Benami transaction
Shankar Balasaheb Dhumal
(Querist) 15 April 2016
This query is : Resolved
Dear all ,
A Purchased land of B . for this transaction consideration amount paid by C's on his own bank account by cheque. can c have remedy to file civil suit against A for this property ( have any merit to A ? )
Please give me answer
Regards.
Adv. Shankar Dhumal
P. Venu
(Expert) 16 April 2016
Not only C has any remedy, he is liable for criminal action unless the transactions is covered by specific exemptions as regards to coparceners or a trusts.
Rajendra K Goyal
(Expert) 16 April 2016
He has given money, he can recover. Property purchased and registered favoring A, it is A property now.
RAVI K GOUD
(Expert) 16 April 2016
Facts are not clear. Whether consideration only is paid or sale is registered. Who has got the agreement of sale and when.
If sale agreement is on A and consideration is paid and Sale got registered on A. C would not have right on the land and C has the only right to recover the money paid towards the sale consideration on behalf of A.
Kumar Doab
(Expert) 16 April 2016
Apparently while the sale deed is registered by B in favor of A, the amount is paid by cheque issued by C.
In such case C can contemplate to recover from A.
Anand Bali Adv.
(Expert) 16 April 2016
Please specify whether the registered sale deed is made out in the name of A or not?
Merely giving the money do not establish the ownership there must be the willingness of the property giver party that to whom he wants to sell the land. Please remember any body can pay the consideration amount for any one and this payment alone do not make him the owner of the property concerned. However he can reclaim his amount paid from A as he has paid that on behalf of A only. Here the crux of the fact is that C paid the consideration money on behalf of A and not directly for his own. he only can claim the borrowed amount by A.
Dr J C Vashista
(Expert) 17 April 2016
No, C cannot sue A for the purchase of property from B.
Is there any evidence to prove that C has made payment on behalf of B, against the purchase transaction of the property?
Even if C has paid the money for the consideration on behalf of B, even then, there is no privity of contract between C and A, rather B was titleholder who have validly transferred the title in favour of A.
C may file suit for recovery of money against B and not against A.
Consult a local prudent lawyer with documents.
RAVI K GOUD
(Expert) 19 April 2016
This is for the explanation of Dr J C Vsshista:
Here C has paid the money to B on behalf of A for the transaction of Purchase of property. Here there is no contract between B and C but money is transferred from C to B on behalf of A. So as per the transaction B has complied and completed his part of performance. So as per the facts given, B is very clear and clean in closing the transaction by registration of property to A in consonance of the agreement/sale deed.
Here the crux of the issue is the ownership of land and the money paid.
1) As per the agreed terms, ownership of land is transferred on consideration to A by B, So A is the absolute owner of the property.
2) Here the money (consideration) is paid to B by C on behalf of A, So here C is the agent of A and acted on behalf of A. A is only the instrumental for the transaction of money and he is nothing to deal with ownership of property and/or as there no terms or agreement between the B and C for the above transaction, B is not liable for C for the money even it is received from C but B is answerable to A for if any deviation with the transaction.
Hence C is not entitled to file a suit for the recovery of money against B, but enforceable against A as the amount is paid for the sake of A. It shall be presumed and deemed to be received by A from C.
I hope my explanation is clear.
Anand Bali Adv.
(Expert) 19 April 2016
I would strongly go with the wide observations made by Mr Ravi K Gaud, The simple principal is this that Any body can pay on behalf of any one and by doing this on behalf of payment he can not become the real owner of the property. B has performed his part of the contract honestly against A after receiving the consideration amount from C on behalf of A. B has no liability against C however C can demand his money back from A under all circumstances.
Hemant Agarwal
(Expert) 23 April 2016
CONSIDER THIS:
1. There is no privity of contract between C & B. Hence no lawful procedure can be initiated by C against B, whatsoever, UNLESS & UNTIL "C" proves that "B" fraudulently registered the property in favor of "A" without consent of "C". HERE, claim on the property as well as Criminal and Civil action is positively possible, against "A" & "B".
2. Subject to various parameters, "C" derives legal right to recover the financed money from "A", SUBJECT to following:
a) "C" should have declared the financed amount, in his income-tax returns, and such amount should be shown as Loan or Recoverable from "A".
b) IF "C" has NOT declared the financed amount, in his income-tax returns, THEN "C" forfeits all lawful remedy and in turn becomes liable for under the Income Tax Act and the "Benami Transaction Act".
3. IF "A" has NOT declared the third-party financed property, in his income-tax returns, THEN "A", becomes liable for under the Income Tax Act and the "Benami Transaction Act", which includes confiscation of the benami property.
4. "C" can successfully & lawfully jinx the so called "title-ownership" of "A" of the said property, subject to above and various other parameters.
Keep Smiling .... Hemant Agarwal
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