HIGH COURT OF JUDICATURE AT MADRAS
M. JAICHANDREN & M.M. SUNDRESH, JJ.
B. Ramachandra Adityan also known as B.R. Adityan & Another
Versus
B. Sivanthi Adityan (Deceased) also known as B.S. Adityan & Others
Original Side Appeal Nos. 427 to 437 of 2012
Decided on: 08-07-2013
TRUST - PUBLIC TRUST - SCHEME FOR ADMINISTRATION - LEAVE TO SUE - SECTION 92, CIVIL PROCEDURE CODE - PERSONS INTERESTED - MALA FIDES - CAUSE OF ACTION - ISSUE ESTOPPEL - JOINDER OF PARTIES - NECESSARY AND PROPER PARTIES - COMPANIES INCORPORATED UNDER COMPANIES ACT - RELIEF AGAINST TRUSTEES AND COMPANIES - ISSUE ESTOPPEL - DELAY IN DISPOSAL OF CASES.
Fact of the Case:
The appellants, father and son, sought to frame a scheme for the administration of a public trust. They filed an application under Section 92 of the Civil Procedure Code (CPC) for leave to sue. The respondents, trustees of the trust and concerns owned by some of them, opposed the application. The learned single Judge dismissed the application and allowed the applications filed by the respondents. The appellants challenged this order before the High Court.
Finding of the Court:
The High Court held that the appellants were 'persons interested' in the trust and had mala fides. It also held that the suit was barred by issue estoppel and that the companies incorporated under the Companies Act were not necessary or proper parties. The High Court allowed the appeals and set aside the order of the learned single Judge.
Issues: 1. Whether the appellants were 'persons interested' in the trust and had mala fides? 2. Whether the suit was barred by issue estoppel? 3. Whether the companies incorporated under the Companies Act were necessary or proper parties?
Ratio Decidendi: 1. The High Court held that the appellants were 'persons interested' in the trust and had mala fides. The High Court relied on the judgment of the Division Bench in O.S.A.No.54 of 1996 etc., dated 16.07.1996, which had held that the appellants were 'persons interested' and had mala fides. 2. The High Court held that the suit was not barred by issue estoppel. The High Court held that the order passed by the learned single Judge in the earlier suit was not a final order and, therefore, did not operate as res judicata. The High Court also held that the cause of action in the present suit was different from the cause of action in the earlier suit. 3. The High Court held that the companies incorporated under the Companies Act were necessary and proper parties. The High Court held that the companies were controlled by the respondents and that the funds of the trust were being diverted to the companies.
Final Decision: The High Court allowed the appeals and set aside the order of the learned single Judge.
M.M. Sundresh, J.
1. These Original Side Appeals have been filed challenging the Order dated 27.08.2012 passed in A.No.1163 of 2011 in C.S.D.No.7665 of 2011, A.Nos.2032 of 2011, 2038 of 2011 to 2040 of 2011 and 2188 to 2193 of 2011 in C.S.D.No.7665 of 2011.
2. The appellants started their legal journey thirty years ago. At times they succeeded in small battles but the war did not even begin as the suit is yet to be opened up. The eventful journey has come a full circle. At present, the appellants stand once again at the very starting point of their tiring journey. However, unrelented and undaunted, they once again seek to take a fresh guard to start the voyage through this Court.
3. Background Facts:-
3.1. The background facts covering the case requires a proper narration as it involves a chequered history. The appellants are the father and the son deo. The father of the first appellant was the founder-Trustee. The entire disputes revolves around the proper administration of the Trust, which is a public Trust, having its own object to serve the public in general. The respondents are Trustees and concerns said to be owned by some of them, which according to the appellants are created and being run through the diversion of the Trust funds meant for public purpose.
3.2. The first appellant started the legal proceedings in the year 1978. Thereafter, an application was filed by the second appellant in Application No.165/81 on the ground that he along with his younger brother were very much interested in the Trust and its administration. The proceeding initiated by the second appellant along with his brother was terminated for the non compliance of Order XI Rule 21(1) of Civil Procedure Code (hereinafter referred to as "C.P.C."). Thereafter an application was filed by the first appellant along with others seeking leave to file a suit under Section 92 of the CPC. A Division Bench of this Court granted leave which was duly confirmed by the Apex Court. Two lawyers sought themselves to be impleaded before the Honourable Division Bench which was acceded to. They dropped out and consequently an application was filed by some of the respondents herein under Order VII Rule 11 of CPC to reject the plaint as the sanction granted by way of consent will have to necessarily encompass all such persons to whom it was given. The Division Bench upheld the contentions on the part of the respondents herein/Trustees, who filed the application under Order VII Rule 11 of CPC and accordingly, rejected the plaint. When a challenge was made before the Apex Court, the Special Leave Petition was dismissed as withdrawn with liberty to avail such remedy as may be available in law.
3.3. The second appellant joined his father in instituting a fresh suit under Section 92 of CPC by seeking leave. It was opposed by some of the respondents. They also filed applications to dismiss the leave to sue application and the proposed plaint. Applications have been filed by others to strike out their names in the proposed plaint and the leave application on the ground that they being strangers, the suit is not maintainable in law and facts as against them under Section 92 of the Code of Civil Procedure. The learned single Judge dismissed the application filed for leave and consequently, allowed the applications filed by respondents. Challenge is made by the appellants against these proceedings before us. During the course of hearing, the second respondent died and necessary amendments have been made by the appellants by way of substitution.
4. Heard Mr. H.Karthik Seshadri, learned counsel appearing for the appellants, Dr. Abhishek Manusinghvi, learned Senior counsel for Mr. V.Shanmugam, learned counsel appearing for respondents 2 and 3, Mr. R.Thiagarajan, learned Senior Counsel for Mr. V.G. Sureshkumar, learned counsel appearing for respondents 7, 9 to 11, perused the records and the written submissions filed by the parties.
5. Findings of the learned Single Judge:-
5.1.
B.S. ADITYAN V. B.R. ADITYAN (2004) 9 SCC 720)
BISHWANATH V. RADHA BALLABHJI (AIR 1967 SC 1044)
SUGRA BIBI V. HAJI KUMMU (AIR 1969 SC 884)
CHARAN SINGH V. DARSHAN SINGH (AIR 1975 SC 371)
Paramatmanand Saraswtahi v. R. Trtpathi (AIR 1974 SC 2141)
Charan Singh v. Darshan Singh (AIR 1975 SC 371)
Madappa v. Mahanthadevaru (AIR 1966 SC. 878).
Vaithianatha Aiyar v. S. Tyagaraja Aiyar (1921) 41 M.L.J. 20)
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