HARIHAR SINGH Vs. MONOMOHAN ROY

JUDGEMENT

(1.) This appeal is at the instance of the defendants and it arises out of a suit for declaration of title and for permanent injunction.

(2.) The case of the plaintiff Manomohan Roy is that he purchased the disputed property by a registered kobala dated February 14, 1935 for valuable consideration. With a view to carry on a business he promoted a limited company, named, All India Sugar Mills Co. Ltd. (hereinafter referred to as the company). He became the Ex-Officio Director of the company and got some shares allotted to his name in lieu of the disputed property although no formal deed of transfer was made by him in favour of the company. He was the supreme authority of the company. The property vested in the company and was shown in its balance sheet. The company also took possession of the property in 1937/38. It is alleged that as there was no formal deed of transfer, the property legally remained under his control. Though there was no chance of the factory of the company being constructed on the disputed property, he could not find out any way of recovering possessing of the same.

(3.) The plaintiff took the advice of the defendant no.2. Dharmadas Mallick, who advised him to execute a colourable benami document without consideration in respect of the disputed property in favour of his officer, the defendant No.1 Harihar Singh. Harihar Singh represented to the plaintiff that he and Dharmadas would, in the event of a benami deed was executed in his favour, recover possession of the property on the strength of such a deed after evicting the company and put the plaintiff in possession thereof. The plaintiff, in good faith relied on the advice of the defendants and executed a kobala without consideration on May 19, 1956 for self and as the Ex-Officio Director of the company. The plaintiff bore all the expenses for the execution and registration of the said kobala. It is alleged that the said kobala was not executed for the purpose of transferring any interest in the disputed property in favour of Harihar Singh and that it was not intended that Harihar Singh would acquire any interest on the strength thereof. Lest the said document would be held to be benami and would stand in the way of recovery of possession of the property, the plaintiff took every step necessary to show off the same as a real transfer. Harihar Singh, it is alleged, did not pay the sum of Rs.20,000/- stated to be the consideration money in the said document. He had no means to pay the said sum or any sum.