PR. COMMISSIONER OF INCOME TAX-6, NEW DELHI vs. MAYAR INDIA LTD.

ITA/85/2018HC DelhiDLHC01499053201724 January 2018Bench: HON'BLE MR. JUSTICE S. RAVINDRA BHAT,HON'BLE MR. JUSTICE A. K. CHAWLA29 pages

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Cases cited in this judgment

Detected automatically from the text. The count shows how many other judgments on BharatTax rely on the same authority.

Ram and Shyam Co. v. State of Haryana
3 SCC 267 · 1985
11 citing
Popat and Kotecha Property v. SBI Staff Assn.
7 SCC 510 · 2005
8 citing
Pawan Kumar v. Babulal Since Deceased
4 SCC 367 · 2019
7 citing
23.12. In Hardesh Ores (P) Ltd. v. Hede & Co.
5 SCC 614 · 2007
6 citing
Eldeco Housing and Industries Limited v. Ashok Vidyarthi and Others
2023 SCC OnLine SC 1612 · 2023
3 citing
Jaydayal Poddar (Deceased) Through L.Rs and Another v. Mst Bibi Hazra and Others
1 SCC 3 · 1974
3 citing
Major S.S. Khanna v. Brig. F.J. Dillon
4 SCR 409 · 1964
3 citing
Neeru Dhir and Others v. Kamal Kishore Dhir and Others
2020 SCC OnLine DEL 2506 · 2020
3 citing
Ramesh B. Desai and Others v. Bipin Vadilal Mehta and Others
5 SCC 638 · 2006
3 citing

RFA(OS) 83/2018, 84/2018 & 85/2018 Page 1 of 29

$~ * IN THE HIGH COURT OF DELHI AT NEW DELHI + RFA(OS) 83/2018 & CM APPLs. 51160/2018, 92/2024 and 31469/2024

MAYANK DAYAL & ORS.

..... Appellants Through: Mr. B.B. Gupta, Sr. Adv. with Mr.Amiet Andlay, Mr.Manish Sharma, Mr.Shivam Prajapati, Mr. Achal Gupta, Mr. Karan Jain, and Mr. Arun K. Sharma, Advocates.

versus

SHAKUNTALA DEVI (SINCE DECEASED) THR LRS & ANR

.....Respondents Through: Mr. Sudhir Nandrajog, Sr. Adv. with Mr.Ashish Verma and Mr.Kartikay Bhargava, Advocates. Mr.Gaurav Dua, Advocate for DDA.

+ RFA(OS) 84/2018 & CM APPL. 51191/2018

MAYANK DAYAL

..... Appellant Through: Mr. B.B. Gupta, Sr. Adv. with Mr.Amiet Andlay, Mr.Manish Sharma, Mr.Shivam Prajapati, Mr. Achal Gupta, Mr. Karan Jain, and Mr. Arun K. Sharma, Advocates.

versus

SHAKUNTALA DEVI (SINCE DECEASED) THR LRS & ANR

.....Respondents Through: Mr. Sudhir Nandrajog, Sr. Adv. with Mr.Ashish Verma and Mr.Kartikay Bhargava, Advocates. Mr.Gaurav Dua, Advocate for DDA. Digitally Signed By:AMAN UNIYAL Signing Date:19.10.2024 19:10:09 Signature Not Verified

RFA(OS) 83/2018, 84/2018 & 85/2018 Page 2 of 29

+ RFA(OS) 85/2018 & CM APPL. 51393/2018, CM APPL. 98/2024

VINOD K DAYAL & ORS

..... Appellants Through: Mr. B.B. Gupta, Sr. Adv. with Mr.Amiet Andlay, Mr.Manish Sharma, Mr.Shivam Prajapati, Mr. Achal Gupta, Mr. Karan Jain, and Mr. Arun K. Sharma, Advocates.

versus

SHAKUNTALA DEVI (SINCE DECEASED THR LRS) & ORS

.....Respondents Through: Mr. Sudhir Nandrajog, Sr. Adv. with Mr.Ashish Verma and Mr.Kartikay Bhargava, Advocates. Mr.Gaurav Dua, Advocate for DDA.

Date of Decision:18th October, 2024

26.

