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1990 Supreme(SC) 601

SUPREME COURT OF INDIA
M.H. KANIA AND L.M. SHARMA, JJ.
R. M. Narayana Chettiar and another, Appellants

Versus

N. Lakshmanan Chettiar and others, Respondents.
C. A. Nos. 4890-91 of 1990

Decided on 11-10-1990.
Advocates Appeared

Mr. S. Padmanabhan, Sr.Advocate, Mr. P. N. Ramalingam and Mr. A. T. M. Sampath Advocates, with him, for Appellants; Mr. K. Parasaran, Sr. Advocate, Mr. S. Balakrishnan and Ms. Revati, Advocates, with him, for Respondnets.

Advocates:
A.T.M.SAMPATH, K.PARASARAN ATTORNEY, P.N.Ramalingam, REVATHY RAGHAVAN, S.BALAKRISHNAN, S.Padmanabhan

Headnote:

Code of Civil Procedure, 1908 - Section 92 - Public Charities - Scheme – Trust - Whether leave granted without such opportunity having been given is void - Appellants instituted Suit in court of learned subordinate Judge in Tamil Nadu against respondents as a representative suit inter alia praying for framing a scheme for a public charitable trust - It is common ground that reliefs prayed for in suit were such that leave under S. 92 of Civil Procedure Code was required for instituting suit - On same day on which suit was filed by lodging plaint in court an application was made praying for leave to institute suit under S. 92 of Code - Without issuing any notice to respondents, said court granted leave by passing an order reading "permitted" and issued summons to respondents - learned Subordinate Judge dismissed said application on ground that grant of leave was an administrative act of court and no notice to respondents was required before such leave was granted - Held, If a suit is instituted on basis of such leave, granted without notice to defendants, suit would not thereby be rendered bad in law or non-maintainable - Grant of leave cannot be regarded as defeating or even seriously prejudicing any right of proposed defendants because it is always open to them to file an application for revocation of leave which can be considered on merits and according to law - We may mention that although clause (ffa) of S. 104(1) of Code provides that an appeal shall lie against refusal of grant of leave, that cannot lead to conclusion that it is obligatory on part of Court to give notice to proposed defendants before granting leave because an appeal lies only against refusal of leave and not against, grant of leave - Before refusing leave proposed plaintiffs are bound to be heard and it is plaintiffs and not defendants who could be prejudiced by refusal to grant such leave - Appeals are allowed.

Judgement Key Points

Certainly. Based on the provided legal document, the key points are as follows:

  1. Leave under Section 92 of CPC: The institution of a suit involving public charities, trusts, or religious or charitable trusts requires prior leave of the court. This leave acts as a condition precedent for maintaining such suits (!) (!) .

  2. Procedure for granting leave: The court's grant of leave is an administrative act, and traditionally, it has been considered that no notice to the respondents is necessary before such leave is granted (!) (!) .

  3. Right to oppose leave: Although the court may not be obliged to give notice before granting leave, it is generally advisable for the court to do so as a matter of caution. This ensures that respondents have an opportunity to present their objections or defenses, especially to prevent frivolous or reckless suits (!) .

  4. Effect of granting leave without notice: If leave is granted without giving notice to the respondents, the leave itself is not automatically invalid. A suit instituted on the basis of such leave remains valid unless the leave is revoked on merits through an appropriate application (!) .

  5. Revocation of leave: Respondents have the right to file an application for revocation of leave if they believe it was granted improperly, such as without notice or on incorrect grounds. The court can then consider such applications on their merits (!) .

  6. Appeals against leave orders: An appeal lies against the refusal of leave under Section 92. However, no appeal lies against the grant of leave, implying that the initial grant, even if made without notice, is not necessarily subject to appeal (!) .

  7. Implication for suits: A suit based on leave granted without notice is not inherently invalid or non-maintainable. The primary concern is ensuring that the proper legal procedure is followed, and respondents' rights to oppose or revoke leave are preserved (!) .

