Venkatachala, J. - (1.) Whether the prohibition to file a suit or to take up a defence in respect of a benami transaction imposed by the Section 4 of the Benami Transactions (Prohibition) Act, 1988 - 'the Act' applies to a benami transanction of purchase of property by a person in the name of his wife or unmarried daughter, is the question requiring our answer in deciding this appeal by special leave filed by the plaintiff in a suit against an order of the Division Bench of the High Court of Delhi allowing an appeal filed by the defendant against an order in the suit made by a learned single Judge of the same Court, refusing to reject the plaint under Order 7 - Rule 11 of the Code of Civil Procedure, 1908 - 'the Code', as that barred by Section 4 of the Act.
(2.) A three Judge Bench of this Court presided over by one of us (Kuldip Singh, J.) which dealt with the prohibition to file a suit on to take up a defence in respect of a benami transaction imposed by Section 4 of the Act in the case of R. Rajagopal Reddy v. P. Chandrasekharan reported in 1995 (1) SCALE 692 , has expressed its view that that prohibition imposed by sub-sections (1) and (2) of Section 4 applies only to suits to be filed or defences to be taken, in respect of property held benami, i.e., benami transactions, after the coming into force of the Act and not to those suits filed and defences taken in respect of such benami tansactions and pending final decision at the time of coming into force of the Act as had been held earlier by a Division Bench of this Court in Mithilesh Kumari v. Prem Behari Khare, (1989) 1 SCR 621 .
(3.) Section 4 of the act which imposes prohibition in the matter of filing of suits or taking of defences in respect of property held benami i.e. covered by benami transactions reads, thus: "4. Prohibition of the right to recover property held benami. - (1) No suit, claim or action to enforce any right in respect of any property held benami against the person in whose name the property is held or against any other person shall lie by or on behalf of a person claiming to be the real owner of such property. (2) No defence based on any right in respect of any property held benami, whether against the person in whose name the property is held or against any other person, shall be allowed in any suit, claim or action by or on behalf of a person claiming to be the real owner of such property. (3) Nothing in this section shall apply, - (a) Where the person in whose name the property is held is a coparcener in a Hindu undivided family and the property is held for the benefit of the coparceners in the family; or (b) where the person in whose name the property is held is a trustee or other person standing in a fiduciary capacity, and the property is held for the benefit of another person for whom he is a trustee or towards who he stands in such capacity." ;