High Court of Judicature at Madras
THE HONOURABLE MR. JUSTICE A. SUBBULAKSHMY
P.S. Subramanian
Versus
K.L. Lakshmanan & Others
A.S. No. 807 of 1983 & C.M.P. No. 685 of 1995
Decided On :Decided on : 10-07-1997
TRUST - ADMINISTRATION - SUIT FOR DECLARATION OF INVALIDITY OF TRUST DEED - MAINTAINABILITY - LEAVE OF COURT UNDER SECTION 92 OF CPC - NECESSITY - TRUSTEES - POWER TO NOMINATE SUCCESSOR - VALIDITY OF NOMINATION - CHARITIES - POWER TO CREATE NEW CHARITIES - VALIDITY OF NEW CHARITIES.
Fact of the Case:
Plaintiff, as Managing Trustee of "Srimathi Sakuntala Ammal Estate Trust", filed a suit for declaration that the 1st defendant was not a validly nominated or appointed Trustee, that the 2nd defendant had abandoned his rights as a Trustee, and that the deed of trust dated 5.12.1963 was invalid. The defendants contended that the suit was barred under Section 92 of the Code of Civil Procedure (CPC) as leave of the Court was not obtained for filing the suit.
Finding of the Court:
The Court held that the suit was barred under Section 92 of the CPC as the plaintiff had not obtained the leave of the Court before filing the suit. The Court further held that the nomination of the 1st defendant as a Trustee by the 2nd defendant was valid as per the terms of the original trust deed dated 11.3.1940, which gave the Trustees the right to nominate their successors. The Court also held that the deed of trust dated 5.12.1963, which created new charities, was not valid as the Trustees had no power to create new charities under the original trust deed.
Issues: 1. Whether the suit was barred under Section 92 of the CPC for want of leave of the Court? 2. Whether the nomination of the 1st defendant as a Trustee by the 2nd defendant was valid? 3. Whether the deed of trust dated 5.12.1963, which created new charities, was valid?
Ratio Decidendi: 1. Section 92 of the CPC requires that in the case of any alleged breach of any express or constructive trust created for public purposes of a charitable or religious nature, the Advocate-General or two or more persons having an interest in the Trust and having obtained the leave of the Court may institute a suit for various reliefs, including the removal of a Trustee, the appointment of a new Trustee, and the direction of accounts and inquiries. In the present case, the plaintiff had not obtained the leave of the Court before filing the suit, and therefore the suit was barred under Section 92 of the CPC. 2. The original trust deed dated 11.3.1940 gave the Trustees the right to nominate their successors. The 2nd defendant had nominated the 1st defendant as his successor, and this nomination was valid as per the terms of the trust deed. 3. The Trustees had no power to create new charities under the original trust deed. The deed of trust dated 5.12.1963, which created new charities, was therefore not valid.
Final Decision: The Court dismissed the plaintiff's suit as barred under Section 92 of the CPC. The Court also held that the nomination of the 1st defendant as a Trustee by the 2nd defendant was valid and that the deed of trust dated 5.12.1963, which created new charities, was not valid.
1. This appeal is against the judgment passed by II Additional Subordinate Judge, Madurai in O.S. No. 593 of 1981.
2. The Plaintiff is the appellant. The case of the plaintiff is as follows:
The Plaintiff and third defendant N.K. Kuppian are the Trustees of “Srimathi Sakuntala Ammal Estate Trust”. The Plaintiff is the Managing Trustee and third defendant is another Trustee who is an Ex-Officio Trustee. The second defendant was the second trustee. The affairs of “Srimathi Sakuntala Ammal Estate Trust” is thus managed by three Trustees.
3. Late Sakuntala Ammal, wife of Puliyadi S. Rajaramaier, executed a Deed of Trust and Settlement dated 11.3.1940, under which the appointed three Trustees are:
a. Puliyadi N.R. Sundararamaier b. K.N.Sr.K. Lankaramaier c. The President of the Sourashtra High School Council Ex-Officio.
The three trustees were vested with all the properties and money in the Trust with a direction to administer and manage them; realise all the rent, profits and income and invest and improve the same as they think best; to pay her Rs. 75-00 for maintenance of herself, and her children; Trustees shall endow and devote all the properties that remain at the time of her death. The plaintiffs father P.N.R. Sundara Ramaier, who was the first trustee shall keep and maintain a true and correct account of the Estate. After her death, the first and second trustees then in possession and management shall have the right severally to nominate each his successor. The items of charities to be performed are set out in the Deed as follows:
a. To provide sufficient space for the residence of pregnant ladies after delivery;
b. To distribute dhoties, towels etc. to poor Saurashtra Students studying in Saurashtra High School:
c. To Provide scholarship to those studying for Doctor, Engineer, Spinning and Weaving, dyeing courses or the Trustees were empowered to spend regarding Education as they think fit.
So, as per Trust deed dated 11.3.1940 income from the Trust properties have to be utilised for the purposes of Education mainly. The deed is a Registered one and it was acted upon.
4. Sakuntala Ammal died in or about 19.11.1946. After her death the then Trustees without duly giving effect to the intentions of the Donor and contrary to the express desire expressed by the Donor in the deed dated 11.3.1940, the Ist Trustee & Managing Trustee, namely the plaintiffs father and father of the defendants 1 and 2 and then President of the Sourashtra High School Sri N.M.R. Krishnamoorthy brought into existence a deed of declaration of Trust dated 5.12.1963 creating new items of charities to be performed from out of the income of the Trust properties namely;-
i) To convert the building in Manjanakara Street, Madurai as a Marriage Hall;
ii) Income from the other property has to be utilised for meeting the Marriage Hall;
iii) To perform Samaradhanai at an expense of Rs. 400.00 on the death Anniversary of Sakuntala Ammal;
iv) To manage the property every 3 years either by the father of the defendants 1 and 2 or by the plaintiffs father-Turn system.
v) Trustee to nominate his successor;
vi) To put up construction over Manjanakara Street House.
5. Thus by this deed the Trustee deviated and brought into existence new items of charities which were never intended by the founder Sakuntala Ammal. She never intended that a sum of Rs. 400/-to be spent on Anniversary day of her death. She never intended separate management of the Trust properties for a period of 3 years in Turn Trustees System. The deed dated 5.12.63 is thus a new one. The Trustees have no power to bring into existence a new deed. The deed dated 5.12.1963 is therefore not valid and binding upon the Trust and is not an operative document. Sakuntala Ammal Estate Trust has to be administered only by the terms of the Trust deed dated 11.3.1940.
6. In pursuance of the wishes of the donor in the 1940 deed the plaintiffs father P.N.R. Sundararamaier nominated the plaintiff as his successor by his
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