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PETITIONER:

BHIM SINGH & ANR.

Vs.

RESPONDENT:

KAN SINGH(AND VICE VERSA)

DATE OF JUDGMENT21/12/1979

BENCH:

VENKATARAMIAH, E.S. (J)

BENCH:

VENKATARAMIAH, E.S. (J)

SHINGAL, P.N.

CITATION:

1980 AIR 727 1980 SCR (2) 628

1980 SCC (3) 72

CITATOR INFO :

RF 1981 SC 102 (33)

ACT:

Benami-What is-Tests for deciding benami transactions.

HEADNOTE:

Plaintiff no. 1 and plaintiff no. 2 were father and son

while defendant was the brother of plaintiff no. 1. The

plaintiffs in their suit against the defendant claimed that

the suit house in which the defendant was living, belonged

to them by virtue of a patta issued in their names. They

alleged that the deceased brother of plaintiff no. 1, who

remained a bachelor till his death, loved plaintiff no. 2 as

his son and had thought of adopting plaintiff no. 2 but

since he died all of a sudden it could not be done. The

defendant on the other hand claimed that he and his deceased

brother lived as members of a joint family after the

partition of their family that as a result of the joint

efforts of himself and his deceased brother the Maharaja, of

Bikaner sanctioned sale of the house to them, that the

purchase money was paid out of their joint income but that

the patta was granted in the names of the plaintiffs due to

political reasons and therefore the plaintiffs were at the

most benamidars.

The trial court held that the house was acquired by the

deceased brother from the Government of Bikaner for the

plaintiffs and the patta was granted in favour of the

plaintiffs and that they were in its possession till 1956.

It rejected the defendant's claim that it was acquired with

the joint funds of himself and his deceased brother.

On appeal the High Court held that the house had been

purchased by the deceased brother out of his own money in

the names of the plaintiffs without any intention to confer

any beneficial interest on them and on his death plaintiff

no. 1 and the defendant succeeded jointly to the estate as

his heirs.

^

HELD: The transaction under which the patta was

obtained was not a benami transaction. The house was

acquired by the deceased brother with his money and with the

intention of constituting plaintiff no. 2 as the absolute

owner thereof. [648G]

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Where a person buys 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

a real owner. The second case which is loosely termed 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 is that whereas in the

former there is an operative transfer from the transferor to

the transferee, though the transferee holds the property for

the benefit of the person who has

629

contributed the purchase money, in the latter there is no

operative transfer at all and the title rests with the

transferor notwithstanding the execution of the conveyance.

One common feature in both 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 depends upon the intention of the

person who has contributed the purchase money in the former

case, and upon the intention of the person who has executed

the conveyance in the latter case. The principle underlying

the former case is statutorily recognized in section 82 of

the Indian Trust Act, 1882. [638B-E]

Meenakshi Mills, Madurai v. The Commissioner of Income-

Tax, Madras, [1956] S.C.R. 691 at p. 722; Mohammad Sadiq Ali

Khan v. Fakhr Jahan Begam & Ors. 59 I.A. 1; Manmohan Das &

Ors. v. Mr. Ramdai & Anr. A.I.R. 1931 P. C. 175; Jaydayal

Poddar (deceased) through his L.Rs. & Anr. v. Mst. Bibi

Hazra & Ors. [1974] 2 S.C.R. 90 referred to.

2. The principles governing the determination of the

question whether a transfer is a benami or not are: (1) The

burden of showing that a transfer is a benami transaction

lies on the person who asserts that it is such a

transaction; (2) if it is proved that the purchase money

came from a person other than the person in whose favour the

property is transferred, the purchase is prima-facie assumed

to be for the benefit of the person who supplied the

purchase money, unless there is evidence to the contrary;

(3) the true character of the transaction is governed by the

intention of the person who has contributed the purchase

money and (4) the question as to what his intention was, has

to be decided on the basis of the surrounding circumstances,

the relationship of the parties the motives governing their

action in bringing about the transaction and their

subsequent conduct. [641C-E]

In the instant case the deceased brother was a

bachelor. On the death of the wife of plaintiff no. 1,

plaintiff no. 2 and his younger brother were staying with

the deceased brother. Plaintiff no. 1 was almost in an

indigent condition while defendant practised law for some

time and later entered into service. The patta for the house

was issued in the name of plaintiffs nos. 1 and 2 at the

request of the deceased brother for the benefit of plaintiff

no. 2 and was handed over to him after he completed his

education. This conduct of the deceased brother established

that it was his intention that, when he secured the patta

from the State Government in the names of plaintiffs it was

his intention that plaintiff no. 2 whom he loved, should

become the owner. [641F-H]

3. The declaration made by the deceased, who had

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contributed the purchase money subsequent to the date of

purchase to the effect that the property belonged to

plaintiff no. 2 was admissible in evidence either under

section 32(3) or section 21 of the Indian Evidence Act to

prove his intention that he intended that plaintiff No. 2

should become its owner. [647E]

Shephard & Anr. v. Cartwright & Anr. [1955] A.C. 431,

distinguished.

JUDGMENT:

CIVIL APPELLATE JURISDICTION: Civil Appeal Nos. 626 &

629 of 1971.

From the Judgment and Order dated 5-8-1970 of the

Rajasthan High Court in R.F.A. No. 31/60.

630

S. T. Desai and Naunit Lal for the Appellant.

P. R. Mridul, B. P. Sharma, Krishna Bhatt and R. K.

Bhatt for the Respondents.

