Overview
The Supreme Court on 8 May 2026 ruled that a property bought through a benami arrangement cannot be protected by a Will or by claiming a fiduciary relationship. The judgment clarifies that transactions covered by the Benami Property Transactions Act (BPTA) are liable for attachment and confiscation, irrespective of testamentary documents.
Key Developments
- The Court held that funds transferred under a commercial MoU do not create a fiduciary duty that could exempt the transaction.
- The plaintiff’s claim of ownership based on a registered Will was rejected as a device to mask benami ownership.
- The bench dismissed the defence that the property was held by the deceased as a trustee for the plaintiff, emphasizing that an employer‑employee relationship is not a recognised fiduciary category under the Act.
- Under Section 27, the properties were ordered to be confiscated and handed over to the Central Government.
- The Court directed the Government to appoint an Administrator and take over the properties within eight weeks, bypassing the need for adjudication by a Benami Authority.
Important Facts
• The disputed properties were purchased in the name of the late K. Raghunath, who was the ostensible owner. The funds were supplied by the plaintiff under a commercial contract.
• The plaintiff