1. By a decree dated the 11th March 1889, made in Civil Suit No. 256 of 1889; it was directed that a certain fund should be invested by the Secretary and Treasurer of the Bank of Madras with the privity of the Accountant General of this Court in Government Securities and from the income arising there from certain religious ceremonies or charities should be performed by the defendant in that suit one of whom was T. Narayana Chetty.
2. It does not appear how the trust fund came to be invested in the names of these defendants, in contravention of the terms of this decree, but it is clear that this T. Narayana Chetty at his death in 1901, held Government Securities of the nominal value of Rs. 6,000 as sole surviving trustee for the performance of these ceremonies. Upon the death of Narayana Chetty, it, therefore, became necessary that new trustee should be appointed and the trust property go in; and, since the Indian Trusts Act, 1882, does not apply to religious or charitable endowments (Section 1), and advantage could not be taken of its provisions relating to the appointment of new trustees, I think that proceedings should have been taken in this Court for this purpose and for bringing the trust fund into Court.
3. In 1904, T. Sudarsanam Chetty, the son of the deceased Narayana Chetty applied to this Court for a grant of Letters of Administration of his father's estate, and tiled two affidavits of assets Exs. D and E in which the value of the trust property together with accrued interest is stated to be Rs. 6,461-11-6. In the affidavit Ex. E, Sudarsanam Chetty set out the nature of the trust and stated that, as legal representative of the last surviving trustee, he had appointed a new trustee to whow he proposed to transfer the trust securities. Upon these representations and upon the execution of an administration bond in the sum of Rs. 6,661-11-6, Ex. J, by Sudarsanam Chetty and by the first defendant and one C. Krishnaswamiah, now deceased, as his sureties, Letters of Administration were granted to the former, as the administrator of the estate, and according to the express terms of this bond, it was the duty of Sudarasanam Chetty to transfer and deliver over the trust securities to a properly constituted trustee but instead of so doing he has sold the securities and applied the proceeds to his own use.
4. By a decree dated the 16th August 1907, made in Civil Suit No. 101 of 1906, the plaintiff and third defendant were appointed trustees to carry out the provisions of the decree of 11th March 1889 and they have obtained an assignment of the administration bond Ex. J. which the plaintiff now seeks to en force against the first defendant as surety, and the second as representative of the de ceased surety.
5. It has been argued by the learned Vakil for the second defendant, that the condition of the bond has been fulfilled, because Sudarsanam Chetty, after the administration of the estate of his father, held the trust securities as trustee and not as administrator and that the sureties are not liable for anything done by him as a trustee. As a matter of fact, it is clear that Sudarsanam Chetty never purported to deal with these securities as a trustee, since he even now claims that he was entitled to deal with them free from any trust, and I think that the argument fails on this ground.
6. If the trust had been declared by Narayana Chetty and his Administrator had duly appropriated part of the estate to the purposes of the trust, and had subsequently misapplied the trust fund, it is possible that this argument might apply; but in the present case the Administrator in taking out the grant entered into an obligation merely to transfer the trust fund to a, properly constituted trustee (see Court Pees Act, 1870, Section 19D), and by dealing with it in any other manner--whether by purporting to act as trustee himself or by appropriating the fund to his own use, I think the condition of the bond is broken.
7. The first and second defendants cannot be made liable for more than the penalty of the bond: and I, therefore, direct that the first defendant personally and second defendant out of the assets of C. Krishnaswamiah do bring the sum of Rs. 6,661-11-6 into Court with interest at 6 per cent, per annum until payment Liberty to plaintiff and 3rd defendant to apply for investment upon payment being made. The decree of 16th August 1907, directs that the moneys belonging to the trust shall vest in them, but it does not appear that the direction contained in the decree of 1888 to which I have referred, was intended to be superseded. The first and second defendants must pay the plaintiff's costs of this suit.