P RAMACHANDRA RAO Vs. G JANGAIAH

JUDGEMENT

(1.) THE appellant is the unsuccessful plaintiff in O.S. No. 208 of 1974. THE suit is based on an oral contract of sate to convey the suit property for valuable consideration to tab appellant. It is his case that G. Jangaiah the first defendant is the real owner of the property and that Natraj, his minor son, and V. Dayanand, the fourth defendant, the soa-in-law, are the benami dars for the benefit of the first defendant. He received valuable consideration as earnest money entered rate the contract but be refused to execute the sale deed dispite several or and legal notices constraining the appellaat to lay the suit for specific performance. THE trial Court framed issue No. 1. "Whether the first defendant purchased the plaint schedule property in the name 0f defedants 2 and 4 benaimi for his own benefit?" and additional issue framed on September 4, 1979 " Whether the plaintiff has locus standi to question the safe transaction as benami?". On consideration of the evidence, it was held that is not a benami transaction and defendants 2 and 4 are the owners of the property and refused specific performance and granted decree for refund of the earnest money. We need not go into those questions. THEy very case of the appellant is that it is a benami transaction and that the real owner is the first defendant who entered into the agreement of sale with the appellant and the defendants 2 and 4 are only his benamidars. Sri Poornaiah, the learned counsel for the respondents, has contended that in " view of the Benami Transactions (Prohibition of the Right to Recovery Property) Ordinance, 1988 (Ordinance No. 2 of 1988, for short, "the Ordinance"), the suit is not maintainable and the appellant cannot succeed by virtue of Section 2 of the Ordinance. Sri Nagaseshaiah, the learned counsel for the appellant, has contended that the Ordinance has no applicant tion to establish rights secured by third party under a contract of sale. THE appellant being a third party, the prohibition does not apply to the facts in this case. THE Ordinance is in applicable to the suit transaction THE question, therefore, is whether by operation of Section 2 of the Ordinance, the right to specfic performance is barred? THE title of the Ordinance itself is Benami Transactions (Prohibition of the Right to Recover Property) Ordinance. It was made manifest in its object in the preamble, namely, "an ordinance to prohibit the right to recover property held benami and for matters connected therewith or incidental thereto." Sub-section (1) of Section 2 of the Ordinance reads :

(2.) HOWEVER, the decree of the trial Court against the first respondent granting refund of the earnest money paid, is confirmed. The suit does not lie for specific performance. The decree of the trial Court is accordingly confirmd. It is open to the appellant to withdraw the amount which "is deposited in the Court below. In the circumstances, 'each party is directed to bear its own costs in this appeal.