C. Kalahasti and Others vs R. Sukhantharaj and Others

K. Veeraswami, C.J.—These appeals, arising out of a suit u/s 92 of the Code of Civil Procedure, are by Defendants 2, 5, 6, 8 and 9 who

are trustees among others one directed against a decree directing a scheme to be settled and asking for a draft scheme and the other against a

decree settling a scheme for Sir Thyagaraja College, Madras, and allied institutions. In a partition document, dated May 19, 1917, executed by

Pitti Pedda Thyagaraya Chetty and Pitti Chinna Thyagaraya Chetty, the properties described in the ''C schedule thereto were set apart for

charitable and other purposes. This trust has since grown considerably, the properties belonging to which are now estimated to be worth

somewhere near half a crore of rupees. Originally what was a small school in the first decade of this century, developed by 1950 into Sir

Thyagaraja College High School and an Elementary School. About 2,000 students are studying in the day college, 1,220 students in the evening

college, 1,900 students in the High School and 100 in the Elementary School. These institutions provide for different courses of study and are

recognised by the University of Madras. On November 12, 1931, Stone J., on an application under Sections 35 and 36 of the Indian Trustees

Act, 1866, appointed additional trustees, and by another order dated November 26, 1931, the same learned Judge settled a scheme and provided

for filling up vacancies which may arise in the Trust Board. He directed that there should be a Board of Trustees consisting of seven members out

of whom one to be elected by the teaching staff of the school, two to be elected by the Councillors of the Corporation, two to be co-opted by the

Board of Trustees and two to be appointed by the adult male members of the family of the donors. The scheme fixed the tenure of office, made

provision for eligibility of re-election, and cessation of trusteeship. By another application under the said sections, the scheme was amended by an

order of Panchapakesa Ayyar J., dated July 16, 1953. As amended, the scheme provided for a Board of 12 members, who should be appointed

in the manner prescribed, that is to say, two to be appointed by adult male members of the family of the donors, two, of whom one to be elected

by the teaching staff of the school and another by the college staff, two to be elected by the Councillors of the Corporation of Madras, one to be

elected from among the old students by the old students of the Thyagaraja Educational institutions, one to be nominated by the Syndicate of the

University of Madras, two to be co-opted by the Board of Trustees and two ex-officio members, namely, Principal of the College and the

Headmaster of the High School. The scheme further provided for the order of election, tenure of office, eligibility for re-election, cessation of

trusteeship and also provided for the power of the Board of Trustees to make such laws or bye-laws not inconsistent with the scheme as were

necessary for the administration and management of the college and school. Substantially, the scheme, as framed by Panchapakesa Ayyar J., in

modification of the earlier one, has been in force over since except for some minor alterations effected by orders of Court, later. Now the Plaintiffs

claiming to be old student instituted the suit with the consent of the learned Advocate-General for a declaration that the scheme settled by Stone J.,

and later modified by Panchapakesa Ayyar J., as aforesaid, was null and void and not in accordance with law, for settling a scheme, to remove

Defendants 2, 8 and 9 from the office of trustees, to appoint new trustees an J vest the properties in them and for certain interlocutory directions.

The plaint, therefore, was based on the allegations that the scheme, which was in force before, was invalid and it was therefore, necessary to have

a fresh one settled, that there was mismanagement, malfeasance, misfeasance including misappropriation and breach of trust and further that there

was also favouritism and constant confusion as between the members of the Trust Board and that it was also necessary because of their

misconduct, to remove Defendants 2, 8 and 9 from the office of trusteeship. The suit was resisted strenuously. At the trial, as many as 11 issues

were settled. Sethuraman J., who tried the suit, found that the Plaintiffs had interest in the trust and were entitled to maintain the suit, that the

scheme settled by Stone J., and modified by Panchapakesa Ayyar J., under Sections 35 and 36 of the Indian Trustees Act, was invalid, as the Act

did not authorise settling such a scheme, that the allegations of mismanagement, breach of trust malfeasance misfeasance, misappropriation,

confusion, favouritism and the rest were not established, that the allegations of misconduct against Defendants 2, 8 and 9 were also not established

and that in view of the fact that he had found the earlier scheme to be void and without authority, it was necessary to frame a fresh scheme of

management. He therefore, called for a draft scheme and later settled the scheme of management, which, as we said at the outset, are the subject

matter of the two appeals.

