Harkishan Dass v. State Of Haryana — 1995 DIGILAW 1261 (SC)

ORDER 1. The Punjab and Haryana High Court at Chandigarh dismissed the writ petition of the appellants in limine, which has given rise to this appeal. 2. On the bare outlines of the matter, it is clear that there is not much scope for interference at our end. The appellants are heirs and legal representatives of Mathura Prashad, deceased, cashier-cum-member of the Cooperative Society, respondent No. 3. On his demise, it was discovered that he had defalcated large sums of money of the Society. Since a dispute arose between the Society and its deceased member, about the recovery thereof, the heirs and legal representatives of the deceased, Mathura Prashad were made to face proceedings. An arbitrator was appointed to go into the matter in accordance with the provisions of Sections 55 and 56 of The Punjab Co-operative Societies Act, 1961. An award was made by the Arbitrator against the appellants, being heirs and legal representatives of Mathura Prashad, deceased, not only for the principal amount found due, but also for the liability to pay interest at the rate of 16 per cent per annum and costs at the rate of 2 per cent on the sum awarded. On appeal before the Deputy Secretary of the Department, at the instance of the appellants, the liability to pay the principal sum was sustained but rest of the award i.e. pertaining to interest and costs was struck off. The appellants writ petition, as said before, was dismissed in limine by the High Court, repelling the plea raised that the dispute did not squarely fall Within the purview of Sections 55 and 56 of the Punjab Co-operative Societies Act, 1961. 3. Though the order of the High Court in sum and substance is in approval of the orders of the departmental officers, one claim however, laid in the writ petition, needs to be highlighted. That was contained in ground (j) in paragraph 11 of the writ petition. It is reproduced hereafter: "(j) That in any case, the liability on the petitioners cannot exceed the interest devolved upon the petitioners from late Mathura Prashad. Late Mathura Prashad had no bank balance and no property of his. All that he had was a share in the ancestral house in which some of the petitioners reside, the liability, if established, then cannot exceed the share of Mathura Prashad in that house." 4. This was a valid plea. Late Mathura Prashad had no bank balance and no property of his. All that he had was a share in the ancestral house in which some of the petitioners reside, the liability, if established, then cannot exceed the share of Mathura Prashad in that house." 4. This was a valid plea. All the same the dismissal of the writ petition cannot have the effect of wiping out such plea which would remain alive when the question of recovery would arise. This plea was personal to the appellants. They cannot be held liable personally for the liability of late Mathura Prashad except to the extent of interest devolved upon them from Mathura Prashad. If such plea is raised as defence in an appropriate forum, that plea shall not be shut out merely on account of the dismissal of the writ petition. No bar of res judicata would be valid to the thwart such defence as and when raised as such matter was not, and could not be, directly and substantially in issue. With this clarification, the appeal stands disposed of. No costs. Contention No. 2 15. So far as this contention is concerned it was vehemently contended by learned senior counsel for the Revenue that Civil Court will get jurisdiction to entertain rectification proceedings provided any of the two conditions precedent are satisfied, namely, (i) through fraud; or (ii) by mutual mistake of parties the instrument in writing does not express real intention parties. So far as fraud is concerned it is not the case of anyone that either party to the instrument had committed any fraud. In fact the learned senior counsel went to the extent of submitting that there are no two parties in an instrument of trust. It is difficult to agree. Settlor is one party to the trust who settles his property in trust for the benefit of others who become beneficiaries and the legal ownership of the property is transferred to the trustees. Thus not only there are more than one party to the instrument of trust but in fact there would at least be two main parties, namely, the settlor on the one hand and the trustees on the other and also there will be the beneficiaries who would be indirectly third parties to the instrument though not being direct parties thereto. Thus it would be almost a tripartite transaction. Dr. Thus it would be almost a tripartite transaction. Dr. Gauri Shankar then submitted that even if it is so, no mutual mistake was alleged in the rectification proceedings. Even this contention cannot be accepted. The Settlor Company had clearly indicated in the rectification proceedings that the real intention of the settlor to create a pubic charitable trust was not clearly brought out on the wordings of the original Trust Deed and, therefore, the need to rectify the instrument, as neither the Settlor Company nor the trustees who assumed the legal ownership of the property settled in trust would have agreed to the transaction in question if it had purported not to create a pubic charitable trust. It was this mutual mistake on the part of both parties that required rectification of the instrument to make, what was latent intention a patent one. Even that apart it is strictly not open to the Revenue which is not a party to the instrument to take up such a contention about non-fulfilment of condition precedent as it would be a fact in issue before the competent