IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HONOURABLE MR. JUSTICE PIUS C.KURIAKOSE & THE HONOURABLE MR. JUSTICE P.Q.BARKATH ALI WEDNESDAY, THE 8TH JULY 2009 / 17TH ASHADHA 1931 RCRev..No. 440 of 2006() ------------------------ RCA.92/2005 of RENT CONTROL APPELLATE AUTHORITY , KOZHIKODE RCP.55/2002 of RENT CONTROL COURT .,KOZHIKODE-I .................... PETITIONER/RESPONDENT/PETITIONER ----------------------------------------------------- T.A.MAJEED, S/O. T.K.MEHAMOOD, AGED 67 YEARS, NOW RESIDING AT 'VIRUS', POTTAKUZHI ROAD, PACHALAM P.O., ERNAKULAM-682 012. BY ADV. SRI.ANTONY DOMINIC RESPONDENT(S):/ APPELLANTS/RESPONDENTS -------------------------------------- 1. GEETHA, W/O. LATE JANARDHANAN, AGED ABOUT 50 YEARS, 'PANKAJ', VALAYANAD AMSOM-DESOM, KOZHIKODE TALUK. 2. SUNILKUMAR, AGED ABOUT 30 YEARS, S/O. LATE JANARDHANAN, 'PANKAJ', VALAYANAD AMSOM-DESOM, KOZHIKODE TALUK. 3. SAJITHA, AGED ABOUT 27 YEARS, D/O. LATE JANARDHANAN, 'PANKAJ', VALAYANAD AMSOM - DESOM, KOZHIKODE TALUK. ADV. SRI.K.B.SIVARAMAKRISHNAN THIS RENT CONTROL REVISION HAVING BEEN FINALLY HEARD ON 08/07/2009, ALONG WITH RCR NO.441/2006 & CONNECTED CASES THE COURT ON THE SAME DAY PASSED THE FOLLOWING: PIUS C.KURIAKOSE & P.Q.BARKATH ALI, JJ. ------------------------ R.CR.Nos.440/2006, 441/2006, 453/2006, 454/2006, 1/2007, 2/2007, 5/2007, 25/2007, 50/2007, 59/2007 & 63 of 2007 & 51 & 52/2008 ------------------------ Dated this the 8th day of July, 2009 O R D E R Pius C.Kuriakose, J. RCR Nos. 440/2006, 441/2006, 453/2006, 454/2006, 1/2007, 2/2007, 5/2007, 25/2007, 50/2007, 59/2007 & 63/2007 are directed against the common judgment dated 6/4/2006 of the Rent Control Appellate Authority, Kozhikode in RCA Nos.63/2004, 65/2005, 143/2004, 53/2005, 72/2005, 91/2005, 92/2005, 93/2005, 106/2005, 107/2005, 108/2005, 111/2005, 113/2005, 119/2005 and 122/2005. 2. The above RCRs are filed by the tenants. RCR No.51/2008 is directed against the judgment of the 1st Additional Rent Control Appellate Authority, Kozhikode in RCA No.56/2006 and RCR No.52/2008 is directed against the judgment of the 1st Additional Rent Control Appellate Authority Kozhikode in RCA No.102/2006. 3. These cases arise out of RCP No.58/2002, 127/2002, RCR.No.440/2006 & conn.cases 2 46/2003, 53/2003, 134/2002, 53/2002, 58/2002, 48/2003, 135/2002, 137/2002 49/2003. 4. The Rent Control Petitions were instituted by the landlord Sri.T.A.Majeed seeking eviction of the tenants in occupation of different portions of a larger building on various grounds including the ground of arrears of rent. The case of the landlord was that the building originally belonged to Vyapara Bhavan Trust, and that he has purchased the same as per sale deed No.904/99 dated 17/11/1999. The Rent Control Petitions were resisted by the tenants contending that the landlord has no right, title or interest over the building, that there is no landlord- tenant relationship between the parties, that the building belongs to Vypara Bhavan Trust, that the entire building was constructed with the funds and substantial investment of several merchants and tenants, that the tenants had made huge investments and at the time of entrustment of lease it was made clear that the persons in possession of the shop rooms will not be evicted in view of the investment made by them at the time of construction of the building, that the sale deed in favour of the T.A.Majeed landlord is prima facie illegal, inoperative, sham and RCR.No.440/2006 & conn.cases 3 is the result of fraud and manipulation done by the vendor and the vendee, that the title deed is not supported by consideration, that the vendor has no right to alienate the trust properties, that the law applicable to sale of trust properties has not been followed. The tenants thus disputed the title of the landlord. 5. In RCP NO.51/2003, the Rent Control Court found that the denial of the landlord's title by the tenant is bona fide and dismissed that RCP. In RCP Nos. 58/2002, 46/2003, 127/2002, 48/2003, 53/2002, 55/2002, 129/2002, 54/2002, 61/2002, 57/2002, 53/2003, 135/2002, 134/2002 and 58/2002, the Rent Control Court held that the denial of the title of the landlord by the tenants is not bona fide and allowed eviction on the ground of arrears of rent. 6. In RCP No.49/2003 and 137/2002 also, the Rent Control Court held that denial of the landlord's title by the tenant is not bona fide and went on to order eviction on the ground of arrears of rent alone. The Rent Control Petitions were tried separately and the evidence in RCR No.46/2003 consisted of oral testimonies of PW1 the landlord and PW2 and documents Exts.A1 to A10 on the side of the landlord. On the side of the tenant in RCR.No.440/2006 & conn.cases 4 that case the evidence consisted of the oral evidence of tenant as RW1. Ext.A1 dated 17/11/1999 was certified copy of the legal assignment