SMT. TULSA BAIversusSTATE OF MADHYA PRADESH AND ORS.

A                               SMT. TULSA BAI
                                          v.
                  STATE OF MADHYA PRADESH AND ORS.

                               NOVEMBER 7, 1996

B               [K. RAMASWAMY AND G.B. PATTANAIK, JJ.]

         Benami Transaction:

        Proceedings for recovery ofsales tax initiated against the husband-
  House in the name of wife sought to be attached-Wife filed suit for
C declaration of her right and title in the house claiming that she had-
  purchased the plot and constructed the house thereon out ofher own funds,
  and sought an injunction restraining the defendant-respondents from selling
  it-Revenue's case was that it was a Benami transaction-Trial Court
  decreed the suit-The High Court on appreciation of evidence, dismissed
D the suit holding that there was no proof that the house was constructed by
  the wife with her own funds; the husband being a businessman, had
  constructed the house in the name of his wife, as such, it was a benami
   transaction liable to be proceeded with for recovery ofarrears ofsales-tax
  from the husband-Held, there is no illegality in the conclusion reached by
   the High Court nor is there any error of law in the judgment of the High
E Court warranting interference.
            Gapadibai v. State of MP., 119801 2 SCC 327, cited.

            CIVIL APPELLATE JURISDICTION : Civil Appeal No. 3100 of
    I980.
F
         From the Judgment and Order dated 19.4.80 of the Madhya Pradesh
    High Court in F.A. No. 8 of 1975.

            Fazlin Anam for S.K. Mehta for the Appellant.

G        U.N. Bachawat, (A.K. Sanghi) (NP), Niraj Sharma and S.K.
    Agnihotri for the Respondents.

            The following Order of the Court was delivered :

H           This appeal by special leave arises from the judgment of the Division
                                         616
                        TUSA BAI v. STATE OF M.P.                        617


Bench of the High Court of Madhya Pradesh, Jabalpur Bench, made on               A
April 19, 1980 in F.A.No.80175. The appellant had filed the suit for
declaration of her right to and title in the suit property situated in Shankar       '
Ward, Bhatapara Municipality in Madhya Pradesh and for incidental
injunction restraining the defendants from selling off the same. Her plea
was that she had purchased a plot on September 23, 1971 by herself out of
her own money. After obtaining the permission from the municipality she          B
had constructed the house by herself after taking loans from various sources
and thereby she is the absolute owner of the built-in house. Therefore, the
said house is not Eable to attachment and sale to recover Rs. 63,063.25
towards arrears of sales-tax from the appellant's husband impleaded as
3rd defendant in the suit. The Trial Court decreed the suit No. 7-A of
1972. But on appeal it was reversed and the suit was dismissed. Thus this        C
appeal by special leave.

       The learned counsel for the appellant, placing strong reliance on the
judgment of this Court in Gapadibai v. State of MP .. [1980] 2 SCC 327,
contended that when the appellant had pleaded and proved that she is the
owner of the property and had constructed the house from her own funds           D
and the trial Court having accepted the same, the High Court was not right
 in reversing the decree. The burden is on the respondent-State to prove
that this is case of benami transaction and that the third defendant-husband
of the appellant is the real owner. The state had miserably failed to do the
same. Consequently, the decree of the High Court is not correct in law. We
find no force in the contention.                                                 E
      It is true that that when the plea of benami transaction has been
raised and on passing different tests laid down in that case, namely, having
been in possession of the house in her own right, purchasing the property
by a registered conveyance in her name, the title deed remained to be in         F
her custody, the payment of property-tax after the purchase were considered
to be indicia to conclude that she was the real owner and it was not a
benami transaction standing in the na1ne of the plaintiff for and on behalf
of her husband. But, in this case, it is difficult to give acceptance to the
contention of the learned counsel for the appellant. The High Court has
pointed out in paragraphs 5 and 6 of the judgment the entire evidence.           G
The finding is based on oral testimony of the witnesses. PW- I, Jagdish
Prasad examined on behalf of the plaintiff, had admitted that he purchased
the plot in 1969 for Rs.4425/- and in 1971, he is stated to have sold the
property for Rs. 4,000/-. It is incredible to believe that after two years he
had sold the property for less than the purchase price of 1969. One
Radheshyam Purohit was examined to show that the respondent had sold             H
    618                     SUPREME COURT REPORTS [1996) SUPP,. 8 S.C.R.


A her gold ornaments to him after 10-15 days of Hali of the year 1971 for a
    surn of Rs. 4220/-. The said Radheshyam is no other than the clerk of
    Jagdish Prasad, P.W. l. No credence can be given to his evidence. Evidence
    ofone Himmatbhai, a relation of the appellant, of her lending money, was
    disbelieved. P.W.3, a contractor who constructed the house during October
    1970, had stated that the cost of construction was Rs. 27,000/- whereas the
B   Municipal Overseer, P.W.4 examined on behalf of the appellant had proved
    that the cost of the construction was Rs. 45,000/-. One Pitamberlal Agrawal,
    P.W.5 relative of the appellant, was claimed to have lent Rs. 10,000/- for
    construction of the house in October 1972. It is not the case that this Rs.
    10,000 1- was utilized in the construction of the house. In the absence of
    any material connecting the alleged oral lending of Rs. I 0,000/- and
C   repayment thereof, the contention was not accepted by the High Court.
    Another witness is the sister of the appellant's mother, one Bhotibai. She
    claimed to have gifted Rs. 5,000/- to the appellant for construction of the
    house. The appellant had admitted as a witness that at the time of
    her marriage she was given Rs. 5,000/- cash and ornaments worth
    Rs.10,000/-. She also admitted that after the house was constructed, she
D   had in her possession Rs. 5,000/- to Rs.6,000/- in cash. In other words,
    she had Rs.l 6,000/- in her possession before construction and she retained
    Rs.5,000/- to Rs.6,000/- in cash after construction. In the absence of any
    specific evidence as to source from which the amount of.Rs. 45,000/- was
    secured by her, the High Court had concluded that there is no proof that
    the house was constructed by her with her own funds and the husband
E    being a businessman, obviously had constructed the house in the name of
     his wife for herself and family. Accordingly, it was concluded that it was
    a benami transaction liable to be proceeded with for recovery of the arrears
    of sales-tax from the third defendant, the husband of the appellant. This
     being a finding of fact based on appreciation of evidence, we do not find
     any illegality in the conclusion reached by the High Court nor do we find
F    any error oflaw in the judgment of the High Court warranting interference.

           The appeal is accordingly dismissed. No costs.

    R.P.                                                    Appeal dismissed.