1 IN THE HIGH COURT OF JUDICATURE AT BOMBAY CIVIL APPELLATE JURISDICTION CIVIL APPLICATION NO.5892 OF 2007 IN FIRST APPEAL No.2667 OF 2007 Mrs.Charu Kishor Mehta ..Applicant V/s. Lilavati Kirtilal Mehta ..Respondents Medical Trust & others WITH CIVIL APPLICATION NO.5877 OF 2007 IN FIRST APPEAL No.2672 OF 2007 Mr.Rajiv Kishor Mehta ..Applicant V/s. Lilavati Kirtilal Mehta ..Respondents Medical Trust & others WITH CIVIL APPLICATION NO.5878 OF 2007 IN FIRST APPEAL No.2670 OF 2007 Mr.Kishor Kirtilal Mehta ..Applicant V/s. Lilavati Kirtilal Mehta ..Respondents Medical Trust & others WITH CIVIL APPLICATION NO.5879 OF 2007 IN FIRST APPEAL No.2671 OF 2007 2 Mr.Prashant Kishor Mehta ..Applicant V/s. Lilavati Kirtilal Mehta ..Respondents Medical Trust & others Mr.Navroze Sarvai, Senior Counsel with Mr.T.N.Subramanium, Senior Counsel with Mr.T.N.Tripathi i/b.M/s.T.N.Tripathi & Co. for the applicant in C.A.No.5892 of 2007 in F.A.No.2667 of 2007. Mr.Aspi Chinoy, Senior Counsel and Mr.Darius Khambatta, Senior Counsel with Mr.Mustafa Doctor, Mr.N.F.Dhilla i/b.M/s.Hariani & Co., Advocates for the Applicants in C.A.No.5879 of 2007 in F.A.No.2671 of 2007, C.A.No.5877 of 2007 in F.A.No.2672 of 2007 and C.A.No.5877 of 2007 in F.A.No.2672 of 2007 Mr.I.M.Chagla, Senior Counsel with Mr.Pravin Samdani, Mr.Sanjay Jain i/b.M/s.Wadia Ghandy & Co.,advocate, for the respondent Nos.1, 2, 5, 8 & 9 Mr.Janak Dwarkadas, Senior Counsel with Mr.Zal Andhiyarujina i/b.M/s.M.K.Banatwala, advocate, for respondent No.3 Mr.Rafique Dada, Senior Counsel with Mr.Pratik Sakseria i/b.M/s.Harsh Mehta & Co., advocate, for the respondent Nos.4 and Mr.M.Gawade, advocate, for respondent No.10 CORAM : A.S.OKA, J. DATE : 15TH FEBRUARY,2008 P.C. 1. I have extensively heard the submissions of the learned Senior Counsel appearing for various parties in Civil Application No.5892 of 2007 in 3 First Appeal No.2667 of 2007. This is an application for interim relief filed by the appellant in First Appeal No.2667 of 2007. With a view to appreciate the submissions made by the learned counsel for the parties it will be necessary to refer to the facts of the case in brief. 2. The applicant/appellant is the plaintiff. For the sake of convenience the parties to the application are hereinafter referred to with reference to their status in the suit. By the First Appeal, the applicant has taken an exception to the Judgment and Decree dated 21st-24th September, 2007 passed by the learned Judge of the City Civil Court at Bombay by which the suit filed by the applicant has been dismissed. 3. According to the case made out in the plaint, the plaintiff and the defendant Nos.2 to 9 are the present trustees of a Public Trust by the name Lilavati Kirtilal Mehta Medical Trust (Hereinafter referred to as the “Said Trust”) which 4 is duly registered under the Bombay Public Trusts Act, 1950. According to the case of the plaintiff, the said trust was settled by Late Kirtilal Mehta. There are various objects of the trust. One of the objects is of running Hospital and promoting medical research work. Accordingly, a hospital has been set up by the said trust at Mumbai. Reliance has been placed on various Clauses in the Trust Deed dated 5th July, 1978. According to the plaintiff, apart from her there are two other permanent trustees of the trust for the life time. The permanent truestees are the plaintiff, the 2nd defendant and 11th defendant. According to the plaintiff, tenth defendant was a trustee of the said trust for three terms of five years since 23rd July, 1990. After completion of three terms, he ceases to be a trustee of the said trust. Reliance has been placed on the Resolution dated 8th April, 2006 passed by a meeting of permanent trustees which according to the plaintiff resolves that the tenth defendant ceases to be a trustee. According to the case of the plaintiff, in the same meeting the 13th defendant was appointed as a trustee in 5 place of 10th defendant and 12th defendant was continued as a trustee for a further period of five years. 4. In the plaint, it is stated that a notice dated 24th April, 2006 was received from the 7th defendant calling a meeting on 25th April, 2006 to discuss certain issues. The contention of the plaintiff is that seventh defendant had no right to call the meeting as stated in the letter/notice dated 24th April, 2006. The plaintiff has referred to another notice dated 27th April, 2006 issued by the second defendant. By the said notice, the second defendant purported to convene a meeting of the trustees of the said trust at 10.00 A.M. on 29th April, 2006. 