The legal question, that arises, is as to whether the relationship between mother-in-law and daughter-in-law can be held to be fiduciary in nature, and whether the daughter-in-law can be held to be a trustee of the mother-in-law. In Indian society, it is not unusual for a daughter-in-law being treated as a trustee of mother-in-law. In fact, in most large families the daughter-in-law plays an extremely important role in nurturing and bringing up the family. Enormous amount of faith and trust is reposed in the daughter-in-law. In fact, the relationship between the two is one of confidence, trust and belief and not unusual to see in society. A mother-in-law confiding in daughter- in-law and vice-versa to the exclusion of the other family members and enjoying strong bonding is a part of our ethos and culture. Admittedly, Smt. Shakuntala Devi belonged to a wealthy family. In her cross-examination, she states that her father used to deal in shares, had rental income and was a very wealthy man. She had five brothers, who looked after her even after the .demise of her father. She was married to Mr. Maheshwar Dayal in 1939, and they were living together in 1876, Haveli Jugal Kishore, Chandni Chowk, Delhi. The transfer letter written by Shri Balbir Singh Goel to the DDA in the name of Smt. Sudha Dayal gives her address as the address of the mother-in-law. The said letter, in original, which bears the extract mentioned above, as receipt of part sale consideration, is clear evidence of the fact that Smt. Shakuntala Devi had paid money to purchase the plot. Smt. Sudha Dayal had authorised her father-in-law Mr. Maheshwar Dayal to deal with the municipal authorities. Various charges have been paid by Smt. Shakuntala Devi including the lease charges in the society. Finally, the letter written by Smt. Sudha Dayal, that she wishes to transfer the property in her mother-in-law's name completely clinches the issue. As against all these documents, the mutation and the conveyance deed by the DDA etc. are in favour of Smt. Sudha Dayal and thereafter, in favour of Mr. Mayank Dayal. Conveyance deed and other such documents have their own consequences in law. However, the evidence is overwhelming and pointing to the fact that Smt. Sudha Dayal always had trust in her mother in law. Thus, Smt. Shakuntala Devi is entitled to seek a declaration that the property actually belongs to her. Such a view is also expressed by the Supreme Court recently in Vinod Kumar Dhall v. Dharampal Dhall [Civil Appeals No.4534-4535/2018 decision Digitally Signed By:AMAN UNIYAL Signing Date:19.10.2024 19:10:09 Signature Not Verified

to only ascertaining whether on the allegations, there exists a case for rejection of the plaint on any grounds as given in order VII Rule 11 CPC. If the Court does not find any grounds for rejection of the plaint, then the Court is within its authority and jurisdiction to dismiss the application for rejection of plaint. 15. However, in the present case, the learned Single Judge erred in proceeding to deal with the merits of the case at the time of considering the applications for rejection of plaint. The issue, whether title as traced by Smt. Shakuntala Devi, i.e., plaintiff in CS(OS) 1640/2014 and CS(OS) 3631/2014, is a legally acceptable one or not, could have been considered only after trial. Therefore, while dismissing the applications for rejection of plaint, the learned Single Judge ought to have put the suits for trial, and not consider the merits of the case. 16. Holding that no amount of evidence or merits of the controversy can be examined at the stage of decision of the application under Order VII Rule 11 CPC, Supreme Court in the case of Eldeco Housing and Industries Limited Versus Ashok Vidyarthi and Others, 2023 SCC OnLine SC 1612, has held as follows: “xxx xx xxx 17. In Kamala v. K. T. Eshwara Sa, this Court opined that for invoking clause (d) of Order VII Rule 11 CPC, only the averments in the plaint would be relevant. For this purpose, there cannot be any addition or subtraction. No amount of evidence can be looked into. The issue on merits of the matter would not be within the realm of the Court at that stage. The Court at that stage would not consider any evidence or enter a disputed question of fact of law. Relevant paragraphs thereof are extracted below: “21. Order 7 Rule 11(d) of the Code has limited application. It must be shown that the suit is barred under any law. Such a conclusion must be drawn from the averments made in the plaint. Different clauses in Digitally Signed By:AMAN UNIYAL Signing Date:19.10.2024 19:10:09 Signature Not Verified

