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N. Shanmukham Chetty Vs. M. Govinda Chetty and ors. - Court Judgment

LegalCrystal Citation
SubjectTrusts and Societies
CourtChennai
Decided On
Reported inAIR1938Mad92
AppellantN. Shanmukham Chetty
RespondentM. Govinda Chetty and ors.
Cases ReferredAbdur Rahim v. Abu Mahomed Barkat Ali A.I.R.
Excerpt:
.....and did not comply with the section was bad to that extent. , to a suit like the present. 1922 mad 17 that section 92 has no application to a suit like the present, the principle underlying that decision is perhaps best stated in the words of sir d. 8. in a suit like the present, the relief though it may be of the kind mentioned in section 92(1) is not sought in the larger interests of the public but is merely for the purpose of vindicating the private rights of one of the trustees and of enabling him to discharge the duties and liabilities which are imposed upon him by the trust. that sentence clearly relates to oases where a representative suit could have been or might have been brought and not to cases where the cause of action sued on was such that no representative suit could..........1922 mad 17 is no longer good law. in that case it was held by a full bench of five judges that a suit by a trustee of a public, charitable or religious trust against a co-trustee for accounts does not fall within section 92, civil p.c. and may be brought without the sanction of the advocate-general. it is said that this decision has been set at nought by the judgment of their lordships of the privy council in abdur rahim v. abu mahomed barkat ali a.i.r. 1928 p.c. 16 and that of this court in 58 mad 988.3 i can see nothing in these decisions to warrant any such assertion. before referring to them, however, it is necessary to refer to the provisions of section 92, civil p.c. the section deals with the procedure to be adopted in a representative suit for relief in respect of a public.....
Judgment:

Leach, C.J.

1. This appeal arises out of a suit for an account and other reliefs instituted by certain trustees against their co-trustees on the Original Side of this Court. In Royapuram, Madras, is an Indian Hindu temple known as Subrahmanyaswami Koil, which belongs, according to the pleadings, to the Pattinava sect of the Hindus. The plaintiffs' case is that in 1922 a meeting of the members of the community was held at Royapuram at which the plaintiffs and defendants 1 to 3 were elected trustees for the purpose of collecting subscriptions for the improvement of the temple, for the performance of the rites therein and for the conduct of festivals and other cognate matters, with power to spend the collections on these objects. It is common ground that this meeting was held and that the plaintiffs and defendants 1 to 3 were elected trustees for these purposes. The contesting defendants, defendants 2 and 3, however, aver that the duties of the trustees were not confined to the temple and say that they were also given authority to collect and spend for the good of the community in general and for purposes of general utility. The plaintiffs allege that defendants 1 and 2 were acting as the managing trustees and were throughout in charge of all the moneys collected and the accounts, defendants 1 and 2 being the only literate members of the Board. Defendant 3 admittedly never took any part in the management of the affairs of the trust, and as defendant 1 died after the institution of the suit, the case is really confined to the question of the liability of defendant 2. The plaintiffs further allege that from 1922 to the date of the suit, large sums of money were collected by defendants 1 and 2 who utilised them for their own purposes and suppressed the accounts. The contesting defendants deny that there is any truth in the allegation that defendants 1 and 2 utilised the trust money for their own purposes or that they suppressed the accounts. It is clear from their written statement, however, that defendant 1 and 2 did participate in the management of the trust and are liable to account, and the learned trial Judge so held. Accordingly he directed that accounts should be taken from 9th November 1925 (the date from which the defendants admit the collections began) and referred the case to the Official Referee for the purpose.

2. It is not in dispute that this is a public trust and it is conceded that defendant 2 is liable to account. But it is said that the decision of the learned trial Judge is erroneous for two reasons: (1) because the suit could not be instituted without the sanction of the Advocate General under Section 92, Civil P.C., and (2) because the learned trial Judge did not decide issue 4 before referring the suit to the Official Referee. Issue 4 is as follows: 'What, if any, were the accounts maintained for the collections and by whom?'. The argument with regard to this issue is based on the contention that the plaintiffs are also accounting parties. Before the learned trial Judge there was no suggestion that they should also be made liable to account; the only question in this connexion was with regard to the liability of defendant 2. The learned trial Judge was therefore justified in adopting the course which he did.