Court which was called upon to rectify the instrument by either of the parties to the instrument. Absence of such a condition would at the most make the order erroneous and which can be challenged by either of the parties to the proceedings but it will have no impact on the jurisdiction of the Civil Court to pass such an order however erroneous it may appear to be to the Revenue. At the highest such an error would remain in the realm of error in the exercise of jurisdiction and not an error depriving jurisdiction to the competent Court to entertain such rectification proceedings. In this connection it is profitable to have a look at the decision of Delhi High Court in the case of Jagdamba Charity Trust v. Commr. of Income-tax, Delhi (Central), (1981) 128 ITR 377 : (1980 Tax LR 879). In that case Deed of Trust was got rectified by the parties from the Civil Court. In this connection it is profitable to have a look at the decision of Delhi High Court in the case of Jagdamba Charity Trust v. Commr. of Income-tax, Delhi (Central), (1981) 128 ITR 377 : (1980 Tax LR 879). In that case Deed of Trust was got rectified by the parties from the Civil Court. These proceedings had to be initiated in the light of judgment of the High Court which had held that due to provisions in certain clauses of the Trust Deed the Trust was non-charitable and the trust was not entitled to exemption under Income-tax Act and that since the decision had created some doubts regarding the validity of some clauses of the deed it was necessary that the deed should be rectified. The Civil Court granted a decree and directed that the Trust Deed be rectified. The question was whether such rectification order of the Civil Court was binding on the Income-tax Department when the assessee-trust armed with such rectification order claimed exemption from income-tax under Section 11 of the 1961 Act. S. Ranganathan, J., as he then was, speaking for the Delhi High Court took the view that the word 'instrument' used in Section 26 of the Specific Relief Act has a very wide meaning and includes every document by which any right or liability is, or is purported to be created, transferred, limited, extended, extinguished or recorded. There is no reason to exclude a Trust Deed from its purview. A Trust Deed is a document which sets out the terms of an understanding between the author of the trust and the trustees. Though in form, the trustees are not signatories to the instrument as drawn up, they are parties to the instrument in a real sense for it is on the terms of the instrument that they accept office and proceed to administer the trust. The law obliges them to act upon the terms of the Trust Deed and they cannot commit a breach thereof. If a gift deed, sale deed or promissory note could be within the terms of the section, there is no reason why a Trust Deed cannot be rectified under Section 26. It was further held that since there was an order of Civil Court binding on the author and the trustees, they could administer the trust only in terms of the amendment directed by the Court. It was further held that since there was an order of Civil Court binding on the author and the trustees, they could administer the trust only in terms of the amendment directed by the Court. The trustees were and must be deemed, from the beginning, to have been under a legal obligation to hold the properties only for the object and with the powers set out in the Trust Deed as amended. Therefore, whatever might be the correctness or otherwise of the order passed by the Civil Court under Section 26 of the Specific Relief Act, 1963, it was not open to the Income-tax Officer to say that the trustees could administer the trust in accordance with the original deed and that the claim for exemption had to be dealt with on the basis of the original deed. Nor was it open to the Income-tax Officer to say that in the relevant accounting year, the trustees held the property subject to the terms of the original and not the amended deed. In our view the aforesaid decision of the Delhi High Court lays down the correct legal position in connection with proceedings for rectification of instruments like trust deeds, initiated before competent Civil Courts under the relevant provisions of the Specific Relief Act. 16. In the case of Trust v. Commr. of Income-tax, (1988) 170 ITR 375, a Division Bench of Rajasthan High Court speaking through S. C. Agrawal, J., as he then was, had to consider the question whether the rectification of the Trust Deed which changed character of the private trust into public charitable trust could be relied upon before the Income-tax authorities for claiming exemption under Section 11 of the Income-tax Act, 1961 by the assessee-trust. In that case the original Trust Deed executed in August 1948 did not bring out the real intention of the settlor to create a public charitable trust on account of certain sub-clauses of Object Clause No. 2. It was, therefore, felt necessary to rectify the mistake in the original settlement deed so as to put on record the true intention of the settlor and of the trust created by him. It was held by the Rajasthan High Court that it was permissible for the settlor to clarify his intention in creating the trust under the original settlement deed by executing the supplementary deed. It was held by the Rajasthan High Court that it was permissible for the settlor to clarify his intention in creating the trust under the original settlement deed by executing the supplementary deed. Even in the original deed, a discretion had been conferred on the trustees to apply the income of the trust in rendering aid to persons belonging to the L family and