The Judgment of the Court was delivered by

VENKATARAMIAH, J.-These two cross appeals by

certificate arise out of a suit for possession of a house

situate in Bikaner and for damages for use and occupation

thereof filed in Civil Original Case No. 17 of 1957 on the

file of the District Judge, Bikaner. The plaintiffs in the

suit are the appellants in Civil Appeal No. 626 of 1971 and

the defendant is the appellant in Civil Appeal No. 629 of

1971. The genealogy showing the relationship between the

parties is given below:-

Sur Singh

|

-----------------------------------------------------------

| | | |

Gad Singh Bharat Singh Bhim Singh Kan Singh

| (Died in (P.I.) (Deft.)

| Sept. 1955) |

| |

----------------------- |

| | | |

Duley Dhaney Deep |

Singh Singh Singh |

|

|

-----------------

Himmat Dalip

Singh Singh

(P.2.) (Died in

Sept. 56)

Gad Singh, Bharat Singh, Bhim Singh (plaintiff No. 1)

and Kan Singh (defendant) are the sons of Sur Singh. Bharat

Singh died unmarried in September, 1955. Gad Singh died

thereafter leaving behind him three sons, Duley Singh,

Dhaney Singh and Deep Singh. Dalip Singh, the second son of

plaintiff No.1 died in September, 1956. Bharat Singh and the

defendant were residing in the house which was the subject

matter of the suit. After the death of Bharat Singh, the

plaintiffs Bhim Singh and Himmat Singh filed the suit out of

which this appeal arises against Kan Singh, the defendant

for recovery of possession of the suit house and other

ancillary reliefs. In the plaint, they

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pleaded that the suit house belonged to them by virtue of a

patta dated July 12, 1940 issued in their names; that the

defendant who was the brother of plaintiff No. 1 and uncle

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of plaintiff No. 2 was living in a part of the house with

their consent; that plaintiff No. 2 and his younger brother

Dalip Singh were also living in the house till the year

1956; that the defendant had refused to receive a notice

issued by them in the month of September, 1957 calling upon

him to hand over possession of the house to the plaintiffs;

that the defendant had done so on account of personal ill

will and that the plaintiffs were, therefore, entitled to

recover possession of the suit house and damages from the

defendant. These were briefly the allegations made in the

plaint. On the above basis, the plaintiffs prayed for a

decree for the reliefs referred to above.

In the written statement, the defendant did not admit

the existence of the patta on the basis of which the

plaintiffs claimed title to the suit house. He denied the

allegation that the plaintiffs were the owners in possession

of the suit house. He claimed that he was the exclusive

owner of the suit house, and in support of the said claim

stated as follows:-

There was a partition amongst the sons of Sur Singh in

the year 1929. At that partition, Gad Singh and plaintiff

No. 1 became separated and they were given all the family

properties which were situated in their village, Roda. As

Bharat Singh and the defendant had been educated at the

expense of the family, they were not given any share in the

property. Bharat Singh and he settled in Bikaner and lived

together as members of joint Hindu family. Bharat Singh died

on September 2, 1955 leaving the defendant as a surviving

coparcener. On his death, the defendant became the owner of

the properties of Bharat Singh 'as a member of joint Hindu

family'. He further pleaded that from the year 1928, Bharat

Singh and he who were working as the Aid-de-Camp and Private

Secretary respectively of the Maharaja of Bikaner were

living in the suit house which then belonged to the

Maharaja. The defendant filed an application for purchasing

the house. The proceedings had not terminated when the

defendant left the service of the Maharaja and went to

Banaras for higher studies. On his return from Banaras, he

joined the service of the Maharaja in the civil department

of Bikaner. After a long time on account of the joint

efforts of Bharat Singh and the defendant, the sale of the

house was sanctioned. Bharat Singh who was living jointly

with him paid the consideration for the sale on November 4,

1939 'out of the joint income.' Thus according to the

defendant, Bharat Singh and he became its owners from the

date of payment of the consideration. He

632

further pleaded that 'if the patta of the property had been

granted in the names of the plaintiffs due to some reasons,

political and other surrounding circumstances and for the

safety of the property, it cannot affect the right of the

defendant'. It was also stated that Bharat Singh and the

defendant had not executed any sale deed in favour of the

plaintiffs and so they could not become owners of the suit

house. In another part of the written statement, the

defendant pleaded thus:

"The plaintiffs have taken the entire ancestral

property of the village. Still they are harassing the

defendant due to avarice. The defendant and Thakur

Bharat Singh had been doing Government service. So

there was always danger or removal or confiscation of

the property. Even if Thakur Bharat Singh might have

written or given his consent for entering the names of

the plaintiffs in the patta in this view, it is not

binding. The plaintiffs are at the most 'benami' even

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though the patta which is not admitted might be

proved."

It is thus seen that the defendant put forward a two-

fold claim to the suit house-one on the basis of the right

of survivorship another on the basis of a joint purchase

along with Bharat Singh. Even though in one part of the

written statement, he declined to admit the existence of the

patta, in paragraph 13 of the written statement which is

extracted above, he put forward the plea that the plaintiffs

were at the most holding the property as benamdars. He,

however, did not claim that he was entitled to the property

as an heir of Bharat Singh alongwith plaintiff No. 1. and

Gad Singh who would have inherited the estate of Bharat

Singh on his death being his nearest heirs.

In the reply, the plaintiffs denied that the defendant

was entitled to the suit house as a surviving coparcener on

the death of Bharat Singh. They, however, pleaded that

plaintiff No. 1 had purchased the suit house out of his

income; that Bharat Singh used to love plaintiff No. 2 'as

his son' and was thinking of adopting him but he died all of

a sudden and that the defendant had not disclosed in his

written statement the special political circumstances under

which the names of the plaintiffs were entered in the patta.

They denied that the defendant had any interest in the suit

house.