The Appellants strenuously contest the finding of the learned trial Judge that the Plaintiffs had the locus standi to institute the suit u/s 92 of the

Code of Civil Procedure. The argument is put in two ways. One is that the Plaintiffs, even as old students, which is not admitted, have no interest in

the trust as envisaged by Section 92 of the Code of CPC and that secondly in any case, the motive of the Plaintiffs was to espouse the cause of the

Principal of the College and to support him. Our attention has been invited to two pending suits in the City Civil Court, in one of which the second

Defendant, as Plaintiff is contesting the no confidence motion against him brought at the board of management, and in the other an order made by

the Board of Trust-tees suspending the Principal was under challenge. Mr. Vasantha Pai for Appellants stated that the Plaintiffs have not even

established that they are old students, which they should have, according to him, proved by deposing to that effect. Since they did not do so, as it

happened in Gayanand v. Jagdish Chandra 40 A.L.J. 334 the suit should, on this limited ground, be dismissed. We are unable to accept this

contention. The Plaintiffs have averred that they are old students of the college and there is no specific denial of this in the written statement. The

Appellants could only draw our attention to the general denial contained in paragraph 1 of the written statement. Then again, it is said that the

Plaintiffs are not even on the electoral rolls of the old students of the college and they have no locus standi to institute the suit. It may be that it

would have been better if the Plaintiffs had gone into the box and proved the fact that they were the old students of the college. But their failure to

do so does not lead us to the inference that they are not old students of the college, which is not seriously challenged in the written statement.

Further, issue No. 1 itself has proceeded on the basis that the Plaintiffs were old students of Thyagaraja College, and the only point under that

issue to be decided was whether, as such old students, they had any subsisting or real interest in the trust, so as to enable them to maintain the suit

u/s 92 of the Code of Civil Procedure. We agree with the learned trial Judge that the Plaintiffs were old students of the college and the fact that

their names are not found in the electoral rolls of the old students will not derogate from the interest they have as such old students of the college.

The next question is whether, as old students of the college, they can be said to have an interest in the trust. u/s 539 of the Code of Civil

Procedure, 1888, the expression persons having direct interest in the trust was used. But in Section 92 of the Code of Civil Procedure, 1908, we

find the phraseology having an interest in the trust. This change in the phraseology may not, however, make much difference to the true import to

the word interest in respect of the trust. All that it, in our opinion, means is that the persons figuring as Plaintiffs in a suit u/s 92 must have an interest

in the trust, that is to say, an interest special or particular as distinct from the generality of the interest which the public may have in the trust.

Ramachandra Aiyer v. Parameswaran Unni I.L.R Mad. 360 decided by a Full Bench of this Court, held that interest u/s 92 of the Code denoted

an interest which was substantial and not sentimental or remote and that the English decisions under Lord Romilly''s Act, which laid down that the

Petitioners under the Act must have an interest which was clear or direct, should be a guidance in interpreting the provisions of Section 92 of the

Code of Civil Procedure. That was a case where a Hindu residing in Madras and another residing in Tellicherry instituted a suit in the District Court

of North Malabar, u/s 92 of the Code of Civil Procedure, in respect of a Hindu temple situated in Tellicherry in North Malabar, after obtaining the

requisite sanction of the Advocate-General. The former would appear to have gone to the temple for worship on one or two occasions in the past

and might possibly go there to worship in future if business took him to Tellicherry. When a question of maintainability of the suit by them was

raised, one of them who had claimed to have worshipped in the temple relied on his right as a Hindu to worship in the temple as entitling him to

institute the suit. The majority held that though, as a Hindu, he might have the right to worship in the temple, he had not, on that ground alone, the

interest required by Section 92 of the Code to maintain the suit. It is obvious from this decision that the general interest a person, as a Hindu, may

have in a temple in that he might possibly worship in the temple, would not by itself be sufficient to satisfy the requisite that he must be a person

who has an interest in the trust. In other words, something more than the generality of interest, which he had, should be established as a kind of a

special factor to establish interest as is required by Section 92. This is what Wallis C.J., observed:

I am clearly of opinion that to entitle him to sue under that section, it is not enough that the Plaintiff is a Hindu by religion, but he must have a clear

interest in the particular trust over and above that which millions of his countrymen may be said to have by virtue of their religion.

The learned Chief Justice went on further:

That interest (interest for purposes of Lord Romilly''s Act), it seems to me, if the provision is not to be altogether illusory, must arise from some

special relation in which the Plaintiff stands to the endowment in question as compared with the whole body of religious community throughout

India; in other words, he must be in a position to derive some benefit from the trust in respect of which the suit is filed.

We are not quite sure whether the last requisite, namely, that the person must be in a position to derive some benefit from the trust in respect of

which the suit is filed, in order to qualify himself that he is a person having interest in the trust, is entirely correct. All that the majority of the Full

Bench meant to say was that the Plaintiff must stand on a special relationship with the trust as distinct from the rest of the community in respect of

the suit trust, so that he may have a particular direct relationship with the institution. To hold that any member of the public, who may have a distant

or indirect connection or relationship with the institution, is a person having interest in the trust, would dilute the requirement of Section 92. That

was the ratio of Ramachandra Aiyer v. Parameswaran Unni ILR Mad. 360. Vaidyanatha Ayyar v. Swaminatha Ayyar ILR Mad. 884, a decision

of the Privy Council, agreed with the view of the learned Chief Justice in Ramachandra Aiyar v. Parameswaran Unni ILR Mad. 360 and said that

to hold that the bare possibility, however remote, that a Hindu might desire to resort to a particular temple, gave him an interest in the trust,

appeared to defeat the object with which the Legislature inserted those words in the section. The Privy Council noted the change in the language

employed by Section 539 of the old Code and Section 92 of the new Code. On facts, in that case, the Respondents were Defendants in female

lines of a Hindu who was the founder of a chattram, which was a public charity. The Respondents before the Privy Council, with the consent of the

Advocate-General, instituted the suit u/s 92 to remove the trustees. The Privy Council held that the Respondents were ""persons having an interest

in the trust"" within the meaning of Section 92 and consequently were entitled to maintain the suit, even though they might never themselves make

use of the chattram. They came to that conclusion because the Plaintiffs were decendants, although only in the female lines of the founder of the

chattram, and that gave them an interest in the proper administration of the trust sufficient to enable them to maintain the suit. Mahant Harnam

Singh, Chela of Bhai Narain Singh Vs. Gurdial Singh and Another, also reviewed the earlier decided cases and accepted the view of Wallis C.J., in

Ramachandra Aiyar v. Parameswaran Unni ILR Mad. 360, as correct. The whole object of Section 92 is to prevent people from interfering, by

virtue of the section with the administration of charitable trusts merely in the interest of others and without any real interest of their own.

In the instant case, the Plaintiffs, as old students of the college, would naturally be interested in the proper administration of the entire trust. As old

students they stand distinguished from the generality of the community and that association gives them a particular direct and distinctive interest in

the public charitable trust, to which their old Alma Mater belongs and in the proper administration of which they will be interested. What is more is

that in the scheme settled by Panchapakesa Ayyar J., old students of the college were entitled to elect from among themselves one as a trustee to

represent them on the Board of Trust. We are satisfied, therefore, that the Plaintiffs are persons having interest in the trust and have locus standi to

maintain the suit.

It is next pressed for the Appellants that the Plaintiffs were motivated in instituting the suit to satisfy the private vendetta of the Principal of the

College, who is an ex-officio trustee and in order to support his case. We have carefully looked into the record and do not find any basis for this

contention. It is true that if that was the motive with which the Plaintiffs came to Court, they would not be entitled to maintain the suit. In Swami

Paramatmanand Saraswati and Another Vs. Ramji Tripathi and Another, it was pointed out.