it was permissible for the trustees not to apply the income of the trust for the said object and in fact the income of the trust had never been applied for that object. It could not be said that the beneficiaries under clause 2(vi), namely, persons belonging to the family of L, had an enforceable right to the application of the income of the assessee for the object mentioned in clause 2(vi), and in these circumstances their consent was not necessary before altering the terms of the Trust Deed. In any case although the supplementary deed was executed in May 1958, none of the persons belonging to the family of L had challenged the validity of the same in a Court of law. After the execution of the supplementary deed, it was not open to the trustees to apply the funds of the assessee for non-charitable purposes. The assessee-trust had acquired the status of a trust wholly for charitable and religious purposes after the amendment of the Trust Deed in May 1958. It was entitled to exemption under Section 11 of the Income-tax Act, 1961. The doctrine of cy-pres was also invoked in the said case by observing that in respect of charities the Courts apply the doctrine of cy-pres which envisages that if a clear charitable intention is expressed, it will not be permitted to fail because the mode, if specified, cannot be executed and the law will substitute another mode cy-pres, i.e., as nearly as possible to the mode specified by the donor. The said doctrine is applied on the principle that the Court would lean in favour of charity and where a general charitable goal is projected and particular objects and modes are indicated, the Court, acting to fulfil the broader benevolence of the donor and to avert the frustration of the good to the community, reconstructs, as nearly as may be, the charitable intent and makes viable what otherwise may die. The aforesaid decision of the Rajasthan High Court also takes a view which is almost parallel to the view taken by the Delhi High Court though the binding nature of the rectification order of the Civil Court on the Income-tax Officer is not highlighted as no such occasion arose for Rajasthan High Court to pronounce on the same on the facts of that case. However, the fact remains that after due rectification of the original Trust Deed either by the settlor himself by executing a supplementary deed or by getting it rectified through competent Civil Court under the relevant provisions of the Specific Relief Act, the trustees would be bound to carry out the amended and rectified objects of the trust and if they fail to do so they would be guilty of breach of trust for which even proper proceedings can be initiated against them under Section 92 of the Code of Civil Procedure. For all these reasons, therefore, it must be held that when such rectified Trust Deed is pressed in service before the Income-tax authorities in assessment proceedings concerning the relevant assessment years the Income-tax Officer will have to interpret such rectified instrument for finding out its correct legal effect. But it will not be open to the Income-tax Officer to refuse to look at such rectified instrument of trust and to insist that the trustees of the trust should ignore the said rectified objects and should stick to the instrument as it existed prior to its rectification. The Income-tax Officer will have to take the instrument as it exists in its actual amended form when it is pressed in service for framing the assessment concerning the relevant assessment year in which such rectified instrument holds the field. The second contention, therefore, fails and is rejected. Contention No. 3 17. So far as this contention is concerned Dr. Gauri Shankar, learned senior counsel for the Revenue was right when he contended that order of rectification by a Civil Court is not a judgment in rem. It would be a judgment in personam binding on the parties to the rectified instrument, namely, the settlor on the one hand and the trustees on the other as well as on the ultimate beneficiaries. It would be a judgment in personam binding on the parties to the rectified instrument, namely, the settlor on the one hand and the trustees on the other as well as on the ultimate beneficiaries. It is also true that Section 41 of the Indian Evidence Act cannot apply to such rectification order as under the said provision only judgments and orders passed in exercise of probate, matrimonial admiralty or insolvency jurisdiction would have the character of judgments in rem. Similarly Section 42 of the Indian Evidence Act also could not make them relevant in any enquiry or proceedings unless they relate to matters of a public nature relevant to the enquiry. However, it is Section 43 of the Evidence Act which would squarely get attracted in such cases. Said section lays down that judgments, orders or decrees other than those mentioned in Sections 40, 41 and 42, are irrelevant, unless the existence of such judgment, order or decree is a fact in issue, or is relevant under some other provisions of this Act. Section 40 deals with 'previous judgments relevant to bar a second suit or trial'. That obviously cannot have any application. But a rectified Trust Deed pursuant to the order of the Court would certainly make the rectification order relevant under the provisions of Section 11 the Indian Evidence Act, as the fact in issue in an enquiry before the Income-tax Officer would be whether on the basis of the rectified trust instrument the assessee-trust is entitled to get its income exempted from tax under relevant provisions of the Income-tax Act. In such proceedings, therefore, the order granting rectification of such instrument of trust