M.S. Vadivelu Mudaliar and Others vs N.S. Rajabada Mudaliar

S. Ramachandra Iyer, C.J.

(1) These appeals arise from the judgment of Ganapatia Pillai J and they involve the interpretation of a Trust deed dated 1-1-1908, executed by

one Subha Daivanayaka Mudaliar. The settlor died in the year 1909, his only son Deiva Subbaraya Mudaliar having predeceased him 17 years

earlier. The widow of the latter had even during the lifetime of her father-in-law adopted one Sarvana Mudaliar. There was a partition of the family

properties between Subba Daivanayaka and his adopted grandson Saravana That transaction is evidenced by a document dated 25-11-1907.

Under that partition the property involved in the present litigation a house in Mint Street, Madras, which was then burdened with a mortgage

liability for Rs. 3000 was allotted to the share of Subba Daivanayaka. He created a trust over that property for the purposes to be presently

mentioned. The trust deed is in Tamil. It discloses the settlor''s intention to divest himself of the property for the purposes mentioned in the

document. The document provides that during his life-time the settlor was to reside as a tenant in a portion of the house paying rent; as and out of

the income therefrom, the encumbrances existing on the property should first be discharged. It further directs that after the discharge of the

mortgage liability certain festivals in a temple at Nungambakkam should be performed conformably to the conditions laid down. The material

portions of the document are contained in paragraphs 7 to 9 and 11 and 12. They run thus:-

After my life-time, a sum of Rs. 10 per mensem shall be paid every month from and out of the aforesaid income to Amruthammal who is my

daughter-in-law and widow of my deceased son Daiva Subbaraya Mudaliar for her life-time for her charity expenses.

The trustees that may be functioning from time to time shall, after the life-time of the aforesaid Amruthammal pay a sum of Rs. ten per mensem

permanently to Saravana Mudaliar who is her adopted son and my grandson, and after his life-time, to his male descendants hereditary.

As regards the expenses that may have to be incurred for maintaining during their(respective) lifetimes and giving education in their youths for the

children that may be born to the aforesaid Saravana Mudaliar in case he gets married and begets issue and the hereditary descendants of such

issue. I have given full power to the trustees to the effect that the trustees who may be functioning from time to time, shall, and from out of the

balance of the income remaining after meeting the expenses of the Uthsavam to be celebrated in the aforesaid Nungambakkam Devastanams and

the trust expenses and the tax and maramath expenses mentioned in the preceding two paragraphs, expend such sum as they may deem proper

and maintain and educate them (as aforesaid). In case the trustees are not willing, they shall stop (the same).

The Trustees shall, after my life-time, (spend) from and out of the aforesaid trust income in(such manner) as they may deem proper and have

the Vasantha Uthsavam celebrated for a period of not less than three days during the Vasantha Uthsavam (festival) which is being celebrated every

year in the temple of Sri Agastheeswaran and Venkatesa Perumal installed by out ancestors and enshrined in Nungambakkam.

After my life-time, the trustees shall accumulate the amount remaining out of the income from the aforesaid property after excluding the

assessment, quit rent and maramath and the monthly and annual expenses as aforesaid, and purchase (properties) therewith and provide (the same)

as income for the aforesaid charity"".

(2) Saravana died issueless in the year 1914. The appellant who was the plaintiff in the suit out of which these appeals arise instituted the suit for a

declaration that the provisions of the trust deed to which we have made reference earlier were void and invalid and that he was entitled to recover

possession of the properties free from all obligations specified in the document. There were other prayers in the plaint more or less of an incidental

nature to which reference is unnecessary.

(3) Substantially the case of the plaintiff was that the dispositions contained in the document being contrary to the rule of perpetuity, its dispositive

provisions should be regarded as void, and that the property involved in the suit be regarded as the property of the settlor and after his life-time of

his heirs.

