The Supreme Court has ruled that a suit for partition of joint family property cannot be dismissed at the initial stage under Order VII Rule 11 of the Civil Procedure Code (CPC) when the plaintiff pleads that the property falls under the exception to the Benami Transactions (Prohibition) Act, 1988.
The bench, comprising Justices Pankaj Mithal and Ahsanuddin Amanullah, emphasized that a plaint can only be rejected under Order VII Rule 11(d) if it is “ex facie barred by law”, meaning clearly prohibited by law without the need for evidence.
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The case involved a suit for partition, declaration, and injunction filed by the plaintiffs (respondents) against the elder son, his wife, and others. They claimed that the properties were joint family assets protected by the exception in the Benami Act. On the other hand, the defendants (appellants) sought rejection of the plaint, arguing that the suit was barred under the Benami Act and the Hindu Succession Act, 1955.
The lower courts had refused to accept the defendants’ application to reject the plaint under Order VII Rule 11. Aggrieved, the defendants moved to the Supreme Court.
Quoting from the judgment, the Court stated:
“Where a plea is taken that the suit is saved by the exception to the benami transaction, it becomes the disputed question of fact which has to be adjudicated on the basis of the evidence.”
The Court added that determining whether a property is benami or part of joint family property requires a factual inquiry—such as looking into the source of funds or family arrangements—and cannot be decided at the pleading stage.
The Court referred to its earlier decision in Pawan Kumar vs. Babu Lal, (2019) 4 SCC 367, noting that if a plaint claims exception under the Benami Act, it should not be dismissed outright under Order VII Rule 11.
As a result, the Supreme Court upheld the High Court's decision and dismissed the appeals filed by the defendants.
Case Title: SMT. SHAIFALI GUPTA VERSUS SMT. VIDYA DEVI GUPTA & ORS. (& connected case)