5. According to the case of the plaintiff, on 29th April, 2006 at about 9.55 A.M., she along with the defendant Nos.11 to 13 reached the venue of the meeting. According to the case of the plaintiff, except the third defendant, there were strangers sitting in the board room. It is contended that 6 the plaintiff was told by the third defendant that the meeting was already called and certain Resolutions have been passed. According to the case of the plaintiff, the third defendant gave a hand written Minutes of the alleged meeting. It is alleged that the presence of the plaintiff and 11th to 13th defendants was noticed by certain employees of the said trust. 6. It will be necessary to refer the Resolutions allegedly passed in the alleged meeting dated 29th April, 2006. The three Resolutions which are relevant for consideration read thus :- “RESOLVED THAT all such actions and/or all such proceedings against Mrs.Charu Kishor Mehta permanent trustee, Mr.Kishore Kirtilal Mehta Mr.Rajiv Kishor Mehta and Prashant Kishor Mehta as may be legally advised for their communication and conduct be adopted.” “Resolved that Mrs.Charu Kishor Mehta shall not interact or communicate with employees and/or consultants of the Lilavati Hospital and Research Centre and/or the trust save and except through the Record of Trustees of the trust and employees and/or consultants be and are hereby informed that they do not have to take into account any instructions directly given by Mrs.Charu K. Mehta to them.” “Resolved that M/s.Ayush enterprises, 7 Security Consultants, be and is hereby instructed not to allow Mr.Kishor Kirtilal Mehta, Mr.Rajiv Kishor Mehta had Mr.Prashant Kishor Mehta ingress anywhere in the premises of the Lilavati Hospital and Research Centre.” 7. There are declarations claimed in the suit as regards illegality of notice dated 27th April, 2006 and the Resolutions adopted in the alleged meeting dated 29th April, 2006. There is a prayer for perpetual injunction restraining the defendants from implementing or acting upon or enforcing the Resolutions adopted in the alleged meeting dated 29th April, 2006. The challenge in the suit is on the ground that the trustees could not have been represented by proxies in the meeting. The contention raised is except the 3rd defendant no other trustee was present in the meeting and therefore there was no requisite quorum in the meeting. It is contended that there was no proper and sufficient notice of the meeting to the plaintiff and the other trustees. 8. The suit was contested by various defendants by filing Written Statements. It is the contention 8 of the contesting defendants that the Resolutions were validly passed in the meeting dated 29th April, 2006. Various assertions made in the Written Statement of the first, fifth and eightth defendants have been adopted in the Written Statements of the third, fourth, nineth and tenth defendants. The case of the contensting defendants is that the plaintiff herself has indulged into and committed wrongful acts. It is contended that though, the 11th defendant has ceased to be a trustee, the plaintiff is contending that the said defendant continues to be a trustee. It is alleged that the 12th and 13th defendants are not the trustees. The contention is that the proceedings of the meeting held on 29th April, 2006 were validly conducted and the Resolutions passed therein are valid. It is contended that the proxy forms signed by the defendants Nos.2, 5, 7, 8 and 10 were received by the trustees. The forms of the defendant Nos.4, 6 & 9 were received by fax transmission. It is contended that proxy forms were duly verified and the meeting was held in the presence of proxies. It was contended that there 9 was adequate quorum in the meeting of the board of the trustees. It is submitted that except the plaintiff, all the trustees of the said trust including the third defendant were present either personally or through their proxy. The various allegations made in the plaint regarding the plaintiff and 11 to 13 defendants reaching in the venue of the meeting have been denied in the Written Statements. 9. The parties led evidence after the learned trial Judge framed various issues. One of the issues raised was regarding the jurisdiction of the trial Court to entertain and try the suit. The said issue has been answered in favour of the plaintiff. The issues as regards the maintainability of the suit and non-joinder of the proper parties have been also answered in favour of the plaintiff. The learned trial Judge held that the plaintiff has failed to establish that the meeting held on 29th April, 2006 is illegal. The learned trial Judge accepted the case made out by the contesting defendants that the proceedings of 10 the meeting held on 29th April, 2006 are legal and valid. The learned Judge observed that the meeting of the permanent trustees held on 8th April, 2006 was legally infirm. The learned Judge accepted the case of the defendants that the 10th defendant continued to be a trustee and the 11th defendant had ceased to be a trustee. Therefore, the learned trial Judge proceeded to dismiss the suit filed by the plaintiff. 