Benami Transactions; Yogita Dasgupta Vs. Kaustav Dasgupta [Delhi High Court, 27-07-2016]

Benami Transactions (Prohibition) Act, 1988 – Hindu Marriage Act, 1955 – Section 13B – Husband purchased the suit property in the name of the appellant wife “out of love and affection” – Marriage was dissolved by mutual consent – Husband filed suit claiming to be real and true owner of the suit property – Suit for declaration and permanent injunction in respect of flat – Whether the husband proved that he was owner of the property – Held, suit property was purchased with the husband’s money, in the wife’s name – husband secured a Bank loan for the purchase of the property – husband continues to be liable for the loan and is making repayment towards installments – wife left the property in 2010 and never returned – two children live with the husband, in the suit property – wife stated that she was repaying the loan, she was unable to prove that allegation – husband, in the cross examination stated that since stamp duty payable was at a lower rate if the vendees were women, he decided to purchase stamp paper in the wife’s name, and complete the transaction – on the basis of the above it can clearly be held that the plaintiff discharged the onus which lay upon him to prove that the property was purchased not for the wife’s benefit, but for that of the family as a whole – by reason of the foregoing analysis, it is held that the appeal is meritless.

Property Law


IN THE HIGH COURT OF DELHI AT NEW DELHI

CORAM: HON’BLE MR. JUSTICE S. RAVINDRA BHAT AND HON’BLE MS. JUSTICE DEEPA SHARMA

PRONOUNCED ON: 27.07.2016

MAT.APP. (F.C.) 7/2014

YOGITA DASGUPTA ….. Appellant Through: Mr. Gaurav Mitra with Mr. Adarsh Rai, Ms. Swati Bhardwaj and Ms. Bina Madhwan, Advocates. versus KAUSTAV DASGUPTA ….. Respondent Through: Ms. Kiran Singh, Advocate.

S.RAVINDRA BHAT, J.

1. This defendant’s appeal is directed against the judgment of the Family Court dated 01.11.2013 passed in CS No.13/2010. The impugned judgment decreed the husband’s suit for declaration and permanent injunction in respect of flat Nos.H-2/21 & H-2/21D, First Floor, Mahavir Enclave, New Delhi – 110 045, which is hereby referred to as “suit property”.

2. The brief facts are that the parties to the suit solemnized their marriage on 12.05.1999. Two children, i.e., a boy and a girl were born out of the wedlock. The suit property was purchased through a sale deed executed on 06.12.2006, which reflected the appellant as owner of the property. The parties started living separately in 2010; eventually their marriage was dissolved by mutual consent under

Section 13B of the Hindu Marriage Act

by order dated 05.07.2014. The husband (hereafter referred to as “the plaintiff”) filed a suit claiming to be real and true owner of the suit property.

3. The suit contended inter alia that since parties were living in a rented accommodation in Dwarka, in 2006, the husband purchased the suit property in the name of the appellant wife “out of love and affection”. The suit also leveled certain allegations of matrimonial misbehavior against the wife, i.e., intimacy with one Rajnish Thakur, owner of the chartered bus, which the wife used for travelling to her office. It was alleged that the wife left the matrimonial home of her own accord after quarrelling with the plaintiff and later she attempted to sell the property. The appellant in the written statement objected to the maintainability of the suit and alleged that the husband plaintiff has concealed the facts. She asserted that she paid the consideration for the suit property and she was discharging the liability towards monthly installment payments for clearing the loan liability. She also alleged that the husband forced her out of the matrimonial home. The written statement even attributed acts of forgery to the plaintiff.

4. In support of the suit claim, the plaintiff led his evidence including the oral testimonies of three other witnesses. This included the testimonies of PW-2 and PW-3 who were bank officials and who brought the certified copies of statement of accounts for the period 01.10.2006 to 31.03.2013. Likewise the defendant relied upon the testimonies of three witnesses which included the evidence of DW-2 from State Bank of India which had produced the bank statement for the period 01.06.2006 – 31.07.2007 (Ex.DW-2/3) and the bank account statement for the period 01.05.2006 – 31.07.2006 (Ex.DW- 2/4).

