decision on such pleas in matters pending as on 19th May, 1988, if such pleas were already raised before 19th May, 1988, by one party or other. This was because such pleas which were already raised before 19th May, 1988, were not intended to be affected by the Act, if they were raised in suits, claims or actions pending as on 19th May, 1988. The repeal provision in s. 7 repealed s. 82 of the Trust Act only in that manner and to that extent.
(2) Secondly, on the express language of s. 4(1), any right inhering in the real owner in respect of any property held benami would be not enforceable once s. 4(1) operated, even if such transaction had been entered into prior to 19th May, 1988, and no suit could be filed on the basis of such a plea after 19th May, 1988. The same prohibition applied in case of s. 4(2) to a defence taken after 19th May, 1988 pleading benami in respect of a transaction prior to 19th May, 1988. The Act could be said to be retrospective only to that extent. But from this it did not follow that where such a plea was already taken before 19th May, 1988 to the effect that the property was held benami, such a plea got shut out merely because the proceeding in which such a plea was raised before 19th May, 1988 was pending on 19th May, 1988.
(3) Thirdly, where a suit had been filed before 19th May, 1988, and in any written statement filed on or after 19th May, 1988, a plea of benami was raised, then such a plea of benami could not also be gone into. If, however, such a plea in defence had been raised before 19th May, 1988, the Act did not preclude that question to be decided in proceedings which were pending on 19th May, 1988. Mithilesh Kumari case (supra) was wrong in holding that such a defence could not be decided after 19th May, 1988, even though the plea was raised before 19th May, 1988.
(4) Fourthly, if such an interpretation as stated in (1) to (3) was given, it could not be validly contended that question of invalid discrimination arose between cases where suits were filed on or before 19th May, 1988, and those filed after 19th May, 1988.
(5) Fifthly, even though the word suit might include appeal or further appeals, s. 4(1) and 4(2) could not be made applicable to these subsequent stages.
(6) Sixthly, pleas by plaintiffs or applicants and defences after 19th May, 1988, of real owners against benamidars were barred under s. 4(1) and s. 4(2), only to the extent indicated above.'
This in substance is what was decided in R. Rajagopala Reddys case (supra).
6. We shall now take up Nand Kishore Mehra case (supra). As we shall presently show, that case was concerned with a different factual situation and different legal principles. We have sent for the record in this case and find that there the suit was filed on 24th January, 1992 (i.e., after 19th May, 1988) by the appellant pleading that he purchased the property on 24th April, 1964, in trust for himself but in the name of his wife (the defendant). The wife relied on the Act and filed an I.A. for rejection of the plaint under O. 7, r. 11, CPC. The Delhi High Court (on Original Side) in its order dt. 18th November, 1993, dismissed the application under O. 7, r. 11 filed by the wife for rejection of the plaint. On appeal by the defendant-wife, a Division Bench of the High Court by judgment, dt. 21st April, 1994, allowed the (wifes) appeal and directed rejection of the plaint as the Division Bench felt that s. 3(1) of the Act applied. On further appeal by the plaintiff-husband, this Court allowed the appeal and the application under O. 7, r. 11 filed by the defendant-wife was dismissed and the suit was directed to be disposed of on merits, taking into account the statutory presumption under s. 3(2) and holding that s. 3(1) did not apply because the case fell under the exception contained in s. 3(2).
This Court referred to R. Rajagopala Reddys case (supra). The plaint being subsequent to 17th May, 1988, the principle that the Act was not retrospective as stated in R. Rajagopala Reddys case was no doubt initially not attracted to that case. That would mean that s. 4(1) applied unless of course the case fell within the exceptions stated either in s. 3(2) or in s. 4(3) of the Act. In that case, this Court permitted the plea of benami in a post 19th May, 1988, suit because the Court was concerned with the exception in s. 3(2). The Court also incidentally referred to the other exceptions falling under s. 4(3). The Court, in that case noticed that the purchase was on 24th April, 1964, and was in the name of the wife. That was why this Court proceeded to refer to the exception in s. 3(2) which concerns benami purchases in the name of a wife or unmarried daughters. This Court also referred to the presumption contained under the same exception in s. 3(2) to the effect that unless the contrary was proved, in the cases of purchases in the name of wife or unmarried daughters, it shall be presumed that the property had been purchased for the benefit of the wife or the unmarried daughters. In view of the exception in s. 3(2), the prohibition under s. 3(1) was held not to apply. It was held that, even though he plaint was filed after 19th May, 1988, such a plea of benami was not shut out. This Court directed that the suit to be disposed of, of course, by applying the statutory presumption contained in s. 3(2) which is to be mandatorily drawn but which is rebuttable. The plaintiff in a suit filed after 19th May, 1988, could still prove that the property had not been purchased by him for the benefit of his wife and he could rebut the presumption, and claim that he was the real owner.