executed by Sri. T.Nazarudheen in favour of the petitioner landlord. Exts.A2 and A3 were receipts issued by the Kozhikode Corporation in favour of the landlord against the remittance of tax. Ext.A4 was a copy of the lawyer notice sent on behalf of the landlord. Ext.A5 was registration copy of the trust deed No.941/1986 of the Kozhikode Zilla Vyapari Vyavasayi Ekopana Smithi. Ext.A6 was certified copy of the decree in O.S.No. 383/2000 of Prl.Munsiff Court, Kozhikode. Ext.A7 was a copy of the judgment in that suit. Ext.A8 was a copy of the judgment in CMA No. 154/2002 and Ext.A9 was copy of the power of attorney executed by the landlord in favour of one Ramdas. Ext.A10 was the reply notice sent on behalf of the tenant to the landlord's advocate. The evidence in the other cases as substantially the same. The evidence in the other cases was substantially the same. 7. The Rent Control Appellate Authority, Kozhikode by common judgment in 15 Rent Control Appeals including RCA Nos.63/2004 and 63/2005 filed by the landlord against orders in RCR.No.440/2006 & conn.cases 5 two Rent Control Petitions, which were dismissed by the Rent Control Court, would interfere with the orders of the Rent Control Court and would dismiss RCA Nos.63/2004 and 63/2005. Thus two orders dismissing the RCPs were confirmed while orders allowing the RCPs were set aside and the RCPs were dismissed. In the revision petitions filed by the landlord, he impugns the judgment of the Rent Control Appellate Authority allowing the appeals filed by the tenants while in the two revisions filed by the tenants they impugn the two appellate judgments dismissing their appeals against the eviction orders passed against them by the Rent Control Court. 8. We have heard the submissions of Smt.Thusara James, learned counsel for the revision petitioners in RCR Nos.59/2002, 5/2007, 440/2006, 1/2007, 2/2007, 25/2007, 50/2007, 63/2007, 441/2006, 453/2006 454/2006 and those of Sri. K.B.Shivaramakrishnan, learned counsel for the revision petitioners in RCR Nos. 51/2008 and 52/2008. We have also heard the submissions of Sri.Benoy Vasudevan, learned counsel for the respondent in RCR No. 441/2007. 9. Smt.Thusara James would argue that the appellate RCR.No.440/2006 & conn.cases 6 Authority has gone wrong in finding that prima facie tenants were justified in contending that the sale deed in favour of the landlord is the result of fraud and collusion between the chairman of the Vyapara Bhavan Trust and the landlord and that the sale deed was executed in violation of the Trust and also the Trust Act and consequently holding that the denial of title of the landlord was bona fide. The learned counsel submitted that Vypara Bhavan Trust was admittedly the original landlord having ownership over the building in question. The above Trust executed in the registered document conferring absolute title over the property and the said registered document (Ext.A1) is conclusive proof of what is recited therein. Denial by any tenant of the title conferred on the assignee under Ext.A1, a registered document, cannot be held to be bona fide. The learned counsel referred to Section 92 of the Evidence Act and submitted that the said Section prohibits adduction of oral evidence against the terms of registered documents. According to the learned counsel, so long Ext.A1 sale deed is in currency, courts are bound to rely on the terms contained therein, as evidence of the transaction recorded therein. Smt.Thusara James submitted the RCR.No.440/2006 & conn.cases 7 court below failed to consider the fact that there was no dispute between the transferor and transferee in regard to the execution of the sale deed. It is not open to the tenants, who are third parties, to question the validity of Ext.A1. The learned counsel submitted that the Rent Control Appellate Authority has gone beyond the scope of the enquiry envisaged by sub section (1) of Section 11 for holding that the denial of title by the tenants is bona fide. According to the learned counsel, the very fact that the landlord was relying on a regular registered document of sale executed by the admitted owner will show that the denial by the tenants is not bona fide. The learned counsel submitted that the judicial precedents cited at the Bar before the Appellate Authority were not properly appreciated by the Appellate Authority. The learned counsel further submitted that the judgments relied on by the learned Appellate authority were not applicable to the case on hand. According to the learned counsel, the finding of the Appellate authority that the tenants are beneficiaries of the Trust has been entered without reference to any material on record. Smt.Thusara James would fortify her submissions on the authority of various decisions including RCR.No.440/2006 & conn.cases 8 judgment of a Division Bench