If it is clear that the Plaintiffs are not suing to vindicate the right of the public but are seeking a declaration of their individual or personal rights or the

individual or personal rights of any other person or persons in whom they are interested, then the suit would be outside the scope of Section 92.

That is not the case here. We have already mentioned the broad scope of the plaint, which is based on two main allegations (1) that the existing

scheme is invalid and, therefore, it is necessary to frame a fresh scheme for the proper administration of the trust and (2) that the Board of Trustees

was guilty of mismanagement, breach of trust, malfeasance, misfeasance, etc. That is certainly not to vindicate the Plaintiffs'' own interest or even

that of the Principal. We, therefore, hold that the Plaintiffs had the necessary locus standi, since they had interest in the trust, and in this respect,

they fully satisfy the requirement of Section 92 of the Code of Civil Procedure.

The next question is whether the finding of the learned trial Judge that the scheme settled by Stone J., and amended by Panchapakesa Ayyar J.,

was invalid, is correct or not. The order of Stone J., dated November 12, 1931, was made on a petition presented by P.T. Chengalvaraya Chetty

and Rao Bahadur P.T. Kumara-swami Chetty, both members of the family of the donors, for appointment of additional trustees and vesting the

properties in them. Stone J., by his order, directed that one Dewan Bahadur C.V. Viswanatha Sastriar, M. Ct. M. Chidambaram Chettiar, K.

Venkataswami Naidu, R. Krishnadoss Lal and M.C. Munuswami Chetty be appointed as additional trustees for the management of the trust,

besides the Petitioners who were existing trustee and that the trust properties be vested in and managed by the committee of management. The

second order of Stone J., dated November 26, 1931, was made on the same petition on the date to which it stood adjourned. The learned Judge

directed a scheme to be settled and approved for filling up future vacancies in the Board of Trustees appointed by his earlier order. In making

these orders, the Court purported to act in exercise of the powers under Sections 35 and 36 of the Indian Trustees Act. Panchapakesa Ayyar J.,

in modifying the scheme by his order, dated July 16 1953, also purported to act under those sections. We may mention that on the day

Panchapakesa Ayyar J., had made his order, by virtue of Central Act xlviii of 1952, the Indian Trustees Act, 1866, had been repealed with effect

from August 2, 1952. Sethuraman J., was of opinion that Sections 35 and 36 of the Indian Trustees Act did not give the Court the power to validly

make the above orders. With respect to the learned Judge, we are unable to agree with him. It is true that the preamble to the Indian Trustees Act,

1866, is rather vague, and would suggest that the Act is only limited to the scope envisaged by the preamble. From a perusal of the various

provisions of the Act, we are led to think it is clear that they are of much wider scope than what is comprehended by the preamble. One thing is

certain, and that is, that where to a trust and its management, Hindu Law will apply or any other personal law the provisions of the Act cannot be

made use of contrary to such laws. Subject only to this, we are of opinion that Sections 35 and 36 of the Act did give the necessary power under

which Stone J., and Panchapakesa Ayyar J., could validly make the orders which they did. The Act deals with various trusts and different

contingencies. Section 3 defines when the powers under the Act could be exercised by the High Court. It says that the powers and authorities

given by the Act to the High Court shall and may be exercised only in cases to which English law is applicable, and may be exercised with respect

to property within the local limits of the extraordinary original civil jurisdiction of the said Courts respectively. This section, in our opinion, does not

mean that the powers and authorities could be applied or exercised only in respect of Englishmen or English trusts. Where personal laws, which

may apply to a charitable trust, are not interfered with or do not come into conflict, there is room for English law to apply. In fact, the laws relating

to trusts of different kinds in this country have been largely borrowed from the English law. That this is the scope of the law and applicability as well

as limitation thereto, has been brought out by some of the decided cases. Radha Kissen Chamaria v. Keshardeo Chamaria I.L.R.(1949) Cal. 461

held that the Indian Trustees Act of 1866 excluded from its scope only such trusts as were created and governed wholly under Hindu and

Mahomedan law, to the incidents of which the principles of English law would not be applicable, and that where, however, the trust is in the English

form and the application of the principles of English law would not violate any provision of Hindu Law, the Indian Trustees Act, 1866, would be

applicable and an application under that Act could be maintained, notwithstanding that the trust was for religious and charitable purposes or for the

benefit of charitable or Hindu religious institutions.

