Source: Supreme Court  

Why in News? 

Recently, the bench of Justices Pankaj Mithal and Ahsanuddin Amanullah held that a partition suit claiming joint family property cannot be rejected at the threshold under Order VII Rule 11 of the Code of Civil Procedure,1908 (CPC) when factual disputes, such as benami exceptions, require trial. 

• The Supreme Court held this in the matter of  Smt. Shaifali Gupta v. Smt. Vidya Devi Gupta & Ors (2025). 

What was the Background of Smt. Shaifali Gupta v. Smt. Vidya Devi Gupta & Ors. (2025) Case? 

• The present case arose from a family dispute involving partition of alleged joint family properties. Smt. Vidya Devi Gupta (plaintiff No.1) and her son Shri Sudeep Gupta (plaintiff No.2) instituted Regular Suit No.630A/2018 against the elder son Sandeep Gupta (defendant No.1) and his wife Smt. Shaifali Gupta (defendant No.2), along with other family members and subsequent purchasers. 
• The foundation of the dispute traces back to Shanti Prakash Gupta, who was engaged in tailoring business until his death in 1977.  
• He left behind no immovable or movable property at the time of his demise. In 1982, his two sons jointly commenced a tailoring business named 'Himalaya Tailors' from a rented shop in New Market, TT Nagar, Bhopal, using funds generated from selling their mother's jewellery. Though operated jointly, the younger brother was designated as the sole proprietor. 
• The family initially resided together in a house purchased in Harshwardhan Nagar around 1990, continuing their joint residence until approximately 2011. 
• Subsequently, the elder son and his family moved to a house in Shalimar Park, which was allegedly purchased jointly by the family in 2014 from the income of their joint family business. 
• Parallel to the tailoring business, the elder son established a fabric business called 'Hemi Textiles' in 1986. The family acquired a shop in New Market, TT Nagar, Bhopal, from the combined income of both Himalaya Tailors and Hemi Textiles businesses. 
• The plaintiffs alleged that numerous properties were purchased using joint family funds or income derived from their joint family businesses, though registered in the names of different family members. They contended that all such properties constituted joint Hindu family assets liable for partition.  
• The suit specifically challenged the sale of certain properties (Serial Nos. 19, 20, and 21) by defendant No.2 to subsequent purchasers, claiming such transactions were void. 
• The subsequent purchasers (defendant Nos. 5 and 6) filed an application under Order VII Rule 11 of the CPC, contending that the suit was not maintainable under the Benami Transaction (Prohibition) Act, 1988.  
• Notably, the primary contesting defendants (the elder brother and his family) never raised any objection regarding the maintainability of the suit or claimed it was barred by any statutory provision. 
• Both the trial court and High Court rejected the application to dismiss the plaint, leading to the filing of Special Leave Petitions before the Supreme Court by defendant No.2 and one of the subsequent purchasers. 

What were the Court’s Observations? 

• The Supreme Court established that for rejecting a plaint under Order VII Rule 11(d) of the CPC, the test is whether from the plaint statements, it appears without doubt that the suit is statutorily barred. Where factual disputes exist regarding property nature, such determination cannot be made at the preliminary stage. 
• The Court noted that while Section 4 of the Benami Act bars suits regarding benami properties, whether a property is benami constitutes a question of prime consideration requiring factual determination beyond mere plaint averments. 
• The Court observed that plaint allegations consistently described suit properties as joint Hindu family properties purchased from nucleus funds or joint family business income, not as benami transactions. Therefore, these could not ex-facie be held as benami properties rendering the suit unmaintainable under Section 4. 
• Regarding Sections 2(8) and 2(9) of the Benami Act, the Court emphasized that certain property categories are excluded from benami definition, including properties held in fiduciary capacity for another's benefit. 
• The Court stressed that benami property determination must consider not merely Section 4 but also exceptions under Sections 2(8) and 2(9). Only where property is benami and doesn't fall within statutory exceptions can a suit be barred. 
• The Court observed that whether property is benami and not covered by exceptions must be decided based on evidence, not plaint averments alone. Defendants bear the burden to prove property is benami. 
• The Court noted that defendant No.2, having neither moved an Order VII Rule 11 application nor challenged the trial court's order in revision, was not a person aggrieved and could not assail the impugned orders, having acquiesced to trial court jurisdiction. 

What is Partition Suit? 

• A partition suit is a legal proceeding filed to divide joint family property among coparceners, resulting in the dissolution of joint family status and creation of separate nuclear families with individual property rights. 
• Any coparcener including sons, daughters (post-2005 amendment), grandsons, and great-grandsons can file a partition suit at any time with or without reason, while minors require guardians to file on their behalf. 
• Partition suits are governed by Hindu Succession Act 1956 and follow either Mithakshara Law (applicable in most Indian states) or Dayabhaga Law (applicable only in Assam, Bengal, and Tripura). 
• The suit encompasses all joint family property including movable and immovable assets, but excludes separate/self-acquired property of individual members and impartible estates like family idols and places of worship. 
• While female members like father's wife, widowed mother, and paternal grandmother cannot initiate partition suits, they are entitled to equal shares when partition is actually effected by male coparceners. 
• Purchasers of undivided shares in coparcenary property (whether through court sale or private transaction with consent) must file partition suits to obtain separate possession of their purchased interest. 
• Partition suits result in two types of decrees - a preliminary decree that determines rights and shares of parties, followed by a final decree that physically divides the property by metes and bounds. 
• Courts ensure equitable distribution where each coparcener receives shares in both movable and immovable property, with monetary compensation provided when physical division would destroy the property's intrinsic value. 
• Upon completion of partition, coparceners become free from joint family obligations and responsibilities, with their shares becoming fixed and no longer subject to fluctuations due to births and deaths in the family. 

Case Referred  

Pawan Kumar v. Babu Lal (2019): 

• The Court held that where exceptions to benami transactions are pleaded, it becomes a disputed question of fact requiring evidence-based adjudication. Consequently, plaints cannot be rejected at Order VII Rule 11 stage.