K. Srinivasan v. G. Kuppusamy Naidu Memorial Sport Trust, K. Selvaraj
2009-09-14
A.SELVAM
body2009
DigiLaw.ai
Judgment : 1. The order passed in Trust Original Petition No. 88 of 2005 by the Principal District Court, Tuticorin is being challenged in Civil Revision Petition No. 2422 of 2008. 2. Civil Revision Petition No. 134 of 2009 has been filed praying to direct the Principal District Court, Tuticorin to dispose of I.A. No. 247 of 2008 in accordance with law. 3. The First Respondent in Civil Revision Petition No. 2422 of 2008 as Petitioner has filed Trust Original Petition No. 88 of 2005 on the file of the Court below, praying to permit the Petitioner to sell the schedule mentioned property for the best price prevailing in the market. 4. It is averred in the Petition that the property mentioned in the schedule belongs to the trust of the Petitioner. The trust of the Petitioner has been registered under Trust Act on 12.8.1960. Initially five trustees have been nominated and in which two trustees are family trustees. The main object of the trust is to encourage sports activities of all kinds. The trust of the Petitioner has conducted Sri G. Kuppusamy Naidu Memorial All India Hockey Tournament at Kovilpatti from the year 1960. For the past 4 years due to financial stringencies, tournaments have not been conducted. The property mentioned in the schedule is the absolute property of the trust of the Petitioner. The trust of the Petitioner has not been able to remit even electricity charges and also to give salaries to its employees. The property mentioned in the schedule is situate near habitations and attempts have been made to encroach the same. The right of selling the property mentioned in the schedule has been given under Clause 23(i) of the Trust Deed dated 12.8.1960. The members of the Petitioner are also running a similar trust at Coimbatore and same has also been registered under Trust Act on 4.7.1976. The purpose of the said trust is also similar to that of the Petitioner. Only for the purpose of safeguarding the interest of the trust property, the present Petition has been filed, praying to allow the Petitioner to sell the Petition mentioned property. 5. The Court below, after considering all the contentions raised on the side of the Petitioner, has allowed the Petitioner to sell the property mentioned in the schedule for Rs. 2,900/- per square meter.
5. The Court below, after considering all the contentions raised on the side of the Petitioner, has allowed the Petitioner to sell the property mentioned in the schedule for Rs. 2,900/- per square meter. Against the order passed by the Court below, the Petitioner/third party has filed Civil Revision Petition No. 2422 of 2008. 6. After the disposal of Trust Original Petition No. 88 of 2005, the Petitioner found in Civil Revision Petition No. 134 of 2009 has filed I.A. No. 247 of 2008 praying to reopen Trust Original petition No.88 of 2005. 7. Since common questions of law and facts are involved in both the Civil Revision Petitions, common order is pronounced. 8. Before considering the divergent submissions made on either side, it would be more useful to perorate the following admitted facts and also circumstances under which Trust Original Petition No. 88 of 200 5has been filed. It is an admitted fact that trust of the Petitioner has been established in the year 1960 and the same has be registered under Trust Act on 12.8.1960. The property mentioned in the schedule is the absolute property of the trust of the Petitioner. The trust of the Petitioner has been established only for the purpose of promoting Sports activities. The main averments made in the Petition is that the Petitioner has conducted tournaments and for the past 4 years due to financial slump, the Petitioner has not been able to conduct tournaments and virtually the trust of the Petitioner has become defunct and similar trust for similar purpose is in existence in Coimbatore and the petition mentioned property is situate near habitations and attempts have been made to encroach the same and in order to safeguard the interest of the trust, the present Petition has been filed so as to permit the Petitioner to sell the petition mentioned property. 9.