Section 35 of the Act gave power to the High Court to make an order appointing new trustees. It says that in all cases in which it shall be

expedient to appoint a new trustee or new trustees, and it shall be found in-expedient, difficult or impracticable so to do without the assistance of

the High Court, it shall be lawful for the said court to make an order appointing a new trustee or new trustees, whether there be any existing trustee

or trustees or not at the time of making such order, and, if there be such trustee or trustees, whether in substitution for or in addition to him or them.

It seems to us that this section conferred a power which could be exercised summarily, and in the circumstances mentioned by the section. The

second paragraph of Section 35 is important. It says that the person or persons who upon the making of such order shall be trustee or trustees,

shall have the same rights and powers as he or they would have had if appointed by decree in a suit duly instituted. That means that the power of

appointing new trustees is not confined to mere appointment, but its significance is fully brought out by the second paragraph of Section 35. In our

opinion, the order made by Stone J., by which he not only appointed additional trustees but recognised the then existing two, and also framed what

he called a brief scheme of management by which he provided for filling up vacancies, duration of the offices, etc., is valid. If the trustees,

appointed by exercise of the power u/s 35 shall have the same rights and power as they had they been would have, appointed by a decree in a suit

that would, in our opinion, duly instituted, cover the entire ambit of the trustees'' powers which may be controlled and guided and limited by the

scheme of management. Section 36 gave the High Court the power to vest immovable property in the trustees appointed by the same Court in

exercise of its powers u/s 35. Here again, we have the second paragraph in the section which say that such order shall have the same effect as if

the person or persons who, before such order, was or were the trustee or trustees (if any) had duly executed all proper conveyances of such

property for such estate. We agree that these two sections are not a substitute for Section 92, which relates to a suit. The powers under Sections

35 and 36 were exercised on an application. That will meet the reasoning of Sethuraman J., who thought that because of Sub-section (2) of

Section 92, the orders made by Stone J. and Panchapakesa Ayyar J., were invalid. Sub-section (2) of Section 92 only provides that 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. The orders of, Stone J. and Panchapakesa Ayyar J., are not hit by Sub-section (2) of Section 92, which

relates to institution of a suit for the reliefs contemplated by Sub-section (1) of Section 92. The applications made before Stone J. and

Panchapakesa Ayyar J., were not of that nature and the orders made by them were not also in a suit. We are of opinion, therefore, that the orders

of the two learned Judges aforesaid were competent and were valid. On that view, it is not necessary to deal with the other contentions of the

Appellants based on Ledgard v. Bull ILR All. 191 and the fact of the orders having been in operation over a long period of years.

Sethuraman J., came to the conclusion that a fresh scheme should be settled only because he found that the orders of Stone J. and

Panchapakesa Ayyar J., were incompetent and were invalid. The learned Judge has after a full consideration of the allegations of mismanagement,

breach of trust, misfeasance, etc., and the related record of evidence, found that none of those allegations was established, either the allegations in

paragraph 17 of the plaint or rest of the allegations directed against Defendants 2, 8 and 9 in connection with the prayer to remove them from

trusteeship.

