..::What is Law of Benami Transaction in Pakistan?

Benami Transaction- ——Purchase of land by petitioner‘s father in name of petitioner—Sale of same by his father-Declaratory suit by petitioner that his father had no right to sell land-Dismissal of suit and appeal-Challenge to-It was for petitioner to prove that purchase of property in his name by his father was not benami and that he was real and beneficial owner of land in dispute-Held: Judgments of Courts below are unexceptionable and call for no interference-Petition dismissed.

PLJ 1987 SC 77 & PLD 1953 Pesh. 19 rel.

Judgment

This petition under Section 115 of the CPC calls in question the decree of the Additional District Judge, Shcikhupura, affirming the decree of the trial Court, passed on llth January, 1981.
2.          The dispute arises out of a suit for declaration filed by the petitioner on 4th July, 1977, to the effect that the sale deed executed on 13th July, 1967 by his father in favour of respondents with respect to a half share of land measuring 233 Kanals 18 marlas situate in village Kot Ranjeet, Tehsil and District Sheikhupura was not binding upon him as his father had no authority to execute the sale deed or to alienate the suit land.
3.          The suit was defended by the respondents on the plea that the real and beneficial owner of the land was the father of the petitioner, who had purchased it in the name of his two sons, namely, the petitioner and his brother on 5th November, 1958, when they were minors.
4.     The learned trial Court framed the following issues out of the pleadings of the parties:–
1.          Whether the suit is bad for non-joinder of parties? OPD.
2.          Whether the plaintiff is estopped to file the present suit? OPD.
3.          Whether the suit is not numu’mablc m te ptc&cnl fotml OPD.
4.          Whether the suit is improperly valued? OPD.
5.          Whether relief of possession as a consequential relief is a substantial relief, if so, what is correct valuation for the purposes of Court fee? OPD.
6.          Whether the defendants are entitled to special cost under Section 35-A CPC? OPD.
7.          Whether the plaintiff was a benumidar? OPD.
8.          Whether the father of the plaintiff was not authori/cd to alienate the suit land in favour pf the defendants? OPP.
9.          Whether the sale deed dated 13lh July. 1%7 in favour of the defendants is illegal, void, without authority, without consideration, ineffective, and not binding on the rights of the plaintiff? OPP.
10.  Relief.
5.          In support of his case, the petitioner appeared as his own witness in addition to which he produced copy of sale deed dated 13th June, 1967 as Ex.P.l, copy of sale deed dated 5th November, 1956, as P.2, copy of the application made to the Guardian Judge as Ex.P.3, and two mutations Ex.P.4 and P.5. In rebuttal, respondent produced Talib Hussain as DW.l and Abdul Hamid, respondent No.3, appeared as DW.2.
6.          The suit filed by the plaintiff was dismissed by the trial Court on 17th July, 1979 on the finding that the petitioner was Bcnamidar for his father, who was the real and beneficial owner of the land. This finding was affirmed by the Additional District Judge.
7.          Mr. Roshan Ali Sindhu, Advocate, learned counsel for the petitioner has contended that the findings recorded by the Courts below holding that the petitioner was a Benamidar to his father are not sustainable. It was emphasized that the onus of issue No.8 was on the defendants/respondents, who had failed to lead any evidence whatsoever and as such the judgments of both Courts stand vitiated. The learned counsel also made a reference to various authorities laying down the principles which could be kept in mind while judging whether or not a transaction is Benami.
8.          The learned counsel for the respondents, on the other hand, maintained that the findings recorded by the Courts below cannot be interfered with by this Court in exercise of revisional jurisdiction and in any case these findings were amply supported by the evidence on the record.
9.     A perusal of the plaint of the suit filed by the petitioner shows that it stands admitted that at the time when the land in question was purchased, i.e. on 5th November, 1956, the petitioner was a minor. There is also an averment in the plaint that it was the father of the petitioner, who hud purchased the land in the name of his sons. The petitioner has failed to bring any evidence on the record to show that he had any independent source of income or that this had been purchased by him. On the other hand, the evidence led by him, was to the effect that it was his mother who had purchased the land for her sons out of her own resources. As noted by the trial Court, this plea was diametrically opposed to the position taken up in the plaint wherein il was admitted that it was the father of the petitioner, who had purchased the land in the name of his sons. It has been consistently held by this Court that the English doctrine of advancement is not applicable in Pakistan and where a property is purchased by one person in the name of the other, it is presumed to be Benami; be it a case of husband purchasing the properly in the name of his wife or of a father purchasing il in the name of his children. (Sec Rain Samp and another v. Maya Shankar and (alters (43 Indian Cases 556), MJ. Medrallt v. Mrs. M.K. McCrath (PLD 1952 Lahore 533) and Aftab Nasir v. Mst. fa:al Bihi and others (PLD 1965 (W.P.)Lahore 550). It will be useful to reproduce the observation made by this Court in the last mentioned case:—
