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Raja Damara Kumara Venkata Lingama Nayanim Bahadur Varu Vs. Panaganti Jagannadha Rayanimgar and ors. - Court Judgment

LegalCrystal Citation
SubjectTrusts and Societies
CourtChennai
Decided On
Reported inAIR1931Mad97; (1931)60MLJ155
AppellantRaja Damara Kumara Venkata Lingama Nayanim Bahadur Varu
RespondentPanaganti Jagannadha Rayanimgar and ors.
Cases ReferredSrinivasa Moorthy v. Venkata Varada Aiyangar
Excerpt:
- - the plea of the defendants was that in fact there was no trust at all, that the properties belonged to the rajah of kalahasthi in his personal capacity and that the mortgage was perfectly valid......for a declaration that there was a trust in favour of a choultry created in respect of the suit village long prior to 1896, and that the mortgage created in 1896 by rajah no. 1 in favour of the defendant (the rajah of venkatagiri) was not binding on the trust. the defendant not having opposed the: suit, a decree 'by consent' was passed in favour of the plaintiff as prayed for. rajah no. 2 mortgaged the village in question in 1912 in favour of the present 1st defendant for a sum of rs. 80,000. in the mortgage deed it was recited that the properties belonged to the mortgagors, and no mention of any trust was made in the mortgage. on the basis of that mortgage, the mortgagee filed o.s. no. 7 of 1916 on the file of the court of the subordinate judge of north arcot to recover the.....
Judgment:

Anantakrishna Aiyar, J.

1. In this case two questions have been referred to the decision of the Full Bench and, as it is admitted, that if our answer to the second question should be against the appellant, there is no necessity to answer the first question, we proceed to state such facts as are necessary to make our answer intelligible.

2. The plaintiff is the present Rajah of Kalahasthi and he instituted the original suit out of which this reference has arisen for a declaration that the mortgage deed, dated the 21st of September, 1912, executed by the Kalahasthi Rajah, whom we may call here Rajah No. 2, in favour of the 1st defendant is not binding upon the trust, for a declaration that the village in question Yerpedu is property appertaining to a trust in connection with a choultry-charity, and to recover possession of the property. The plea of the defendants was that in fact there was no trust at all, that the properties belonged to the Rajah of Kalahasthi in his personal capacity and that the mortgage was perfectly valid. The second question which has been referred to us is whether the defendants are entitled to set up the defence that they did in the present case, namely, that there was no real trust with reference to the village in question.