On the basis of the oral and documentary evidence

produced before him, the learned District Judge who tried

the suit held that Bharat Singh had secured the house from

the Government of Bikaner for the plaintiffs with their

money; that the patta of the house had been granted by the

Patta Court in favour of the plaintiffs; that the plaintiffs

were in possession of the suit house till September, 1956

and that the

633

defendant being their close relative was living in the house

not on his own account but with the plaintiffs' permission.

The learned District Judge also held that the defendant had

failed to prove that the suit house had been acquired by him

and Bharat Singh with their joint fund. Accordingly he

decreed the suit for possession of the house in favour of

the plaintiffs and further directed that the defendant

should pay damages for use and occupation at the rate of Rs.

50 per month from September 20, 1956 till the possession of

the house was restored to them. Aggrieved by the decree of

the trial court, the defendant filed an appeal before the

High Court of Rajasthan in Civil First Appeal No. 31 of

1960. The High Court rejected the case of the plaintiffs

that the consideration for the house had been paid by Bharat

Singh out of the funds belonging to them and also the case

of the defendant that the house had been purchased by Bharat

Singh with the aid of joint family funds belonging to

himself and the defendant. The High Court held that the

house had been purchased by Bharat Singh out of his own

money in the names of the plaintiffs without any intention

to confer any beneficial interest on them. It further held

that the suit house belonged to Bharat Singh and on his

death, Gad Singh, plaintiff No. 1 and the defendant

succeeded to his estate which included the suit house in

equal shares. Accordingly in substitution of the decree

passed by the trial court, the High Court made a decree for

joint possession in favour of plaintiff No. 1. The rest of

the claim of the plaintiffs was rejected. Dissatisfied with

the decree of the High Court, the plaintiffs and the

defendant have filed these two appeals as mentioned above.

The principal issue which arises for consideration

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relates to the ownership of the suit house. It is admitted

on all hands that though Bharat Singh and the defendant were

living in the suit house from the year 1928, it continued to

be the property of the Maharaja of Bikaner till the date on

which the patta (Exh. 4) was issued by the Patta Court of

Bikaner and that on the issue of the patta, the State

Government ceased to be its owner. It is also not disputed

that the patta constituted the title deed in respect of the

suit house and it was issued in the names of the plaintiffs

on receipt of a sum of Rs. 5,000. On January 11, 1930, the

defendant had made an application, a certified copy of which

is marked as Exhibit A-116 to the Revenue Minister of the

State of Bikaner making enquiry about the price of the suit

house on coming to know that the State Government intended

to sell it. After the above application was made, the

defendant left the service of the State of Bikaner and went

to Banaras for studies. Bharat Singh who was also an

employee of the State Gov-

634

ernment was working as the Aid-de-Camp of the Maharaja in

1939. At the request of Bharat Singh, an order was made by

the Maharaja on May 4, 1939 sanctioning the sale of the suit

house for a sum of Rs. 5,000. Exhibit A-118 is the certified

copy of the said order. Exhibit A-120 is a certified copy of

the order of Tehsil Malmandi showing that a sum of Rs. 5,000

had been deposited on behalf of Bharat Singh towards the

price of the suit house. It also shows that Bharat Singh was

asked to intimate the name of the person in whose favour the

patta should be prepared. Presumably, the patta was issued

in the names of the plaintiffs as desired by Bharat Singh

and Exhibit A-121 shows that it was handed over on September

30, 1940. The patta was produced before the trial court by

the plaintiffs.

By the time the patta was issued in the names of the

plaintiffs, the mother of plaintiff No. 2 had died. He was

about eight years of age in 1940 and he and his younger

brother, Dalip Singh were under the protection of Bharat

Singh who was a bachelor. They were staying with him in the

suit house. The defendant also was residing in it. The

plaintiffs who claimed title to the property under the patta

in the course of the trial attempted to prove that the sum

of Rs. 5,000 which was paid by way of consideration for the

patta by Bharat Singh came out of the jewels of the mother

of plaintiff No. 2 which had come into the possession of

Bharat Singh on her death. The plaintiff No. 2 who gave

evidence in the trial court stated that he had not given any

money to Bharat Singh for the purchase of the house but he

had come to know from his father, plaintiff No. 1 that it

had been purchased with his money. Jaswant Singh (P.W. 2)

and Kesri Singh (P.W. 3) to whose evidence we will make a

reference in some detail at a later stage also stated that

they had heard from Bharat Singh that the jewels of the

mother of plaintiff No. 2 were with him suggesting that they

could have been the source of the price house. Plaintiff No.

1 who could have given evidence on the above question did

not enter the witness box. It is stated that he was a person

of weak mind and after the death of Bharat Singh was

behaving almost like a mad man. The defendant stated in the

course of his evidence that the mother of plaintiff No. 2

had gold jewels weighing about 3-4 tolas only. In this state

of evidence, it is difficult to hold that the plaintiffs

have established that the consideration for the suit house

was paid by them. The finding of the trial court that the

house had been purchased by Bharat Singh for the plaintiffs

with their money cannot be upheld. The case of the defendant

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that the price of the suit house was paid out of the funds

belonging to him and Bharat Singh has been rejected both by

the trial court and the High Court. On going

635

through the evidence adduced by the defendant, we feel that

there is no reason for us to disturb the concurrent findings

arrived at by the trial court and the High Court on the

above question. We shall, therefore, proceed to decide the

question of title on the basis that the consideration for

the purchase of the house was paid by Bharat Singh out of

his own funds.