There is no doubt that the doctrine of advancement of English (law) does not apply in our country, and if a property is purchased or constructed by the father in the name of his minor child, the latter holds the property merely as a Bcnamidar and the parent is the real beneficiary of the property. In this respect reference may be made to Gopeekrist Gosain v. Gungapcrsaud Gosain (6 Moore’s I A 53), Maulvie Sayyud UzlmrAli v. Mst. Bcbcc Ultaf Fatima (13 Moore’s I A 232), Bilas Kunwar v. Desraj Ranjit Singh and others (42 I A 202) Kerwick v. Kerwick (ILR 48 Cal. 260), Lakxhmiah v. Kothandarama (AIR 1925 PC 181), MJ. McGrath v. Mrs M.K. McGralh (PLD 1952 Lah. 533). Viewing the case from this angle, although the house in question ostensibly stands in the name of the petitioner, it cannot be ruled out that in law he is merely a benamidar unless established otherwise”.
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Reference may also be made to Muzaffar Shah and others v. Qazi Muhammad Shafiq and others (PLD 1953 Peshawar 19). The principle stands further fortified by the observations of the Supreme Court in C/J. Habibullah v. Sheikhupnra Central Co-operative Bank Lid. (PLJ 1987 S.C. 77), the relevant portions of which appearing at pages 81 and 82 of (he report read thus :—”The law on the subject is clear enough. In a case from NWFP, that of Git/wn Ditto and another . T. Ram Ditto (AIR 1928 PC 172) the law was summed up in the following words:—
“The general principle of equity, applicable both in this country and in India, is that in (he case of a voluntary conveyance of property by a grantor, without any declaration of trust, there is a resulting trust in favour of the grantor, unless it can be proved that an actual gift was intended. An exception has, however, been made in English law, and a gift to a wife is presumed, where money belonging to the husband is deposiled at a Bank in the name of a wife, or, where a deposit is made, in the joint names of both husband and wife.
This exception has not been admitted in Indian law under the different conditions which attach to family life and where the social relationships arc of an essentially different character. The principle to be applied has been stated in Kerwick v. Kerwick (AIR 1921 PC 96 = 48 Cal. 260 = 47 IA 275 (PC).The general rule and principle of the Indian law as to the resulting trusts differs but little, if at all, from the general rule (of) English law upon the same subject, but in their Lordships’ view it has been established by the decision in the case of Gopeekrist v. Gungapcrsad (1854) 6 MIA 53 = 4 WR 46-2 Suther. 13-1 Sar. 493 (PC) and U:har Alt v. Bebee Ulfat Fatima (1869) 13 MIA 232-4,
BLR 1-13 WR 1(PC), that owing to the widespread and persistent  practice which  prevails amongst the natives of India, whether Mahomedan or Hindu, for owners of property to make grants and
transfers of it benami for no obvious reason or apparent purpose, without the slightest intention of vesting in the donee and beneficial interest in the property granted or transferred as well as the usages which these natives have adopted and which has been protected by statute, no exception has ever been engrafted on the general law of India negativing the presumption of the resulting trust in favour of the person, providing the purchase money, such as has, by the Courts of Chancery in the exercise of their equitable jurisdiction,been engrafted on the corresponding law in England in those cases,where a husband or father pays the money and the purchase is taken in the name of a wife or child. In such a case there is, under the general law of India, no presumption of an intended advancement as
there is in England”In view of the above legal position, it is obvious that it was for the petitioner to prove that the purchase of the property in his name by his father was not benami and that he was the real and beneficial owner of the land in question. The judgments of the Courts below are therefore, unexceptionable and call for no interference.
11.      In the last, the learned counsel for the petitioner contended that the  lower Courts failed to discuss the evidence produced by the petitioner. The evidence led by the petitioner was to the effect that it was his mother, who had purchased the land in his name. However, as this plea was inconsistent with the case set up in the plaint, where it was asserted that the land had been purchased by the father in the name of his son, the Courts below were justified in discarding thai evidence.
12.      As regards the cases cited by the learned counsel for the petitioner, suffice it to say that these precedents have no applicability. So far as the principles laid down therein, there cannot be any cavil but none of the cases applies to the facts of the present case.
As a result, this petition has no force and is accordingly dismissed, leaving the parties to bear their own costs.

18 comments on “..::What is Law of Benami Transaction in Pakistan?

  1. sir i want to know that my father purchased property on the name of my sister.there is also mention on registry “by ali asgher (my father)”.my sister also mention on Rs 200 stamp paper that my father bought a house of 5 lac for me and i ll pay back 5 lac to my father as loan and me and my father will sale this house mutually. after that my father died she did not pay any thanks to my father and she transferred property to his husband can we file benami suit?

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