would certainly remain relevant. Consequently it cannot be said that such rectification orders passed by civil courts permitting rectifications of trust deeds under the relevant provisions of the Specific Relief Act could not be relied upon by the assessee-trust in assessment proceedings before the Income-tax Officer even though the Revenue or the Income-tax Officer was not a party to such rectification proceedings. Consequently it cannot be said that such rectification orders passed by civil courts permitting rectifications of trust deeds under the relevant provisions of the Specific Relief Act could not be relied upon by the assessee-trust in assessment proceedings before the Income-tax Officer even though the Revenue or the Income-tax Officer was not a party to such rectification proceedings. It will be for the Income-tax Officer to consider the real scope and ambit of the Trust Deed as presented to him in rectified form with a view to finding out whether on the basis of such a rectified instrument the assessee trust had earned exemption from payment of income-tax under the relevant provisions holding the field in the concerned assessment years. The third contention is, therefore, decided by answering that though the rectification orders of the civil Court are not judgments in rem they are relevant in assessment proceedings before the Income-tax Officer and will have to be given effect to for whatever they are worth. Contention No. 4 18. So far as this contention is concerned learned senior counsel for the Revenue is spared his pains as learned senior counsel for respondent-assessee fairly stated in the light of the debate that took place in the Court that he was not supporting the answer given by the High Court in favour of assessee on Question No. 2 referred for the opinion of the High Court at the instance of the assessee-trust. In short he submitted that he would treat 1955 rectification of the instrument of trust as creating almost a new trust or substituting the new for the old and, therefore, he would not press that such rectification of 1955 would have any retrospective effect. In view of the fair stand taken by the learned senior counsel for the respondent-assessee, this contention will have to be decided in favour of the Revenue and against the assessee by holding that rectification brought about by the order of the civil court in 1955, namely, the second rectification had no retrospective effect and would operate prospectively from the date on which such rectification saw the light of the day and would cover assessment years 1956-57 onwards up to assessment years 1965-66 and would not look back on the previous assessment years from 1949-50 to 1955-56. In other words the decision of the Tribunal on referred Question No. 2 will remain operative and that contrary answer of the High Court on this question would stand rejected. Contention No. 5 19. Having cleared the Revenue's stand in connection with the Trust Deed in question for the assessment years 1949-50 to 1955-56 as aforesaid, Dr. Gauri Shankar, learned senior counsel for the Revenue set his sails on the subsequent assessment years 1956-57 onwards wherein the Trust Deed as rectified in 1955 held the field. He submitted that even after the rectification of 1955 the situation had not at all improved for the respondent-trust and it remained a private trust and not a public charitable trust. So far as this contention is concerned it was vehemently opposed by learned senior counsel for respondent-assessee, Shri Verma. In fact this has remained now the real bone of contention between the warring parties. 20. In order to resolve this controversy it will be profitable to have a close look at the relevant provisions of the Trust Deed of 1941 as amended in 1955 pursuant to the second rectification order of the civil Court. The said Trust Deed as amended in 1955 is found at Annexure 'J' to the Paper Book Volume II. Leaving aside the introductory recitals, the relevant operative recitals in the Trust Deed read as under:-- "1. The said Trust Deed as amended in 1955 is found at Annexure 'J' to the Paper Book Volume II. Leaving aside the introductory recitals, the relevant operative recitals in the Trust Deed read as under:-- "1. That in exercise of the power reserved to it under the Memorandum of Association and for effectuating its object of establishing a trust or settlement for public religious or charitable purposes including trusts or settlements for relief of property, education medical relief and advancement of any other object of general public utility of religious or charitable nature, the Company doth hereby grant convey and assume up to the Trustees the said plot of land situate at Cawnpore and numbered as 1 in Block H Factory Workmen Area containing by admeasurement 43.70 (forty three decimal point seventy) acres more or less and more clearly delineated and shown on the plan annexed to the said Indenture bearing date the 19th day of October 1936 and thereon marked red as also the said plot of land situate of Cawnpore and numbered as 2 in Block H Factory Workmen area containing by admeasurement 26.30 (twenty six decimal point thirty) acres more or less and more clearly delineated and shown on the plan annexed to the said Indenture dated the 2nd day of February 1938 and thereon marked red TOGETHER WITH all way wells waters water courses sewers ditches drains trees shrubs liberties easements profits privileges and appurtenances whatsoever to the said plots of land respectively belonging or in anywise appertaining with the same or any part thereof now or at any time heretofore usually held occupied or enjoyed therewith and all the State right title interest claim and demand whastsover at law or in equity of it was the company into or upon the said two plots of land and every part thereof TO HAVE AND TO HOLD THE SAID two plots of land hereby conveyed granted or assured or expressed so to be and every part thereof unto and to the use of the Trustees for ever to be by them held upon the trusts and with the subject to the powers provisions agreements and declarations in respect thereof hereinafter appearing and contained. 