Law:

Section:

Section 281A of the income-tax act, 1961 - Bar of suit - In respect of properties held benami - Plaintiff filed suit for partition of properties against his mother, etc., claiming share in such properties by inheritance on the ground that his father, in his lifetime was real owner of such properties but in collusion with his mother, he obtained a sham decree in her favour under arbitration act, thus holding them benami in her name - Whether since plaintiff was not a person who had laid claim in respect of a property held by him in benami nor was he a person claiming to be owner thereof, aforesaid suit by him was not barred under section 281A - Held, on facts, yes Facts The plaintiff, one of the sons of B, filed a suit for partition and accounts of immovable properties and business against his mother, brothers, and sisters on the grounds (i) that his father B, in his lifetime, in order to defraud the creditors and the Income-tax Department, initiated false and collusive proceedings under the Arbitration Act, in collusion with his mother who succeeded in obtaining a fictitious award and decree over one premises and three businesses; and (ii) that notwithstanding the sham decree, B, during his lifetime, continued to remain the owner of the said property and the business and, on his death, the plaintiff had inherited one-sixth share in them along with the other properties. The Subordinate Judge held that the plaintiff's claim in respect of aforesaid premises and three businesses was barred under the provisions of section 281 A. On a revision application: Held Two conditions need to be fulfilled to attract the application of section 281 A. In the first place, the right to be enforced must be in respect of a property held in the name of the benamidar and, secondly, such a claim must be made by or on behalf of a person claiming to be the real owner. In view of the facts of the case, it could be hardly said that the suit was in respect of a property held in the name of a benamidar since the plaintiff's case was that the business and property in question were held by his father who merely created a sham decree based on a collusive arbitration award. Thus, the first…

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