Back
2019 Supreme(Mad) 34
IN THE HIGH COURT OF JUDICATURE AT MADRAS
M.V. MURALIDARAN, J.
P.Rajasekar and Ors - Appellants
Versus
Prem Educational Trust and Ors - Respondent
C.M.A. Nos.2724 and 2739 of 2018 and CMP.Nos.20600 and 20773 of 2018
Decided on : 24-01-2019
Advocate Appeared:
For the Appellants : Mr.V.Raghavachari
For the Respondents: Ms.S.Thamizharasi
Headnote:
trusteeship - Civil Procedure Code - Order 39 Rule 1 and 2 - 15, 17, 18, 19, 20, 21, 22, 23, 24, 25, 26, 27, 28, 29, 30, 31, 32, 33, 34, 35, 36, 37, 38, 39, 40, 41, 42, 43, 44, 45, 46, 47, 48, 49, 50, 51, 52, 53, 54, 55 - The court dismissed the plaintiffs' petitions for injunction as they failed to establish a strong prima facie case, balance of convenience, and irreparable loss in their favor. The court directed the trial court to dispose of the suits independently on merits as expeditiously as possible.
Fact of the Case:
The plaintiffs sought various reliefs including declaring a resolution removing them from trusteeship as null and void, and interim injunctions to collect fees and prevent the defendants from interfering with their function as trustees. The defendants alleged misappropriation of trust funds and removal of the plaintiffs due to adverse actions.
Finding of the Court:
The court found that the plaintiffs failed to establish a strong prima facie case, balance of convenience, and irreparable loss in their favor to grant the injunctions. The court also directed the trial court to dispose of the suits independently on merits as expeditiously as possible.
Issues: The main issues revolved around the removal of the plaintiffs from trusteeship, alleged misappropriation of trust funds, and the granting of interim injunctions.
Ratio Decidendi: The court held that for the grant of temporary injunction, a strong prima facie case, balance of convenience, and irreparable loss or injury are basic requirements. The court also emphasized that interim mandatory injunctions should only be granted in exceptional cases.
Final Decision: The Civil Miscellaneous Appeals were dismissed, and the trial court was directed to dispose of the suits independently on merits as expeditiously as possible.
1. These Civil Miscellaneous Appeals have been filed against the order dated 24.10.2018 passed in I.A.Nos.62 and 63 of 2018 in O.S.No.10 of 2018 on the file of the III Additional District Court, Vellore @ Tirupattur.
2. Since the issue involved in the appeals are one and the same and also the parties are one and the same, both the appeals were heard together and disposed of by this common judgment. For the sake of convenience, the parties are referred to as per their array in the suit.
3. The appellants are plaintiffs and the respondents are defendants in the suit. The plaintiffs have filed the suit seeking the following reliefs:
(a) Declaring the Resolution dated 05.11.2017 allegedly passed by the defendants 2 to 6 removing the plaintiffs from the trusteeship of the 1st defendant trust, as null and void, arbitrary, contrary to law, the registered trust deed and in violation of principles of natural justice.
(b) Declaring the supplemental deed of trust registered on 09.11.2017 as Document No.70/2017 as null and void.
(c) Declaring and restoring the 1st plaintiff as founder trustee for life of the 1st defendant trust as well as the plaintiffs 2 to 5 as trustees.
(d) Permanent injunction restraining the defendants 2 to 6, their men, agents and subordinates or any one claiming through them fro preventing the plaintiffs from discharging their function as trustee of the 1st defendant trust.
(e) Mandatory injunction to the defendants 2 to 6 to collect fees from students admitted to future school during the ensuing academic year 2018-19 only through the Bank account maintained by the 1st defendant trust in State Bank of India, Main Branch with Account No.33850373275 and to submit proper accounts for such fees.
(f) Directing the 2nd to 6th defendants jointly and severally to pay a compensation of Rs.10,00,000/- (Rupees Ten Lakhs only) as damages for the pain, mental agony and harassment caused to the plaintiffs.
(g) Directing the 2nd to 6th defendants to pay cost.
4. Along with the suit, the plaintiffs have filed I.A.Nos.62 and 63 of 2018 for interim injunctions. The prayer sought for in the aforesaid Interlocutory Applications is as under:
(i) I.A.No.62 of 2018 seeking ad interim mandatory injunction to the defendants 2 to 6 to collect fees from students admitted to Future School during the ensuing academic year 2018-19 only through the Bank account of the 1st defendant trust maintained in State Bank of India, Ambur Main Branch with Account No.33850373275 and to submit proper accounts for such fees.
(ii)I.A.No.63 of 2018 seeking interim injunction restraining the defendants 2 to 6, their men, agents and subordinates or any one claiming through them from preventing the plaintiffs from discharging their function as trustee of the 1st defendant trust.
5. The case of the plaintiffs as stated in the affidavit filed in support of the Interlocutory Applications is as follows:
The 1st plaintiff is the founder of the 1st defendant trust and 1st plaintiff appointed himself as the Chairperson of the Board of Trustees for life. The Board of Trustees by a majority resolution remove any trustee from the trust if such trustee failed to abide the rules and regulations of the trust or acted in any manner adverse to the interest of the trust. The trust established a school in the name and style of “Future School” with due permission and recognition from the Government of Tamil Nadu in the property of the defendants. The 1st plaintiff extended huge money as loans for the purpose of construction of the school and as on date 440 students are studying in the school. The 1st plaintiff as the Chairperson of the Board of Trustees had acted in a transparent manner, conducting the affairs of the trust and the school and all accounts were properly audited by the Chartered Accountant and at no point of time, he held secret to himself any affairs of the trust as well as the school.
6. In 2015, loan of Rs.2.05 Crores was availed from State Bank of India, Walaja Branch