2. 2. The Trustees do hereby declare that they shall hold and stand possessed of the said two plots of land upon the trusts following namely : (a) To manage the said two plots of land (hereinafter called "the Trust Properties" which term shall include any security or securities or investments of any kind whatsoever into which the same or any part thereof may be converted and varied from time to time and such as may be acquired by the Trustees or come to their hands by virtue of these present or by operation of law or otherwise however in relation to these trusts as also all donations funds or endowments either in the shape of cash shares securities or other movable or immovable properties which may be given to the Trustees by any person whosoever for the benefit of the Trusts hereby created and to collect and recover the rents profits and other income thereof and to pay thereout the expenses of collection of such income and the rates taxes assessment and other outgoings in respect of any properties that may at any time be comprised in the Trust properties including the premia for insurance of any such property against loss or damage by fire or lightning or civil commotion air-raids and other risks or losses or damages as the Trustees may in their absolute discretion think proper (but so that nothing herein contained shall impose any obligation on the Trustees to insure any of the premises comprised in the Trust Properties which they do not wish to do so) as also to pay the expenses of painting or white washing the building and structures that may be created on the said Trust Properties and of effecting all repairs additions and alterations thereto as well as to all plant and machinery which may be lying thereon or affixed thereto. (b) To erect, establish, equip, furnish, fit maintain and repair on the said two plots of land and other land that may hereafter be acquired by the Trustees on behalf of the Trust. (b) To erect, establish, equip, furnish, fit maintain and repair on the said two plots of land and other land that may hereafter be acquired by the Trustees on behalf of the Trust. (i) residential quarters, chawls or buildings for the workmen in the town of Kanpur and the surrounding areas and extensions and for their respective families and dependents and for such other skilled and unskilled workmen craftsmen traders merchants technical or professional men whom the Trustees may permit to reside or work in the said two plots proved that the benefit in this clause shall be granted only to those persons who on account of property are in need of help and really deserve help. (ii) Public schools, pathshalas, colleges, libraries-public halls, hostels or boarding houses. (iii) Hospitals, dispensaries, museum places or recreation, instruction, swimming baths, lakes, parks, play-grounds, temples, mosques, churches, market or markets and such other works and institutions of general public utility. (iv) such other works, building and installations as the Trustees may in their discretion think fit to provide for the advancement of any other similar object of general public utility. (c) To erect, establish, equip, furnish fit maintain and repair on the second of the aforesaid two plots a temple, a hospital with all necessary quarters for housing its staff, an officer or officers for management and administration of the Colony or Settlement to be established on the said two plots and quarters for the office staff and a water pumping station and similar other works. (d) To charge such rent or fees for the use and occupation of any of the said premises as the Trustees may in their discretion for time to time think fit. (e) To use and spend the income of the Trust properties or the corpus of any funds or donations given or endowed for the benefit of these trusts for the objects herein mentioned." A mere look at the aforesaid objects of the trust which remained operative and kicking after the second rectification of 1955 shows that each of the objects mentioned in clauses (b), (c), (d) and (e) of Object Clause 2 clearly partakes the character of a charitable disposition meant for the benefit of a well demarcated mass of humanity. There is not much dispute on this aspect, so far as paras 2(a) and (b)(ii) to (iv), (c), (d) and (e) are concerned. There is not much dispute on this aspect, so far as paras 2(a) and (b)(ii) to (iv), (c), (d) and (e) are concerned. However learned senior counsel for the Revenue vehemently submitted that leaving aside the objects mentioned in para 2(b), sub-paras (ii), (iii) and (iv) so far as sub-para (i) of clause (b) of para 2 is concerned, at least that object does not create a public charitable trust as the object mentioned therein namely constructing residential quarters, chawls or buildings for the workmen in the town of Kanpur and surrounding areas was a very vague object. It was next contended that though the object is so widely worded, it in substance is meant to benefit only the workmen of the Company if the entire history of the trust from 1941 onwards is minutely scrutinised. It was submitted by Dr. Gauri Shankar that initially when the two pieces of land were obtained on concessional rates from the Improvement