Ramaswami Gounder, J.-This appeal has been preferred by the plaintiffs, whose suit against the United India Life Assurance Co., Ltd., as the first defendant and its directors, defendants 2 to 7, and the Official Trustee of Madras, defendant 8, was dismissed by the City Civil Judge. The plaintiffs prayed for two reliefs: (1) declaring that the first defendant-Company and its directors, defendants 2 to 7 are not entitled to invest the funds belonging to the policy-holders’ trust-fund in the construction of any building in Mount Road, Madras and (2) restraining defendants 1 to 8 by a permanent injunction from applying, expending or appropriating any monies belonging to the policy-holder’s trust-fund for the construction of any such building.

The first defendant-Company is a limited liability Company, incorporated about the year 1906, for the purpose of carrying on the business of life insurance. About 1927, the subscribed share capital of the Company was about Rs. 70,000; but most of the shares were then held by Sri M.Ct. Muthiah Chettiar. It therefore appeared that the Company was dominated by that gentleman and was an one man’s show. Though the share capital of the Company was comparatively small, the assets and the funds of the Company amounted to about 20 lakhs. Naturally, therefore, an agitation was stated by the policy-holders to rescue the Company from the control of that one gentleman and to devise ways and means for protecting their interests and safeguarding he monies of he Company. The Company had to yield to the agitation and the pressure of the share holders, with the result that with effect from 1st January, 1927, a separate fund called the Policy-holders’ Trust-fund was created; and the necessary amendments to the Articles of Association were carried out by incorporating therein Articles 110 to 125.

Article 110 provided that the Company shall with effect from 1st January,. 1927, maintain a separate account called the policy-holders’ trust-account, and the fund relating to the said account be called Policy-holders’ Trust-fund. That fund was to be kept distinct and separate from the o’her assets of the Company, so as always to constitute and remain the security of the policy-holders of the Company exclusively. Article 111 provided that that fund shall not under any circumstances be liable for any contracts or liabilities of the Company other than those expressly mentioned in Article 118. Article 112 provided that the directors of the Company shall control, administer and manage the. investments, funds and assets of the Policy-holders’ Trust-fund in accordance with the provisions of these articles. It further provided that the directors shall have power to appoint, with the previous sanction of the general meeting of the members, any person as a trustee to hold and administer the said trust-fund, but subject to the regulation of any trust-deed executed by them from time to time for and on behalf of the Company. Articles 113, 114, and 115 prescribed the amounts that shall constitute or go into the trust-fund, in particular, 85 per cent, of all the premia excluding the premia receivable for the first year. Articles 116 and 117 provided for investment of the trust-fund by the directors. For the purpose of this case, it will be necessary to note that the directors had power under clause (a)(1)(i) of Article 116 by a unanimous resolution to invest the funds “in the purchase of house-property”. Article 117 provided for certain investments with the sanction of the Court. Article 118 is important for, it enumerated the items of expenditure charged upon the trust-fund, it may be noted that the items of expenditure provided for under clauses (a), (b) and (c) of that article are solely for the benefit of the policy-holders; clause (d) is for the benefit of the shareholders, and clause (e) for the policy-holders and shareholders, and clauses (f) and (g) for the benefit of the Company. Articles 119 to 123 dealt with “the general fun

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