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2000 Supreme(Mad) 1044

High Court of Judicature at Madras
THE HONOURABLE MR. JUSTICE C. NAGAPPAN
Sahruvan Nachiar and Another, Plaintiffs - Appellant
Versus
V. S. Mohamed Hussain Maracaiar, Defendants - Respondents
Appeal Suit Nos. 45 and 191 of 1958
Decided On : 30 October 2000

Appearing Advocates:G, Rajan, Plaintiffs, G. Kathirvelu, Defendant, Advocates.

A British citizen can hold property in India and function as trustee.

Headnote:Foreign Exchange Regulation Act, 1973-Section 31-A British citizen whether can hold property in India and function as trustee.

Judgement Key Points

Key Points: - The suit discusses whether the plaintiff, a British citizen residing in London, can continue as trustee of trust properties in India under Section 31 of the Foreign Exchange Regulation Act, 1973. (!) (!) (!) - The judgment evaluates possession and administration of trust properties by a trustee who is allegedly not an Indian citizen and resides abroad, and whether he can hold or manage immovable property in India. (!) (!) (!) - The court assesses recovery of possession of the Schedule A house property by the plaintiff-trustee against the defendants, including allegations of occupancy and rightful possession. (!) (!) (!) - The decision determines which heir is fit to be trustee among male heirs and whether the second defendant (an Indian resident) is best suited to maintain the properties. (!) (!) (!) - The settlement deed Ex. A4 requires personal charity duties and accounting by the trustee; the plaintiff’s non-residency and non-performance are evaluated. (!) (!) - The court concludes with implications on trustee eligibility and possession, enhancing relief in favor of the appropriate heir. (!)

What is the eligibility of a British citizen to hold property in India and act as trustee under the Foreign Exchange Regulation Act, 1973?

What is the validity of trusteeship and possession rights when the alleged trustee resides outside India and holds property in India?

What are the criteria to determine fitness of a defendant as trustee and the entitlement to recover possession of trust property?


Judgment :-

These two appeals arise out of a common judgment passed by the Subordinate Judge, Nagapattinam in O.S. Nos. 36/86 and 112/86 dated 11-11-1987.

2. The suit in O.S. No. 36/86 was filed for declaration that the suit property is a Muslim Charitable Property and the plaintiff is the sole trustee of the same and for recovery of possession of the suit property from the defendants. The suit in O.S. No. 112/86 was filed for removing the first defendant as trustee of the suit property, declaring the second and third defendants as unfit to hold the post of trustee, declaring the plaintiff as the proper trustee of the suit property and for recovery of possession of A schedule property from the first defendant.

3. The trial Court, by a common judgment, decreed the suit in O.S. No. 36/86 as prayed for with costs and dismissed the suit in O.S. No. 112/86 with costs. Aggrieved by the same, the defendants in O.S. No. 36/86 preferred an appeal in A.S. No. 45/88 and the plaintiff in O.S. No. 112/86 preferred an appeal in A.S. No. 191/88 before this Court.

4. The plaintiff in O.S. No. 36/86 has stated as follows :-

The plaintiff is the son of Fathima Beevi, the fourth wife of late V. Sheik Ismail Maracaiar. The first defendant is the wife of late Mohamed Yousuf Maracaiar. The second defendant is the son of the first defendant. Late Mohamed Yousuf Maracaiar was the brother of the plaintiff. He passed away in 1971. The brothers and sisters of the plaintiff viz., Mohamed Thambi Maracaiar, Mohamed Yousuf Maracaiar, Rabiyath Nachiar, Habeeth Kani Nachiar died in 1970, 1979, 1949 respectively. Mohamed Haneef Maracaiar was the fifth son of late Sheik Ismail Maracaiar and he passed away in 1978. The plaintiff is the fourth son of late Sheik Ismail Maracaiar and is the only male legal heir who is alive. Late Sheik Ismail Maracaiar executed a registered Settlement Deed on 16-2-1931. The properties mentioned in the settlement deed are the suit properties and other properties and as per the recitals therein, the income from the properties have to be utilised for the charities mentioned therein and the remaining have to be equally divided among the heirs. As per the recitals in the deed, after the death of Sheik Ismail Maracaiar, the male heirs have to administer the properties. The plaintiff, being the only living son of Late Sheik Ismail Maracaiar, is managing the suit properties and other properties as trustee and the defendants have no right in the suit properties. The defendants vacated the house in which they were living and requested the plaintiff in the month of May 1978 to permit them to reside in the suit property for some time, and they promised to vacate the house in a short time. The defendants were permitted to occupy the suit property in T. S. No. 756 and they did not keep their promise and on the other hand they quarrelled with the plaintiff. Hence the plaintiff has filed the suit.

5. The defendants filed written statement stating that the plaintiff's father died in the year 1971 and after his death, the first defendant's husband Yousuf Maracaiar administered the trust in a proper way till his lifetime. The plaintiff is not entitled to trusteeship since he is the permanent citizen of United Kingdom. He is not an Indian citizen and he is not entitled to manage the trust as a trustee or to file the suit as a trustee claiming reliefs in respect of the trust properties. Even before 1971, the plaintiff was a resident of London and he used to come to India once in three years for short stay. Taking advantage of the fact that the first defendant was a widow and the second defendant was a young man, the plaintiff has manoeuvred to transfer the registry of the property in his name. The plaintiff has not distributed the income after 1971 even though he was collecting the rent from the property. The said house has been in the possession of the defendants' family for a quite long time. The first defendant's husband was born in the suit house and he

































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