Trust, Kanpur in 1941 by indentures of 19-10-1936 and 2-2-1938 respectively, they were meant to be utilised for the construction of colonies of workmen of the Settlor Company itself. That the original Trust Deed of 1941 without later rectifications of 1945 and 1955 clearly indicated that the beneficiaries were only the employees of the Settlor Company and there was no whisper about the benefit to humanity at large or to members of the general public. Thus it was clearly a private trust. That though by rectification of 1945 the term 'workmen in general' was introduced for indicating the class of beneficiaries, in substance the benefit was reserved to the workmen of the Settlor Company itself, and that even after 1955 rectification, the words 'workmen in general' in Kanpur and surrounding areas and extensions remained a mere camouflage. It is not possible to agree with the aforesaid submissions of the learned senior counsel Dr. Gauri Shankar, for the Revenue. The reasons are obvious. It cannot be said that the indicated beneficiaries, namely, the workmen in the town of Kanpur and surrounding areas and extensions are so vague as to make the object of the trust inoperative or otiose. Workmen in town of Kanpur and the surrounding areas and extensions formed a clearly earmarked class or category of members of general public and they were certainly a part and parcel of the general public. Workmen in town of Kanpur and the surrounding areas and extensions formed a clearly earmarked class or category of members of general public and they were certainly a part and parcel of the general public. It is also not possible to countenance the submission that the words 'surrounding areas and extensions of Kanpur town 'introduced vagueness, in the identification of beneficiaries. Surrounding areas and extensions would naturally include those areas which are on the periphery of Kanpur town, and which are adjacent to Kanpur town. They would not obviously includ any areas which are geographically far removed from and situated at long distance from Kanpur town and which could not be said to be in the vicinity of the Kanpur town. The words 'surrounding areas and extensions of Kanpur town' indicate proximity of such areas with the Kanpur town and have a clear nexus with the geographical boundary of Kanpur town. It is also easy to visualise that the trustees will have to make avilable the benefit of the clause only to those workmen in the town of Kanpur and surrounding areas and extensions and to their respective families and dependents who on account of poverty are in need of help and really deserve help. Any provisions made for a poor class of public well earmarked as recipient of such benefits would certainly make the object of such bounty a charitable one. In fact Dr. Gauri Shankar fairly stated that if one only goes by the verbiage of the clause as found in 1955 rectified deed then it would appear to be a public charitable trust. But he submitted that we have to X-ray the clause and try to find out as to who are the real beneficiaries of the said trust. It is difficult to countenance even this submission. In order to find out whether the relevant clauses of a trust deed create a public charitable trust or not we have to go by the express words employed by the Trust Deed. In our view for finding out the real intention of the settlor, the words used in the Deed would be the real vehicle of thought of the settlor expressing his intention in cold print. This would be much more so when such recitals in the Trust Deed are not challenged on the ground that they are a camouflage or a result of a colourable device. This would be much more so when such recitals in the Trust Deed are not challenged on the ground that they are a camouflage or a result of a colourable device. As we have noted earlier, contention regarding colourable device was not pressed by Dr. Gauri Shankar for the Revenue and rightly so as it did not arise out of the judgment under appeal. On the other hand, on the express language of clause 2(b)(i) of the 1955 rectified deed, it cannot be said that it does not create a public charitable trust. On the contrary it becomes clear on a close reading of relevant provisions of this clause that the objects are specific and charitable in nature. The beneficiaries are also clearly indicated. There is also no ambiguity about the trustees or the trust properties. Thus all the basic requirements for creation of a public charitable trust do exist on the express language of the relevant sub-clauses of clause (2) of 1955 rectified deed. Dr. Gauri Shankar, learned senior counsel for the Revenue then submitted in any case absolute discretion is vested in the trustees under the Trust Deed to utilise the trust income for the benefit of any of the sub-classes of workmen in the town of Kanpur and they were likely to divert the entire benefit to their own workmen. To say the least it is merely a discretion left to the trustees and not an obligation of the trustees that they must necessarily spend the income of the trust for the workmen of the settlor company itself and not for the benefit of any other outside worker. We shall deal with this aspect in greater details when we will refer to contention No. 6 canvassed by learned senior counsel for the assessee trust that even apart from the rectification of 1955 the earlier rectification of 1945 did create a public charitable trust. However so far as the second rectification of 1955 is concerned it has clearly indicated that only a discretion is vested in the trustees to utilise the trust income for benefit of poor workmen in the town of Kanpur and in the surrounding areas and extensions and that