Calcutta High Court
Shyam Sundar Kejriwal & Others vs Usha Kejriwal on 3 September, 2010
Equivalent citations: 2011 AIR CC 325 (CAL), (2011) 97 ALLINDCAS 910 (CAL), AIR 2011 (NOC) (SUPP) 219 (CAL.), (2010) 4 CAL HN 782
Author: Sanjib Banerjee
Bench: Sanjib Banerjee
1 GA No. 1894 of 2010 CS No. 103 of 2007 IN THE HIGH COURT AT CALCUTTA ORDINARY ORIGINAL CIVIL JURISDICTION SHYAM SUNDAR KEJRIWAL & OTHERS
-Versus-
USHA KEJRIWAL
For the Defendant: Mr Surojit Nath Mitra, Sr Adv.,
Mr Amitava Das, Adv.,
Mr Shuvasish Sen Gupta, Adv.,
Mr Mahendra Yadav, Adv.
For the Plaintiffs: Mr Anindya Mitra, Sr Adv.,
Mr Abhrajit Mitra, Adv.,
Mr Jishnu Chowdhury, Adv.,
Ms Rajshree Kajaria, Adv.
Hearing concluded on: September 2, 2010.
BEFORE
The Hon'ble Justice
SANJIB BANERJEE
Date: September 3, 2010.
SANJIB BANERJEE, J. : -
The defendant challenges the authority of this court to receive the suit where the principal relief is for a perpetual injunction to restrain the defendant from holding herself out or representing herself to be a trustee of the subject trust. The defendant claims that the object of the suit is to take control of the 2 trust and, through it, its only property in Madhupur in Jharkhand. The defendant says that this is a suit for land.
In her application, the defendant has contended that a trust is an obligation to property and since the property in respect of the subject trust is a land outside jurisdiction, this Court did not have the jurisdiction to receive the suit. The defendant argues that the plaintiffs seek, in effect, to assert title, control, possession and management of the immovable property situated outside jurisdiction and the claim has to be carried to a court exercising jurisdiction over such immovable property. No other ground is taken in the application.
The first eight plaintiffs claim to be the present trustees of the ninth plaintiff trust. The trust was created by a registered deed of March 3, 1990. Though a copy of the relevant instrument has been appended to the plaint, the copy of the plaint that the defendant has included with her petition is one without its annexures. A copy of the deed of trust has been made over by the plaintiffs.
Nine settlors established the trust for public charitable purposes and contributed a sum of Rs.5,000/- in 1990. The deed envisages that the trust may receive further sums and properties. The initial office of the trust was at 9, Jagmohan Mullick Lane, Calcutta - 700009 and the deed permits the trustees to determine where the office would be situate. The primary object of the trust is to create, establish, maintain and run educational institutions. Eight trustees were appointed by the deed of trust, including the defendant herein. The number of trustees is required to be not less than five or more than fifteen. The trustees are to appoint or nominate any of them as the chairperson and another as the managing trustee, each office having a tenure of five years. The deed named the defendant as the first managing trustee. Clause 32 of the trust deed provides 3 that a trustee may resign from the office or retire by giving a month's notice in writing to the other trustees. The next clause records that a person shall cease to be a trustee, inter alia, if he or she resigns from office. Clause 37 of the deed stipulates that the office of the trustee shall be without profit except to the extent of reimbursement of actual expenses incurred for the purposes and objects of the trust. Clause 43 of the deed makes the provisions of the Indian Trust Act applicable to the trust except to the extent it is repugnant to the contents of the deed.