We have been taken through parts of the judgment of Sethuraman J., and the related evidence. We are of opinion that his finding that none of

the allegations was proved is well-founded. Broadly speaking, these allegations are covered by Issues Nos. 4 and 5 and relate to (1) the property

in Korukkupet, (2) construction of a building in the High School premises, (3) acts of favouritism, (4) absence of property qualification of the

trustees, (5) impropriety of the Principal of the College and the Headmaster of the High School being members of the Board of Management, (6)

impropriety of there being two trustees from the family of Sir Theyagaraja Chetty contrary to the partition deed of 1917 and (7) alleged wrongful

payment to the relations of Theyagaraja Chetty contrary to the object of the trust. So far as the first items is concerned, what appears to have

happened is that in recent years some vagrants and boyees had come into occupation of this land. The charge is that the Board of Trustees did not

take any steps to remove them. But in these days, as we know, it is a common feature that those who are houseless, vagrants and Ors. who belong

to the lower strata of society trespass in to others lands and persist in continued occupation thereof. This is a problem which is commonly noticed

these days. But the Defendants have shown that they have taken steps to have these people evicted, though somewhat belatedly. As to the

construction of the building in the High School premises without calling for tenders, Sethuraman J., has found that though it would be desirable to

call for tenders, which would rule out the possibility of making an allegation of favouritism, he could not find any basis for the charge of favouritism

or any loss to the institution. He considered that, on the record of evidence as it stands, he could not find fault with the Board of Management on

this ground. We are inclined to agree with him. On the whole, there appears to be no impropriety or mismanagement or malversation of trust funds

because in constructing a building no tenders were called for. The allegation of favouritism under item 3 relates to the appointment of one

Ganapathi, nephew of the second Defendant, who happened to be the President of the Trust Board. But then, as pointed out by Sethuraman J.,

though Ganapathi was only a Third Class M. Sc., in Mathematics, he was recommended by the Principal and his appointment as Assistant

Professor was made with the approval of the Board, and the Board had accepted the recommendations of the Principal. We find no serious

impropriety on this score as well, for, in academic matters, the Board would be normally expected to be guided by the advice of the Principal. The

next item relates to the want of property qualification in the trustees. But the scheme framed by Panchapakbsa ayyar J., in modification of the

earlier orders, Stone J., proceeded not in property qualification but in certain other qualifications, which would well meet the requirement of the

proper conduct of the affairs of the trust. We also find no impropriety in the Principal of the College and the Headmaster of the School being

members of the Board of management, because this is a trust which is managing educational institutions and their presence would be advisable and

in fact necessary. The trust deed itself provided for representation of the donors'' family on the Trust Board, and there was nothing wrong in two

trustees being put on the Board who were from the family of Theyagaraja Chetty. The allegation that certain amount were wrongly paid to the

relations of Theagaraja Chetty was also not made out, because though it left some acrimony between the parties, the matter was dealt with by the

Board and ultimately no amount was paid to the relations. In the circumstances therefore, we agree with Sethuraman J. that the ground of

mismanagement, breach of trust, misfeasance, etc., for settling a fresh scheme falls to the ground. A great deal was sought to be made out of the

fact that for the admission of a candidate to the College at the instance of one Dr. Murugesan and his brother-in-law Shanmugam, a sum of Rs.

1,000 was received as donation and this was misappropriated eventually. We find that there was conflicting evidence on this point and that the

donation itself was returned as acknowledged by Dr. Murugesan himself. No misappropriation was, therefore, established.

As the scheme as settled by Panchapakesa Ayyar J., was a valid one, as we have held it was, and the ground of mismanagement breach of

trust, etc., fails, there is no other reason for settling a fresh scheme on the basis of the plaint such as it has been presented.

We, therefore, allow the appeals. But before we part with the matter, we should like to observe that having seen a great deal of acrimony and

fight, a tendency towards conflict as between members of the management, it will be in the interest of the trust that a fresh scheme is settled in a

properly instituted suit and in a more peaceful surrounding and atmosphere. The scheme, such as it is, appears to be inadequate in certain

particulars, though the lacuna may be filled up by framing bye-laws which the Board has power to do. In the circumstances, we direct that the

learned Advocate-General may look into the affairs of the administration of the trust, and if he felt advisable, himself institute a suit u/s 92 of the

CPC for settling a fresh scheme for the proper administration of the trust, which, since its foundation, has grown into such huge proportions. No

costs.