IA.No.2857/2008 in CS(OS) 420/2008 Page 1 of 19 *IN THE HIGH COURT OF DELHI AT NEW DELHI + IA.No.2857/2008 in CS(OS) 420/2008 %23.04.2009 Date of decision:23.04.2009 CH. HOSHIAR SINGH MANN & ORS. ….… Plaintiffs Through: Mr. Laliet Kumar & Mr. Ashutosh Lohia, Advocates Versus CHARAN SINGH & ORS. ....... Defendants Through: Mr. K.C. Mittal, Mr. Sumit Babbar & Mr. Sujeet Singh, Advocates for defendants No.1,2 &4 to 11 Mr. Ved Prakash Sharma, Advocate for defendant No.3 CORAM :- HON’BLE MR. JUSTICE RAJIV SAHAI ENDLAW 1. Whether reporters of Local papers may be allowed to see the judgment? Yes 2. To be referred to the reporter or not? Yes 3. Whether the judgment should be reported in the Digest? Yes RAJIV SAHAI ENDLAW, J. 1. The application of the plaintiffs for interim relief is under consideration. The plaintiffs, who are 12 in number have instituted this suit inter-alia on the averments that the plaintiffs No.1,3 to 6 and the plaintiff No.10 and the defendants No. 1 to 3 & 5 to 9 along with four other persons i.e. 18 in all were as on 12th May, 2007 trustees of Sir Chhotu Ram Educational Trust, Kanjhawala, Ghevra, Delhi, a Public Charitable Trust registered under the Trusts Act; that under Article 2, of the Rules & Regulations of the said trust, the trust is to always comply with the provisions of the Societies Registration Act, 1860; that in the meeting of the trust held on 27th March, 2007 it was resolved to amend the rules & regulations of the trust; that the elections to the post of the office bearers of the trust i.e. Chairman, IA.No.2857/2008 in CS(OS) 420/2008 Page 2 of 19 Vice Chairman, Secretary, Joint Secretary and Treasurer were scheduled to be held on 12th May, 2007; that as per the rules & regulations, the elected candidates are to hold office for a period of three years; that in the meeting on 12th May, 2007, the plaintiff No.1 was unanimously elected as the Chairman of the Trust but no consensus emerged for the post of the other office bearers; that as a mark of respect, the members decided to bestow faith in defendant No.2 to appoint the other office bearers of the trust in consultation with the plaintiff No.1; that the defendant No.2 in consultation with the plaintiff No.1 appointed the defendant No.1 as the Vice Chairman, Dr. Balbir Singh who is neither the plaintiff nor the defendant in the present suit as General Secretary, the defendant No.6 as the Treasurer besides appointing plaintiffs No.3,5 & 6 as the Chairman and Secretary respectively of the schools run by the said trust; a letter dated 15th May, 2007 was written by defendant No.2 in this regard; that the said office bearers occupied their respective offices and started functioning in their new capacities; that the amended rules of the trust were registered with the Registrar of Societies on 22nd May, 2007. 2. It is further the case in the plaint that as per the rules & regulations, the trust can have a maximum of 21 trustees; that though it was a part of the agenda for the meeting on 12th May, 2007 that the three vacancies of the trustees will also be filled up but the same could not be done on 12th May, 2007; however in the first meeting of the new executive committee of the trust held on 14th July, 2007, the executive committee and the board of trustees passed various resolutions including that for induction plaintiffs No.7,8 & 9 as the new trustees of the trust; that the said nominations were made unanimously in accordance with the rules & regulations. IA.No.2857/2008 in CS(OS) 420/2008 Page 3 of 19 3. The plaintiffs have further pleaded that notwithstanding the aforesaid, the defendant No.2 attempted to usurp the powers of the trustees as well as governing body by continuing/attempting to act as the sole dictatorial authority and in pursuance whereof the defendant No.2 vide his letter dated 14th August, 2007, in modification of his earlier letter dated 15th May, 2007 and consequent upon the alleged unwillingness of the defendant No.6 for holding the post of Treasurer, appointed the plaintiff No.3 as the Treasurer and the defendant No.8 and one Shri S.S. Solanki who is not a party to the suit as the Secretary of the institutions run by the trust. It is the case of the plaintiffs that the said action of the defendant No.2 is in derogation of the rules & regulations of the trust and was protested by the plaintiff No.1 vide his letter dated 22nd August, 2007. 4. It is further the case of the plaintiffs that the defendant No.2 issued another communication dated 22nd August, 2007 stating that he had been authorized in the meeting held on 14th July, 2007 to fill up the three vacant posts of trustees in the trust and for which posts he appointed the defendants No.10,11 and the plaintiff No.7 as the trustees. It is the case of the plaintiffs that the said action of the defendant No.2 is also in violation of the amended rules & regulations of the trust which had come into force w.e.f. 22nd May, 2007. According to the plaintiff, the three vacancies of trustees already stood filled up on 14th July, 2007 and thus as on 22nd August, 2007 there were no vacancies. 