In the plaint it is stated that the trust runs a school named after it as the "Madhusthali Vidyapeeth" in Madhupur which is affiliated to the Council for the Indian School Certificate Examination. The case made out in the plaint suggests that the affairs of the school dipped alarmingly between 2003 and 2006. At the relevant time the defendant was the managing trustee and, of the plaintiffs, only the eighth plaintiff was one of the six other trustees. The plaint says that in April, 2006 the eighth plaintiff and the defendant requested the plaintiff nos. 1 to 7 to become trustees since they were apparently experienced in running schools. It is the plaintiffs' case that simultaneously all the then existing trustees except the eighth plaintiff offered to resign from office. The plaint says that by a notice of May 10, 2006 the defendant, as the managing trustee, convened a meeting of the trust on June 6, 2006 for the purpose of considering the resignation of all but one of the existing trustees and the appointment of new trustees. The plaintiff nos. 1 to 7 are said to have been requested to attend the meeting as invitees. The plaintiffs claim that the meeting of June 6, 2006 was attended by four of the then trustees, including the eighth plaintiff and the defendant, and by the plaintiff nos. 1 to 7, initially as invitees. According to the plaint, the first seven plaintiffs were unanimously appointed as trustees and the defendant thereafter submitted her letter of resignation as trustee and handed over letters of resignation of the three absentee trustees at such meeting. The two other attending trustees also submitted their individual letters of resignation. The plaint speaks of the letters 4 of resignation of the six trustees, including the defendant, being accepted at the meeting; whereupon they ceased to be trustees of the said trust. The plaintiffs claim that the registered office of the trust was subsequently shifted from Jagmohan Mullick Lane to 11, Brabourne Road, Calcutta - 700001. The plaint seeks to make out that the resolutions passed at the said meeting of June 6, 2006 have been acted upon and the individual plaintiffs have brought in substantial funds to the trust. The plaintiffs claim to have applied on behalf of the trust to the State Government in Jharkhand for establishing an engineering collage on the Madhupur land and say that the existing school and its infrastructure have been substantially revamped. The plaintiffs allege that it was only in April, 2007 that the plaintiffs discovered that the defendant was purporting to hold herself out and represent herself as a trustee of this trust. The plaintiffs have instituted the suit with leave under Order II Rule 2 of the Code of Civil Procedure by reserving the right to claim other reliefs arising out of a memorandum of understanding between the plaintiffs and some of the erstwhile trustees including the defendant. The first relief claimed is for a perpetual injunction restraining the defendant from using the old letterhead of the trust where the office of the trust is shown to be 9, Jagmohan Mullick Lane. The second relief is for restraining the defendant from holding herself out or representing herself to be a trustee. The third relief is for discovery on oath of all letters issued and communication made by the defendant subsequent to June 6, 2006 claiming to be a trustee.
The defendant refers to the much-used judgment in Moolji Jaitha and Co. v. The Khandesh Spinning and Weaving Mills Co. Ltd. reported at AIR 1950 FC 83. She relies on what is said to be the common opinion of the court in that decision that in order to see whether a suit is covered by the expression "suit for land" in clause 12 of the Letters Patent, one has to consider whether the suit is for the purpose of obtaining a direction for possession or a decision on title to land, or the object of the suit is something different but involves the consideration of the question of the title to land indirectly.
5The defendant relies on a Single Bench judgment of this Court rendered at the trial of a suit reported at AIR 1974 Cal 292 (Bholanath Shaw v. Badrinath Shaw) where the action failed for want of jurisdiction. The suit was instituted with leave under clause 12 of the Letters Patent for administration of the trust estate. The trust owned immovable properties all situate outside the original jurisdiction of this Court. One of the reliefs claimed was for removal of one of the defendants from the office of the sole trustee and shebait and for appointment of the plaintiff in her place. The trust deed provided that upon the death of the settlor who was the first sole trustee, his widow would be the sole trustee for life and also the sole shebait of the deity. After the widow's death the four sons of the settlor were to be the joint trustees of the trust estate and, simultaneously, shebaits of the deity. The settlor as sole trustee conveyed two immovable properties of the trust estate absolutely to the deity. A son of the settlor brought the action complaining of the settlor's widow indulging in wrongful acts. The contesting defendants denied the title of the deity in the two immovable properties and challenged the validity of the transfer made by the original sole trustee in favour of the deity. It was in such context that the court held at paragraph 13 of the report as follows:
"13. The prayers for removal of Dhaneswari including the removal of the contesting defendants from their offices and for the appointment of the plaintiff in their place, in my opinion, are not ancillary reliefs as was contended before me. Further, their legal position cannot be equated with the legal position of an executor. It is true that under Sec. 211 of the Indian Succession Act, 1925, the estate of a deceased person is vested in his executor but the expression "as such" used in that section is, in my opinion, leads to an irresistible conclusion that such vesting is only for the purpose of representation of the estate of the deceased person. But, no such qualification can be attached to the office of a trustee or a shebait because they are not the legal representative of the settlor."