9. The learned Counsel appearing for the Revision Petitioner/third party in C.R.P. No.2422 of 2008 has contended with great vehemence that the trust of the Petitioner is a Public Trust and the present Petition has been filed under Sections 34 and 39 of the Indian Trust Act, 1882 and the provisions of the said Sections are applicable only to Private Trust and the Petitioner should seek remedy only by way of invoking the provision of Section 92 of the Code of Civil Procedure, 1908 and therefore, the present Petition is not legally maintainable and the Court below has not at all considered the same and further periodically tournaments are being conducted in the property mentioned in the schedule and the trust of the Petitioner has not become extinguished and further the private negotiation for selling the property in question is not permissible and further the Resolution of the trustees which enables to file the present Petition has not at all been filed and therefore, viewing from any angle the impugned order passed by the Court below is liable to be set aside. 10. The learned Senior Counsel appearing for the First Respondent/Petitioner has also equally contended that the trust of the Petitioner is a Private Trust and the some of the family members of the founder of the trust have been appointed as trustees and the trust of the Petitioner has not been able to conduct tournaments due to financial slump and virtually the trust of the Petitioner has become defunct and similar trust is in existence in Coimbatore for similar purpose and further the property mentioned in the schedule is situate near habitations and attempts have been made to encroach the same and in order to protect the interest of the trust, with bona fide intention, the present Petition has been filed and the Court below, after considering the contention of the Petitioner and after observing all formalities and also keeping in mind of the noble desire of the Petitioner, has allowed the Petition and therefore, the impugned order passed by the Court below is not at all liable to be interfered with. 11.
11. The learned Counsel appearing for the Revision Petitioner in C.R.P. No. 134 of 2009 has also equally contended that after the disposal of Trust Original Petition No. 88 of 2005 by the Court below, the Petitioner found in C.R.P. No. 134of 2009 has filed the Petition in question in I.A. No. 247 of 2009 so as to reopen Trust Original Petition No. 88 of 2005 and the Court below has not at all passed any order and under the said circumstances, Civil Revision Petition No. 134 of 2009 has been filed so as to direct the Court below to dispose of I.A. No. 247 of 2008. 12. On the basis of the rival submissions made by the Counsel appearing for the Revision Petitioner in C.R.P. No. 2422 of 2008 as well as the learned Senior Counsel appearing for the First Respondent/petitioner therein, the Court has to look into as to whether the Petition filed in Trust Original Petition No. 88 of 2005 under Sections 34 and 29 of the Indian Trust Act, 1882 is legally maintainable. 13. The primary attack made by the learning Counsel appearing for the Revision Petitioner in Civil Revision Petition No. 2422 of 2008 is that the trust of the Petitioner is a Public Trust and since it is not a Private Trust, the provisions of Sections 34 and 39 of the Indian Trust Act, 1882 are not applicable. 14. The consistent argument advanced by the learned Senior Counsel appearing for the First Respondent/Petition is that the trust of the Petitioner is a Private Trust. 15. Section 34 of the Indian Trust Act, 1882 reads as follows: “Right to apply to Court for opinion in management of trust property.-Any trustee may, without instituting a Suit, apply by Petition to a Principle Civil Court of original jurisdiction for its opinion, advice or direction on any present questions respecting the management or administration of the trust property other than questions of detail, difficult or importance, not proper in the opinion of the Court for summary disposal. A copy of such Petition shall be served upon, and the hearing thereof may be attended by, such of the persons interested in the Application as the Court thinks fit.
A copy of such Petition shall be served upon, and the hearing thereof may be attended by, such of the persons interested in the Application as the Court thinks fit. The trustee stating in good faith the facts in such Petition and acting upon the opinion, advice or direction given by the Court shall be deemed so far as regards his own responsibility, to have discharged his duty as such trustee in the subject-matter of the Application. The costs of every Application under this Section shall be in the discretion of the Court to which it is made.” 16. Section 39 of the said Act reads as follows: “Power of convey.-For the purpose of completing any such sale, the trustee shall have power to convey or otherwise dispose of the property sold in such manner as may be necessary.” 17. From the close reading of the provisions of the said Sections, one can easily discern that a trustee without filling a Suit can file a Petition to a Principal Civil Court of original jurisdiction for getting opinion, advice or direction with regard to management or administration of trust property. It is a humdrum that Indian Trust Act, 1882 is applicable only to Private Trust. 18.
It is a humdrum that Indian Trust Act, 1882 is applicable only to Private Trust. 18. Section 92 of the Code of Civil Procedure, 1908 reads as follows: “In the of any alleged breach of any express or constructive trust created for public purposes of a charitable or religious nature, or where the direction of the Court is deemed necessary for the administration of any such trust, 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, whether contentious or not, in the Principal Civil Court, of original jurisdiction or in any other Court empowered in that behalf by the State Government within the local limits of whose jurisdiction the whole or any part of the subject matter of the trust is situate to obtain a decree- (a) removing any trustee; (b) appointing a new trustee; (c) vesting any property in a trustee; (cc) directing a trustee who has been removed or a person who has ceased to be a trustee, to deliver possession of any trust property in his possession to the person entitled to the possession of such property; (d) directing accounts and inquiries; (e) declaring what proportion of the trust property or of the interest therein shall be allocated to any particular object of the trust; (f) authorizing the whole or any part of the trust property to be let, sold, mortgaged or exchanged; (g) setting a scheme; or (h) grantingsuch further or other relief as the nature of the case may require.” (2) Save as provided by the Religious Endowments Act, 1863, or by any corresponding law in force in the territories which, immediately before the 1st November, 1956, were comprised in Part B States, no Suit claiming any of the reliefs specified in sub-section (1) shall be instituted in respect of any such trust as is therein referred to except in conformity with the provisions of that sub-section.