3. The contention with regard to the necessity for the prior approval of the Advocate-General needs more consideration as it is said that the decision of this Court in Appanna v. Narasingha A.I.R. 1922 Mad 17 is no longer good law. In that case it was held by a Full Bench of five Judges that a suit by a trustee of a public, charitable or religious trust against a co-trustee for accounts does not fall within Section 92, Civil P.C. and may be brought without the sanction of the Advocate-General. It is said that this decision has been set at nought by the judgment of their Lordships of the Privy Council in Abdur Rahim v. Abu Mahomed Barkat Ali A.I.R. 1928 P.C. 16 and that of this Court in 58 Mad 988.3 I can see nothing in these decisions to warrant any such assertion. Before referring to them, however, it is necessary to refer to the provisions of Section 92, Civil P.C. The section deals with the procedure to be adopted in a representative suit for relief in respect of a public trust. But to come within the section there must be a breach of trust or the necessity for the direction of the Court with regard to the administration of a trust. The section requires that there shall be at least two plaintiffs and that the Advocate-General must give his sanction to the institution of the suit. If these conditions are fulfilled, a suit can be launched under the section. It was never intended, in any opinion, that this section should take away the right of a trustee to launch a suit for an account against a co-trustee, unless he obtained the approval of the Advocate. General and I consider that it has not this effect. That a trustee has such a right cannot be denied. The right is necessary for his own protection; otherwise he might be made liable for acquiescing in unlawful dealings with the trust funds.

4. In Abdur Rahim v. Abu Mahomed Barkat Ali A.I.R. 1928 P.C. 16 the Judicial Committee were careful to point out that in a Code regulating procedure it is unlikely that the Legislature intended without express words to abolish or extinguish substantive rights of an important nature which admittedly existed at the time the Code was enacted. If the argument advanced on behalf of the appellants were sound, it would mean that a trustee could not proceed against a co-trustee for an account without joining a third party and he could never proceed at all if the Advocate-General refused his sanction. This was pointed out by Oldfield J. in Appanna v. Narasingha A.I.R. 1922 Mad 17 and it appears to me to provide a complete answer to the appellant's case. The learned advocate for the appellants has relied on a passage in the judgment in 55 Cal 519, 2 where it was pointed out that in inserting Sub-section (2) of Section 92 the Legislature adopted the view of the Bombay High Court that a suit which prays for reliefs mentioned in Section 92 can only be instituted in accordance with the provisions of that section. But it must be a suit contemplated by that section and as I have already mentioned the Judicial Committee in this very case expressed the opinion that the section did not operate to abolish existing rights. With regard to 58 Mad 9883, the learned Judges who decided that case pointed out that it was entirely a different case to that in 45 Mad 1131 and there is nothing in the judgment which throws the slightest doubt on the correctness of the former decision.

5.We have been referred to two other cases, Ramanuja Krishna Ayyangar v. Ramanuja Alwarappa Ayyangar A.I.R. 1933 Mad 70 and Sundara Ayyar v. Murari Varada Ayyar A.I.R. 1935 Mad 855 In the first of these cases it was held that a trustee could not, apart from Section 92, ask for the framing of a scheme, and a suit which did ask for the framing of a scheme and did not comply with the section was bad to that extent. This is so, but the decision does not in any way assist the appellants in this case. It does not affect the question under discussion at all. The case in Sundara Ayyar v. Murari Varada Ayyar A.I.R. 1935 Mad 855 was decision of my learned brother Varadachariar J. My learned brother there held that the mere fact that the plaintiffs may in a sense be trustees will not necessarily preclude the application of Section 92, Civil P.C., if the reliefs in the suit relate not to the vindication of their personal rights, but to the advancement of the interests of the institution itself by securing more efficient management. A perusal of that judgment shows that the learned Judge was careful to distinguish the case where a plaintiff is suing to vindicate a personal right and that is what the plaintiffs are doing in the case out of which the present appeal arises. The correctness of the Full Bench decision in Appanna v. Narasingha A.I.R. 1922 Mad 17 is unshaken and we are bound by it. We accordingly hold that the learned trial Judge was right in deciding that the suit did not require the sanction of the Advocate. General before institution.

