KESHAB CHANDRA NAYAK Vs. LAXMIDHAR NAYAK

JUDGEMENT

(1.) This reference to the Full Bewnch has been made by a learned single Judge to decide whether the view expressed principally in Kailash Chandra Sahu v. Mahani Charan Mohanty, (1988) 62 CLT 261, by a learned single Judge of this Court which was approved by a Division Bench of this Court in Ramachandra v. Suresh Chandra, 1988 (1) OLR 185, that consolidation authorities have no jurisdiction to decide a question relating to benami nature of transaction is correct or not.

(2.) TO answer the reference, it would be apposite at the very outset to know what is meant by a 'benami' transaction, as it would appear from what is being stated later that, in fact, there is no clash in the view taken in the aforesaid decisions and the one which the learned Judge making the reference had taken in Civil Revision No. 351 of 1983 (Hruda -nanda Panda v. Dhirendra Behura, disposed of on 30 -4 -1985), which view, the learned Judge felt is correct despite what was held in the aforesaid two decisions. The discussion to follow would show that both the views are correct and can stand together, if note is taken about what is really meant by 'benami' transaction.

(3.) THE second type of transaction was characterised as sham transaction in Sree Meenakshi Mills Ltd, v. Commissioner of Income -tax, AIR 1957 SC 49, which further seated in its paragraph 30 that the first type of transaction signifies one which is real in the sense that the sale of a property in the name of, say, X as the purchaser is genuine, but the real purchaser is B, X being his benamidar. It was then observed in this paragraph that the fundamental difference between the two classes of transactions is that whereas in the former there is an operative transfer, in the latter, there is none such; the transfeor continuing to retain the title notwithstanding the execution of the transfer deed. So, in what follows, we shall call the first type of transaction as 'benami' and the second as 'sham'.