(4) The suit was contested by the trustees appointed under the document. The learned Judge found that the document amounted to a valid

dedication of the property for a religious purposes that the rule of perpetuity would not apply to the case and that, therefore, the dispositions were

valid. But at the same time the learned Judge took the view that having regard to the changed circumstances, viz, the increase in the income of the

property yielded, it would be just and equitable that the settlor, Subbaraya''s heirs should obtain a sum of Rs. 50 per mensem instead of Rs. 10 as

provided under clause 7 of the document.

(5) The plaintiff feeling aggrieved by the decree has filed O.S.A. 39 of 1961. The trustees who felt aggrieved by the increase in the allowances

made to the settlor''s family have filed O.S.A. 13 of 1961.

(6) The only question for determination in O.S.A 39 of 1961 is whether the property has been dedicated absolutely for the performance of

vasantha uthasavam in the temples of Sri Agastheeswarar and Venkatesa Perumal. If that is so, the mere fact that members of the settlor''s family

are given certain benefits out of the income from the property or out of the available surplus will not affect the essential character of the dedication.

(7) Where a property is set apart for a charitable or religious purpose, the endowment generally takes one of two forms. (1) an absolute transfer of

the property for the benefit of the intended trust. In such a case, vesting of property can co-exist with minor dispositions out of the income from the

property in favour of other persons or even the settlor''s successors. (2) A case where there is no disposition of property as such in favour of the

charity but where it is merely kept or treated, as a fund or source out of which the charity has to be performed. In such a case what the charity

obtains is only a charge over the property, which will continue to remain at the disposal of the settlor and if he makes dispositions in favour of other

persons, they will take the property subject to the charge in favour of the charity. If he does not create any such disposition, his successors will

inherit the property as heirs as on intestacy, they also being liable to pay out the property amounts needed for the charity founded.

(8) Whether a particular endowment or trust amounts to an absolute transfer of property for the institution although it might be burdened with minor

dispositions in favour of other persons or whether it amounts merely to a charge in favour of the charity depends upon the ascertainment of its true

nature and where such endowment is in writing, upon a true construction of the document read as a whole. There is and can be no absolute or

precise rule by which such document has to be considered, For example, it cannot be inferred as a matter of law that the destination of the surplus

under a document indicates any intention on the part of the settlor to vest the property in accordance therewith. Where the terms of the document

are clear, the intention of the testator or settlor has to be found only by referring to those terms and in the light of the surrounding circumstances.

(9) Documents of trust not unoften contain words of dedication to charity but the mere fact that such words exist cannot mean that the property

has been absolutely dedicated to charity, for it might sometimes be a cloak or device to cover up a different disposition. Therefore, the substance

of the document has got to be found out. If it is found, on a fair reading of the document, that the dedication was merely intended to preserve the

property for the benefit of the successors of the settlor, then the disposition in favour of the charity should be considered as illusory, Per contra;

there may even be no words of dedication of property as such; there being only a disposition of the income therefrom. In such a case, the rule is

that so long as there is nothing contrary in the document, dispositions of the income can be taken as determining the character of the disposition of

the corpus. As has been pointed out in Harnarayan v. Sarja Kunwari, ILR 43 All 291: AIR 1921 P.C. 20 the question whether the idol(or charity)

itself should be considered the true beneficiary, subject to a charge in favour of the heirs or specified relatives of the testator for their upkeep, or on

the other hand such heirs should be considered the true beneficiaries of the property subject to a charge for the upkeep, worship and expenses of

the idol, is a question which can only be settled by a conspectus of the entire provisions of the will or document. Where, therefore, the effect of a

deed of dedication is to vest the property in a particular charity or for the purposes designated, the absolute character of the dedication will not be

cut down merely by reason of the fact that certain members of the settlor''s family or persons appointed by him are given certain benefits out of the

property. Such benefits will not amount to transfer of property in their favour. It will be a mere charge or something to be paid out in the event of

some contingency. Likewise as we said, there may be cases where the dedication is purely illusory; or what is intended for the purposes of the

charity might be nothing more than a charge, the substantial interest in the property vesting in the members of the settlor''s family or in those

appointed by him under the document. In short, the dedication might be either absolute or partial. As pointed out by AIR 1937 185 (Privy