5. The plaintiffs further claim that in a meeting of the trustees held on 15th September, 2007 certain resolutions were passed and which annoyed the defendants No.1,5,6,7,8,9 & Mr. S.S. Solanki who IA.No.2857/2008 in CS(OS) 420/2008 Page 4 of 19 together with the defendants No.10 & 11 wrote a letter dated 22nd September, 2007 to the defendant No.2 to pass a No Confidence Motion against the existing management and also requested him to re-constitute the trust. According to the plaintiffs the said letter was written by nine persons out of whom the defendant No.10 & 11 were not trustees though claiming to be trustees nominated by the letter dated 22nd August, 2007 of the defendant No.2. The plaintiffs state that the defendants No.2 & 3 circulated a letter calling for an emergency meeting of the trust and which also was not in accordance with the rules; on the failure of the plaintiff No.1 (being the Chairman) and of the Secretary of the Trust to call such meeting, the defendant No.1 issued a letter dated 12th October, 2007 whereby he called a emergency meeting on 16th October, 2007 with the agenda to select the Chairman and other office bearers of the trust and to discuss and resolve the No Confidence Motion against the Chairman and Secretary of the trust. It is the case of the plaintiffs that the defendant No.1 being the Vice Chairman of the trust was under the rules & regulations thereof not authorized to convene any meeting. 6. It is further the case of the plaintiffs that Dr. Balbir Singh aforesaid being the Secretary of the trust instituted a suit in this court being CS(OS) No.2054/2007 and vide interim order dated 16th October, 2007 wherein, with respect to the meeting scheduled for 16th October, 2007 it was ordered that though the meeting may be held but no further action would be taken in pursuant to any resolution adopted in the said meeting. The defendants in that suit subsequently filed a written statement and a copy of the resolution passed in the meeting of 16th October, 2007 whereby No Confidence Motion had been passed against the plaintiff No.1 as Chairman and IA.No.2857/2008 in CS(OS) 420/2008 Page 5 of 19 Dr. Balbir Singh as the Secretary and their team. The plaintiffs further aver that though in the agenda, the No Confidence against the Chairman & Secretary only was included but in the meeting on 16th October, 2007 No Confidence was passed against all the office bearers. Also, again though it was not in the agenda, new committees were constituted in the said meeting. 7. According to the plaintiffs, the office bearers under the rules were elected for a period of three years and there is no provision for their removal and this action of the defendants of purported removal and appointing themselves as the office bearers of the trust is illegal. The plaintiffs thus, in the suit claim the relief of declaration that the defendants No.10 & 11 are not the trustees of the trust and that the No Confidence Motion passed on 16th October, 2007 is null and void and the appointments made on 16th October, 2007 as office bearers of the trust are null and void and of mandatory injunction directing the defendants to surrender all documents/records etc. of the trust to the plaintiffs. Interim relief during the pendency of the suit of restraining the defendants from acting as office bearers of the trust has been claimed. In the replication, it is stated that the plaintiffs 11 and 12 were made trustees on 24th January, 2008. 8. The defendants in their written statement do not dispute the 18 trustees of the trust as on 12th May, 2007. The defendants dispute the election of the plaintiff No.1 as the Chairman in the meeting held on 12th May, 2007. It is pleaded that the plaintiff No.1 was also nominated by defendant No.2. It is further pleaded that the plaintiffs 7 to 9 and 11 and 12 are not trustees and have no locus to file the suit; that the suit is bad for non-joinder of Dr Balbir Singh, Shri S.S. Solanki and Shri Chander Verma who are the trustees. The IA.No.2857/2008 in CS(OS) 420/2008 Page 6 of 19 defendants dispute the resolution dated 14th July, 2007 claimed by the plaintiffs appointing the plaintiffs No.7 to 9 as the trustees of the trust. It is further pleaded that the plaintiffs 1 to 6 and 10 who only of the 12 plaintiffs are the trustees, are in minority and the majority of the trustees in the meeting of 16th October, 2007 have passed the no confidence motion against the then chairman and office bearers of the trust; that the plaintiffs 1 to 6 opted not to participate even in the meeting of 16th October, 2007. It is pleaded that in the said meeting, the trustees present and voting unanimously expressed no confidence against the then chairman and other office bearers and appointed new office bearers. The defendants rely upon Clause 12 of Chapter IV titled Special Provisions in Additional Rules & Regulations of the trust which is as under:- “If any member of Board of Trustees or Governing Body is found involved in anti-trust or anti-governing body activities or is found to act in a way as to bring a bad name to the trust or governing body, he may be terminated by the Board of Trustees after duly endorsing such as an act of the Member of Board of Trustees/Governing Body by calling a meeting of the trust. In case of non-unanimity, the decision can be taken by a majority vote.” 9. According to the defendants, the meeting dated 16th October, 2007 was attended by 11 trustees including the defendants No.10&11 and who unanimously passed a No Confidence Motion. It is thus the case of the defendants that the removal of the office bearers appointed on 12th May, 2007 is in accordance with law. It is further the case that the present suit is not maintainable in view of judgment dated 30th January, 2008 in CS(OS)2054/2007 (supra). 