In FA 109 OF 2018 - CALC HC- In Indian society, if husband supplies consideration money for acquiring property in wife’s name, it does not necessarily imply Benami transaction: Calcutta High Court dismisses son’s plea against mother, says burden of proving Benami transaction lies upon person who asserts it
Justice Tapabrata Chakraborty and Justice Partha Sarathi Chatterjee [07-06-2023]

Read Order: Sekhar Kumar Roy v. Lila Roy

Simran Singh

New Delhi, June 9, 2023: The Calcutta High Court, while dealing with an appeal filed by a son questioning the order passed by the Civil Judge which had dismissed the suit for declaration, partition and permanent injunction instituted by him calling the transaction of the sale deed in relation to subject property as ‘Benami Transaction’, held that Sekhar Kumar Roy (appellant/son) could not bring any evidence to show what amount of consideration money was paid, how was the consideration amount paid, how the suit property was purchased and who paid the consideration amount. He could not even produce any document relating to the suit property whereas the Title deed and all documents relating to the suit property were all along in the custody of Lila Roy, the mother, who had been paying municipal tax and had gotten the suit property mutated in her name.

The Division Bench of Justice Tapabrata Chakraborty and Justice Partha Sarathi Chatterjee stated that the appellant “could not bring any evidence on record to lead any prudent man to infer that his father had a motive to create Benami in name of his mother or that his father intended to enjoy the full benefit of the title in him alone.” In view thereof, the Court upheld the decision of the Courts below who had correctly held that the appellant had failed to discharge his burden to prove that subject sale transaction was Benami transaction thus the impugned judgment could not be annihilated.

In the matter at hand, the appellant contended inter alia that his Late father, Sailendra Kumar Roy (Sailendra), purchased the suit property by one registered deed of sale in 1969 in ‘Benam’ of his wife, Lila Roy (defendant 1/Lila) who was a house-wife and a mere name lender who did not contribute a single farthing towards consideration money since she had no independent income at the relevant time of purchase of the suit property. Sailendra got the building plan sanctioned in the name of Lila and by spending money from his own fund constructed two-storied building thereon. He thereafter died intestate on 29.5.1999 leaving behind his widow, Lila, the plaintiff as his son and one daughter (defendant 2,/ Sumita Saha) who according to Section 8 of Hindu Succession Act,1956 had inherited 1/3rd share each of the suit property. The appellant had also stayed in the suit property till 11.5.2011 and thereafter approached the defendants to effect partition of the suit property by metes and bounds who refuted the claim of partition hence, the suit.

The issue for consideration was whether the transaction in relation to the purchase of the suit property under registered sale deed dated 20.01.1970 by Lila Roy, was Benami Transaction or not.

The Bench navigated through Prohibition of Benami Property Transactions Act, 1988 which defined the expression, ‘Benami Transaction’ and equipped the appropriate authority with powers to acquire Benami property. “As defined in Section 2(a) of the Act ‘Benami transaction’ means any transaction in which property is transferred to one person for a consideration paid or provided by any other person. A transaction must, therefore, be Benami irrespective of its date or duration.”

The Court while explaining the prevalence of Benami Transactions in India stated that “In India, two kinds of Benami transactions are generally recognised. 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 contributed 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.” However, there was a presumption in law that the person who purchases the property was the owner of the same and such presumption could be displaced only by pleading and successfully proving that the person whose name appears in the document was not the real owner, but only a Benami and burden heavily lied upon the person who pleaded that recorded owner was mere name-lender.

The Court noted that the appellant claiming that Lila, the transferee was a mere name-lender by adducing his oral testimony, however, did not produce any document whereas Lila deposed and adduced her oral accounts which found support from evidence

The Bench while dealing with question of ‘burden of proof’ as to whether it was the appellant who had to discharge the burden to prove that the subject sale transaction was Benami transaction or it was Lila who had to prove that she purchased the suit property from own fund or ‘stridhan’ properties detailing the source of such fund and disclosing every details of payment of consideration money, the Bench referred to the case of Jaydayal Poddar v. Bibi Hazra which had observed that “It is well settled that the burden of proving that a particular sale is benami and the apparent purchaser is not the real owner, always rests on the person asserting it to be so…”

The court stated that in the present case it was the appellant that claimed that his mother Lila was a mere name-lender. “He deposed that at the relevant time of sale, he was not present and he could not say the actual amount of consideration money and he admitted that he did not verify from attesting witness, identifier etc. whether his father paid the consideration money and he admitted that his father never claimed himself to be the real owner of the suit property and he admitted that he did not have any document to show that his father paid the consideration money.”

The Bench perused the evidence of Lila and it appeared that Lila admitted that she was a home-maker throughout her life and she had no independent income of her own and asserted that she purchased the suit property from her ‘stridhan’ properties by selling her gold ornaments.  “Admittedly, Lila testified that during his stay in the suit property, Sekhar used to behave well with her.”

The Court noted that the appellant tried to convince that since both the parties had led evidence, question of burden of proof had lost its significance and Court should pass judgment appreciating evidence led by the parties and since, Lila had failed to disclose the particulars of her ‘stridhan’ properties and had admitted that she was a home-maker throughout her life  having no independent income of her own, the Courts below should have come to the conclusion that Lila was nothing but a mere name-lender.

However, the Court opined that it was a well-settled principle that the burden of showing that a transfer was a Benami Transaction always lied on the person who asserted it.  “In the Indian society, if a husband supplies the consideration money for acquiring property in the name of his wife, such fact does not necessarily imply Benami transaction. Source of money is, no doubt, an important factor but not a decisive one.  The intention of the supplier of the consideration money is the vital fact to be proved by the party who asserts Benami.”