6. I might mention that one of the prayers in the plaint asks for an injunction restraining defendant 2 from acting further as a trustee. The question whether such a prayer can be included in the present suit does not arise in the appeal and therefore I express no opinion on it. The appeal fails and must be dismissed with costs.

Varadachariar J.

7. I respectfully agree. But, in view of the state of the authorities, I think it right to add a few observations on the question of the applicability of Section 92, Civil P.C., to a suit like the present. If the matter were res Integra, it may be conceded that there is a fair volume of authority in favour of the wider construction of Section 92 contended for by Mr. Sesha Ayyangar on behalf of the appellant. The decisions referred to in the judgments in 45 Mad 1131 are themselves sufficient to show this. I may add that even more recently the Bombay High Court has expressed views which seem to lend considerable support to the appellant's contention: Narayan v. Vasudeo A.I.R. 1924 Bom 518 and Chhaganlal v. Sobharam, : AIR1934Bom26 So far however as this Court is concerned, we have to start with the fact that a Bench of five Judges have decided in Appanna v. Narasingha A.I.R. 1922 Mad 17 that Section 92 has no application to a suit like the present, The principle underlying that decision is perhaps best stated in the words of Sir D.F. Mulla: see page 309, Edn. 10, Civil Procedure Code, viz. that Sub-section (2) of Section 92, though expressed in general terms, must be read along with Sub-section (l) and it follows on such reading that:

It is not every suit claiming any of the reliefs specified in Sub-section (1) that should be brought with the consent of the Advocate-General, but those suits only which besides claiming any of those reliefs are brought by individuals as representatives of the general public.

8. In a suit like the present, the relief though it may be of the kind mentioned in Section 92(1) is not sought in the larger interests of the public but is merely for the purpose of vindicating the private rights of one of the trustees and of enabling him to discharge the duties and liabilities which are imposed upon him by the trust. That in certain circumstances similar reliefs may have to be prayed for in the one kind of action as in the other is pointed out in the judgment of Kumaraswami Sastri J. in Appanna v. Narasingha A.I.R. 1922 Mad 17 It therefore does not seem to me right to make the nature of the relief prayed for in a suit the conclusive and exclusive test in determining the applicability of Section 92.

9. Mr. Sesha Ayyangar had, in view of the Full Bench decision, to contend that that decision can no longer be regarded as authoritative after the decision of the Judicial Committee in Abdur Rahim v. Abu Mahomed Barkat Ali A.I.R. 1928 P.C. 16 I agree with my Lord that there is nothing in the judgment of their Lordships of the Judicial: Committee which throws doubt on the authority of Full Bench decision. As pointed out in the judgment just delivered, their Lordships have there taken care to say that it is too much to presume that the Legislature intended to make any serious alteration in the previous state of the law or to extinguish or impair pre-existing rights of action and that the main purpose of the enactment of Sub-section (2) of Section 92 was to settle the conflict of the previous state of the decisions in India. To understand the effect of this observation of their Lordships, some regard must be had to the previous state of authority in this country and attention must also be bestowed on the circumstances in which the question arose before the Judicial Committee. In that case the action had been brought by certain Mahomedan inhabitants of the neighbourhood who were interested in the institution. The suit was therefore not one by trustees who had any personal rights of their own to assert, but corresponded to what is spoken of as a representative suit on behalf of the public.