The judgment drew strength from the decision reported at (1875-76) ILR 1 Cal 249 (The Delhi and London Bank v. Wordie). The discussion in the judgment 6 in Bholanath Shaw was in the context of the trustees simultaneously being shebaits and must be read in such light. As some of the authorities cited by the plaintiffs would reveal, there is considerable difference between the office of trustee and shebaitship. The judgment distinguished the dictum in the judgment reported at AIR 1960 Cal 691 (Hem Chandra Dev v. Dhirendra Chandra Das) where the plaintiff sought a decree for the administration of the estate of a deceased person. The Division Bench had held that such a suit was not a suit for determination of a right to or interest in immovable property.
The defendant relies on a Division Bench judgment reported at AIR 1983 Cal 420 (Tridandeeswami Bhakti Kusum Sraman Maharaj v. Mayapore Sree Chaitanya Math) where the administration, control and custody of a debutter estate was sought. The reliefs clearly indicated that the defendants attempted to wrest control of, or consolidate their possession and control over, immovable properties situate outside jurisdiction. The court found that the dominant or primary object of the suit was to establish title to land which was situate outside. Paragraph 15 of the report is instructive:
"15. In our opinion, the question whether, out of several reliefs in the plaint, the claim for the grant of a particular relief which does not relate to the title to, or possession, control or management of land or buildings or other immoveable property, is the primary object of the suit or not, has to be decided by applying the test whether such relief claimed to be the primary object of the suit can be granted to the plaintiffs without the necessity of any adjudication on the question of title to any land or buildings or other immoveable property, or possession, control or management thereof. If the relief stands the test, the suit will not be a suit for land or other immoveable property within the meaning of Cl. 12 of the Letter(s) Patent, although the grant of such relief may indirectly affect land or other immoveable property. If, however, by applying the test it is found that such relief cannot be granted without deciding the question of title to, or possession, control or management of land or other immoveable property, the claim for the grant of such relief cannot be the primary object 7 of the suit and, in that case, the suit will be a suit for land or other immoveable property within the meaning of Cl. 12 of the Letters Patent."
The defendant next relies on a judgment reported at 1958 SCR 296 (W.O. Holdsworth v. State of Uttar Pradesh) for the proposition that the properties of a trust estate vests in the trustees. The defendant argues that since it is the effective removal of the defendant as a trustee that has been sought in the suit, it amounts to an adjudication of the defendant's right to the immovable property of the trust which is admittedly situate outside jurisdiction. The defendant has also cited a judgment reported at 76 CWN 807 (Benarasilal Rajgorhia v. Central Bank of India) and has relied on paragraphs 71 to 80 of the report dealing with the aspect of the challenge on jurisdiction.
The plaintiffs have first referred to a celebrated Full Bench decision of this Court reported at AIR 1932 Cal 791 (Monohar Mukherjee v. Bhupendra Nath Mukerjee). The plaintiffs say that the judgment in Bholanath Shaw should be seen in the light of the law laid down more than 40 years before Bholanath Shaw and, particularly, in the context that there was no distinction in Bholanath Shaw between the office of trustee and the office of shebait. They refer to the following distinction recognised by the Full Bench between shebaitship and trusteeship:
"... Shebaitship in its true legal conception involves two ideas: The ministrant of the duty and its manager, it is not a bare office but an office together with certain rights attached to it. A shebait's position towards the debutter property is not similar to that in England of a trustee towards the trust property, it is only that certain duties have to be performed by him which are analogous to those of trustees. ..." (From pages 810-811) The plaintiffs say that the office of trusteeship is not a property at all. They say that in the case of a shebait the office is blended with the property; a shebait can gift his office but a trustee cannot alienate of his office or deal with it. The plaintiffs submit that it is in such circumstances that shebaitship is regarded as 8 an immovable property but the office of the trustee is not seen to be the same. The plaintiffs place a judgment reported at (1978) 3 SCC 236 (Ram Rattan v. Bajrang Lal) where the hereditary office of shebait as well as the right to worship by turn were regarded as immovable properties within the meaning of Section 3(26) of the General Clauses Act. The Supreme Court relied on a Bombay judgment to hold that the hereditary office of shebait which would be enjoyed by the person by turn would be immovable property and the document of transfer was liable to be registered. In the judgment reported at 3 IC 435 (Suppian Thevan v. M. Krishna Row) the issue was as to whether the appointment of a trustee was required to be under a registered document. The Madras High Court concurred with the view of the subordinate Judge that the properties of a trust estate vest in the trustees by operation of law, but the document appointing a trustee does not, by itself, create any such right.