It was contended by the learned counsel for the

defendant that since the plaintiffs had failed to establish

that they had contributed the price paid for the suit house,

the suit should be dismissed without going into the question

whether Bharat Singh had purchased the suit house with his

money in the names of the plaintiffs for the benefit of

plaintiff No. 2. The plaint does not disclose the name of

the person or persons who paid the sale price of the suit

house. The suit is based on the patta standing in the names

of the plaintiffs. In the written statement of the

defendant, there was an allegation to the effect that even

though the patta was standing in the names of the

plaintiffs, they were only benamidars and the real title was

with Bharat Singh and the defendant. The particulars of the

circumstances which compelled Bharat Singh or the defendant

to take the patta in the names of the plaintiffs were not

disclosed although it was stated that it had been done owing

to some political and other surrounding circumstances and

for the safety of the property. From the evidence led by the

parties, we are satisfied that they knew during the trial of

the suit that the question whether the transfer effected

under the patta was a benami transaction or not arose for

consideration in the case. Even in the appeal before the

High Court, the main question on which arguments were

addressed was whether the transaction was a benami

transaction or not. Merely because the plaintiffs attempted

to prove in the trial court that the money paid for

purchasing the house came out of their funds, they cannot in

the circumstances of this case be prevented from claiming

title to the property on the basis that even though Bharat

Singh had paid the consideration therefor, plaintiff No. 2

alone was entitled to the suit house. Reference may be made

here to the decision of this Court in Bhagwati Prasad v.

Shri Chandramaul(1) where the Court observed as follows:-

"There can be no doubt that if a party asks for a

relief on a clear and specific grounds, and in the

issues or at the trial, no other ground is covered

either directly or by necessary implication, it would

not be open to the said party to

636

attempt to sustain the same claim on a ground which is

entirely new........But in considering the application

of this doctrine to the facts of the present case, it

is necessary to bear in mind the other principle that

considerations of form cannot over-ride the legitimate

considerations of substance. If a plea is not

specifically made and yet it is covered by an issue by

implication, and the parties knew that the said plea

was involved in the trial, then the mere fact that the

plea was not expressly taken in the pleadings would not

necessarily disentitle a party from relying upon it if

it is satisfactorily proved by evidence. The general

rule no doubt is that the relief should be founded on

pleadings made by the parties. But where the

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substantial matters relating to the title of both

parties to the suit are touched, though in directly or

even obscurely in the issues, and evidence has been led

about them, then the argument that a particular matter

was not expressly taken in the pleadings would be

purely formal and technical and cannot succeed in every

case. What the Court has to consider in dealing with

such an objection is: did the parties know that the

matter in question was involved in the trial, and did

they lead evidence about it ?"

After holding that the parties to the said case were

not taken by surprise, the Court granted the relief prayed

for by the plaintiff on the basis that defendant was a

licensee even though the plaintiff had pleaded in his plaint

that the defendant was tenant. In the above case, the Court

distinguished the decision in Trojan & Co. Ltd. v. RM. N. N.

Haggappa Chettiar(1) on which much reliance was placed by

the learned counsel for the defendant before us. In the case

of Trojan & Co. Ltd. (supra), this Court came to the

conclusion that the alternative claim on which relief was

sought was not at all within the knowledge of the parties in

the course of the trial. The case before us is not of the

nature.

In Ismail Mussajee Mookerdum v. Hafiz Boo(2) the

plaintiff laid claim to a property which had been

transferred in her name by her mother alleging that she had

paid the purchase money to her mother. The court came to the

conclusion that she had failed to prove that she had paid

the consideration. Still a decree was made in her favour

holding that she had become the owner of the property by

virtue of the transfer in her favour even though

consideration had not been

637

paid by her since it had been established in the case that

her mother intended to transfer the beneficial interest in

the property in her favour. This is borne out from the

following passage at page 95:

"In her evidence, which was very confused, she

tried to say that she paid that purchase-money to her

mother. This was clearly untrue: as both Courts have

found. The fact, therefore, remains that the properties

purchased by the sale proceeds were purchased no doubt

in Hafiz Boo's name, but were purchased out of funds

emanating from her mother's estate. This circumstance

no doubt, if taken alone, affords evidence that the

transaction was benami, but there is, in their

Lordships' opinion, enough in the facts of the case to

negative any such inference."

Moreover no plea was raised on behalf of the defendant

before the High Court in this case contending that the High

Court should not go into the question whether the transfer

under the patta was a benami transaction or not. We,

therefore, reject the above contention and proceed to

examine whether the High Court was right in arriving at the

conclusion that the plaintiffs were only benamidars holding

the property for the benefit of its real owner, Bharat Singh

as the consideration therefor had emanated from him.

Under the English law, when real or personal property

is purchased in the name of a stranger, a resulting trust

will be presumed in favour of the person who is proved to

have paid the purchase money in the character of the

purchaser. It is, however, open to the transferee to rebut

that presumption by showing that the intention of the person

who contributed the purchase money was that the transferee

should himself acquire the beneficial interest in the

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property. There is, however, an exception to the above rule

of presumption made by the English law when the person who

gets the legal title under the conveyance is either a child

or the wife of the person who contributes the purchase money

or his grand child, whose father is dead. The rule

applicable in such cases is known as the doctrine of

advancement which requires the court to presume that the

purchase is for the benefit of the person in whose favour

the legal title is transferred even though the purchase

money may have been contributed by the father or the husband

or the grandfather, as the case may be, unless such

presumption is rebutted by evidence showing that it was the

intention of the person who paid the purchase money that the

transferee should not become the real owner of the property

in question. The doctrine of advancement is not in vogue in

India.

638

The counterpart of the English law of resulting trust

referred to above is the Indian law of benami transactions.