(3) The Court may alter the original purposes of an express or constructive trust created for public purposes of a charitable or religious nature and allow the property or income of such trust or any portion thereof to be applied cypress in one or more of the following circumstances, namely.- (a) where the original purposes of the trust, in whole or in part,- (i) have been, as far as may be fulfilled; or (ii) cannot be carried out at all, or cannot be carried out according to the directions given in the instrument creating the trust or, where there is no such instrument, according to the spirit of the trust; or (b) where the original purposes of the trust provide a use for a part only of the property available by virtue of the trust; or (c) where the property available by virtue of the trust and other property applicable for similar purposes can be more effectively used in conjunction with, and no to that end can suitably be made applicable to any other purpose, regard being had to the spirit of the trust and its applicability to common purposes; or (d) where the original purposes, in whole or in part, were laid down by reference to an area which then was, but has since ceased to be a unit for such purposes; or (e) where the original purposes, in whole or in part, have, since they were laid down,- (i) been adequately provided for by other means, or (ii) ceased, as being useless or harmful to the community, or (iii) ceased to be, in law, charitable, or (iv) ceased in any other way to provide a suitable and effective method of using the property available by virtue of the trust, regard being had to the spirit of the trust.” 19. The opening words of Section 92 of the said Code deal with “express or constructive trust created for public purposes of charitable or religious nature”. It is a settled principle of law that if a trust is a Public Trust, the person interested can get remedy only by invoking the provision of the said Section. 20. The sine quo non of the present case is: “whether the trust of the Petitioner is a Private Trust or Public Trust? 21.
It is a settled principle of law that if a trust is a Public Trust, the person interested can get remedy only by invoking the provision of the said Section. 20. The sine quo non of the present case is: “whether the trust of the Petitioner is a Private Trust or Public Trust? 21. In order to decide the aforesaid vital aspect, it would be apropos to look into the purpose of the trust of the Petitioner. In the Trust Deed dated 12.8.1960, the primary object of the trust is mentioned as follows: “(a) Whereas the founder and his friends cherished a keen desire to create a trust in the name of the late Sri. G. Kuppuswamy Naidu for encouraging activities in Sports. (b) Whereas the founder for the above said purpose is desirous of building a stadium at Kovilpatti at present.” 22. From the close reading of the purpose of the trust of the Petitioner, one can easily discern that the trust in question has been created only for the purpose of encouraging activities in Sports. 23. Of course it is true that under trust deed dated 12.8.1960, the family trustees viz., Sri. K. Sundaram and K. Rajagopal sons of late Sri. G. Kuppuswamy Naidu have been appointed. Simply because, the said persons have been appointed as family trustees, the Court cannot come to a conclusion that the trust of the Petitioner is a Private Trust. 24. At this juncture, once again the Court has to look into the opening words of Section 92 of the Code of Civil Procedure, 1908. Wherein it has been clearly mentioned that “express or constructive trust created for public purposes of charitable or religious nature”. The trust of the Petitioner has not been created for the purpose of doing religious duties. Therefore, we have to analyse as to whether the trust of the Petitioner would come within the purview of the first part viz., “public purposes of charitable”. The word “charity”, as per Black’s Law Dictionary (Eighth Edition), means (1) Charitable organization (2) Aid given to the poor, the suffering, or the general community for religious, educational, economic, public-safety, or medical purposes (3) Goodwill. 25. It is admitted fact that sports activities would come within the purview of education. It has already been pointed out that primary object of the trust of the petitioner is to encourage activities in Sports.
