Disputes arising under the Indian Trusts Act are not arbitrable and fall under the exclusive jurisdiction of civil courts.

JUDGMENT :

1. Both suits seek the relief’s of, (i) declaration as null and void, inoperative, unenforceable and contrary to public policy of India of the arbitration agreement contained in Clause 36 of the Restated Trust Deed dated 9th April, 2014 (Trust Deed); (ii) declaration as null and void, unenforceable and contrary to public policy of India of the Application for Emergency Measures filed by defendant No.1 in both the suits and referred to as ICC Case No.25137/HTG(EA); (iii) permanent injunction restraining the defendant No.1 Lalit Modi, in both the suits, from prosecuting or continuing with the Application for Emergency Measures and/or from instituting or proceeding with any arbitration proceedings against the plaintiff/plaintiffs in both the suits, under Clause 36 of the Trust Deed; and, (iv) directing the International Chambers of Commerce to enforce the order passed in terms of the aforesaid prayers.

2. The suits, being in the nature of anti-arbitration injunction suits and, (A) a three Judge Bench of the Supreme Court in Kvaerner Cementation India Limited Vs. Bajranglal Agarwal (2012) 5 SCC 214, followed by the undersigned in several judgments, having taken a view that “bearing in mind the very object with which the Arbitration and Conciliation Act, 1996 has been enacted and the provisions thereof contained in Section 16 conferring the power on the Arbitral Tribunal to rule on its own jurisdiction, including ruling on any objection with respect to existence or validity of the arbitration agreement, we have no doubt in our mind that the civil court cannot have jurisdiction to go into that question”; (B) the suits being accompanied with applications for interim relief seeking to restrain the defendant No.1 from instituting or continuing with ICC arbitration; and, (C) the counsel for the defendant No.1 having appeared on caveat to oppose the very admission of the suits, the senior counsels for the plaintiff/s and the senior counsels for the defendant No.1 were heard from 1030 hours to 1320 hours and again from 1600 hours to 1640 hours, orders on admission of suits were reserved on 27th February, 2020, when the suits had come up first before this Court.

3. The facts, insofar as necessary on the aspect of maintainability of the suits, may be recorded as under:

(i) Charu Modi (Charu), Lalit Modi (Lalit) and Samir Modi (Samir) are the children of K.K. Modi (KK) and Bina Modi (Bina);

(ii) CS(OS) 84/2020 has been filed by Bina against Lalit, with Charu and Samir as proforma parties thereto;

(iii) CS(OS) 85/2020 has been instituted by Charu and Samir against Lalit, with Bina as a proforma party thereto;

(iv) both suits are otherwise identical and the counsels have been heard with reference to CS(OS) 84/2020;

(v) the Trust Deed was executed at London by KK as settlor/managing Trustee and Bina, Lalit, Charu and Samir as Trustees, and in pursuance to oral family settlement recorded in the Oral Family Settlement dated 10th February, 2006 between them and in supersession of the earlier Trust Deed dated 10th February, 2006 (Original Trust Deed) of constitution of K.K. Modi Family Trust (Trust);

(vi) Clauses 3.2, 3.3, 4 & 36 of the Trust Deed were/are as under:

“3.2. In the event of Mr. K.K. Modi ceasing to be the Managing Trustee on his demise or in accordance with Clause 26 hereof, Miss. Bina Modi shall forthwith and without any further action assume the office of the Managing Trustee.

3.3 Save and except where it is specifically provided otherwise, both Mr. K.K. Modi and Mrs. Bina Modi as the Managing Trustees shall have the powers the day to day administration, execution and management of the Trust, the assets forming part of the Trust fund including Family Controlled Businesses, to execute all documents, writing, deeds agreements etc. that may be required to be executed for and on behalf of the Trust; to assign, sell, exchange, distribute or dispose of any of the properties or income or any part thereof of the Trust and generally all othe