Council) what has to be considered for determining the real character of a document is:

It is also of importance to consider the extent of the property alleged to be dedicated in relation to the expense to be incurred and the ceremonies

to be observed in the worship of the idol. The purposes of the dedication may be directed to expand as the income increases, or the purposes may

be prescribed in limiting terms so that if the income increases beyond what is required for the fulfilment of these purposes it may not be protected

by dedication"".

(10) The passage extracted above gives a safe test for ascertaining whether a deed of dedication really amounts to a dedication or contains merely

a charge in favour of the idol of charity. If for example the charity or service to be performed is fixed, consuming only a part of the income from the

property dedicated while what is left over either to the heirs of the settlor or other persons appointed by him is the substantial one, we can

reasonably infer that the testator or the settlor intended to create a mere charge in favour of such charity or service. If on the contrary, what is given

to the appointees of the settlor under the document was only a fixed sum, not capable of any increase or one to be paid in a contingency or at the

discretion of the trustee for the time being there being no such discretion left with him in regard to the charity or where the charity is an expanding

one, it can be taken that there is an absolute dedication of the property subject to a charge in favour of the appointees. Decided cases beyond

helping us to ascertain the principles of interpretation might not be of much use in finding out whether in a particular case, the document is of one

kind or the other.

(11) Mr. T. R. Sangameswara Iyer, learned counsel appearing for the appellant in O.S.A 39 of 1961 has referred us to a number of decisions

which according to him will show that the destination of the surplus under a document will be decisive as to the character of the endowment.

Reference was first made to the decision in Ashutosh Dutt v. Doorga Churn chatterjee, 2004(1880) Cal 438. In that case, the testatrix left a will

bequeathing certain lands for the support of the daily worship of an idol and for certain other religious purposes with a provision that in the event of

there being a surplus after these uses had been satisfied out of the income from the lands such surplus should be applied for the support of the

family. The Privy Council found that the surplus available after meeting the fixed expenses of the religious purposes specified would be substantial

and that provision relating thereto in favour of the members of the family amounted to a bequest of it to them. It was accordingly held that

notwithstanding the direction given by the testatrix in her will to the effect that her heirs should have no power of gift or any other form of alienation

over the property her intention was that the property should continue to remain with the family, the religious expenses being only met out of a part

of the income therefrom. This was a case where the disposition was of the surplus which was substantial, that for the designated religious purposes

amounting to no more than a charge.

In ILR 43 All 291 : AIR 1921 PC 20 there was a similar document and the expenses of the worship maintenance etc, of the idol in whose favour

there was a will were fixed; although the testament provided that the property of the testator should be considered as the property of the idol, it

was provided that after meeting the expenses in favour of the idol the surplus in that case was to go to the heirs of the testator. The surplus was

comparatively more substantial than the expenses intended for worship. The Privy Council held that as the expenditure upon the idol was fixed and

would require only a small portion of the income, that feature indicated that the intention of the founder was that the heirs should take the property

subject to a charge for the performance of the religious purposes named.

In Ramappa Naidu v. Lakshmanan Chettiar, 54 Mad LJ 272: AIR 1928 Mad 190 it was found that the charities which were set out in the will

would not consume any considerable portion of the income even if they were conducted on a lavish scale, and that a very large amount of the

income would be left in fact for enjoyment by the family in whose favour a residuary disposition was made; consequently it was held that the

properties covered by the will were not absolutely dedicated to the trust but were only charged with carrying out the trust, the principal intention of

the testator being to provide for the members of his family. M. Thiruvengadamudayanaiya Vs. R. Narasimhaswamiaiya and Others, was a similar

case where it was held that the proper inference to be deduced from the terms of the document which directed the residuary legatee to take a

substantial part of the income from the property for his own purpose while the religious and charitable purposes designated were to consume only

a small or a fixed part of the income, was that the property was merely charged to the charitable uses the ownership vesting in the residuary legatee

subject to the charge.

