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PETITIONER: PADMINI CHANDRASEKHARAN [SINCE DECEASED] THROUGH LRS.

       Vs.

RESPONDENT: R. RAJAGOPAL REDDY [SINCE DECEASED] THROUGH LRS.

DATE OF JUDGMENT:       19/02/1996

BENCH: RAMASWAMY, K. BENCH: RAMASWAMY, K. G.B. PATTANAIK (J)

CITATION:  1996 SCALE  (2)766

ACT:

HEADNOTE:

JUDGMENT:                          O R D E R      Leave granted.      We have learned counsel on both sides.      This appeal  by special  leave arises from the judgment and decree  dated August  16, 1995  of the Division Bench of Madras High Court made in OSA No.27 of 1980.      The appellant,  [since  deceased]  represented  by  the executors of  her will in C.S.110 of 1971, laid the suit for declaration that she was the sole and exclusive owner and in possession, in  her own  right,  of  the  house  and  ground bearing Door  No.40, Fourth  Main Road, Gandhi Nagar, Adyar, Madras-20 as  owner thereof  and  for  permanent  injunction restraining R.  Rajagopala Reddy, the first defendant in the suit, or  his agents  or servants, from interfering with her possession and  enjoyment thereof.  Initially, the  suit was decreed but  on appeal, following the judgment of this Court in Mithilesh Kumari & Anr. v. Prem Behari Khare [AIR 1989 SC 1247] holding  that Section  4 of  the  Benami  Transactions [Prohibition] Act,  1988 operates  retrospectively, the High Court held  that the second defendant, Venugopal Reddy was a benamidar and  the joint  family  had  no  manner  of  right whatsoever over  the suit  property. The  earlier  partition deed was  not valid. On appeal to this Court, the view taken in Mithilesh  Kumari’s case  was overruled  by a three-Judge Bench in  this very  case and the matter was remitted to the High Court  for a  decision afresh. The Division Bench after considering the  evidence  held  that  Venugopal  Reddy  was allotted the plot by Madras Cooperative Housing Construction Society [Housing  Society]; at a partition in 1955, the suit property was allotted to Srinivasalu Reddy, elder brother of Rajagopal  Reddy  belonging  to  one  branch  Petta  family; Venugopal Reddy was benamidar for joint family. Accordingly, the High  Court allowed  the appeal, set aside the decree of the trial  Judge and dismissed the suit. Thus this appeal by special leave.      When the  matter had  come up  before us for admission,

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the question  raised by  Shri Kapil  Sibal,  learned  senior counsel was  that the  Division Bench had not considered the effect of  the benami transaction in proper perspective and, therefore, the  decision is  vitiated by grave error of law. Accordingly, notice  was taken  by the  respondents and they have filed  their counter  and have  placed  on  record  the entire evidence.      The only  question  is  whether  Venugopal  Reddy,  the second defendant  is a  benamidar of the property belongs to Rajagopal Reddy,  the first  defendant. It is not in dispute that on  an application  made by Venugopal Reddy, the second defendant on  July 9,  1947 to  the Housing Society the site was allotted  in his  name. Three  families were  living  as composite  Hindu  Joint  Family  who  dealt  with  extensive properties  situated  in  various  places  including  Thada, Venadu etc.  in Andhra  Pradesh and  in the  City of Madras. Three families  are for  short stated  as Petta, Vakatti and Eswaravakka families. Rajagopal Reddy equally applied for allotment  to  the  Housing  Society.  Venugopal  Reddy  had allotment of  the suit  property. At  a partition  that took place between  three families  on September  29, 1955  under partition deed  [Exh.D-9], several  properties including the suit land  fell to  the share of Petta family represented by Srinivasalu Reddy  and Rajagopal Reddy, the first defendant. After the partition, the appellant paid rents to Srinivasalu Reddy from  1956 to  1957. Srinivasalu Reddy also paid hire- purchase instalments to the Housing Society. Pursuant to the letter dated  November 7, 1958, Venugopal Reddy directed the appellant to  pay the  balance  amount  and  also  rents  to Srinivasalu Reddy  and accordingly  she paid  the  same.  By letter dated February 24, 1961, the husband of the appellant enquired from  Srinivasalu Reddy  whether he was prepared to transfer the  said property in his name to which Srinivasalu Reddy declined  to execute  the sale  deed. Thereafter,  the litigation started.      From these facts, the question that emerges is: whether Rajagopal Reddy is benamidar for Venugopal Reddy and whether the appellant  had the  property from  Venugopal Reddy?  The Division Bench  has recorded a finding, in our view rightly, that the  1955 partition  [Exh.D-9] was  not  questioned  by Venugopal   Reddy    as   vitiated    by   any    fraud   or misrepresentation.  Therefore,   it  was  not  open  to  the appellant to  question the same. Her plea that she discharge the amount  due and payable to the Housing Society on behalf of the  Venugopal Reddy  pursuant to  an agreement  she  had entered into with Venugopal Reddy and thereby she became the owner, has  also been negatived by the Division Bench in our view quite rightly. The only question, therefore, is whether Venugopal Reddy  is the  real owner  and Rajagopal  Reddy in purchasing  the  property  from  the  Housing  Society?  The Division Bench has recorded, as a fact, the finding based on voluminous evidence  that  "[v]arious  items  of  properties purchased in  the names  of  different  individuals  of  the family were put into the common pool and divided amongst the members of  the composite  family. All  the  three  families alone  had   the  right,  title  and  interest  in  all  the properties. They  have acted  upon by adjusting their rights mutually in  terms of  the deed  by taking  their respective shares  in   the  various   properties.  In  our  view,  the partition, which  was acted upon by the parties to the same, cannot be set aside on the contention of the learned counsel for the  1st respondent that it was not a composite family". The partition  deed was  not a  sham or nominal document nor was it  vitiated  by  fraud  or  misrepresentation  only  in respect of  one item. There cannot be any ulterior motive or

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extraneous consideration  for the parties to enter into such a partition  in the year 1955. The partition having remained unquestioned for a long period of time by any of the parties to the  deed, it  does not lie in the mouth of a third party to impeach  the nature  of the  transaction recorded  in the said  document   when  Venugopal   Reddy  himself   had  not questioned the partition deed (Ex.D-9).      From  these   facts,  the   question  emerges   whether Rajagopal Reddy  is only a benamidar for Venugopal Reddy? In the face  of the conduct of the appellant and her husband in paying the  rents to Srinivasalu Reddy, brother of Rajagopal Reddy and  her  Husband  asking  Srinivasalu  Reddy  of  his willingness to  transfer the  property  in  his  favour;  on payment of  rent, the  appellant-plaintiff amounts  to  have attorned Srinivasalu  Reddy as owner of the demised property and, therefore,  she was  stopped under  Section 116  of the Evidence Act  to deny title of Srinivasalu Reddy, brother of Rajagopal  Reddy,   the  first  respondent.  The  decree  of eviction had  by Rajagopal  Reddy from  the Rent  Controller binds the appellant-plaintiff which had become final, though the question of title was left open. In those circumstances, the plea  of benami  is only a collusive one between her and Venugopal Reddy  to defraud  Srinivasalu Reddy and Rajagopal Reddy of  the property had in the partition. Though the High Court has not dealt with this aspect of the matter in proper perspective, from  the above  consideration we find that the decree is not vitiated by any error of law.      The appeal is accordingly dismissed. No costs.