5. The first issue framed by the Family Court was whether the plaintiff proved that he was owner of the property. While considering this, the Family Court took into account the provisions of the

Benami Transactions (Prohibition) Act, 1988

(hereafter referred to as “Benami Act”) and the judgments of the Supreme Court reported asNand Kishore Mehra v. Sushila Mehra, AIR 1995 SC 215; Jaydal Poddar v. Mst. Bibi Hazra, AIR 1974 SC 171; Gapadibai v. State of Madhya Pradesh(1980) 2 SCC 327. The impugned judgment after noticing the relevant provisions speciallySection 3 of the Benami Act as well as the ruling in Nand Kishore Mehra(supra) held that the onus to prove that the property was not for the benefit of the wife was upon the plaintiff/husband and that he was yet to prove it strictly. The Family Court thereafter observed as follows: –

“32. In the present case, it is not in dispute that the parties were married according to Hindu Customs and Rites on 12-05- 99 and they have resided together till 27-02-2010.The suit property has been purchased on 06-12-2006 from its erstwhile owner. It is not in dispute that the Sale Deed had been executed in the name of the defendant. DW-4 was a witness to the registered Sale Deed and he has also deposed about the Sale Deed being executed in the name of the defendant without any force, pressure or coercion and he having signed the same in the presence of the Sub Registrar and the parties as a witness. It is further deposed by him that the Demand Draft for a sum of Rs.9 lakhs drawn on Central Bank of India, Janakpuri was also given at the time of execution of the Sale Deed.

33. The plaintiff, in his plaint had alleged that he had executed the Sale Deed in the name of the defendant out of love and affection as they were having a relationship as husband and wife. In his testimony as PW-1, he has clarified that the Sale Deed was registered in the name of the wife purely because the Stamp Duty was less if the property was registered in the name of the lady. The testimony of the plaintiff on this aspect has not been challenged by the defendant either in her written statement or at the stage of evidence. The sole defence that has been put forth by the defendant is that the sale consideration for the flat had been paid by her.

34. The plaintiff has explained in his testimony as PW-1 that the cost of the flat was Rs.15 lakhs and out of the Rs.15 lakhs, he had to pay Rs.10 lakhs by the end of December and remaining Rs.10 lakhs were to be paid after taking loan from the bank. There was no schedule for making payment of Rs.5 lakhs but they were to be paid by December, 2001. It was further deposed by him that he could not pay the entire amount of Rs.5 lakhs till December, 2006 but he took a personal loan of Rs.3,50,000/- from Syndicate Bank to pay the part consideration towards the cost of the flat. The remaining Rs.1,50,000/- was paid by him in the year 2007-08 as he had good relations and understanding with the builder. Whether the entire consideration amount vis-a-vis the builder was paid in 2006 or 2007 as little significance having regard to the fact that the Sale Deed was duly executed in the year 2006 and the possession of the flat was taken by the parties. It is evident from the testimony of the parties that the motive of giving this transaction a benami colour was to pay the stamp duty which can be done legitimately by having the property registered in the name of the wife.”

6. It was also held by the Family Court that the intention of the parties was relevant and that the materials on record did not establish that the husband wished that the property was to belong to the wife. As regards consideration it was held that even though the loan was obtained jointly, it was for the reason that the sale deed was executed in favour of the wife. After considering the materials on record, i.e., Ex.PW-2/1, PW-3/1 and PW-3/2, it was held that the husband alone repaid the loan and that the wife at no stage made any payments to discharge the liability for payment of consideration to acquire the suit property. With respect to the defendant’s evidence it was noticed that she had secured a personal loan of Rs.1,96,000/- but there was nothing to show that any amount was used to discharge the liability on account of the flat. It was also noticed that the appellant wife had admitted that the entire loan was for the purchase of the flat and the plaintiff was repaying the loan advanced by the bank.