The Decision in AIR 1937 185 (Privy Council) to which we have made reference earlier held that if on a fair reading of the document of trust as a

whole it was found that it was not intended that the expenditure on the religious and charitable purposes should increase indefinitely with the

growing income yielded by the properties but on the other hand, the benefit of such increase was to be taken by the members of the family or

persons designated by the settlor, it will be a reasonable inference to regard the dedication in favour of the charity as amounting to nothing more

than a charge.

In Vasudeva Rao Vs. C.K. Rangai Gounder, Managing Trustee of Sri Koniyamman Devasthanam and Others, there were dispositions in favour of

a number of charities and in regard to one of them there was no limit prescribed. There was no disposition in regard to the residue. One of the heirs

of the settlor brought a suit contending that what had been given to the various charitable and had been given to the various charitable and religious

purposes was nothing more than a charge on the property and as the property itself had not been disposed of by the settlor, it descended to him as

on intestacy. The learned Judges after considering the various decisions, considered that having regard to the expanding nature of the charities the

intention of the settlor must be taken to be to vest absolutely the property for the charities and not to leave anything for himself.

Learned counsel then invited out attention to the decision in Annada Charan Dutta Vs. Kamala Sundari Rai and Others, . We are unable to find

any different principle laid down in that case. In this connection we may refer to the decision of the Privy Council in Jadunath Singh v. Thakur Sita

Ramji, ILR 39 All 553: AIR 1917 PC 177, where under the terms of a document of trust one half of the income was to be applied to the temple

purposes and the other half for the maintenance of the trustees or the Mutavallis thereof who were to come from the family of the settlor. The Privy

Council held that the gift in favour of the idol and not been cut down by any other disposition in favour of others the remuneration to the Mutavallis

being incidental to the proper management of the institution. In Jainambukanni Ammal and Another Vs. Ruthrapathy Pillai and Others, , the

property was endowed for certain charitable and religious purposes but there was also disposition of the residuary income in favour of certain

beneficiaries for a limited period. Nevertheless the dominant intention of the settlor as disclosed in the preamble as well as from the other parts of

the document was found to be to vest the property for the benefit of an expanding charity.

It will be apparent from decisions to which we have just now made reference, that the question whether a document amounts to an absolute

dedication of property in favour of a charity or whether it merely amounts to a charge on the property cannot be decided purely on a consideration

as to who takes the surplus after meeting the expenses of the charity, but on a conspectus of all the terms thereof in the light of the numerous

circumstances, the vital point to be taken into account being what is the proportion of the benefit received by the charity in relation to that received

by the other beneficiaries. To reiterate what we said earlier if the benefit is essentially to the charity, the fact that certain amounts are paid out of the

income from the property dedicated, to the relatives of the settlor will not take away the character of the dedication. Therefore, the fact that such

amounts are to be paid out of the surplus, found after meeting the expenses of the charity cannot mean that what is given to the charity is merely a

charge on the property and that the relatives of the settlor could take the property.