10. The contention before the Judicial Committee on the one side was that wherever the litigation related to a public trust, the suit could be framed only in accordance with the provisions of Section 92, Civil Procedure Code, and the reference in Sub-section (2) of Section 92 to the nature of the reliefs prayed for in such a suit was sought to be ignored by the appellant's learned Counsel. It was in those circumstances that their Lord, ships emphasized the antithesis between a suit praying for reliefs specified in Sub-section (1) of Section 92 and for reliefs outside that Sub-section and they observed that Section 92 could apply only to suits praying for reliefs specified in Sub-section (1). But as I have already pointed out, the whole discussion arose in connexion with what was undoubtedly a representative suit. It does not seem to me right to ignore that circumstance and read the judgment as laying, down that even where a suit is not in any sense of a representative character, the mere fact that the reliefs asked for in the suit may fall within Sub-section (1) of Section 92, Civil P.C., was intended by their Lordships to be a conclusive test. Mr. Sesha Ayyangar relied on one observation on page 529 as supporting his contention that their Lordships must have had even suits based on individual rights in their contemplation when they laid down their proposition. This observation relates to the previous cases in India which had held that private persons who had individual rights under such trusts could bring suits to enforce such individual rights by an ordinary suit without being obliged to bring a suit of a representative nature as above-mentioned. It seems to me that Mr. Sesba Ayyangar's contention does not give effect to the words used in that sentence. That sentence clearly relates to oases where a representative suit could have been or might have been brought and not to cases where the cause of action sued on was such that no representative suit could have been brought.

11. An examination of the earlier cases in India will show that even when a suit was not intended to enforce a right in the nature of the rights of a trustee but related to the en cement of the obligations of the defendant in the performance of the trust for the benefit of the public, it had been held that a suit of that kind need not necessarily be brought only in conformity with the provisions of Section 539 but may be brought either under Order 1, Rule 8, Civil P.C., or even independently of it. It is in this sense that their Lordships point out that the question had arisen in this country whether the provisions of Section 539 wore merely permissive or mandatory. The question of permissive or mandatory cannot possibly arise in respect of a suit which cannot be brought in a representative character at all. All that the Judicial Committee intended to lay down and did lay down was that wherever the cause of action on which the suit is founded is one which could have sustained a representative suit, the procedure prescribed by Section 92 must necessarily be followed and no suit could be maintained in any other form. I particularly wish to point out that in this judgment, their Lordships did not add the sentence which is somehow introduced in a later judgment of this Court, namely that the character of the plaintiff is immaterial. It is only in the judgment of this Court in Janaki Bai Ammal v. Vinayakar of Melmandai A.I.R. 1935 Mad 825 that Cornish J., in attempting to state the effect of the Privy Council decision, puts the antithesis in the following words:

Whether the suit falls within Section 92 depends not upon the character in which the plaintiff sues but upon the nature of the relief sought.

12. With great respect I would state that this is not the proper test to be applied and was certainly not the test laid down by the Judicial Committee. It has sometimes been said that whenever relief is sought on the allegation of a breach of trust, the suit must necessarily be brought in conformity with Section 92, if it in any manner relates to a public charitable trust. Here again, I think, this will not be a safe or conclusive test, because an allegation of breach of trust may in certain circumstances be necessary even when a co-trustee is trying to assert or vindicate his own rights against other co-trustees who are in management: Narayanan v. Mootha Poduval : AIR1930Mad295 The test seems to me to have been stated with fullness and accuracy in the passage that I have already cited from Sir D.F. Mulla's book. Even in Bombay the principle that Section 92 will not apply to suits instituted for the vindication of the right of management vested in the plaintiffs has always been recognized Nowroji v. Dastur Kharsetji (1904) 28 Bom 20 and Narayan v. Vasudeo A.I.R. 1924 Bom 518 particularly the judgment of Eawcett J.), but differences have arisen mainly on the construction of the scope of the plaint in each case. In the view that we are bound by the judgment of the Full Bench in Appanna v. Narasingha A.I.R. 1922 Mad 17 and that its authority has not been shaken by the decision of the Judicial Committee in Abdur Rahim v. Abu Mahomed Barkat Ali A.I.R. 1928 P.C. 16 we have no alternativ but to disallow the appellant's contention.


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