25. It is admitted fact that sports activities would come within the purview of education. It has already been pointed out that primary object of the trust of the petitioner is to encourage activities in Sports. Therefore, it is needless to say that the primary object of the trust of the Petitioner would come within the purview of the “public purposes of charitable” mentioned in Section 92 of the Code of Civil Procedure, 1908. The basic distinction between a private or a Public Trust is that in the former the beneficiaries are specific individuals and in the latter they are the general public and are incapable of ascertainment. Further it is essentially a question of fact in each case to determine whether endowment is for public purposes of charitable or religious nature or it is private endowment though of religious or charitable nature. Therefore, it is pellucid that if a trust is created for the benefits of specific individuals, the same can be called as a Private Trust. If beneficiaries are public at large, the same can be called as a Public Trust. 26. Inthe instant case, even at the risk of repetition, the Court would like to point out that the primary object of the founder of the trust of the Petitioner is to encourage Sports activities. Since the primary object of the founder of the trust of the Petitioner is to encourage Sports activities and since it comes (primary object) within the purview of the word “charity”, it is needless to say that the trust of the Petitioner is a Public Trust. Since the trust of the Petitioner is a Public Trust, the Petition filed in Trust Original Petition No.88 of 2005 is not at all legally maintainable under Section 34 and 29 of the Indian Trust Act, 1882. The only remedy available to the First Respondent/Petitioner is to invoke the provision of Section 92 of the Code of Civil Procedure, 1908. 27. The learned Counsel appearing for the Revision Petitioner in C.R.P. No.2246 of 2008 has also accentuated the Court to look into the following decisions: (a) In In re, Man Singh and other, AIR 1974 Del. 228 it has been held that a Public Trust is perpetual. To it rule against perpeturties does not apply. It can never die through its nature may be changed.
228 it has been held that a Public Trust is perpetual. To it rule against perpeturties does not apply. It can never die through its nature may be changed. In legal theory the Court is the guardian of charity, as it is of an infant. (b) In Shanthi Devi v. State and others, AIR 1982 Del. 453 , it has been held that Indian Trust Act, 1882, does not apply to Public Trust and Charitable Trust. It applies to only Private Trusts. (c) In R. Venugopal Naidu and others v. Venkatarayulu Naidu charities and others, AIR 1990 SC 444 the Honorable Apex Court has held that property belonging to religious and charitable endowments should not be sold in private negotiations and the same can be sold in public auction after giving wide publicity. (d) In A. Changiah, etc., Petitioners, 1997 (3) LW 537 this Court has held that since the proceeding under Section 34 of the Indian Trusts Act, 1882 intended to be summary, the Court would not be exercising a proper discretion, if it disposes of matters of vital importance such as involving the conversion of a trust property when there is no question of emergency and when it is open to the trustees at all times to file a regular Suit. (e) In Trustees of HEH The Nizam’s Pilgrimage Money Trust, Hyderabad v. Commissioner of Income Tax, A.P., Hyderabad, 2000 (4) SCC 179 , the Honorable Apex Court has held that an Application filed under Section 34 of the Indian Trust Act, 1882 cannot be deemed to one under Section 92 of the code of Civil Procedure, 1908. 28. From the cumulative effect of the decisions referred to above, it is needless to say that a Public Trust is permanent and it never comes to an end. Further the Indian Trust Act, 1882 is not applicable to properties belonging to Public Trust and even property of a Private Trust should not be sold by private negotiation and the same should be sold in public auction after making wide publicity and further an Application filed under Section 34 of the Indian Trust Act, 1882 cannot be converted into Section 92 of the Code of Civil Procedure, 1908. 29. Inthe instant cases, it has already been narrated in detail and ultimately found that the trust of the petitioners is a Public Trust.
29. Inthe instant cases, it has already been narrated in detail and ultimately found that the trust of the petitioners is a Public Trust. Since the trust of the Petitioners is a Public Trust, the provision of Sections 34 & 39 of the Indian Trust Act, 1882 are not at all applicable and therefore in view of the decisions referred to supra, it is made clear that the order passed in Trust Original Petition No. 88 of 2005 by the Court below is totally erroneous and the same is liable to be set aside. 30. The learned Senior Counsel appearing for the First Respondent/Petitioner in Civil Revision Petitioner No. 2422 of 2008 has also repeatedly contended that no appreciable income has been derived from the trust property and therefore, the trust of the Petitioner has become defunct and similar trust is in existence in Coimbatore for similar purpose and under the said circumstance, the First Respondent/Petitioner has filed the present Petition under Sections 34 & 39 of the Indian Trusts Act, 1882, and the Court below, after observing all the formalities, has rightly allowed the Petition. 31. In fact, this Court has closely perused the Income Tax Return filed by the trust of the Petitioner, wherein no appreciable nor taxable income has been mentioned. In the Court below an Advocate Commissioner has been appointed and he inspected the property mentioned in the schedule and subsequently filed his report, wherein it has been clearly stated that only old shops are available in a portion of the schedule mentioned property. Therefore, it is quite clear that the trust of the Petitioner is not having sufficient income so as to fulfil the object mentioned in the Trust Deed. However, the trust, Petitioner being a Public Trust necessary remedy can be obtained by invoking the provision of Section 92, of the Code of Civil Procedure, 1908. Therefore, viewing from any angle the impugned order passed by the Court below in Trust Original Petition No.88 of 2005 is not correct and the same is liable to be set aside. 32.