of this court in Govindan v. Rashid (2009 (1) KLT 997), to which one among us(PCK(J)) was party. The judgment of another Division Bench in Aboobacker v. Girija (1995 (1) KLT 553), Joseph v. Thomas (1987 (2) KLT 1029) and the judgment of a Full Bench in Parthakumar v. Ajith Viswanathan (2006 (2) KLT 250 (F.B.) also were relied on. 10. All the submissions of Smt.Thusara James were forcefully resisted by Sri.K.B.Shivaramakrishnan. The learned counsel for the tenants, who are the revision petitioners in RCR Nos. 51/2008 & 52/2008. The learned counsel submitted that admittedly the larger building, of which the buildings which are subject matters of the various RCPs are parts, belongs to a Trust and as such the same could not have been assigned in favour of a stranger without obtaining permission from the Court. According to him, Ext.A1 is executed by the managing Trustee of the Trust which owns the building in favour of his own brother. Once this aspect of the matter is noticed, it will have to be found that the tenants were justified in denying the title of the landlord. According to the learned counsel, the Rent Control Appellate Authority by its judgment allowing the appeals filed by the RCR.No.440/2006 & conn.cases 9 tenants considered the scope and ambit of the provisions of the Trust Act and the Trust Deed properly and correctly. This was why the conclusion is correctly arrived at by that Appellate Authority that the denial of landlord's title by the tenants was bona fide. The learned counsel submitted that the Appellate Authority which authored the judgments which are impugned in RCR Nos. 51/2008 and 52/2008 did not consider the scope and ambit of the Trust Act properly and correctly. This was why the two judgments impugned in those revision petitions have become illegal irregular and improper. The learned counsel submitted that the alleged resolution by the Trustees authorising the Chairman to sell the Trust property was not produced by the landlord and hence no sanctity could be given to the alleged sale effected by the Chairman of the Trustee. The learned counsel further submitted that the alleged alienation of the Trust property is the result of fraud and collusion between the Chairman of the Trust and the landlord who is none other than his brother and hence alienation is illegal and invalid in view of Section 52 of the Trust Act. The learned counsel submitted that even if it is assumed that the Chairman of the Trust is RCR.No.440/2006 & conn.cases 10 empowered to alienate the Trust Property, then also the power conferred on the Chairman cannot be absolute power and the Chairman was bound to exercise the power reasonably and in good faith. Sri.Shivaramakrishnan would fortify his submissions by various judgments. The judgment of the Supreme Court in R.Venugopala Naidu and others v. Venkatarayulu Naidu Charities and others (AIR 1990 Supreme Court 444), the judgment of the Madhya Pradesh High Court in Banwarilal v. Edwin Bhagirathi ( AIR 1981 Madhya Pradesh 116) , a Full Bench judgment of the Patna High Court in Kaushlendra Prasad v. State(FB) (AIR 1978 Patna 64 Full Bench), the judgment of the Supreme Court in Shanti Vijay & Co. etc. v. Princess Fatima Fouzia and others ( AIR 1980 Supreme Court 17) were a few of them 11. Sri.Benoy Vasudevan, cited before us the judgment of the Supreme Court in Sheikh Abdul Kayum and others v. Mulla Alibhai and others ( AIR 1963 Supreme Court 309) and the judgment of the Madras High Court in Janakirama Ayyar and others v. Nilakanta Ayyar and others (1954 (II) ILR Madras 486). 12. We have very anxiously considered the rival RCR.No.440/2006 & conn.cases 11 submissions addressed at the Bar. We have carefully perused the materials on record, particularly Ext.A1, under which the landlord claims title and Ext.A5 deed of Trust particularly, the statements thereon made by Kozhikode Zilla Vyapari Vyavasayi Ekopana Samithi in respect of the building in question. 13. The cardinal point that arises for determination is whether the denial of the landlord's title made by the tenants in all these cases can be said to be a bona fide one in terms of sub section (1) of Section 11 of Act 2 of 1965. It was the judgment of the Division Bench of this court in Aboobacker case (supra), which was held out before us by Smt.Thusara James as the trump card for the landlord for arguing that the denial made by the tenants is not bona fide. But, we notice that the learned Appellate Authority who authored the common judgment dated 6/4/2006 was not unmindful of that judgment. As rightly noticed by that Appellate Authority, admittedly the Vyapara Bhavan Trust building, portions of which are the buildings which are subject matter of the Rent Control Petitions, belonged to Vyapara Bhavan Trust. The landlord purchased the entire building except the second floor as