10. The plaintiffs in the replication have for the first time contended that Dr Balbir Singh, Shri S.S. Solanki and Shri Chander IA.No.2857/2008 in CS(OS) 420/2008 Page 7 of 19 Verma were not required to be made a party since they were removed from membership of trust for failure to attend meetings of trust. Elsewhere it is pleaded that Shri Chander Verma and another trustee Dr Chanderketu were removed on 24th January, 2008 for their antitrust activities and in whose place plaintiffs No. 11 and 12 were inducted as trustees. 11. The plaintiffs besides challenging the convening of the meeting dated 16th October, 2007 also rely upon Clause 2(e) of Chapter-I of the aforesaid Additional Rules & Regulations which provides for any major decision about the trust or its institutions such as nomination or termination of trusteeship etc. to be adopted by at least 2/3rd majority (14 trustees) of 21 trustees. The plaintiffs contend that even if the meeting called on 16th October, 2007 is found to be properly convened and in pursuant of Clause 12 aforesaid, the same still does not satisfy the test of Clause 2(e) in as much as the No Confidence Motion is not by 2/3rd majority. It is stated that according to both the parties as on that date there were 21 trustees and the No Confidence Motion, if any, had to be of at least by 14 trustees, while according to the documents filed by the defendants also, there were only 11 trustees present in the said meeting. Per contra, the defendants have urged that under Clause 12 the No Confidence Motion was required to be passed by majority vote only and the requirement of 2/3rd does not apply. 12. The counsels for the defendants contend that the present suit is for the reliefs falling within the ambit of Section 92 of the CPC; the plaintiffs had along with the suit filed an application (IA No.2858/2008) seeking leave of the court but withdrew the said application on 4th August, 2008. It is the case of the defendants that IA.No.2857/2008 in CS(OS) 420/2008 Page 8 of 19 upon withdrawal of the said application, the suit is barred by Section 92 of the CPC. Reliance was placed on R. Venugopala Naidu Vs Venkatarayalu Naidu AIR 1990 SC 444. 13. I do not find any merit in the contention of the counsel for the defendants that the present suit is barred by Section 92 of the CPC. The present suit is not of the category covered by Section 92 of the CPC. The present suit is to address personal grievances and disputes and to assert personal rights, may be as the office bearers of the trust, but certainly not in public interest, or in a representative capacity. Every suit with respect or against a public charitable trust does not fall within the domain of Section 92 of the CPC. Where the suit is filed for vindication of private rights and not as representatives of the public or where the right as a trustee is asserted and is denied by the other, the suit is not covered under Section 92 of the CPC. Reference can be made to Swami Parmatmanand Saraswati Vs Ramji Tripathi AIR 1974 SC 2141 and to Vidyodaya Trust Vs Mohan Prasad 2008 V A.D. (SC) 101. 14. It is further the argument of the defendants that the present suit is also barred by the earlier suit being CS(OS) No.2054/2007 which was preferred by Dr. Balbir Singh in a representative capacity. A copy of the order dated 30th January, 2008 in the said suit has been filed. However, a perusal of the said order shows that that suit was dismissed for the reason of being barred by Section 92 of the CPC and thus being not maintainable. Of course, while dismissing the suit this court had also observed that it is the prerogative of the trust to run the trust in an efficient, honest and proper manner and if majority of trustees feel that the trust is not being run in a proper manner and the funds are being misappropriated, the trustees can IA.No.2857/2008 in CS(OS) 420/2008 Page 9 of 19 always exercise their right to manage the trust and recall such persons and handover the management to other set of persons. It is the contention of the defendants that the meeting of 16th October, 2007 was under challenge in the said suit and upon dismissal of the said suit, the present suit is barred by res judicata. Reliance was placed on Shiromani Gurdwara Parbandhak Committee Vs Mahant Harman Singh AIR 2003 SC 3349. 15. I do not agree with the aforesaid contention of the defendants. The earlier suit was dismissed as not maintainable. It tantamounts to rejection of the plaint. If the suit is dismissed for a technical defect, the findings, even if any, given on merits do not constitute res judicata. 