SMT. TULSA BAI versus STATE OF MADHYA PRADESH AND ORS.

Citation: [1996] SUPP. 8 S.C.R. 616 · Decided: 07-11-1996 · Supreme Court of India · Bench: K. RAMASWAMY, G.B. PATTANAIK · Disposal: Dismissed
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Judgment (excerpt)

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 of sales 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 of her 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 of arrears of sales-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. 
F 
G 
Gapadibai v. State of MP., 119801 2 SCC 327, cited. 
CIVIL APPELLATE JURISDICTION : Civil Appeal No. 3100 of 
I980. 
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. 
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 t
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