IMPORTANT POINT
Creation of specific endowment by Deed of Settlement – Deed of Settlement must be examined as a whole to determine true intention of settlor.

JUDGMENT

Dr. Dhananjaya Y. Chandrachud, J.

1. This appeal arises from a judgment dated 1 December 2016 of a Single Judge of the Madurai Bench of High Court of Judicature at Madras. The High Court dismissed the appellant‘s second appeal and upheld the judgment dated 31 August 2005 of the Principal District Judge, Tiruchirapalli and the decree dated 10 November 2004 of the Second Additional Subordinate Judge, Tiruchirapalli, permitting the first respondent to sell a portion of the suit property to the fourth respondent.

2. The first respondent is a trust represented by its Managing Trustee. The second and third respondents are members of the first respondent. The suit property was originally purchased on 2 June 1887 by Thoppulan Chettiar. On a portion of the property, he constructed a ‘Stone Mandapam’ for the deity of Sri Renganathaswamy. During the Hindu festival months, he used to invite the deity of Sri Renganathaswamy and receive its blessings. In addition, Thoppulan Chettiar also conducted other charitable activities at the suit property for the benefit of the devotees, namely supplying drinking water and millet porridge for three days during the Gajendra Moksham and Eighteen Padi festivals from the “Mahimai” fund (God’s account), which was established from his granary business. After fourteen continuous years of carrying on these charitable activities, on 8 July 1901, Thoppulan Chettiar executed a Deed of Settlement, prohibiting the future sale or mortgage of the suit property and directing his descendants to continue carrying out these charitable activities upon his death from the income of ‘their business’. The relevant clauses of the Deed of Settlement are examined in a later section of this judgement.

3. By a lease deed dated 29 April 1978, the suit property was leased out to Sri Renga Fibre for twenty years. Sri Renga Fibre further sub-let the suit property to various third parties. A portion of the suit property admeasuring 2,500 square feet was encroached upon by third parties and the first respondent had filed a suit [OS No 706 of 1984] for eviction of the encroachers before the Principal Subordinate Judge, Trichy. Owing to the difficulties in maintaining the suit property and preventing encroachment, the managing trustees of the first respondent decided to sell the suit property (20,865 square feet) to the fourth respondent, leaving aside 4,135 square feet, where the ‘Stone Mandapam’ was situated. The object of the sale was to use the interest generated from the sale consideration for carrying out the object of the charity. By an agreement dated 1 February 2001, the first respondent sought to sell land admeasuring 20,865 square feet (out of property admeasuring 25,000 square feet) to the fourth respondent. The present dispute concerns the proposed sale of the 20,865 square feet.

4. The first respondent instituted a suit [O S 60 of 2004] in 2004 before the Second Additional Subordinate Judge, Tiruchirapalli, seeking permission for sale of the suit property in favour of the fourth respondent and to deposit the sale proceeds in a nationalised bank. The proposed sale was resisted by the appellant, namely the idol of Sri Renganathaswamy represented by its Executive Officer (the fourth defendant). It was contended by the appellant that the trust had no right to alienate the property and that Thoppulan Chettiar had dedicated the entire property to the idol for the performance of charitable activities. The appellant alleged that the first respondent is a public religious trust created for carrying out specific charities and therefore the suit property constituted a specific endowment as contemplated under Section 6(19) of the Tamil Nadu Hindu Religious and Charitable Endowments Act 1959 [“Act of 1959”]. According to the appellant, under Section 34 of the Act of 1959, only the Commissioner of Hindu Religious and Charitable Endowments has the power to grant sanction for alienation of the suit property of a trust and the civil co