1. Trust situated in one state with properties in another — Applicability of state endowment regulations — Challenge to trustee removal orders. (Para 2 , 3 , 4 )
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1962 Supreme(SC) 347
SUPREME COURT OF INDIA
B.P.Sinha, C.J.I., J.C.Shah, K.C.Das Gupta, K.N.Wanchoo, P.B.Gajendragadkar, JJ.
Anant Prasad Lakshminiwas Ganeriwal
Versus
State Of A.P.
Case No. : 140 of 1962 , 86 of 1960
Date of Decision : 11/2/62
Advocates Appeared: Chatterjee N.C. : Kuppuawami Alladi : Menon P.D. : Rai Ganpat : Rao T.Ramachandra : Reddy P.Ram : Sastry D.V. : Tatachari T.V.R.
Advocates:
ALLADI KRISHNASVAMI IYER, D.V.Sastry, GANPAT RAI, N.C.CHATTERJI, P.D.MENON, P.RAM REDDY, T.RAMACHANDRA RAO, T.V.R.TATACHARI
ALLADI KRISHNASVAMI IYER, D.V.Sastry, GANPAT RAI, N.C.CHATTERJI, P.D.MENON, P.RAM REDDY, T.RAMACHANDRA RAO, T.V.R.TATACHARI
A state has jurisdiction over a trust situated within its territory even if the trust's properties are located elsewhere. Furthermore, the removal of a trustee for incompetence requires a mandatory formal inquiry and adherence to prescribed procedural grounds.
Headnote:(A) Hyderabad Endowments Regulations - Sections 2, 3-12 - Madhya Pradesh Public Trusts Act, 1951 - Sections 2(4), 3, 4, 7(1) - Constitution of India - Articles 14, 19(1)(f), 19(5) - Part B States (Laws) Act, 1951 - Section 6 - Charitable Endowments Act, 1890 - Charitable and Religious Trusts Act, 1920 - Section 3 - Application of state law to trusts situated within the state - Where a trust is situated in a particular State, the law of that state applies even if some trust properties are located outside the state (Paras 10-12).
(B) Constitution of India - Article 14 - Geographical classification based on historical reasons - Parallel but different laws in different parts of a state, arising from the merger of different territories, are not necessarily discriminatory and can be sustained (Para 15).
(C) Constitution of India - Article 19(1)(f) - Reasonable restrictions - Provisions requiring registration of endowments to ensure efficient management and fulfillment of the endower's intentions are reasonable restrictions in the interest of the general public (Paras 16-17).
(D) Removal of Trustee - Procedure - Removal of a trustee for incompetence requires a proper inquiry by a competent officer and an order by the designated authority; failure to appear for registration of the endowment is not a valid ground for removal under the regulations (Paras 19-21).
Facts of the case:
A hereditary trustee of a temple situated in one state, but possessing income-yielding properties in another state, registered the trust under the laws of the state where the properties were located. The state where the temple was situated issued a notice for registration under its own endowment regulations. The trustee challenged the notice and subsequent orders removing him from management and vesting it in the government.
Findings of Court:
The court held that the law of the state where the trust is situated applies regardless of the location of its properties. The registration under another state's law does not exclude the jurisdiction of the state where the trust is located. The removal orders were found to be invalid as they were passed without a proper inquiry, by an unauthorized authority, and on grounds not permitted by the regulations.
Issues: Whether registration under another state's public trusts act excludes the application of the local state's endowment regulations; whether historical differences in laws across a state violate Article 14; and whether the removal of a trustee without a formal inquiry is valid under the regulations.
Ratio Decidendi: The court reasoned that territorial connection is established by the location of the trust, granting the state legislative power over it. It further held that historical geographical classifications are valid under Article 14. Regarding the removal of the trustee, the court emphasized that the requirement for a trustee to be "found" incompetent implies a mandatory inquiry, and removal must follow the specific procedure and grounds laid down in the rules.
Result: Appeal dismissed; writ petition allowed with costs and orders dated June 13 and 14, 1960, set aside.
Legal Category Hierarchy
- constitutional law
- administrative law
- religious and charitable endowments
Table of Contents
2. Whether registration under another state's act excludes local regulations, whether regulations violate Articles 14 and 19, and whether trustee removal followed statutory procedure. (Para 5 , 9 )
3. Trust location determines legislative jurisdiction; historical legal differences in reorganized states are permissible; registration is a reasonable restriction; removal requires statutory inquiry and authority. (Para 10 , 12 , 15 , 17 , 21 )
4. State law applies to trusts situated within its territory regardless of property location; statutory removal of trustees requires adherence to prescribed inquiry and authority. (Para 12 , 21 )
5. Appeal dismissed regarding registration notice; writ petition allowed and orders removing the trustee set aside. (Para 22 )
6. Does a state have jurisdiction over a religious trust if the trust is situated in that state but its properties are located elsewhere?