A judgment reported at 9 Bom LR 1071 (Fatmabibi v. Shaik Hassan) has been referred to by the plaintiffs. In that case, on the death of one of the trustees a surviving settlor appointed a new trustee by an unregistered document relying on the right reserved to the surviving settlors in the indenture of trust to make such nomination. The question raised was whether the deed appointing a new trustee required registration. The argument in defence was that the appointee's interest in the trust property was not created by the deed of appointment but it vested in the trustees by operation of law under Section 75 of the Trusts Act, 1882. Though the Trusts Act was found not to apply to such case, the court held that the document appointing the new trustee did not convey anything to him.
The plaintiffs have brought a judgment reported at (2001) 9 SCC 471 (Ram Bharose Sharma v. Mahant Ram Swaroop) for the definition of a trust where the trustees have been found to be ostensible owners holding a property for the 9 benefit of another person as an obligation annexed to the ownership. The plaintiffs say that the trustees of a trust are de jure or deemed owners for administrative convenience, but not the real owners of the property and the office of trustee is, thus, not an immovable property. They rely on the W.O. Holdsworth judgment and say that a trustee is the legal owner of the trust property as trustee; that the office is not generally or naturally hereditary; that the trustee has no beneficial ownership in the property or personal interest therein; and, he would generally have no disposable right but his powers are subject to the deed of trust.
The plaintiffs rely on passages from Lewin on Trusts (18th Ed., South Asian Edition, 2009). Paragraph 37-14 of the text provides as follows:
"For the purpose of exercising their functions as trustees"
37-14 The powers are conferred on trustees of land "for the purpose of exercising their functions" as such trustees. Therefore they are fiduciary powers which must themselves be exercised so as to carry out the trusts, and with a single eye to the benefit of those with interests under the trusts. That is, they are powers of management relating to the land, not powers to override the beneficial interests under the trusts. That is, they are powers of management relating to the land, not powers to override the beneficial interests under the trusts. They are administrative powers of selling, leasing, mortgaging, improving buildings and so forth, such as the Settled Land Act 1925 confers individually and in restrictive terms, and not dispositive powers. The trustees could not, for instance, use their beneficial ownership powers to give the land away to a third party, because that would defeat the beneficial interests under the trusts, which it is their prime function to carry out."
The plaintiffs refer to Chapter VII of the Trusts Act and the use of the word "office" in Sections 70 to 72 thereunder and say that the trust property vests in the office of the trustee and is not personal to the trustee.
10The plaintiffs have placed a judgment reported at (2001) 7 SCC 698 (Adcon Electronics P. Ltd v. Daulat) and a recent judgment of this Court reported at (2010) 1 Cal LT 274 (Hansraj Jain v. Santanu Chaudhuri) for the proposition that every claim for specific performance of an agreement involving an immovable property would not make it a suit for land. On a parity of reasoning, the plaintiffs contend that if the specific performance simpliciter of an agreement relating to an immovable property - where neither title nor possession is in dispute - is not regarded as a suit for land, the present action can neither be branded as such.
The plaintiffs submit that the Single Bench judgment in Bholanath Shaw did not appreciate The Delhi and London Bank judgment in proper perspective. In that judgment of 1876 the part owner of a land executed on his behalf and on behalf of the other part owner, a deed of assignment of the whole of the property to trustees for the benefit of the creditors of the estate. In a suit by one of the creditors, the original joint owners of the land were made defendants and one of them claimed that the other who had executed the document of transfer of the entirety of the land had no authority to bind the co-owner. It was in such circumstances that a question as to the title of the land came to be in issue and the court held that it was a suit for land within the meaning of clause 12 of the Letters Patent.