7. Therefore, to the six principles hereinbefore culled out from R. Rajagopala Reddys case (supra), the following further principles decided in Nand Kishore Mehra case (supra) can be added :
'(7) Seventhly, if in a suit, claim or action, a plea or defence, based on benami is raised even after 19th May, 1988, and the purchase is in the name of a wife or unmarried daughter, such a plea of benami is permissible and R. Rajagopala Reddys case will not come in the way merely because the plea is raised after 19th May, 1988. Such a plea if raised, will, however, have to be decided taking into account the statutory presumption laid down in s. 3(2). This is because the Act says that if the purchase is in the name of the wife or unmarried daughter, the prohibition in s. 3(1) will not apply. Sec. 3(2) is enacted as an exception to the provisions in the Act and does not depend for its interpretation on the question as to what extent ss. 4(1) and 4(2) are retrospective.
(8) Eighthly, if the case falls within the exception in s. 4(3)(a) i.e., where the person in whose name the property is held is a coparcener in an HUF and the property is held for the benefit of the coparceners in the family, or where, as stated in s. 4(3)(b), 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, then in both situations if such a plea or defence is raised in a suit filed after 19th May, 1988, the same can be decided by the Court notwithstanding ss. 4(1) or 4(2) and notwithstanding what is decided in R. Rajagopala Reddys case (supra).
For the above reasons, we are unable to find how Nand Kishore Mehra case (supra) can be said to have doubted R. Rajagopala Reddys case (supra). In fact far from doubting it, it proceeds to accept the said judgment and then considers the case of exceptions provided in s. 3(2). It holds incidentally that there is another exception contained in s. 4(3) of the Act. These exceptions apply even to suits filed after 19th May, 1988, and are not affected by what is decided in R. Rajagopala Reddys case (supra).
8. In order to complete discussion, we shall also refer to two subsequent cases. The case in Heirs of Vrajlal Ganatra vs. Heirs of Parshottam S. Shah 1996 (4) SCC 490 was one where the suit was filed in 1981 claiming that the defendant in whose name the deed dt. 16th December, 1963, stood was benami. The plaintiffs heirs filed appeal in Gujarat High Court in 1990 against the judgment of the trial Court. No contention based on the Act of 1988 was raised in the High Court. For the first time it was argued in this Court that the plea was prohibited by the Act. This Court, followed R. Rajagopala Reddys case (supra) and held that the plea was raised in a suit filed before 19th May, 1988, and it was not barred under the Act. This Court then proceeded to decide the case on merits, dismissing the plaintiffs appeal.
9. Sankara Hali & Sankara Institute vs . Kishori Lal Goenka : (1996)7SCC55 decided on 6th December, 1994, is by a three judge Bench. It was decided before R. Rajagopala Reddys case (supra) but is reported later. In a way it took the same view as in R. Rajagopala Reddys case (supra). It noticed that ss. 3, 5 and 8 of the Act came into force at once, i.e., 5th September, 1988, and the remaining provisions came into force from 19th May, 1988. It was held that the plea of benami was raised before 19th May, 1988, and that the objection that the deed of release dt. 24th February, 1964, by the benamidar in favour of the firm was invalid because of the Act, could not be permitted to be raised after 19th May, 1988. In that case, the rent control proceedings started around 1970 and the plea of benami was raised and was also proved by the firm, the real owner, by relying on the release deed dt. 24th December, 1964, executed by the benamidar in favour of the firm. The objection that the deed was invalid because of the provisions of the Act was raised after 19th May, 1988, relying upon Mithilesh Kumari case (supra) which held the Act was retrospective. That judgment has since been reversed in R. Rajagopala Reddys case (supra). It is clear that the conclusion arrived at in Sankara Hali case (supra) can now be easily justified by R. Rajagopala Reddys case overruling Mithilesh Kumari case (supra) and on the basis of the principles laid down in the said case.
For the aforesaid reasons we hold that the decision in R. Rajagopala Reddy (supra) is not in any manner shaken by anything said in Nand Kishore Mehra case and that both cases deal with different aspects of the Act as stated above and each of the cases continues to govern different provisions of the Act.
Civil Appeal and SLP are dismissed.