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1995 Supreme(Bom) 125
IN THE HIGH COURT OF BOMBAY
A.P. Shah, J.
Homi P. Ranina others......Plaintiffs.
Versus
Eruch B. Desai others .......Defendants.
Originating Summons No. 407 in Suit No. 1760 of 1993, decided on 22-2-
1995.
Advocates appeared :
K.S. Cooper with S.K. Cooper, K.D. Mehta and Mrs. Bhika Treasurywalla i/b Payne Co., for the plaintiffs.
Bomi R. Zaiwalla i/b Zaiwalla Co., for defendant No. 1.
Virendra Tulzapurkar with Farzana Madon i/b Wadia Ghandy Co., for defendant Nos. 2, 4 and 5.
Atul Setalwad with Bomi Patel i/b Desai Berjis Chinoy, for defendant No. 3.
A long-standing custom or usage, even if not provided for in a Trust Scheme, can be binding and enforceable if it has been acted upon consistently and invariably for a sufficient period of time.
Headnote:
PARSI PANCHAYAT - TRUSTEES - APPOINTMENT OF PRESIDENT - CUSTOM AND USAGE - SCHEME - INTERPRETATION - VALIDITY OF RESOLUTIONS - ORIGINATING SUMMONS - MAINTAINABILITY - BOMBAY PARSI PANCHAYAT SCHEME, 1910 - RULES AND FORMS OF THE HIGH COURT OF JUDICATURE AT BOMBAY ON THE ORIGINAL SIDE, CHAPTER XVII.
Fact of the Case:
The plaintiffs, Trustees of the Bombay Parsi Panchayat, filed an originating summons seeking determination of questions related to the appointment of the President of the Panchayat. The dispute arose when the defendant Trustees passed resolutions appointing a temporary Chairman and President, bypassing the senior most Trustee, who claimed the position by virtue of custom and usage.
Finding of the Court:
The Court held that the Trustees had no power to appoint or elect the President under the Scheme and that the custom and usage of appointing the senior most Trustee as the President had been established. The resolutions passed by the defendant Trustees were declared invalid and ineffective.
Issues: 1. Whether the Trustees have the power to appoint/elect the President of the Bombay Parsi Panchayat under the Scheme? 2. Whether the Trustees have the authority to elect a Chairman of their meeting if the President is present, by removing the President and appointing someone else? 3. Whether the Trustees have the power to prevent the senior most Trustee from assuming the office of the President without modification of the Scheme? 4. Whether the resolutions passed by the defendant Trustees at the meeting held on March 30, 1993 are valid and effective?
Ratio Decidendi: 1. The Scheme is silent on the manner of appointment of the President, and the practice of appointing the senior most Trustee as the President had been followed consistently for a long period, establishing a custom and usage. 2. The Court relied on the principles laid down by the Supreme Court in Gokal Chand v. Parvin Kumari and Harihar Prasad v. Balmiki Prasad, which held that a custom or usage can be established by long and invariable practice, even if the period is less than the "memory of man." 3. The Court found that the resolutions passed by the defendant Trustees were invalid and ineffective as they were contrary to the established custom and usage, and the Scheme did not provide for the appointment of the President by majority vote.
Final Decision: The Court determined the questions raised in the originating summons in favor of the plaintiffs, holding that the Trustees had no power to appoint or elect the President, that the custom and usage of appointing the senior most Trustee as the President had been established, and that the resolutions passed by the defendant Trustees were invalid and ineffective.
(1) Whether the Trustees of Bombay Parsi Panchayat have any power under the present scheme or otherwise to appoint/elect the President of the Bombay Parsi Panchayat?
(2) Whether the Trustees of Bombay Parsi Panchayat have any power or authority to elect any Chairman of their meeting if the President of the Bombay Parsi Panchayat is present at the meeting by removing the President and appointing someone else in his place or otherwise?
(3) Whether the Trustees of the Bombay Parsi Panchayat have the power under the Scheme or otherwise to prevent the senior most Trustee from assuming the office of the President without modification of the present scheme?
(4) Whether the resolutions purported to be passed by the defendant Nos. 2 to 5 at the meeting held on 30th March, 1993 are valid and/or proper and/or effective?
2. The plaintiff Nos. 1 and 2 and the defendant Nos. 2 to 5 are the Trustees of the Funds and immovable properties of the Parsi Panchayat of Bombay. On March 25, 1993, the President of the Trust Dr. Aspi Golwala tendered his resignation. According to the plaintiffs, the President of the Board of Trustees has, by long usage and practice, been the senior most trustee and that the Trustees never had the power to appoint or elect the President of the Bombay Parsi Panchayat. Therefore, according to the plaintiffs, after the resignation of Dr. Golwala, the office of the President automatically devolved upon the senior Trustee i.e. the defendant No. 1. However, at the meeting held on March 30, 1993, the defendant No. 3 proposed and the defendant No. 2 seconded that the defendant No. 4 should chair the meeting. The plaintiff Nos. 1 and 2 and the defendant No. 1 then raised an objection that according to the provisions of the Scheme and by settled convention, the senior most Trustee automatically became the President and by virtue of Rule 69 of the Scheme, he was the only person entitled to chair the meeting. Notwithstanding the objection raised by the plaintiffs Nos. 1 and 2 and defendant No. 1, a resolution came to be passed to appoint defendant No. 4 "as temporary Chairman to conduct the meeting till the President of the Bombay Parsi Panchayat is elected." Thereafter, the defendant No. 3 proposed the following resolution, which was seconded by the defendant No. 2:
"Mr. E.B. Desai shall not continue as temporary Chairman of this meeting and further more shall not occupy the office of the President of the Bombay Parsi Panchayat, and Mr. M.R. Shroff be and is hereby appointed as temporary Chairman to conduct the meeting."
This resolution was carried by majority. Thereafter, the defendant No. 2 proposed and the defendant No. 5 seconded the resolution "that Mr. J.N. Guzder (defendant No. 3) be and is hereby appointed as the President of the Bombay Parsi Panchayat for the term of his office as Trustee. "The defendant Nos. 2 to 5 voted for the resolution. The plaintiff Nos. 1 and 2 and defendant No. 1 objected to the legality and validity of the resolution and also voted against the same. The resolution was carried by majority of 4 : 3. Thus the defendant No. 3 came to be appointed as the President of the Trust.
3. It is the case of the plaintiffs that by long usage, convention and custom, which is deemed to be incorporated in the scheme, the senior most Trustee for the time being automatically assumes the office of the President, and in that view of the matter, it is beyond the competence of a majority of the Trustees or even all the Trustees to modify the Scheme or to change the aforesaid convention, custom and usage and thereby altered the scheme by passing the aforesaid resolutions. The plaintiffs have relied upon the past practice and convention from 1931 to 1993. In Para 16(b) of the plaint, the plaintiffs have furnished the particulars of the appointments made in the past from 1931 t