  8. Judicial discretion: While it is preferable for courts to give notice before granting leave, the absence of such notice does not automatically invalidate the suit. The courts have the discretion to balance the need for expedition with procedural fairness (!) .

  9. Legal object of Section 92: The section aims to prevent frivolous or reckless suits against public trusts by requiring leave, but it also recognizes the need for procedural flexibility to avoid unnecessary delays, especially in urgent circumstances (!) .

  10. Overall conclusion: Granting leave under Section 92 without notice to respondents is permissible, and such leave, if properly granted, does not invalidate the subsequent suit. Respondents retain the right to challenge the leave through revocation proceedings, which must be considered on their merits (!) .

Please let me know if you need further elaboration or assistance with this matter.


JUDGMENT

KANIA, J.:— Special Leave granted. Counsel heard.

2. These two appeals are filed by Special leave against the judgment of the High Court of Madras in Revision Petitions Nos. 517 and 518 of 1989. * These appeals raise an interesting question as to whether it is obligatory on the Court, before granting leave to institute a suit as required under S. 92 of the Code of Civil Procedure, 1908, to give an opportunity to the respondents to show cause against the grant of such leave, and whether leave granted without such opportunity having been given is void.

* Reported in (1990) 1 Mad LJ 113.

3. The appellants instituted Suit No. O.S. 55 of 1987 in the court of the learned subordinate Judge of Sivaganga in Tamil Nadu against the respondents as a representative suit inter alia praying for framing a scheme for a public charitable trust. It is common ground that the reliefs prayed for in the suit were such that leave under S. 92 of the Civil Procedure Code was required for instituting the suit. On the same day on which the suit was filed by lodging the plaint in court an application was made praying for leave to institute the suit under S. 92 of the Code. Without issuing any notice to the respondents, the said court granted leave by passing an order reading "permitted" and issued summons to the respondents. In March 1988 the respondents filed an interim application before the learned Subordinate Judge for revoking the leave granted inter alia on the ground that the respondents had not been given any opportunity to be heard before leave was granted. The learned Subordinate Judge dismissed the said application on the ground that the grant of leave was an administrative act of the court and no notice to the respondents was required before such leave was granted. The respondents then preferred a Civil Revision Petition in the Madras High Court which has been allowed by a judgment delivered by learned single Judge. He took the view that an analysis of the provisions of S. 92 of the Code shows that in order to institute a representative suit as contemplated in the said Section two or more persons must have an interest in the trust and they should have obtained the leave of the court before they institute the suit. The learned single Judge held that while the said section enables persons interested in a public trust to file a suit to secure the proper administration and management of the trust and its properties by its trustees, it also imposes a check on the institution of such suits by the imposition of certain conditions, one of which is the, obtaining of leave from the court. It was held that it is the grant of leave which confers on the person concerned a right to institute a suit under S. 92 of the Code. If there were any facts which might, disentitle the applicants for leave from obtaining the leave of the court, these could be best brought to the notice of the court by the party arrayed on the opposite side. The learned Judge also referred to the provisions of S. 104(1) (ffa) of the Code whereby an order under S. 91 or S. 92 refusing leave to institute a suit of the nature referred to in S. 91 is made appealable. The learned Judge followed the decision of the High Court of Madras in T. M. Shanmugam v. The Periyar Self Respect Propaganda Institution (1984) 2 Mad LJ 440: AIR 1985 Madras 93,and held that as the leave had been granted without any notice to the respondents, it was void and liable to be set aside. The learned Judge allowed the revision petitions, set aside the leave and held that the suit could not be entertained and was liable to be dismissed. It is against this decision that these appeals have been preferred.

4. Learned counsel for the appellants submitted that if the court were required to give opportunity to the defendants to be heard before granting leave under S. 92, the grant of leave would entail a great deal of delay and might defeat the ends of justice where some urgent relief was required. He pointed out that,

































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