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2006 Supreme(Cal) 530

High Court Of Calcutta
Arun Kumar Bhattacharya, J.
BASANTI SEAL - Appellant
Versus
HIRALAL SEAL - Respondent
Suit 729 Of 1977
Decided On : 08/22/2006

Advocates Appeared:
ANIL DHAR, B.K.BACHAWAT, BANNI ROY CHAUDHARY, RUPOBRATA KUMAR, Surajit Nath Mitra

A trust deed containing a power of revocation and appointment is valid if it complies with the requirements of section 6 of the Trusts Act and the rule against perpetuity does not apply. The trustees can exercise the power of appointment to appoint beneficiaries and exclude a son who is not entitled to be a beneficiary. The challenge to the validity of the trust deed and deeds of appointment is barred by the principles of res judicata and constructive res judicata if the validity of the deeds has been previously challenged in a prior suit.

Headnote:

TRUST - Validity - Trust deed containing power of revocation and appointment - Trustees exercising power and appointing two sons as beneficiaries - Plaintiff, another son, challenging validity of trust deed and deeds of appointment - Court holding trust deed and deeds of appointment valid - Plaintiff not a beneficiary - Suit dismissed.

Fact of the Case:

Plaintiff, son of settlor, challenged the validity of a trust deed executed by his father and mother, as well as two deeds of appointment executed by the trustees. The trust deed provided that the trustees would hold the trust properties in trust for such of their sons and/or son's sons and/or son's son's sons as they jointly during their lifetime or after the death of either of them the survivor shall by any deed or deeds with or without power of revocation and new appointment may determine. The deeds of appointment appointed the plaintiff's two brothers as beneficiaries and excluded the plaintiff. The plaintiff claimed that the trust deed was invalid for ambiguity, lack of provision for bequeathing property to an unborn person, and violation of the rule against perpetuity. He also argued that the deeds of appointment were invalid as the trustees had no power to exclude one of the sons.

Finding of the Court:

The court held that the trust deed was valid as it complied with the requirements of section 6 of the Trusts Act and the rule against perpetuity did not apply. The court also held that the deeds of appointment were valid as the trustees had the power to appoint beneficiaries and the plaintiff was not entitled to be a beneficiary. The court further held that the plaintiff's challenge to the validity of the trust deed and deeds of appointment was barred by the principles of res judicata and constructive res judicata, as the validity of the deeds had been previously challenged in a prior suit.

Issues: 1. Whether the trust deed was valid. 2. Whether the deeds of appointment were valid. 3. Whether the plaintiff was a beneficiary under the trust. 4. Whether the plaintiff's challenge to the validity of the trust deed and deeds of appointment was barred by the principles of res judicata and constructive res judicata.

Ratio Decidendi: 1. The trust deed was valid as it complied with the requirements of section 6 of the Trusts Act and the rule against perpetuity did not apply. 2. The deeds of appointment were valid as the trustees had the power to appoint beneficiaries and the plaintiff was not entitled to be a beneficiary. 3. The plaintiff's challenge to the validity of the trust deed and deeds of appointment was barred by the principles of res judicata and constructive res judicata, as the validity of the deeds had been previously challenged in a prior suit.

Final Decision: The suit was dismissed.

( 1 ) IN this suit, the original plaintiff Subol Charan Seal, since deceased and substituted by heirs, has prayed for a declaration that the deed dated 28. 12. 56 executed jointly by Radheshyam Seal and Sabitri Seal and deed dated 17. 12. 62 executed by Sabitri Seal are inoperative, null and void, for partition and other reliefs.

( 2 ) SHORTLY put, and shorn of details, the plaintiffs' case is that radheshyam Seal, father of the original plaintiff Subol Charan Seal, hereinafter referred to as the plaintiff, and defendant. No. 1 Parbati Sankar seal, since deceased and substituted by heirs, and defendant No. 2 Hiralal seal, who was the owner of immovable properties, as described in schedule 'a' and movable properties, as described in schedule 'b' to the plaint, executed a deed of settlement/trust on 01. 09. 37 in respect of three properties, as described in schedule 'a', providing that he and his wife sabitri seal would act as joint trustees thereof and they may reside in the trust property at 4, Krishna Behari Sen Street, Calcutta and collect rents, profits and interest income and use the same for their benefit in equal shares. After the death of either of them the surviving trustee would act in terms of the stipulations of the trust deed. Thus trust properties would be held by them in trust for such of their sons and/or son's sons and/or son's son's sons in such shares and in such manner as they jointly during their lifetime or after the death of either of them the survivor shall by any deed or deeds with or without power of revocation and new appointment may determine. After their death there would be no trustee, and in default of any such appointment of any trustee their sons will get the trust properties absolutely and in equal shares. The said deed did not incorporate any provision of appointment of any other trustee or trustees and revocation of the trust. The said Radheshyam and Sabitri held the trust properties in trust for the beneficiaries i. e. their sons defendant Nos. 1 and 2 and the plaintiff, and the daughters viz defendant Nos. 4 to 6 were not and are not beneficiaries under the deed.

( 3 ) ON or about 28. 12. 56 the joint trustees Radheshyam and Sabitri executed a deed of appointment stating that they would hold the trust properties at 4, Krishna Behari Sen Street, Calcutta, hereinafter referred to as Calcutta property (item No. 1 of schedule 'a') and at Jasidih (item No. 2 of schedule 'a') in trust for defendant Nos. 1 and 2 absolutely and for ever, declaring most improperly that the plaintiff would not get and has no right, title and interest in the said properties, without assigning any reason therefor. Shortly after the death of Radheshyam on 25. 06. 62, the surviving trustee Sabitri executed another deed of appointment on 17. 12. 62 stating that she would hold the trust property at Chinsurah, Hooghly (item No. 3 of schedule 'a') in trust for defendant Nos. 1 and 2 absolutely and for ever, declaring most illegally and arbitrarily that the plaintiff would have no right, title and interest in the said property. Sabitri died on 26. 02. 75 without appointing any trustee or trustees.

( 4 ) THE joint trustees did not act in accordance with the provisions of law relating to the trust properties and did not discharge their duties as trustees to protect the interest of the beneficiaries of the trust properties. The joint trustees instituted a suit being Suit No. 708/62 in this Court for eviction of the plaintiff from the Calcutta property with some wild and false allegations alleging him as licensee, without any cause which is still pending. The plaintiff had all along been living with his perents and brothers jointly in the Calcutta property till the end of December, 1956 when he was forced to live separately there with his wife and children at the instigation of defendant Nos. 1 and 2. No deed of revocation was ever executed by the said joint trustees either jointly or severally. Under the trust deed the plaint



























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