may include even poor and need workmen of the settlor company itself. However so far as the second rectification of 1955 is concerned it has clearly indicated that only a discretion is vested in the trustees to utilise the trust income for benefit of poor workmen in the town of Kanpur and in the surrounding areas and extensions and that may include even poor and need workmen of the settlor company itself. In this connection Shri Verma also rightly invited our attention to Section 92 of the Code of Civil Procedure and clause (i), sub-clause (b)(iv) whereby trustees in their discretion could prove for advancement of other similar objects of general public utility. Relying on a series of decisions of this Court in Commor. of Income-tax, Madras v. Andhra Chamber of Commerce, Ahmedabad Rana Caste Association v. Commr of income-tax, Gujarat, (1971) 82 ITR 704 : (1972 Tax LR 78) (SC); Abdul Sathar Haji Moosa Sait Dharmastapanam v. Commr. of Agricultural Income-tax, Kerala, (1973) 91 ITR 5: (1974 Tax LR 480) (SC); Sole Trustee, Loka Sikshana Trust v. Commr. of Income-tax, Mysore, (1975) 101 ITR 234 : (1976 Tax LR 1) (SC); Yogiraj Charity Trust v. Commr. of Income-tax, New Delhi, (1976) 103 ITR 777 : (1976 Tax LR 733) (SC); and Commr. of Income-tax, Madras v. Andhra Chamber of Commerce, (1981) 130 ITR 184 : (1981) Tax LR 1356) (SC) it was submitted that objects of general public utility would clearly indicate that they are meant for public benefit and would create a public charitable trust. That in the light of the objects of the trust as rectified in 1955 even a workmen who is not an employee of the settlor company could in appropriate case seek direction under Section 92, Code of Civil Procedure, from competent Civil court against the trustees to act according to the object of the trust and give benefit to such an applicant beneficiary if the circumstances so permit and the income of the trust is sufficient to cater to his needs. 21. When confronted with these very widely worded objects of the trust, Dr. Gauri Shankar, learned senior counsel for the Revenue mounted his attack in the light of clause 30 of the Trust Deed as rectified in 1955 which reads as under : "30. 21. When confronted with these very widely worded objects of the trust, Dr. Gauri Shankar, learned senior counsel for the Revenue mounted his attack in the light of clause 30 of the Trust Deed as rectified in 1955 which reads as under : "30. The Trust premises shall be held by the Trustees hereof subject to the terms and provisions of the said two indentures bearing date the 19th day of October 1936 and 2nd February 1938 and the Trustees shall accordingly duly and faithfully observe perform and comply with all the terms and provisions thereof and all such other terms provisions rules and regulations which the said Cawnpore Improvement trust may from time to time impose upon them or require them to observe perform and comply with or such as may from time to time be mutually agreed upon between the Cawnpore Improvement Trust and the Trustees consistently with the powers reserved by the said Cawnpore Improvement Trust in that behalf under the said two Indentures." "We are doubtful whether the construction of residential colony for workmen in general can be regarded as an object of public charity. While enabling the trustees to construct residential quarters, etc., for the benefit of the workmen in general, the settlor made it clear that such buildings were not to be constructed for the benefit of the public in general. The expression "workmen in general" does not fix a definite class of public which is intended to be benefited under the deed. What types of employees or workers can be said to be covered by this expression is not at all clear. Moreover, the precise language. used by the settlor is "to erect...residential quarters, etc., for the workmen in general and in particular for the workmen, staff and other employees of the company or other allied concerns under the management of . . . ". This shows that the expression "workmen in general" was not intended to mean merely poor labourers. The expression was intended to cover even such classes of persons who might be employed in any concern in any capacity whatsoever and who may be drawing high salaries. . . ". This shows that the expression "workmen in general" was not intended to mean merely poor labourers. The expression was intended to cover even such classes of persons who might be employed in any concern in any capacity whatsoever and who may be drawing high salaries. Making a provision for constructing residential quarters, etc., for the benefit of the employees irrespective of whether they are poor or not, can hardly be said to be a charitable object or a work of general public utility." As we have discussed earlier the term 'workmen in general' when read in the context socio-economic situation prevailing in 1945 in the country and when also considered in the context of construction of residential quarters, chawls or buildings in Kanpur may partake the character of a well defined class or workmen in Kanpur city who may be poor and needy, still as the trustees are enjoined to construct residential quarters, chawls or buildings in particular for the workmen, staff and other employees of the company it follows that other employees of the company who are the beneficiaries may not necessarily be poor or needy or affluent. We, therefore, concur with the second part of the reasoning of Allahabad High Court in the aforesaid judgment though we are not in a position to subscribe to the general proposition that construction of residential colonies for workmen in general cannot by itself be regarded as an object of public charity. As a result of the aforesaid discussion, therefore, it must be held that rectified clause 2 (b)(i) of 1945 deed fell short of projecting an object of a public charitable nature and it could not be said that under the rectified deed of 1945 the trust properties were held by respondent-trust wholly for religious or charitable purposes. It is of course true that rest of the sub-clauses of clause 2(b) did refer to charitable objects but as one of the objects was not of a public charitable nature it could not be held that the entire trust was wholly for religious or charitable purposes. 