From the Benarasilal Rajgorhia judgment that the defendant has cited, the plaintiffs place several passages expended in discussing the ninth issue framed in the suit. At paragraph 102 of the report it was held that notwithstanding the trustee denying the trust in a suit to prevent the trustee from committing a breach of trust, it was only to be incidentally decided as to whether there was a trust.
11The test, therefore, is as to what is the primary object of the action. The principal motive for instituting the present action appears to be to ensure that the defendant has no further connection with the trust. It is an attempt to delink the persona of the defendant from the office of the trustee. It is not the defendant's case that the defendant is entitled to the trust property otherwise than is incidental to her office as trustee.
Trustees are deemed owners of the trust properties in the sense that they own it by a legal fiction and do not ordinarily enjoy the attendant incidents of regular ownership. The ownership of the trust estate may vest collectively in the trustees or individually in a trustee, if there is only one trustee, but the vesting is as trustees or trustee. The person and the office are two different things. The plaintiffs here attack the person and the person's right to the office. The authority to control the trust properties is incidental to the office and irrespective of whether the plaintiffs succeed or fail it is their avowed case that the trust owns the Madhupur property.
If the plaintiffs succeed in this suit, the necessary corollary would be that the defendant would have no say in the trust and, consequently, in its properties. But the object of the action does not appear, on a reading only of the plaint, to be to restrain the defendant from having a say in the Madhupur property; it is to have the defendant altogether removed from the trust. It is just as possible that the real tussle is as to the control of the Madhupur property of the trust and such matter has been camouflaged in crafty pleading. To assess whether the primary object of an action is for the purpose of obtaining a direction for possession or a decision on title to land, or the object of the suit is something different but involves the consideration of the question of the title to land indirectly, the real dispute between the parties have to be ascertained. At this stage of the proceedings, where the allegations in the plaint have to be taken as true and correct - that is generally the rule in a demurer - it cannot be discerned 12 from the plaint that the object of the action is intricately linked to the title to, or the possession or control of, the immovable property of the trust in Madhupur. But on the written statement being filed and the immediate pre-suit conduct of the parties being seen, it may be evident that the real dispute is as to such immovable property which has been concealed in the plaint for the plaintiffs to ward off the possibility of an untimely end to the action. The plaint case is primarily for preventing the defendant from having anything to do with the trust. The plaintiffs have not even sought a declaration that the defendant has ceased to be a trustee. As to what matters will ultimately be in issue in the suit will depend on the defence. But an action simpliciter seeking an injunction against a person from holding herself out or representing herself to be a trustee brought by the trust in the names of the ostensible trustees will not be a suit for land.
Unless a clear case is made out in an application in the nature of demurer, the defendant has to be left free to carry the objection to trial and not obtain a premature arrest of the suit. Here, at least, on an apparent reading of the plaint the primary motive of the plaintiffs does not appear to be to wrest control, or consolidate their possession, of the Madhupur property. It is possible that the defendant may cite facts that would reveal that the plaintiffs have deliberately avoided directly claiming control of the Madhupur property though that is the real dispute between the parties. But for such a case to be made out, the defendant's version of things has to appear and be established. In an application of the present nature, it is only the plaint case that is seen, however misleading - as the defendants suggest - it may be in its appearance.
The other aspect is that the application has been made nearly two years after appearance was entered on behalf of the defendant in the suit. Though two years now may be a fraction of the life of a suit in this Court, but it would still demand that the objection be taken as a defence and not to obtain a premature ouster from this Court of the plaintiffs. GA No. 1894 of 2010 is disposed of by 13 permitting the defendant to carry the same objection, on grounds that may be more fleshed out, at the trial. There will be no order as to costs.
Urgent certified photocopies of this judgment, if applied for, be supplied to the parties subject to compliance with all requisite formalities.
(Sanjib Banerjee, J.)