7. In the light of these considerations, the Trial Court held as follows: –

“42. Even if the plaintiff had been able to establish that he had purchased the flat for himself though in the name of his wife the defendant could have still succeeded in defeating the ownership claim of the plaintiff if she could have established that the property had been purchased for her benefit. Neither this plea had been taken nor any evidence has been led in this regard by the defendant. The conduct of the parties also does not establish that the flat had been purchased by the plaintiff for the benefit of the defendant/wife.

43. The plaintiff has therefore, been able to successfully establish from the nature of the transaction and the surrounding circumstance that he is the actual owner of the suit property that had been purchased benami in the name of the plaintiff.”

In view of the above findings, the Court decreed the suit and held that the plaintiff husband was the real and true owner and was entitled to the injunctive relief claimed.

8. It is urged on behalf of the appellant by Mr. Gaurav Mitra that the Trial Court fell into error in not appreciating that the husband did not discharge the onus cast upon him to prove that the suit property was not acquired for the benefit of the wife. It is submitted that a fair reading of Section 3 of the Benami Act would show that in the first instance property acquired in the name of the wife is not deemed to be benami property [Section 3 (2)] but – yet there is a statutory presumption in law that the property is for the benefit of wife. The expression “unless the contrary is proved” clearly places the onus of proving that this property was acquired not for the benefit of wife, upon the husband. It was urged that nowhere in the suit the plaintiff urged that the property though in the name of the wife was not for her benefit. Counsel emphasized repeatedly that the husband stated that the property was acquired in 2006 “out of love and affection” for the wife.

9. Learned counsel relied upon the observations and ruling in Nand Kishore Mehra (supra) specially the following portion of the judgment: –

“Further, we find it difficult to hold that a person permitted to purchase a property in the name of his wife or unmarried daughter under sub-section (2) of Section 3 notwithstanding the prohibition to enter into a benami transaction contained in sub-section (1) of Section 3 cannot enforce his rights arising therefrom, for to hold so would amount to holding that the Statute which allows creation of rights by a benami transaction also prohibits the enforcement of such rights, a contradiction which can never be attributed to a Statute. If that be so, there can be no valid reason to deny to a person, enforcement of his rights validly acquired even in the cast by purchase of property in the name of his wife or unmarried daughter, by making applicable the prohibition contained in respect of filing of suits or taking up of defences imposed in respect of benami transactions in general by sub-sections (1) and (2) of Section 4 of the Act. But, it has to be made clear that when a suit is filed or defence is taken in respect of such benami transaction involving purchase of property by any person in the name of his wife or unmarried daughter, he cannot succeed in such suit or defence unless he proves that the property although purchased in the name of his wife or unmarried daughter, the same had not been purchased for the benefit of either the wife or the unmarried daughter, as the case may be, because of the statutory presumption contained in sub-section (2) of Section 3that unless a contrary is proved that the purchase of property by the person in the name of his wife or his unmarried daughter, as the case may be, was for her benefit.”

10. Learned counsel also urged that the Section 3 (2) was carefully worded. In that the requirement of proving that the property was acquired for the benefit is in the past tense. In other words, the use of the terms “had been purchased for the benefit of wife” in Section 3 underlines that it is at the time of purchase or acquisition of the property that the intention is material and not thereafter. It was submitted that in the present case the pleadings and the evidence clearly point to husband’s intention that the property was to belong to the wife and, therefore, was for her benefit. The mere change of such intention subsequently, according to the counsel, would not detract from the initial presumption or displace the onus to prove that from inception property was not purchased for the benefit of wife. It was, therefore, urged that mere fact that the husband paid installments towards discharging a loan liability in respect of the consideration paid for purchase of the property was not a sufficient indicator of the lack of intention on his part that the wife should own the property. Learned counsel also relied upon the judgment reported as