Order 7 Rule 11, in our opinion, should not be mixed up. Whereas in a given case, an application for rejection of the plaint may be filed on more than one ground specified in various sub-clauses thereof, a clear finding to that effect must be arrived at. What would be relevant for invoking clause (d) of Order 7 Rule 11 of the Code are the averments made in the plaint. For that purpose, there cannot be any addition or subtraction. Absence of jurisdiction on the part of a court can be invoked at different stages and under different provisions of the Code. Order 7 Rule 11 of the Code is one, Order 14 Rule 2 is another. 22. For the purpose of invoking Order 7 Rule 11(d) of the Code, no amount of evidence can be looked into. The issues on merit of the matter which may arise between the parties would not be within the realm of the court at that stage. All issues shall not be the subject-matter of an order under the said provision. 23. The principles of res judicata, when attracted, would bar another suit in view of Section 12 of the Code. The question involving a mixed question of law and fact which may require not only examination of the plaint but also other evidence and the order passed in the earlier suit may be taken up either as a preliminary issue or at the final hearing, but, the said question cannot be determined at that stage. 24. It is one thing to say that the averments made in the plaint on their face discloses no cause of action, but it is another thing to say that although the same discloses a cause of action, the same is barred by a law. 25. The decisions rendered by this Court as also by various High Courts are not uniform in this behalf. But, then the broad principle which can be culled out therefrom is that the court at that stage would not consider any evidence or enter into a disputed question of fact or law. In the event, the jurisdiction of the court is found to be barred by any law, meaning thereby, the subject-matter thereof, the application for rejection of plaint should be entertained.” (Emphasis Supplied) xxx xxx xxx

suits certainly require trial before any adjudication can be made on the various issues raised in the suits. 18. Further, it is to be noted that the preliminary issue framed by the learned Single Judge was as to whether the suit property was held by Smt. Sudha Dayal (daughter-in-law), as trustee of Smt. Shakuntala Devi (mother- in-law). However, in the impugned judgment, the issue of “Trusteeship” and “Fiduciary Relationship” have been dealt interchangeably, though said issues and relationships are separate and independent of each other. 19. By virtue of the impugned judgment, the learned Single Judge has not only dismissed the applications of the appellants for rejection of the plaint under Order VII Rule 11 CPC, but has also proceeded to declare Smt. Shakuntala Devi, the deceased grandmother of the appellant, as the “Benami” owner of the suit property. However, as per the law elucidated by the Supreme Court, the burden of proving that a particular sale is „Benami‟, has to be strictly discharged by adducing legal evidence of a definite character. Thus, in the case of Jaydayal Poddar (Deceased) Through L.Rs and Another versus Mst Bibi Hazra and Others, (1974) 1 SCC 3, Supreme Court has held, as follows: “xxx xxx xxx 6. It is well settled that the burden of proving that a particular sale is benami and the apparent 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 Digitally Signed By:AMAN UNIYAL Signing Date:19.10.2024 19:10:09 Signature Not Verified

„fiduciary capacity‟ vis-a-vis his deceased brother, Shri Anil Kumar Dhir, predecessor-in-interest of the appellants/plaintiffs. On perusing the averments made in the plaint, it cannot be said at this stage that the suit is barred by Benami Act. In this context, we may usefully refer to a recent decision of the Supreme Court in Pawan Kumar v. Babulal Since Deceased through Legal Representatives reported as (2019) 4 SCC 367, wherein it has been held as below:— “13. In the present case, the controversy has arisen in an application under Order 7 Rule 11 CPC. Whether the matter comes within the purview of Section 4(3) of the Act is an aspect which must be gone into on the strength of the evidence on record. Going by the averments in the plaint, the question whether the plea raised by the appellant is barred under Section 4 of the Act or not could not have been the subject-matter of assessment at the stage when application under Order 7 Rule 11 CPC was taken up for consideration. The matter required fuller and final consideration after the evidence was led by the parties. It cannot be said that the plea of the appellant as raised on the face of it, was barred under the Act. The approach must be to proceed on a demurrer and see whether accepting the averments in the plaint the suit is barred by any law or not. We may quote the following observations of this Court in Popat and Kotecha Property v. SBI Staff Assn. [Popat and Kotecha Property v. SBI Staff Assn., (2005) 7 SCC 510] : (SCC p. 515, para 10) “10. Clause (d) of Order 7 Rule 7 speaks of suit, as appears from the statement in the plaint to be barred by any law. Disputed questions cannot be decided at the time of considering an application filed under Order 7 Rule 11 CPC. Clause (d) of Rule 11 of Order 7 applies in those cases only where the statement made by the plaintiff in the plaint, without any doubt or dispute shows that the suit is barred by any law in force.” (Emphasis added) 23. If we go strictly by the averments made in the plaint and the documents filed by the appellant/plaintiffs, we are of the opinion that the suit ought not to have been rejected outright under Order VII Rule 11 CPC on the ground that the pleas taken by the appellants/plaintiffs are barred under Section 4(3) of the unamended Benami Act. In our view, the matter would require a more comprehensive consideration after permitting the parties to lead evidence in the case. Order VII Rule 11 CPC was not the appropriate Digitally Signed By:AMAN UNIYAL Signing Date:19.10.2024 19:10:09 Signature Not Verified