per Ext.A1 sale deed which is executed by RCR.No.440/2006 & conn.cases 12 Sri.T.Nazarudheen, brother of the landlord in his capacity as the Chairman of the Vyapara Bhavan Trust. The argument of Smt.Thusara James that the authorities under the Rent Control Act is expected only to consider whether the denial of the title of the landlord by the tenant is bona fide and they are without power to even to examine the respective contention of the parties as to the question of title cannot be accepted. We are in agreement with the view expressed by a Division Bench of this court Narayana Murti v. Thankamma Sebastian (2005 (3) KLT 102), wherein it was held that though the Rent Control Court is not expected to decide the question of title once for all, while deciding whether the denial of title by the tenant is bona fide, the Rent Control Court is not powerless in examining the respective contentions of the parties regarding the question of title so as to arrive at a finding as to whether the denial of title is bona fide. 14. As rightly noticed by the Rent Control Appellate Authority in its common judgment dated 6/4/2006 the Vyapara Bhavan Trust was formed at the instance of Kozhikode Zilla Vyapari Vyavasaya Ekopana Samithi, which is a registered RCR.No.440/2006 & conn.cases 13 society. The stand taken by the Chairman of the Trust, who is the author of the assignment deed relied on by the landlord, is that the Trust is a private Trust. That Trust Deed (Ext.A5) is a registered document. The stand of the landlord in his oral evidence is also that the Trust is a private Trust. According to the tenants, the Trust is not a private Trust, but it is a public Trust. The distinction between private and public trust has been correctly understood by the learned Appellate Authority on the basis of the judgment of the Supreme Court in Deoki Nandan v. Muraleedhar ( AIR 1957 SC 133), wherein it is held that in a private Trust the beneficiaries are specified individuals while in the later they are the general public or a class thereof. The learned Appellate Authority has enumerated seven objects of Ext.A5 Trust and held that Ext.A5 is a public trust and not a private trust. We do not find any reason to disagree with the learned Appellate Authority on its above finding. The Appellate Authority has also found that on the terms of Ext.A5, the tenants are the beneficiaries of the Trust. As per Ext.A5, one member is to be elected by the tenants occupying the ground floor of the Vyapara Bhavan from 1/1/1987. As noticed by the Appellate RCR.No.440/2006 & conn.cases 14 Authority, it is clearly stated in the Trust Deed that the Vyapara Ekopana Samity have resolved to settle the property in Trust for the purpose and objective of constructing and conducting a shopping cum office complex in the property and associated business and commercial institutions thereof as specified in details in the objective clauses. Under Ext.A5 it is clearly stated that the Vyapara Bhavan is the Trust property and the Board of Trustees shall frame separate rules and regulations for the conduct and administration of the Vyapara Bhavan and its associated institutions and the enterprises. The learned Appellate Authority noticed that it came out in evidence that no such rule has been framed as mentioned in clause (1) of the object. It was noticed by the Appellate Authority that it is clearly stated in clause (7) as to how the funds for the construction is to be raised. It is stated that the funds required for the construction of Vyapara Bhavan and enterprises shall be raised by the Board of Trustees from the prospective tenants of the Vyapara Bhavan as voluntary contribution for the allotment of rooms and by subscription and donation collected from among members of mercantile community and general public. It is also RCR.No.440/2006 & conn.cases 15 stated that the Board of Trustees have to frame separate rules and stipulations for the said collection of contributions, donations ands subscriptions and for the future relation and dealing with the prospective tenants of the Vyapara Bhavan building. Sri.T.A.Majeed, the landlord, admitted in cross examination as PW1 that there are about 135 tenants and about 50 tenants are paying rent. He also admitted that the building was constructed with the contribution from merchants and tenants besides members. Thus it became evident that the building was constructed by raising funds from the tenants and the merchants community besides the members. Sri.Ramdas ( AW2) was the power of attorney holder of Sri.T.A.Majeed. His version in cross examination was that advance amount received from the tenants is to be repaid by the trustees and not by Sri. Majeed. Sri.Ramdas also did not deny the suggestion that as per the audit report, a sum of Rs.1,56,00,000/- is in deposit with the Trust. It was also admitted by him that a suit was filed before the Sub Court as O.S. No.435/1996 seeking conversion of the Trust as a charitable trust and that the said suit was allowed by the Sub Court. He also admitted that as per the deed of Trust RCR.No.440/2006 & conn.cases 16 one of the tenants shall be a mandatory trustee of Trust. He conceded that consent from the tenants was not obtained before alienation of the trust property. 