(12) In the present case, the dispositions under the document are clear. The property is absolutely given for the performance of utsavam in the

temples. It will be noticed that the settlor has not prescribed any limit to the duration of the festival or to the amount to be spent upon it. Subject to

the provisions of clause 7, the trustee in his discretion can expand the charity. It is only if the trustee finds a surplus after spending to the full on the

charity that he is directed to devote certain amounts for the benefit of the education of the descendants of the settlor. Paragraph 7 of that trust-

deed contains the direction of payment of Rs. 10 per mensem to the descendants of the settlor. That will amount to a charge on the property. The

other disposition in regard to the educational expenses of the children of Saravana is one purely to be done at the discretion of the trustee who may

give it for the purposes mentioned or perhaps even refuse, to give. The descendants of the settlor cannot therefore be held to have any disposition

in their favour which they can claim as of right. The document contains certain directions about the disposal of the accumulated surplus which is

indicative of the intention of the settlor. It provides that the surplus amounts should be utilised for the purchase of properties to augment the

resources of the charity specified. The property must accordingly be held as absolutely dedicated for the performance of the utsavams referred to

in the document, subject to the charge in favour of the relative specified. The appeal fails and is dismissed.

(13) O.S.A. 13 of 1961 concerns the direction given by the learned Judge for increasing the amount of Rs. 10 granted by the settlor under Clause

7 of the trust deed to Rs. 50 per mensem. As the terms of the document will show, the settlor did not authorise payment of anything more than Rs.

10 per month to his descendants. The learned Judge regarded this payment of Rs. 10 per month as one for the maintenance of the representatives

of the donor and in as much as the income from the property had increased he thought that this allowance could be increased. He observed--

Consequently the cy pres rule can be invoked to increase the allowance payable to the descendants of the donor equally with the increased income

being applied to the other utsavams to be performed in the temple because both are the declared objects of bounty of the settlor"".

We are unable to accept the reason given by the learned Judge as a sound one. As we said, the settlor did not intend that his descendants should

get more than Rs. 10 per mensem. We are unable to see how the cy pres doctrine can at all be invoked in the present case. That doctrine is stated

to be that if a general charitable intention is indicated but the particular object named is illegal the gift may be applied cy pres. Again where a fund

to charity is not exhausted by the particular purpose specified by the donor the surplus will be a applied cy pres if the donor had a general

charitable intention. If no such intention is disclosed, the testator must be held to have left the surplus testator must be held to have left the surplus

undisposed of. It is well settled that the doctrine of cy pres will not apply where a contrary intention is expressed or implied from the language used

by the testator. This rule is state thus at page 324 of Halsbury''s Laws of England, Vol. 4, third Edn,:

No application of cy pres is possible in cases where a contrary intention is expressed or is to be implied from the language used by a testator, as

for example, where there is a direction that on failure of a bequest the property shall fall into residue and the residue is not given to other charitable

purposes or where the objects of the original trust are capable of being carried into effect but remain unsatisfied or where the original trusts are still

subsisting"".

From the terms of the document to which we have made reference it is indisputable that the intention of the testator was that all the surplus income

should be utilised to purchase additional properties for the benefit of the trust. There is, therefore, no scope for the application of any rule of cy

pres so long as the objects of the trust exist. We are further unable to see how any direction by Court by way of application of cy pres doctrine

can at all be made in this case where the only relief sought for was recovery of possession of the property from the trustees by the appellant. The

question as to the application of the cy pres doctrine can arise only in suits filed under S. 92 C.P.C. or in other appropriate proceedings. We are

therefore unable to sustain the increase of the maintenance allowance from Rs. 10 to Rs. 50.

Mr. T.R. Sangameswara Iyer realising this difficulty sought to support the judgment of the learned Judge by referring to Cl. 9 of the document.

That clause provides for payment of education and other expenses out of the surplus income at the discretion of the trustee. It is very doubtful

whether the plaintiff who is not a son born of the loins of Subbaraya could at all obtain any benefit under Clause 9; but even so that clause only

vests a discretion in the trustee either to pay allowance or not to pay any allowance. It will not be open to the Court in such a case to issue a

mandatory direction of the kind contained in the present decree. The result is that O.S.A. 13 of 1961 has got to be allowed with respect to the

increase of the maintenance amount. There will be no order as to costs. The appellant in O.S.A. 39 of 1961 will pay Court Fee due to the

Government.

(14) Order accordingly.