10. It will be necessary to refer to interim arrangement which was in force till the disposal of the suit. Initially ad-interim relief was granted in favour of the plaintiff which had the result of stay of the resolutions dated 29th April, 2006. Subsequently, the ad-interim relief granted by the trial Court was vacated. The order passed by the trial Court on the Notice of Motion for interim relief was carried to this Court by preferring an Appeal from Order. As the plaintiff did not succeed in the Appeal from Order, the matter was carried to the Apex Court by filing a Special Leave Petition. Leave was granted in Special Leave 11 Petition and the Appeal was disposed of by the Apex Court by 26th March, 2007. The relevant part of the order passed by the Apex Court reads thus :- “After hearing the arguments on both sides, we find that there are serious disputes between the parties which ultimately may cause serious difficulties in the running of the hospital, which is under the management of the Trust. In view of the present circumstances, as a temporary measure, we direct that Dr.Narendra Trivedi, Vice- President of the Leelavati Hospital and Dr.K.Ramamurthy, Senior Consultant in that hospital, shall be in-charge of the hospital of the day to day running of the hospital and Research Institute. These two Administrators will take all decisions relating to the administration of the hospital. They shall give a report to the Board of Trustees every two weeks and any directions by the Board of Trustees are to be issued to these two Administrators only in the form of resolutions and not individual instructions by any Trustee. A copy of the report of resolution shall also be furnished to the appellant and if she is in any way aggrieved by the directions issued by the Board, she would be at liberty to seek appropriate direction from the City Civil Court, Mumbai where the suit is pending.” While disposing of the appeal, the Apex Court directed the trial Court to expedite hearing of the suit. The interim arrangement made under the said order was to continue till the disposal of the suit. There is a further order passed by the 12 Apex Court on 20th August, 2007. By the said order, the Apex Court replaced one of the Joint Administrators Dr.K.Ramamurthy by Mr.Justice A. A. Halbe, a retired Judge of Bombay High Court. There are two further orders passed by the Apex Court. By the order dated 28th September, 2007, the Apex Court noted the fact that the trial Court had dismissed the suit on 24th September, 2007. The Apex Court directed that the Joint Administrators will continue for a period of ten weeks from 24th September, 2007 subject to any interim or final order that may be made in appeal or any collateral proceedings. On 26th October, 2007, the Apex Court had passed further order which reads thus :- “Heard both sides. The petitioner seeks clarification of the Order passed on 28.9.2007. In paragraph 5 of the Order we have indicated thus : “We direct that the Joint Administrators will continue for a period of ten weeks from 24.9.2007, subject however to any interim or final order that may be made in appeal or any collateral proceedings.” The above Order has been passed without prejudice to the rights of parties of either side and the Order passed by us does not tantamount to the continuance of the 13 services of the Administrators, if their service is not required. The I.A. is disposed of accordingly.” 11. The learned Senior Counsel appearing for the plaintiff/applicant has taken me through the impugned Judgment of the learned trial Judge, pleadings and documents on record. Before referring to the submissions made by him, it will be necessary to refer the prayers made in this application. Prayer (a) is for stay of execution and operation of the impugned Judgment, Decree and findings. Prayer (b) is for seeking stay of implementation of the impugned Resolutions. Prayers (c) and (e) not pressed by the learned counsel appearing for the applicant. Prayer (d) is for continuing the appointment of the Joint Administrators in terms of the order passed by the Apex Court till final disposal of the appeal. 