15. One point on which the assignment deed in favour of Majeed was challenged by the tenant was inadequacy of consideration. The Appellate Authority noticed that the District Register had initiated proceedings under Section 45A in respect of Ext.A1 for undervaluation and that considering the appeal preferred by Sri.Majeed, the District Court had set aside the order of the District Registrar and remanded the matter for fresh consideration. 16. The Appellate Authority noticed as per Clause (8) of the Trust Deed, the relevant provisions of the Indian Trust Act governs in relation to the matters not expressly provided therein. The appellate Authority took the view that as per Section 11 of the Trust Act, the Trustee is bound to fulfill the purpose of the trust and to obey the directions of the author of the Trust given at the time of its creation, except as modified by the consent of all the beneficiaries. It was noticed that the statutory duty of the Trustees is to take all necessary steps for the preservation and RCR.No.440/2006 & conn.cases 17 protection of the Trust property. Section 13 of the Trust Act is referred to in this context by the Appellate Authority. It is noticed that the duty of the Trustee is to protect the trust property for the benefit of all the beneficiaries. The Appellate Authority has found that breach of any duty imposed on a trustee on the terms of the Trust Deed or by law is actually a breach of trust. The Appellate authority noticed that Section 36 of the Indian Trusts Acts confers upon the Trustee a general Authority to do all acts which are reasonable and proper for the realisation, protection or benefit of the trust property and for the support or protection of a beneficiary. The appellate authority also noticed Section 60 of the Trust Act under which the beneficiary of a Trust has a right subject to the provisions of the Trust Deed to see that the property shall be properly protected and held and administered by proper person and by a proper number of such persons. It was noticed by referring to explanation -1 of Section 60 that person having an interest inconsistent with that of the beneficiary is not a “proper person” within the meaning of Section 60. The Appellate Authority found that in view of the alienation of the trust property under Ext.A1 to his brother the RCR.No.440/2006 & conn.cases 18 executant of the assignment deed is not a proper person within the meaning of Section 60. According to us, the above view cannot be said to be wrong and that alienation of the trust property is against the interest of the beneficiaries especially the tenants. The learned Appellate Authority has applied the doctrine of tracing as embodied in Section 63 of the Trust Act to the facts of this case. It was found on the basis of the discussion in corpus juris secundum that documents of Trust have to be considered in a manner as not to thwart the maker's intentions. We are of the view that the interpretation placed by the Appellate Authority on Ext.A5 in this case is a correct one. The learned Appellate Authority has referred to the various precedents cited before him by either sides and has given reasons as to why the decisions cited on behalf of the landlord could not be applied to the facts obtaining in these cases. It was noticed by the learned Appellate Authority that suit(O.S.No.383/2000) filed by one of the Trustees of Vyapara Bhavan Trust against the Kozhikode Corporation and against the landlord for a prohibitory injunction to restrain them from effecting the mutation was dismissed. However, it was found that a separate petition seeking leave RCR.No.440/2006 & conn.cases 19 under Section 92 of the CPC was pending before this court in CMA No. 2/2002 at the instance of one of the trustees and that the above fact was actually admitted by Sri.Ramdas in his evidence. The learned Appellate Authority has very much relied on the evidence adduced by Sri.Nazeerudheen, who has executed Ext.A1, to take the view that Ext.A1 document in so far as the same is executed in the violation of the objects of the Trust does not confer valid title over the property. 17. Enquiry of this court under Section 20 of Act 2 of 1965 is only to consider whether the judgment of the Appellate Authority is vitiated by any illegality, irregularity or impropriety warranting corrections under Section 20 of Act 2 of 1965. The nature of the jurisdiction under Section 20 is