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 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. 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

transfer 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. 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

the person who has executed the conveyance in the latter

case. The principle underlying the former case is also

statutorily recognized in section 82 of the Indian Trusts

Act, 1882 which provides that where property is transferred

to one 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. This view is in accord with the following

observations made by this Court in Meenakshi Mills. Madurai

v. The Commissioner of Income-Tax, Madras(1):-

"In this connection, it is necessary to note that

the word 'benami' is used to denote two classes of

transactions which differ from each other in their

legal character and incidents. In one sense, it

signifies a transaction which is real, as for example

when A sells properties to B but the sale deed mentions

X as the purchaser. Here the sale itself is genuine,

but the real purchaser is B, X being his benamidar.

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This is

639

the class of transactions which is usually termed as

benami. But the word 'benami' is also occasionally

used, perhaps not quite accurately, to refer to a sham

transaction, as for example, when A purports to sell

his property to B without intending that his title

should cease or pass to B. The fundamental difference

between these two classes of transactions is that

whereas in the former there is an operative transfer

resulting in the vesting of title in the transferee, in

the latter there is none such, the transferor

continuing to retain the title notwithstanding the

execution of the transfer deed. It is only in the

former class of cases that it would be necessary, when

a dispute arises as to whether the person named in the

deed is the real transferee or B, to enquire into the

question as to who paid the consideration for the

transfer, X or B. But in the latter class of cases,

when the question is whether the transfer is genuine or

sham, the point for decision would be, not who paid the

consideration but whether any consideration was paid."

In Mohammad Sadiq Ali Khan v. Fakhr Jahan Begum &

Ors.(1) the facts were these: A Mahemmodan bought an

immovable property taking the conveyance in the name of his

daughter who was five years of age. The income was credited

to a separate account, but it was in part applied to

purposes with which she had no concern. Upon her marriage,

the deed was sent for the inspection of her father-in-law.

After the death of the donor it was contended that the

property was part of his estate, the purchase being benami.

The Judicial Committee of the Privy Council held that there

was a valid gift to the daughter because there was proof of

a bona fide intention to give, and that intention was

established. In the course of the above decision, it was

observed thus:-

"The purchase of this property was a very natural

provision by Baqar Ali for the daughter of his

favourite wife, and though there may be no presumption

of advancement in such cases in India, very little

evidence of intention would be sufficient to turn the

scale. The sending of the deed for the inspection of

the lady's father-in-law, which the Chief Court held to

be established, was clearly a representation that the

property was hers, and their Lordships agree with the

learned Judges in the conclusion to which they came."

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In Manmohan Dass & Ors. v. Mr. Ramdei & Anr. (1) Lord

Macmillian speaking for the Judicial Committee observed:

In order to determine the question of the validity

or invalidity of the deed of gift in question it is of

assistance to consider.

'the surrounding circumstances, the position of

the parties and their relation to one another, the

motives which could govern their actions and their

subsequent conduct.' Dalip Singh v. Nawal Kanwar 35

I.A. 104 (P.C.) always remembering that the onus of

proof rests upon the party impeaching the deed.

The principle enunciated by Lord Macmillan in the case

of Manmohan Dass & Ors. (supra) has been followed by this

Court in Jayadayal Poddar (deceased) through his L. Rs. &

Anr. v. Mst. Bibi Hazara & Ors.(2) where Sarkaria, J.

observed thus:

"It is well settled that the burden of proving

that a particular sale is benami and the apparent

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purchaser is not the real owner, always rests on the

person asserting it to be so. This burden has to be

strictly discharged by adducing legal evidence of a

definite character which would either directly prove

the fact of benami or establish circumstances

unerringly and reasonably raising an inference of that

fact. The essence of a benami is the intention of the

party or parties concerned; and not unoften such

intention is shrouded in a thick veil which cannot be

easily pierced through. But such difficulties do not

relieve the person asserting the transaction to be

benami of any part of the serious onus that rests on

him; nor justify the acceptance of mere conjectures or

surmises, as a substitute for proof. The reason is that

a deed is a solemn document prepared and executed after

considerable deliberation and the person expressly

shown as the purchaser or transferee in the deed,

starts with the initial presumption in his favour that

the apparent state of affairs is the real state of

affairs. Though the question, whether a particular sale

is benami or not, is largely one of fact, and for

determining this question, no absolute formulae or acid

tests, uniformly applicable in all situations, can be

laid down; yet in weighing the probabilities and for

gathering

641

the relevant indicia, the courts are usually guided by

these circumstances: (1) the source from which the

purchase money came; (2) the nature and possesion of

the property, after the purchase; (3) motive, if any,

for giving the transaction a benami colour; (4) the

position of the parties and the relationship, if any

between the claimant and the alleged benamidar; (5) the

custody of the title deeds after the sale and (6) the

conduct of the parties concerned in dealing with the

property after the sale."

The principle governing the determination of the

question whether a transfer is a benami transaction or not

may be summed up thus: (1) The burden of showing that a

transfer is a benami transaction lies on the person who

asserts that it is such a transaction; (2) if it is proved

that the purchase money came from a person other than the

person in whose favour the property is transferred, the

purchase is prima facie assumed to be for the benefit of the

person who supplied the purchase money, unless there is

evidence to the contrary; (3) the true character of the

transaction is governed by the intention of the person who

has contributed the purchase money and (4) the question as

to what his intention was has to be decided on the basis of

the surrounding circumstances, the relationship of the

parties, the motives governing their action in bringing

about the transaction and their subsequent conduct etc.

Now we shall refer to the facts of the present case.

When the suit house was purchased from the Maharaja of

Bikaner, Bharat Singh was a bachelor and he did not marry

till his death in the year 1955. The wife of Bhim Singh had

died before 1939 leaving behind her two young children.

Plaintiff No. 2 was about eight years old in the year 1939

and his younger brother Dalip Singh was about two years old.