12. The learned Senior Counsel appearing for the plaintiff has submitted that the proceedings of the meeting dated 29th April, 2006 were illegal and void. His submission is that the trustees could 14 not have been represented by the proxies. He has invited my attention to Clause 12 of the Trust Deed. He submitted that on proper interpretation of the Clause 12 of the Trust Deed, the trustees ought to have personally attended meeting of the Board of the trustees. His submission is that there is no provision in the Trust Deed under which the trustees can delegate the right of voting in the meeting of the Board of the Trustees. He also invited my attention to the Section 47 of the Indian Trusts Act. He submitted that the meeting was attended by the strangers who have voted on the resolutions without any authority. He submitted that, obviously, there was no quorum for the meeting as only one trustee was present at the time of the meeting. He criticized the findings recorded by the trial Court by relying upon sub- clauses (h) and (k) of Clause 11 of the Deed of Trust. He submitted that the interpretation made by the learned Judge of various sub clauses of Clause 11 is completely erroneous. He submitted that the learned trial Judge has completely overlooked the opening words of Clause 11. He 15 submitted that the effect of the said controlling words has been completely ignored by the learned trial Judge. Thus, the submission is that the meeting was non-est and void. 13. His second submission is that 11th defendant continues to be a trustee of the said trust. His submission is that 11th defendant continues as a permanent trustee. He pointed out that by an order dated 29th September, 2004, the learned Assistant Charity Commissioner passed an order recording that the 11th defendant left India in January, 2001 without permission and therefore he cannot continue as a trustee. The Assistant Charity Commissioner directed the Trust to take appropriate steps in that behalf. He pointed out that the said order has been set aside by this Court by order dated 3rd October, 2005 passed in Writ Petition No.5099 of 2004. He submitted that the order passed by this Court has attained finality. He submitted that a change report filed for recording removal of the 11th defendant has been rejected by the Assistant Charity Commissioner. Placing reliance on the 16 provisions of Sections 21 and 22 of the Bombay Public Trusts Act, 1950 he submitted that as of today, the entry made of the name of the 11th defendant as a permanent trustee is conclusive. He submitted that the attention of the learned Judge was drawn to the Order of this Court dated 3rd October, 2005, by which Order dated 29th September, 2004 passed by the Assistant Charity Commissioner was set aside. He submitted that the attention of the learned trial Judge was drawn to the order by which the said Change Report was rejected by the learned Assistant Charity Commissioner. He invited my attention to the relevant part of the affidavit in lieu of the evidence filed by 11th defendant and the relevant part of his Written Statement. He, therefore, submitted that the finding of the learned trial Judge that 11th defendant no longer continues as a trustee is perverse. He submitted that the meeting dated 29th April, 2006 is vitiated as the notice of the meeting was not served to the 11th defendant. 14. The third submission canvassed by the 17 learned counsel for the applicant is that the tenth defendant was not continued as a trustee after the term of tenth defendant as a trustee had come to an end. He submitted that tenth defendant was never a permanent trustee. The tenth defendant has not discharged the burden on him to prove that he is a permanent trustee of the said Trust. He submitted that there was no ground for recording a finding by the learned trial Judge that tenth defendant is a permanent trustee and the said finding is based on no evidence. His submission is that notice of the meeting dated 29th April, 2006 could not have been sent to the tenth defendant as he had ceased to be a trustee. 15. He pointed out that the learned Judge has committed an error by holding that the meeting of the permanent trustees held on 8th April, 2006 was bad in law. According to the case of the plaintiff, in the said meeting, the 12th defendant was re-appointed as a trustee and 13th defendant was appointed as a trustee. He submitted that as the tenth defendant had ceased to be a trustee, there 18 was no reason to send notice of the meeting dated 8th April, 2006 which was in any event a meeting of the permanent trustees. He submitted that the meeting dated 8th April, 2006 cannot be held to be bad in law, as it was not necessary to issue notice to the tenth defendant. 16. He submitted that there is no material on record to show that the tenth defendant continues as a permanent trustee. He submitted that none of the contesting defendants including the tenth defendant have set out in the Written Statement as to how the tenth defendant has become a permanent trustee. 