Karnataka High Court
Dr. L Prashanth vs M/S. Shushruti Education Trust(R) on 9 October, 2013
Author: Huluvadi G.Ramesh
Bench: Huluvadi G Ramesh
1
IN THE HIGH COURT OF KARNATAKA AT BANGALORE
Dated this the 9th day of October, 2013
Before
THE HON'BLE MR JUSTICE HULUVADI G RAMESH
Miscellaneous First Appeal 5283 / 2010 (CPC)
Between
1 Dr L Prashanth, 39 yrs
S/o V Lakshminarayana
2 V Lakshminarayana, 61 yrs
S/o late Venkataswamappa
Both are r/a # 11, 1st Main Road
Prashanthi Nagar Extension
ISRO Layout, Bangalore 78 Appellants
(By Sri R L Patil, Adv.)
And
M/s Shushruti Education Trust ®
# 68, Shushrutinagar
Andrahalli Main Road
Peenya II Stage, Bangalore 91
By its Managing Trustee
N Srinivasamurthy, 57 yrs
S/o late N Narayanappa Respondent
(By Sri N Kempegowda, Adv.)
2
First Appeal is filed under S.104 r/w O 43 R 1, of the Civil
Procedure Code praying to set aside the order dated 31.5.2010 on IA 1 in
OS 6093/2009 by the 41st Addl. City Civil Judge, Bangalore.
First Appeal coming on for hearing this day, the Court delivered the
following:
JUDGMENT
Appeal is by the defendants against the order passed on IA 1 filed under O 39 R 1 & 2, CPC by the plaintiff for an ad-interim temporary injunction against the defendants restraining them from entering upon the suit premises of the plaintiff's Trust, its office and institutions and interfering with the work and activities of the Trust and its offices and institutions pending disposal of the suit. Further, IA 2 was also filed by the defendants seeking permission to withdraw the undertaking dated 5.2.2010 and to recall the order dated 15.3.2010.
IA 1 filed by the plaintiff was allowed restraining defendants 1 and 2 and their henchmen, agents and supporters from entering upon the schedule premises of the plaintiffs Trust, its offices and its institutions and interfering with the work and activities of the Trust and its offices and institutions till the disposal of the suit. IA 2 filed by the defendants seeking withdrawal of 3 the undertaking dated 5.2.2010 and to recall the order dated 15.3.2010 was dismissed. Aggrieved by the said order, defendants are before this Court.
It transpires, one N Srinivasa Murthy claiming to be the Managing Trustee of Shushruti Education Trust, Bangalore filed a suit against the defendants for the relief of permanent injunction restraining them from entering upon the suit schedule premises of the plaintiff's Trust and its other offices and institutions. The Trust is situate in Sy.No.63 and 63/2 in an extent of 3.5 acres bearing No.68, Shushruti Nagar, Andarahalli Main Road, Peenya II Stage, Bangalore. It is stated, the Trust is a registered Public Trust. Upto 2006, there was smooth running of the Trust and its activities. Thereafter, the defendants started interfering in the Trust activities and started making character assassination of the plaintiff and also interfered with the internal management affairs of the Trust and were even extracting money from students at the time of admissions, illegally. It is also stated, though the 1st defendant ceased to be the Secretary of the Trust, he unlawfully continued to interfere with the administrative activities and also used the office of the Secretary without any authority from the Trust, he 4 also used to sign the Trust papers and also collect commission and illegal money from students of MBA, BBM, B.Sc. Nursing, etc. The 2 nd defendant is the father of the 1st defendant and brother-in-law of the plaintiff. Taking advantage of the relationship and lenience, the 1 st defendant forged signatures of the Managing Trustee and represented to the Public that he himself has been designated as Managing Trustee. It is also stated 1st defendant has taken all the books of the Trust including the minutes of the Board forcibly and also started troubling the employees of the Trust and also interfered with the activities through rowdy elements.
The defendants in the written statement have contended that the suit itself is not maintainable and that all the contentions taken by the plaintiff is false. It is stated, the 1st defendant was appointed as Founder Secretary of the Trust till 11.11.2011 and continued till he was elected as Managing Trustee of the Trust on 7.8.2009. It is also denied that the 1 st defendant is not involved in any illegal activities. It is stated that from the year 2006 onwards, Mr Srinivas Murthy the then Managing Trustee started troubling because of the alertness of the 1st defendant and also 1st defendant did not 5 allow to misuse the funds of the Trust because Srinivas Murthy had deposited funds in Sri Vemana Credit Co-operative Society, Bangalore Education, misused the amount to the tune of 15 lacs rendered by the students. It isalso stated, that this defendant took much efforts for the welfare and progress of the students and that he has sacrificed his profession for the improvement of the Trust. The 2nd defendant undertook the entire responsibility of civil works and fund raising for construction of more than Rs.1.5 lakhs sq.ft. of buildings. Plaintiff is trying to cover up his wrong doing and misuse of public funds which would be exposed. While denying all averments made in the plaint it is also contended that the plaintiff himself has resigned on 7.8.2009 and the same has been accepted by the full quorum in the Resolution and also 1 st defendant has filed suit in OS 6403/2009 against the plaintiff and the same is pending before the civil court. According to them,, the plaintiff ceased to be the Managing Trustee of the Trust, he cannot represent the Trust, the suit filed by him for injunction is not maintainable and there is no cause of action. It is contended, allowing the IA would cause much hardship to the defendants. Accordingly, they sought for dismissing the IA filed.