These two children were living with Bharat Singh. Bhim

Singh, plaintiff No. 1 was almost in indigent condition. The

defendant had by then acquired a degree in law and also had

practised as a lawyer for some time. It is stated that the

defendant had again been employed in the service of the

State of Bikaner. The patta was issued in the names of

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plaintiffs 1 and 2 at the request of Bharat Singh. Even

though the defendant stated in the written statement that

the patta had been taken in the names of the plaintiffs

owing to certain political circumstances, he had not

disclosed in the course of his evidence those circumstances

which compelled Bharat Singh to secure the patta in the

names of the plaintiffs, though at one stage, he stated that

it was under his advice that Bharat Singh got the patta in

the names of the plaintiffs. Bharat

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Singh had no motive to suppress from the knowledge of the

public that he had acquired the property. It was suggested

in the course of the arguments that he had taken the patta

in the names of the plaintiffs because he was in the service

of the State. We do not find any substance in this

submission because the property was being purchased from the

State Government itself and there was no need for him to

shield his title from the knowledge of the State Government.

It appears that Bharat Singh acquired the suit house for the

benefit of plaintiff No. 2 for the following circumstances:

The first circumstance is that the original patta had been

handed over by Bharat Singh to plaintiff No. 2 on his

passing B. Sc. Examination. This fact is proved by the

evidence of plaintiff No. 2 and it is corroborated by the

fact that the patta was produced by the plaintiffs before

the Court. In the course of his evidence, the defendant no

doubt stated that the patta had been stolen by plaintiff No.

2 from the suit house during the twelve days following the

death of Bharat Singh when the keys of Bharat Singh's

residence had been handed over to plaintiff No. 2 by the

defendant. It is difficult to believe the above statement of

the defendant because of two circumstances-(i) that the

defendant did not state in the written statement that the

patta had been stolen by plaintiff No. 2 and (ii) that

within a month or two after the death of Bharat Singh,

plaintiff No. 2 wrote a letter which is marked as Exhibit A-

124 to the defendant stating that the rumour which the

defendant was spreading that plaintiff No. 2 had stolen some

articles from the suit house was not true since whenever

plaintiff No. 2 opened room or any of the almirahs of Bharat

Singh in the suit house, Devi Singh the son of the defendant

was keeping watch over him. That letter has been produced by

the defendant and there is no reference in it to a false

rumour being spread about the theft of the patta by

plaintiff No. 2. Plaintiff No. 2 however, while asserting

his claim to the suit house in the course of that letter

stated that he had seen that the patta had been executed in

his favour; and that the patta contained his name. The

defendant does not appear to have sent any reply to Exhibit

A. 124 nor did he call upon the plaintiffs to return the

patta to him. He did not also file a complaint stating that

the patta had been stolen by plaintiff No. 2. We are of the

view that there is no reason to disbelieve the evidence of

plaintiff No. 2 that the patta had been handed over to him

by Bharat Singh on his passing the B.Sc. examination. This

conduct of Bharat Singh establishes that it was the

intention of Bharat Singh when he secured the patta from the

State Government in the names of the plaintiffs the

plaintiff No. 2 whom he loved should become the owner. It is

no doubt true that the name of plaintiff No. 1 is also

included in the patta. It may have been so included by way

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of abundant caution as plaintiff No. 2 was a minor when the

patta was issued. The above circumstance is similar to the

one which persuaded their Lordships of the Privy Council in

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the case of Mohammad Sadiq Ali Khan (supra) to hold that the

property involved in that case belonged to the person in

whose favour the conveyance had been executed.

The second circumstance which supports the view that

Bharat Singh intended that plaintiff No. 2 should become the

owner of the suit house is proved by the declarations made

by Bharat Singh regarding the title to the suit house.

Jaswant Singh (P.W. 2) was a former Prime Minister of the

State of Bikaner. His wife was a cousin of plaintiff No. 1,

Bharat Singh and the defendant. Being a close relative of

Bharat Singh who was also the Aid-de-Camp of the Maharaja of

Bikaner, he was quite intimate with Bharat Singh who used to

discuss with him about his personal affairs. P.W. 2 has

stated in the course of his evidence that Bharat Singh

thought it proper to purchase the house in the name of

plaintiff No. 2 and that he intended to make plaintiff No. 2

his heir and successor. He has also stated that Bharat Singh

had expressed his desire to give all his property to

plaintiff No. 2 by a will and that he had told Kesri Singh

(P.W. 3) just a day prior to his (Bharat Singh's) death that

a will was to be executed. This statement of Jaswant Singh

(PW. 2) is corroborated by the evidence of Kesri Singh (P.W.

3) whose wife was also a cousin of Bharat Singh, plaintiff

No. 1 and the defendant. The relevant portion of the

deposition of Kesri Singh (P.W. 3) reads thus:

"I came from Jaipur to Bikaner by train one day

before the death of Bharat Singh and when I was

returning after a walk I found Bharat Singh standing at

the gate of his house. I asked Bharat Singh to

accompany me to my house to have tea etc. Bharat Singh

came with me to my house. Bharat Singh told me at my

house that he was not quite all right and that he might

die at any time. He wanted to execute a will. He

further told me that his house really belonged to

Himmat Singh. It has been purchased in his name. He

wanted to give even other property to Himmat Singh.. By

other property which Bharat Singh wanted to give to

Himmat Singh was meant Motor car, bank balance and the

presents which he had. The house regarding which my

talk took place with Bharat Singh at my house was the

house in dispute."