17. His submission is that in view of the Resolutions passed in the meeting of the trustees held on 8th April, 2006, the 12th defendant has been re-appointed as a trustee and 13th defendant has been appointed as a trustee. By virtue of the Resolution passed in the said meeting, the tenth defendant ceased to be a trustee on completion of his three terms from 23rd July, 1990. 19 20 18. Thus, his submission is that the meeting dated 8th April, 2006 was a valid meeting and therefore, the proceedings of the meeting held on 29th April, 2006 are illegal also on the ground that notice of the meeting was not issued to 12th and 13th defendants. His submission is that as the proceedings of the meeting dated 29th April, 2006 were void, prayer (b) of this application deserves to be granted. His submission is that as the findings recorded by the trial Court are perverse, prayer (a) of the application deserves to be granted. He submitted that if prayer (a) was not granted, the said findings are likely to be misused in various other proceedings which are pending between the parties. His submission is that the necessity to continue Joint Administrators appointed by the Apex Court continues to exist and therefore, their appointment must be continued till the final disposal of the appeal. He invited my attention to certain reports submitted by one of the Joint Administrators (Justice A.A.Halbe) which according to him clearly show that it is more than necessary to continue the interim arrangement made 21 under the orders of the Apex Court. 19. In support of his submissions made by the learned counsel appearing for the original plaintiff in support of Civil Application No.5892 of 2007, the learned counsel appearing for the appellants in First Appeals No.2670 of 2007 and 2672 of 2007 have made submissions. Their submission is that interim arrangement which was made by the Apex Court be continued till the final disposal of the appeals. They have pointed out various findings recorded by the trial Court against the concerned appellants and submitted that in view of the fact that the findings are perverse, it is necessary to stay the operation of the said findings. 20. The learned Senior Counsel appearing for the defendant Nos.1, 2, 5 and 8 have also made extensive submissions. He invited my attention to the last order of the Apex Court dated 26th October, 2007. His submission is that the Apex Court has clarified that the order passed by the said Court 22 on 28th September, 2007 does not tantamount to continuance of the services of the Joint Administrators. He submitted that in view of the aforesaid order of the Apex Court, unless it is established that there is a necessity of continuing the administrators, the interim order passed by the Apex Court cannot be mechanically continued till the final disposal of the appeals preferred by the plaintiff and other supporing defendants. He pointed out that the original plaintiff has filed a Writ Petition before the Division Bench of this Court in which a Notice of Motion has been taken out praying for continuation of the order passed by the Apex Court and on the said Notice of Motion, no ad-interim order was passed by the concerned Division Bench. He submitted that plaintiff is not entitled to claim the same relief in the present appeal. 21. His submission is that the order of the Apex Court is by way of temporary arrangement pending the expeditious disposal of the suit by the trial Court. He submitted that now this Court will have 23 to examine whether the services of the Joint Administrators are required to be continued. 22. He placed reliance on decisions of the Apex Court in the case of The State of Orissa Vs. Madan Gopal Rangta, (A.I.R.(39) 1952 Supreme Court 12) as well as in Cotton Corporation of India Versus United Industrial Bank Limited And Others, ( (1983) 4 Supreme Court Cases 625.) His submission is that the relief of continuation of order of appointment of Joint Administrator will not be in the aid of the final reliefs which are sought in the suit. He, therefore, submitted that on the first principles such a relief cannot not be granted. His further submission is that the order of the Apex Court on which reliance is placed by the applicant is passed in exercise of powers conferred under Article 142 of the Constitution of India. 23. He invited my attention to various reports submitted by the Joint Administrators. He submitted that the said reports disclose that the 24 working of the hospital is satisfactory. He pointed out that one of the Joint Administrators (Mr.Justice A.A.Halbe) has unilaterally submitted five reports. He submitted