6
The trial court noting the facts of the case, having raised five points for consideration, after looking into the citations produced by the parties, held all the issues in the affirmative and while holding that defendants are not entitled to recall the undertaking given, passed the impugned order against which, this appeals is filed by the defendants.
Counsel for the appellants vehemently contended that as per the Trust Deed itself, it is a public Trust as such, as per the provisions of S.9, CPC r/w S.92, the suit itself is not maintainable. If at all the suit is filed, it ought to have been filed as per S.92, CPC. In this regard, counsel has relied upon the judgment in the case of Krishnappa Setty Vs Ramakrishnappa - ILR 1993 KAR 1580 to contend that S.92 excludes recourse to general remedy when the property is a trust property. The suit for injunction without invoking S.92 is not maintainable. It is submitted, plaintiff has been removed since he tendered resignation and in this regard, already a resolution is passed and plaintiff is no more a Managing Trustee. Even then, the trial court having entertained the suit though it is not maintainable, passed an order of injunction without looking into the contents of S.92, 7 CPC. Counsel has also relied upon the decisions of this Court in the case of Shivalingaiah Vs Ananda Social & Educational Trust - ILR 1985 KAR 1950 to contend that to maintain a suit, all the Trustees must join. As per S.48 of the Trust Act, 1882, it is not permissible for one or two Trustees to represent the Trust and bring action and also to contend that Trust is not a legal entity and that such an interim application could be maintained by the Trust only through resolution by all the Trustees and there is no such resolution much less the plaintiff is not continued as a Trustee or Managing Trustee since he has resigned and the resignation is accepted. The primary contention of the appellants' counsel is, in the Trust Deed there is no procedure contemplated for removal of the Trustees and accordingly, sought for allowing the appeal and to set aside the impugned order.
Per contra, counsel for the respondent submitted, by virtue of the amendment to the Trust Deed, it is not a public trust so as to invoke S.92, CPC and as per the decision of the Supreme Court in the case of Vinayak Dev, Idagunji & Ors Vs Shivaram & Ors - (2005)6 SCC 641, when the property is a private trust and no public right is involved , S.9, CPC is not a bar 8 and the suit is therefore, not barred. Accordingly, it is contended that the suit is very much maintainable. It is further submitted, the appellants were carrying on illegal activity of extortion of monies and removal of all the records and in this regard, complaint was filed by the plaintiff and in the criminal petition filed by the appellants herein , this Court having found no prima facie case, rejected the complaint filed and submitted that S.92, CPC is not applicable when by virtue of the amendment, Trust Deed has been amended to the effect that it is a private trust and even in the amended Trust Deed, it is made clear that the Trustees can be removed and that a resolution is being passed to the effect removing these appellants as Trustees and also due to the illegal activities, criminal complaint has been lodged. The respondent never tendered resignation and it is only a forged and concocted version of the appellants. There is a serious dispute in the family relationship between the appellants and the respondent and coercive steps were taken by the appellants to misuse the property of the Trust to save their private properites and a complaint was filed by the plaintiff against these appellants/defendants and rightly, the trial court has passed the impugned order of injunction. The suit is maintainable and also an 9 application can be filed for injuncting the appellants. In support of his contention, counsel has relied upon the decision in the case of State of Andhra Pradesh Vs Manjeti Laxmikantha Rao (dead) by Lrs & Ors - (2000) 3 SCC 689 to contend that the Civil Court has jurisdiction.
In reply to the argument advanced by the counsel for the respondent, appellants' counsel submitted that there is no such change being depicted in the amended Trust Deed changing the nature of the Trust and as such, suit itself is not maintainable and in view of the submission and the pleadings in the plaint that it is a public trust, the suit itself is not maintainable without having recourse to S.92, CPC. However, the same has been controverted by the respondent and it is submitted, it is pleaded that subsequently it is treated as a private trust. Appellants counsel also submitted that unless the suit is maintainable, mere pleading for injunction cannot be entertained and the inherent defect in passing an order on IA injuncting the defendant is totally baseless.
In the light of the argument advanced by the counsel, the point that 10 would arise for consideration is whether the trial court is justified in granting an interim order of injunction when it is contended that suit itself is not maintainable as there is no recourse to S.92, CPC.