29. It is of course true that rest of the sub-clauses of clause 2(b) did refer to charitable objects but as one of the objects was not of a public charitable nature it could not be held that the entire trust was wholly for religious or charitable purposes. 29. Now is left the consideration of one submission of Shri Verma, learned senior counsel for the Respondent who relied upon Explanation to sub-section (3) of Section 4 of 1922 Act which read as under : "In this sub-section 'charitable purpose' includes relief of the poor, education, medical relief and advancement of any other object of general public utility, but nothing contained in clause (i) or clause (ii) shall operate to exempt from the provisions of this Act that part of the income from property held under a trust or other legal obligation for private religious purposes which does not ensure for the benefit of the public." In our view the said Explanation cannot be of any avail to the respondent-assessee so far as the rectified deed of 1945 is concerned. The emphasis in the Explanation is on charitable objects of general public utility like relief of poor, education, medical relief and advancement of any other object of general public utility. Once it is held that clause 2(b)(i) of 1945 rectification deed imposed an obligation on the trustees to utilise the trust property for the benefit of the settlor company's own workmen and employees, it would cease to be projecting an object of providing relief to poor workmen only. Nor would it advance any other object to general public utility but would be confined to the utility of a well defined class of employees and workmen of the settlor company and its allied concerns only. For all these reasons, therefore, it is not possible to accept the submission of Shri Verma, learned senior counsel for respondent-assessee based on this Explanation. This contention, therefore, stands rejected. Conclusions 30. The aforesaid decision on the contentions canvassed on behalf of the rival contesting parties by their learned senior advocates, yield the following result : (i) For assessment years 1949-50 to 1955-56 the respondent-assessee would not be entitled to get the benefit of Section 4(3)(i) of the 1922 Act and income derived by it from its properties would not get exemption from income tax under the said provision. (ii) For the assessment years 1956-57 to 1961-62 the income derived by the respondent-assessee from trust properties during these years will get exempted under Section 4(3)(i) of 1922 Act as the 1955 rectified Trust Deed is held by us to be having objects of wholly charitable nature. (iii) For the assessment years 1962-63 to 1965-66 the income derived from trust properties by the respondent-trust will be entitled to exemption from income tax under Section 11 of the 1961 Act subject to the compliance with the conditions laid down therein as even during this period the rectified Trust Deed of 1955 as interpreted by us will be treated to have held the field. Final Order 31. In the light of the aforesaid discussion and the conclusions to which we have reached the questions referred for opinion of the High Court will stand answered as under : Questions referred at the instance of the assessee in ITR No. 18/73 Question No. 1 Answered in the affirmative in favour of the Revenue and against the assessee. Question No. 2 Answered in the affirmative in favour of the Revenue and against the assessee as the answer of the High Court on this question was not supported by the learned counsel for the respondent. Questions referred at the instance of Revenue in ITR No. 715/72 Question No. (a) Answered in the affirmative in favour of the assessee and against the Revenue as answer of the High Court was not challenged before us by learned counsel for the Revenue. Question No. (b) Answered in the negative in favour of the assessee and against the Revenue as the answer of the High Court was not challenged by learned counsel for the appellant-revenue. Question No. (c) Answered in the affirmative in favour of the assessee and against the Revenue as the answer of the High Court was not challenged by learned counsel for the Revenue. Question No. (d) Answered in the negative in favour of the assessee and against the Revenue. Question No. (e) Answered in the negative in favour of the assessee and against the Revenue. 32. In the result, out of these 17 appeals filed by the Revenue seven appeals pertaining to assessment years 1949-50 to 1955-66 will stand allowed while Revenue's remaining ten appeals pertaining to assessment years 1956-57 to 1965-66 will stand dismissed. Question No. (e) Answered in the negative in favour of the assessee and against the Revenue. 32. In the result, out of these 17 appeals filed by the Revenue seven appeals pertaining to assessment years 1949-50 to 1955-66 will stand allowed while Revenue's remaining ten appeals pertaining to assessment years 1956-57 to 1965-66 will stand dismissed. In the facts and circumstances of the case there will be no order as to costs in these appeals. 33. Order accordingly.