Yes. Where a trust is situated in a particular state, the law of that state applies to the trust, even if some or most of the endowed properties are located outside that state. (Para 10 , 11 , 12 )
7. Does the existence of different laws in different parts of a state, resulting from historical reorganization, violate Article 14?
No. Geographical classification based on historical reasons is sustainable and does not violate the equal protection clause of Article 14, provided parallel laws exist in both regions. (Para 15 )
8. Are mandatory registration requirements for religious endowments under state regulations violative of the right to property under Article 19(1)(f)?
No. Provisions for the registration of endowed property to ensure efficient management and fulfillment of the endower's intentions are reasonable restrictions in the interest of the general public. (Para 16 , 17 )
9. Can a trustee be removed from management solely for failing to respond to a registration notice?
No. Removal requires a proper inquiry by a competent officer to establish specific grounds of unfitness and must be ordered by the designated authority, such as the Minister for Endowments. (Para 21 )
K.N.WANCHOO, J.
(1) THE appeal is by special leave from the order of the Andhra Pradesh High court. The appellant has also filed a writ petition and as the two matters are connected, they will be dealt with together.
(2) THE appellant is Anant Prasad Lakshminivas Generiwal. He is also the petitioner in the writ petition and will hereafter be referred to as the appellant. The main respondents, who are also opposite parties in the writ petition, are the State of Andhra Pradesh and the Director of Endowments, Hyderabad. They will be referred to hereinafter as the respondents. The appellant claims to be the sole hereditary trustee and Mutwalli of the temple of Shri Sitaram Maharaj Sansthan and the subsidiary deity Shri Varadarajaswami, situate at Sitaram Bagh, in Hyderabad. In the earlier part of the nineteenth century, an ancestor of the appellant migrated to Hyderabad and carried on business there. He obviously prospered and in or about 1833 he built a temple at a cost of two lakhs of rupees and installed in it the idols of Shri Rama and other ancillary or subsidiary; deities and consecrated the temple for public benefit and worship. In 1841, one Maharaja Chandulal, a minister to the then Nizam granted a jagir consisting of the villages of Akolee and Bordee in Berar for the upkeep and maintenance of the temple. Later, however, these villages were resumed by the Nizam and two other villages were granted instead to the temple. It appears that these two other villages were also resumed, and the village of Bulgaon was granted to the temple in 1850. It also appears that though village Akolee was resumed, the resumption order was not carried out and that village continued in the possession of the temple,, so that since 1850 the temple has been in possession of the two villages for its upkeep and maintenance. In 1853, Berar was transferred to the British government of India by the Nizam and these two villages therefore came under the administration of the government of India. In 1859, some doubts arose about the title of the temple to the villages and there were enquiries under the Berar Inam Rules. Eventually, it was decided that the title of the temple was good and the villages had been assigned with the rest of Berar to the government of India for administration and that they had been granted in jagir for a religious object and their devolution was governed by Rule IV of the Berar Inam Rules. Thereafter inam certificates were issued with respect to these two villages in the name of Ramlal, son of Hargopal, who was described as the Manager of the jagirdar, Shri Sitaramji Maharaj of Akolee and Bulgaon. The purpose of the jagir was mentioned as `for charitable expenses of the temple of Shri Sitaram Maharaj situated in the Sitaram Bagh, at Hyderabad`. In the twentieth century there was considerable litigation between the members of the family of the founder as to the right of management of the temple. Eventually, it was decided in 1932 that Lakshminivas Generiwal, father of the appellant, was to be the manager of the jagirdar, and this decision was finally confirmed in 1933 by the governor of the central Provinces. The government of Hyderabad was trying all along to find out how the income of this jagir was being spent. But it was decided that it was the government of the central Provinces alone which had the right to call for accounts of the villages and was responsible to see that the conditions of the grant were fulfilled, and in 1941 this position seems to have been accepted by the government of Hyderabad.
(3) AFTER the Constitution came into force from 26/01/1950, the State of Madhya Pradesh took the place of the old central Provinces and Berar. The State of Madhya Pradesh enacted a law known as the Madhya Pradesh Abolition of Proprietary Rights (Estates, Mahals, Alienated Lands) Act, No. 1 of 1951. In consequence of this law, the two villages were taken over by the State and statutory compensation was awarded. In a