There is no reason to disbelieve the evidence of these

two witnesses. Their evidence is corroborated by the

deposition of Dr. Himmat Singh (D.W. 6) who was the

Secretary of a Club in Bikaner

644

of which Bharat Singh was a member. He was examined by the

defendant himself as his witness. In the course of his

cross-examination, Dr. Himmat Singh (D.W. 6) referred to

what Bharat Singh had told him a few months prior to his

death. The substance of his deposition is found in the

judgment of the trial court, the relevant portion of which

reads thus:

"D.W. 6 Dr. Himmat Singh is the Secretary of the

Sardul Club, Bikaner. He is the Senior Eye-Surgeon in

the Government Hospital, Bikaner. He has stated that

Bharat Singh was the member of Sardul Club. A sum of

Rs. 425/6/-remained outstanding against him till the

year 1955. This amount was received on 28-10-1955. He

has said that he does not know who deposited this

amount. On the merits of the case, he has stated that

he intimately knew Bharat Singh and members of his

family. Bhim Singh and his sons Himmat Singh and Dalip

Singh used to live in this house. Bharat Singh took

this house for Bhim Singh and Himmat Singh. Four months

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before his death, Bharat Singh told the witness that he

had already taken the house for Bhim Singh and Himmat

Singh and that whatever else would remain with him

shall go to them. Dr. Himmat Singh refutes the

defendant's stand and supports the plaintiff's case."

It was argued on behalf of the defendant that there is

some variation between the deposition of Dr. Himmat Singh

(D.W. 6) and the above passage found in the judgment of the

trial court and that the evidence of D.W. 6 should not be

believed as he had turned hostile.

The deposition of Dr. Himmat Singh (D.W. 6) was read

out to us. It was also brought to our notice that an

application had been made by the defendant to treat D.W. 6

as hostile and that it had not been granted by the trial

court. Even though there is a slight variation between what

is stated by D.W. 6 and what is contained in the judgment of

the trial court with regard to certain details, we do not

feel that the said variation is of any substantial nature.

The evidence of D.W. 6 suggests that Bharat Singh was of the

view even during his life time that the suit house belonged

to plaintiffs and not to himself. Even though an application

had been made by the defendant to treat D.W. 6 as hostile,

we feel that this part of the evidence of D.W. 6 cannot be

rejected on that ground since it is consistent with the

evidence of Jaswant Singh (P.W. 2) and Kesri Singh (P.W. 3).

It is seen from the judgment of the High Court that the

effect of the statement of Kesri Singh (P.W.3) in his

deposition that Bharat Singh

645

had told him that the suit house was the property of

plaintiff No. 2 has not been considered. The High Court

while dealing with the evidence of Jaswant Singh (P.W. 2)

and Kesri Singh (P.W. 3) laid more emphasis on those parts

of their evidence where there was a reference to the alleged

utilisation of the jewels or moneys belonging to the

plaintiffs by Bharat Singh for the purpose of acquiring the

suit house. The High Court has also observed in the course

of its judgment that neither of them had stated that Bharat

Singh had told them that he was purchasing or had purchased

the suit house as a gift to Bhim Singh and Himmat Singh. The

above observation does not appear to be consistent with the

evidence of Kesri Singh (P.W. 3) discussed above.

It was, however, contended on behalf of the defendant

that the statement made by Bharat Singh in the year 1955

could not be accepted as evidence in proof of the nature of

the transaction which had taken place in the year 1940. It

was contended that the question whether a transaction was of

a benami nature or not should be decided on the basis of

evidence about facts which had taken place at or about the

time of the transaction and not by statements made several

years after the date of the transaction. In support of the

above contention, the learned counsel for the defendant

relied on the decision of the House of Lords in Shephard &

Anr. v. Cartwright & Anr.(1). The facts of that case were

these: In 1929, a father, with an associate, promoted

several private companies and caused a large part of the

shares, for which he subscribed, to be allotted in varying

proportions to his three children, one of them being then an

infant. There was no evidence as to the circumstances in

which the allotments were made. The companies were

successful and in 1934 the father and his associate promoted

a public company which acquired the shares of all the

companies. The children signed the requisite documents at

the request of their father without understanding what they

were doing. He received a cash consideration and at various

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times sold, and received the proceeds of sale of, their

shares in the new company. He subsequently placed to the

credit of the children respectively in separate deposit

accounts the exact amount of the cash consideration for the

old shares and round sums in each case equivalent to

proceeds of sale of the new shares. Later he obtained the

children's signatures to documents, of the contents of which

they were ignorant, authorising him to withdraw money from

these accounts and without their knowledge he drew on the

accounts, which were by the end of 1936 exhausted, part of

the sums withdrawn being dealt with for the benefit of the

children but a large part remaining unaccounted for. He died

in

646

1949. In the action filed against his executors, it was

contended by them that the subsequent conduct of the father

showed that when the shares were got allotted by him in the

names of the children in 1929, he did not intend to make

them the real owners of the shares and that the presumption

of advancement had been rebutted. This contention was met by

the plea that the subsequent conduct of the father in

dealing with the shares as if they were his own could not be

relied upon either in his favour or in favour of his

representatives, executors and administrators to prove that

he had no intention to create any beneficial interest in his

children in the shares in question when they were obtained.

On these facts, the House of Lords held that the subsequent

acts and declarations of the father could not be relied upon

in his favour or in favour of his executors to rebut the

presumption of advancement. Viscount Simonds in the course

of his judgment observed thus:

"My Lords, I do not distinguish between the

purchase of shares and the acquisition of shares upon

allotment, and I think that the law is clear that on

the one hand where a man purchases shares and they are

registered in the name of a stranger there is a

resulting trust in favour of the purchaser; on the

other hand, if they are registered in the name of a

child or one to whom the purchaser then stood in loco

parentis, there is no such resulting trust but a

presumption of advancement. Equally it is clear that

the presumption may be rebutted but should not, as Lord

Eldon said, give way to slight circumstances: Finch v.