3. The history of this village in so far as the same is disclosed by the evidence in this case is as follows: In 1896 the Rajah of Kalahasthi, who may be called as Rajah No. 1--by name Akkappa Nayanim Bahadur Varu--mortgaged this village to the Rajah of Venkatagiri under Ex. VII. The Rajah of Venkatagiri filed O.S. No. 2 of 1907 to recover the amount due on the basis of that mortgage, making the mortgagor's son a party to the suit. The suit was in fact filed against Rajah No. 2 the mortgagor Rajah No. 1 having died in the meantime. There was a decree passed in favour of the. plaintiff. Subsequently, however, Rajah No. 2 instituted O.S. No. 21 of 1910 on the file of the Court of the Subordinate Judge of North Arcot against the Rajah of Venkatagiri for a declaration that there was a trust in favour of a choultry created in respect of the suit village long prior to 1896, and that the mortgage created in 1896 by Rajah No. 1 in favour of the defendant (the Rajah of Venkatagiri) was not binding on the trust. The defendant not having opposed the: suit, a decree 'by consent' was passed in favour of the plaintiff as prayed for. Rajah No. 2 mortgaged the village in question in 1912 in favour of the present 1st defendant for a sum of Rs. 80,000. In the mortgage deed it was recited that the properties belonged to the mortgagors, and no mention of any trust was made in the mortgage. On the basis of that mortgage, the mortgagee filed O.S. No. 7 of 1916 on the file of the Court of the Subordinate Judge of North Arcot to recover the amount due and obtained a decree. In execution of the decree, the decree-holder became himself the purchaser of the properties and also obtained possession of them. Rajah No. 2 seems to have died in December, 1919. Subsequent to that, Rajah No. 3 of Kalahasthi instituted in 1922 the present suit for a declaration that the village of Yerpedu is trust property, and for recovery of possession of this village on the footing of its being trust property, the Rajah of Kalahasthi for the time being being alleged to be the trustee. The plea of the: defendants that there was no trust at any time regarding this village was upheld both by the Trial Court and also by the two learned Judges before whom this appeal came on in the first instance and who have made this reference to us. Having regard to the observations made by the Privy Council in Srinivasa Moorthy v. Venkata Varada Aiyangar the learned Judges were in doubt as to whether it was open to a person who assumed the position of a trustee to mortgage the property subsequently as his private property. The second question referred to us is whether the 1st defendant, the mortgagee from Rajah No. 2, could set up the defence that there was no trust at all and that the property was liable for the amount of the mortgage due to him. From the above statement of facts, and from the finding of the two learned Judges, concurring with the finding of the Lower Court, that there was in fact no trust with reference to this property, it would follow that if it be held that it is open to the 1st defendant to raise such a plea, then he, has got a complete defence to the suit. The only question, therefore, is whether it is open to the defendants to raise such a plea. It was argued by the learned Advocate-General on be-half of the appellant that the effect of the decree in O.S. No. 21 of 1910 was in fact to create a valid trust in respect of this particular village. In the plaint in O.S. No. 21 of 1910 (Ex, GG) it is stated in paragraph 1 that the dedication of the village Yerpedu was made 'long ago' for the maintenance of a choultry-charity and that the Rajahs of Kalahasthi were the hereditary trustees thereof. In paragraph 7 it is mentioned that the mortgage of 1896 was not binding upon the trust, which, it is stated, had been in existence for a long time. We: are unable to agree with the contention of the learned Advocate-General that the effect of the decree in O.S. No. 21 of 1910 is to create a trust for the first time in respect of this property. It was not anybody's case in O.S. No. 21 of 1910 that the village in question was for the first time dedicated to trust by Rajah No. 2 in 1910. The case was that a trust had been created long prior to the suit of 1910; otherwise it is impossible to understand how a mortgage created in 1896 could be declared to be not binding on the property. If no trust existed already, it does not seem to have been the intention of anybody to create a trust for the first time in 1910. Anyhow, different considerations would arise if the latter plea had been put for-ward. That was not so alleged in the plaint, and, as we read the decree, (Ex. GG 1), that was not the decree passed in that case.

4. In any event, it is enough for our present purpose to state that the effect of that decree, which was passed by consent of parties, could not be more than a private contract between the then plaintiff and the then defendant. The present defendants took the mortgage of 1912 from the Rajah of Kalahasthi No. 2 not as representing any trust but in his private capacity and on the: footing of the, property being the mortgagor's own property; and that being so, we do not think that there is anything to prevent the present defendants from alleging and proving that there was no trust at all as alleged by the plaintiff. In this case any disability which it was argued attached to Rajah No. 2 would not, in our view, attach to the defendants. As far as the defendants are concerned, the proceedings in O.S. No. 21 of 1910 could not be regarded as anything more-at the highest--than a piece of evidence, to be considered along with the other evidence in the case, in deciding whether any trust existed. In this view of the case we do not think it necessary for us to consider the effect of the observation of the Privy Council in Srinivasa Moorthy v. Venkata Varada Aiyangar . That would be necessary only in case we propose to answer the first question referred to us; and it is admitted that, if our answer to the second question should be against the appellant, it is not necessary to decide the first question. We accordingly hold that it is open to the defendants to plead that there was no trust at all in this case, and that, on the finding of the Trial Court, confirmed by the learned referring Judges, that there was in fact no trust at all, the suit as against the defendants was rightly dismissed. Our answer, accordingly, to the second question is that it was open to the defendants to set up the defence that in fact no trust at all existed with reference to the property in dispute in this case.

5. We do not, for the reasons already mentioned, consider it necessary to answer the first question referred to us. It is admitted that the answer to question No. 2 we have given would dispose of the whole suit, and that being so, the appeal is dismissed with costs.

Horace Owen Compton Beasley, Kt., C.J.

6. I agree and have nothing further to add.

Curgenven, J.

7. I agree.


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