So far as the maintainability of the suit is concerned, the trial court has taken into consideration S.9 r/w S.92, CPC and formed an opinion with regard to S.38 of the Specific Relief Act that the suit for injunction by a Trustee against a Co-trustee is maintainable and that the Trust created for the purpose of promotion of education cannot be called as a public trust. Further on the point of resignation tendered by the plaintiff to the post of Managing Trustee is concerned, it has noted the contention of the defendants that on 7.8.2009 plaintiff had tendered resignation and the same was accepted in full quorum by the 1st defendant who is the Secretary of the Trust. The trial court has taken note of the arguments advanced by both the parties. The stand of the plaintiff is that 1 st defendant created fabricated letter of power of attorney in the name of his wife and got some of the personal property of plaintiff inhis name through his wife and also availed lakhs of amount in the form of loan. So far as the decision to convene a 11 special meeting, it is stated, there should be some special reasons other than the date resolved in the earlier meeting and no notice was issued to other Trustees to call for a meeting and it is alleged that 1 st defendant himself had written several aspects in his own handwriting as if he is the Chairman of the said Trust and it is also stated, there is a resignation letter by the plaintiff and the same has been accepted , however, it is denied. It is stated, no such alleged resignation was tendered by the plaintiff nor there was acceptance of the resignation and such an act of the defendant is not binding on the plaintiff and other Trustees. The trial court has gone through the documents and other submissions made and also has looked into the Trust Deed dated 10.9.1999 which was amended on 17.11.2001. The plaintiff and the defendants were first Trustees of the Trust. As per the amended Deed, plaintiff is the Managing Trustee and the original resignation is not produced by the defendant. The defendant has produced the xerox copy of the alleged resignation letter dated 27.6.2009 stating that the plaintiff has tendered resignation for the post of Managing Trustee. It is noted by the trial court that plaintiff has produced the plaint documents 5, 6 and 8 which are the original Board Meeting Register and continuation of 12 the Minutes of Meeting Book from 8.8.2009. Document No.8 - Vehicle Book would show who entered the premises on the particular date. It is noted that original resignation letter is not produced before the Court. Document 5 is the original Board Meeting Register and in the meeting held on 27.6.2009, the next date was fixed on 8.8.2009 but in the Register, it is shown as 7.8.2009 a meeting was conducted by the 1st and 2nd defendants along with their brother Somashekar and acceptance of resignation is also one of the subject and opined that if there was really an ugency to call a special meeting to accept the resignation of Krishnamurthy, only one subject could have been mentioned in the alleged special meeting dated 7.8.2009 but, other subjects including the appointment of new Managing Trustee is mentioned in the alleged resolution and also reason for urgency to call for the meeting is not explained. Even it is not discussed in the resolution as to service of notice on all the Trustees. Further, the trial court noted, there is no mention as to the Trustees entering the premises in the Entry Register as such, it creates a doubt as to the authenticity and veracity of the resolution dated 7.8.2009. Further, it has observed that the burden is on the defendants to prove that the meeting held on 7.8.2009 is legal and 13 valid with regard to removal of the plaintiff from the trusteeship. Noting that the plaintiff has maintained document No.6 - Minutes of the Meeting Book continued from 8.8.2009 till 5.12.2009, it has observed that there is continuous absence of defendants 1 and 2 and one Soma Shekar, the Board of Trustees has has taken a decision on 28.8.2009 to issue show cause notice to the 1st defendant and 2nd defendant for several acts. Even it has noted that defendants have denied their removal in the written statement. In this regard, trial court without expressing any opinion whether the defendants Trustees were removed and their removal is proper or not and that plaintiff has to prove the same, throwing the burden on the plaintiff regarding removal of the defendants at the appropriate stage, opined that there is a prima facie case made out by the plaintiff and also looking into the plaint filed against the defendants and also noting the behaviour of 1 st defendant, the trial court has opined that if injunction is not granted, it would certainly cause inconvenience to the plaintiff and also there would be hardship and there is sufficient material placed on record to make out a prima facie case in favour of the plaintiff and holding that the balance of convenience weighs in favour of the plaintiff, allowed the application filed 14 by the plaintiff.
So far as submission of the appellants as to maintainability of the suit filed is concerned that there is a clear bar under S.9 and also S.92, CPC ought to have been followed before filing the suit as it is their contention that it is a public trust and also there is an averment to that effect in the plaint itself, what is also to be noted is, though initially it was treated as a public trust but there is an amendment carried out before filing the present suit. Further more, the controversial issue would be with regard to maintainability whether the suit would be barred as per S.9 and whether S.92 of CPC is very much attracted having regard to the amendment being brought in to the Trust Deed. The activity carried out by the Trust i.e., running educational institutions by way of private trust satisfies the requirement. So far as granting injunction is concerned and also maintainability even in case of a Trust, the suit is maintainable as is held by the Apex Court. Having regard to the nature of application made by the defendants though the defendants are relatives of the plaintiff and that documents are created and properties are being transferred in the name of 15 the wife of one of the defendant and also noting that a private complaint is filed by the plaintiff against defendants 1 and 2 and also taking note of the fact that the High Court has also not interfered with the nature of complaint filed, I am of the opinion, this is not a case to interfere with the order passed. However, the parties may press for early trial, if so advised. All contentions are left open to be urged. It is for the trial court to expedite the matter in four months. The observations made during the course of the order shall not have a bearing on the disposal of the case on merits.
Appeal is disposed of.
Sd/-
Judge an