Finch (1808) 15 Ves. 43.

It must then be asked by what evidence can the

presumption be rebutted, and it would, I think, be very

unfortunate if any doubt were cast (as I think it has

been by certain passages in the judgments under review)

upon the well-settled law on this subject. It is, I

think, correctly stated in substantially the same terms

in every text book that I have consulted and supported

by authority extending over a long period of time. I

will take, as an example, a passage from Snell's

Equity, 24th ed., p. 153, which is as follows:

"The acts and declarations of the parties before

or at the time of the purchase, or so immediately after

it as to constitute a part of the transaction, are

admissible in evidence either for or against the party

who did the act or made the

647

declaration. ... But subsequent declarations are

admissible as evidence only against the party who made

them, and not in his favour."

The above passage, we are of the view, does not really

assist the defendant in this case. What was held by the

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House of Lords in the case of Shephard & Anr. (supra) was

that the presumption of advancement could be displaced only

by a statement or conduct anterior to or contemporaneous to

the purchase nor could any conduct of the children operate

against them as admissions against their interest as they

acted without the knowledge of the facts. In the instant

case, we are concerned with the conduct and declarations of

Bharat Singh subsequent to the transaction which were

against his interest. The evidence regarding such conduct

and declarations is not being used in his favour but against

the legal representative of Bharat Singh i.e. the defendant

who would have become entitled to claim a share in the suit

house if it had formed part of his estate. Such conduct or

declaration would be admissible even according to the above

decision of the House of Lords in which the statement of law

in Snell's Equity to the effect `but subsequent declarations

are admissible as evidence only against the party who made

them, and not in his favour' is quoted with approval. The

declarations made by Bharat Singh would be admissible as

admissions under the provisions of the Indian Evidence Act

being statements made by him against his proprietary

interest under section 21 and section 32(3) of the Indian

Evidence Act

The defendant cannot also derive any assistance from

the decision of this Court in Bibi Saddiqa Fatima v. Saiyed

Mohammad Mahmood Hasan(1). The question before the Court in

the case of Bibi Siddiqa Fatima (supra) was whether a

property which had been purchased by a husband in his wife's

name out of the fund belonging to a waqf of which he was a

Mutawalli could be claimed by the wife as her own property.

This Court held that the wife who was the ostensible owner

could not be treated as a real owner having regard to the

fact that the purchase money had come out of a fund

belonging to a waqf over which her husband who was the

Mutawalli had no uncontrolled or absolute interest. In

reaching the above conclusion, this Court observed thus :

"We may again emphasize that in a case of this

nature, all the aspects of the benami law including the

648

question of burden of proof cannot justifiably be

applied fully. Once it is found, as it has been

consistently found, that the property was acquired with

the money of the waqf, a presumption would arise that

the property is a waqf property irrespective of the

fact as to in whose name it was acquired. The Mutawalli

by transgressing the limits of his power and showing

undue favour to one of the beneficiaries in disregard

to a large number of other beneficiaries could not be

and should not be permitted to gain advantage by this

method for one beneficiary which in substance would be

gaining advantage for himself. In such a situation it

will not be unreasonable to say-rather it would be

quite legitimate to infer, that it was for the

plaintiff to establish that the property acquired was

her personal property and not the property of the

waqf."

It was next contended that the defendant had spent

money on the repairs and reconstruction of the building

subsequent to the date of the patta and that therefore, he

must be held to have acquired some interest in it. We have

gone through the evidence bearing on the above question. We

are satisfied that the defendant has not established that he

had spent any money at all for construction and repairs.

Even if he has spent some money in that way with the

knowledge of the actual state of affairs, it would not in

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law confer on the defendant any proprietary interest in the

property.

It is also significant that neither Gad Singh during

his life time nor his children after his death have laid any

claim to a share in the suit house which they were entitled

to claim alongwith the defendant if it was in fact a part of

the estate of Bharat Singh. Their conduct also probabilities

the case of the plaintiffs that Bharat Singh did not intend

to retain for himself any interest in the suit house.

On the material placed before us, we are satisfied that

the transaction under which the patta was obtained was not a

benami transaction and that Bharat Singh had acquired the

suit house with his money with the intention of constituting

plaintiff No. 2 as the absolute owner thereof. Plaintiff No.

2 is, therefore, entitled to a decree for possession of the

suit house.

The trial court passed a decree directing the defendant

to pay damages for use and occupation in respect of the suit

house at the rate of Rs. 50/- per month from September 20,

1956 till the

649

possession of the house was delivered to the plaintiffs. The

operation of the decree of the trial court was stayed by the

High Court during the pendency of the appeal before it. In

view of the decree passed by the High Court, the defendant

has continued to be in possession of the suit house till

now. Nearly twenty years have elapsed from the date of the

institution of the suit. In the circumstances, we are of the

view that the defendant should be directed to pay mesne

profits at the rate of Rs. 50/- per month till today and

that an enquiry should be made by the trial court under

Order 20, Rule 12 of the Code of Civil Procedure to

determine the mesne profits payable by the defendant

hereafter till the date of delivery of possession.

In the result, the decree passed by the High Court is

set aside and a decree is passed directing the defendant to

deliver possession of the suit house to plaintiff No. 2 and

to pay mesne profits to him at the rate of Rs. 50/- per

month from September 20, 1956 till today and also to pay

future mesne profits as per decree to be passed by the trial

court under Order 20, Rule 12 of the Code of Civil

Procedure.

For the foregoing reasons, Civil Appeal No. 626 of 1971

is accordingly allowed with costs throughout. Civil Appeal

No. 629 of 1971 is dismissed but without costs.

C.A. 626/71 allowed.

P.B.R. C.A. 629/71 dismissed.

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