However, the trust, Petitioner being a Public Trust necessary remedy can be obtained by invoking the provision of Section 92, of the Code of Civil Procedure, 1908. Therefore, viewing from any angle the impugned order passed by the Court below in Trust Original Petition No.88 of 2005 is not correct and the same is liable to be set aside. 32. The learned Counsel appearing for the Second Respondent in Civil Revision Petition No.2422 of 2008 has also contented that the Second Respondent herein, on the basis of permission given to the First Respondent/Petitioner in Trust Original Petition No.88 of 2005, has purchased the property mentioned in the schedule for reasonable price and subsequently converted the same into various plots and therefore, the interest of the Second Respondent is also liable to be taken into consideration. 33. In Trust Original Petition No.88 of 2005, the only Relief sought for therein is to permit the First Respondent/Petitioner to sell the petition mentioned property. The Court below has granted the same and against the impugned order passed by the Court below, Civil Revision Petition No.2422 of 2006 has been filed on the file of this Court and further the primary attack made by the learned Counsel appearing for the Revision Petitioner in Civil Revision Petition No.2422 of 2008 is legally tenable and this Court has taken a considered view that the Petition in question filed under Sections 34 & 39 of the Indian Trust Act, 1882 is not legally valid and therefore, the interest of the Second Respondent cannot be considered at this stage. 34. As stated earlier, the learned Counsel appearing for the Revision Petitioner in Civil Revision Petitioner No.134 of 2009 has contended that after the disposal of Trust Original Petition No. 88 of 2005, the Revision Petitioner herein as Petitioner has filed I.A.No.247 of 2008 so as to reopen the Trust Original Petition No.88 of 2005 and the Court below has not passed any order and therefore, the present Civil Revision Petition No.134 of 2009 been filed for giving necessary direction. 35. Since the impugned order passed in Trust Original Petition No.88 of 2005 by the Court below is liable to be set aside, the Petition filed in I.A. No.247 of 2008 has become in-fructuous. Since the same has become in-fructuous, Civil Revision Petition No.134 of 2009 is liable to be dismissed. 36.
35. Since the impugned order passed in Trust Original Petition No.88 of 2005 by the Court below is liable to be set aside, the Petition filed in I.A. No.247 of 2008 has become in-fructuous. Since the same has become in-fructuous, Civil Revision Petition No.134 of 2009 is liable to be dismissed. 36. As marshaled earlier, the learned Counsel appearing for the Revision Petitioner in Civil Revision Petition No.2422 of 2008 has raised various points apart from the primary attack. Since the main point urged on the side of the Revision Petitioner in Civil Revision Petition No.2422 of 2008 itself is legally maintainable and since impugned order passed in Trust Original Petition No.88 of 2005 by the Court below is liable to be dismissed mainly on that ground, the incidental points raised by the learned Counsel appearing for the Revision Petitioner in Civil Revision Petition No.2422 of 2008 need not be discussed in detail. It has already been pointed out that the Trust of the Petitioner is a Public Trust and the Petition in question is not at all legally maintainable under Sections 34 & 39 of the Indian Trusts Act, 1882 and therefore, Civil Revision Petition No.2422 of 2008 is liable to be allowed. 37. In fine, Civil Revision Petition No.2422 of 2008 is allowed without costs. Consequently, connected C.N.P. No.3 of 2008 is closed. The impugned order passed in Trust Original Petition No.88 of 2005 by the Principal District Court, Tuticorin is set aside and the Petition filed therein is dismissed without costs. However, the First Respondent/Petitioner is at liberty to invoke the provision of Section 92 of the Code of Civil Procedure, 1908. Since Civil Revision Petition No.2422 of 2008 is allowed. Civil Revision Petition No.134 of 2009 is dismissed without costs. Consequently, connected C.M.P. No.1 of 2009 is dismissed.