16. The counsel for the defendant No.3 also raised a technical plea that the interim order of restraint sought could not be granted as no relief of permanent injunction had been claimed. Relying upon Manisha Commercial Ltd Vs N.R. Dongre 87 (2000) DLT 393 and V.D. Tripathi Vs Vijai Shanker Dwivedi AIR 1976 All. 98 it was contended that a party is not entitled to interim relief which can never be granted to the party while disposing of the suit finally. 17. The counsel for the plaintiffs has referred to a) Sarbjit Singh Vs All India Fine Arts & Crafts Society ILR (1989) II Delhi 585 to contend that it is not open to a society to do any act contrary to its Memorandum and Articles of Association; b) Dr Raj Vardhan Azad Vs All India Ophthalmological Society 103 (2003) DLT 518 where prima facie view was taken of a Resolution passed in General Body meeting of society; c) Sanjay Jain Vs. Bar Council of Delhi AIR IA.No.2857/2008 in CS(OS) 420/2008 Page 10 of 19 1999 Delhi III for the proposition that a practice not in consonance with statute cannot be allowed to stand even if it is hallowed by time; d) Anil Aggarwal Vs. Institute of Chartered Accountants 2000 (54) DRJ 415 for the proposition that power to recall is not inherent in the electorate and in the absence of a power of removal of Chairman and Vice Chairman in the bye laws the members are not entitled to do so; e) N. Sivarama Vs. State of Andhra Pradesh AIR 1996 A.P. 394, to the same effect. 18. The aforesaid pleadings and submissions would show that the controversy in the present suit is as to whether the office bearers of the trust as elected/appointed pursuant to the meeting of 12th May, 2007 are to continue for a period of three years i.e., till 11th May, 2010 or the new office bearers appointed on 16th October, 2007 whose appointment is challenged and the inter alia the removal sought in the suit entitled to continue for three years i.e. till 15th October, 2010. Some of the persons appointed pursuant to the meeting dated 12th May, 2007 are not parties to the present suit and some are not supporting the suit and have been impleaded as the defendants. The other question which arises though no express relief is claimed with respect thereto is as to the appointment /induction of three trustees in addition to the 18 admitted trustees. Of these, the plaintiff No.7 is common. While the plaintiffs contend that plaintiffs No. 7 to 9 were so inducted as trustees, the defendants contend that the plaintiffs No.7 and the defendants No., 10 and 11 were inducted as the trustees. Yet another dispute is as to whether Dr Balbir Singh, Shri S.S. Solanki and Shri Chander Verma all of whom are not parties, ceased to be the trustees, and plaintiffs 11 and 12 appointed in their place or the said persons continued to be trustees. Again no express relief is claimed in this regard. IA.No.2857/2008 in CS(OS) 420/2008 Page 11 of 19 19. I had during the hearing posed the question to the counsels as to what purpose the present litigation will serve. The term of the office bearers who have sued as plaintiffs is barely for a period of further one year. The disposal of the suit is likely to take longer than that. While the counsel for the plaintiffs contended that if interim injunction is granted in favour of the plaintiffs, the office bearers appointed pursuant to 12th May, 2007 shall continue for the remaining term i.e., till May, 2010, the counsel for the defendants 1, 2 and 4 to 11 contended that the office bearers presently functioning are entitled to continue for a period of three years from their appointment. The counsel for the defendant No.3 however suggested a solution to not only the application for interim relief but also for disposal of the suit. It was suggested that since there was no controversy as to the 18 trustees as on 12th May, 2007, the suit could be disposed of by directing the said 18 members to be the only trustees of the trust and by further directing fresh election to the post of the office bearers of the trust, to be held by the said 18 trustees and with the induction of the remaining three trustees being left to be decided in accordance with the rules and regulations of the trust. 20. It is sad that such dispute has been brought to the court. The trustees of a public charitable trust are expected to perform a duty rather than to seek posts/office. The positions to the governing body of a public charitable trust for which the parties are litigating are supposed to be non-remunerative. I do not see any reason for the parties to pine for the same. 21. The courts have evolved a policy for non interference with the internal affairs and management of such trusts/societies for the IA.No.2857/2008 in CS(OS) 420/2008 Page 12 of 19 reason that they are to be governed by their Charter/Rules & Regulations and by the rule of majority, acting in terms of said Charter. 22. From the narration of facts above it is evident that there are dissentions not only amongst the trustees but even amongst the office bearers of the trust. The application for interim relief seeks the relief of restraining the defendants from acting as office bearers of the trust and directing the defendants to deposit or surrender all documents/statements of accounts/records in respect of the trust to the plaintiffs. However, amongst the defendants are persons whom the plaintiffs also contend are the office bearer having been elected /appointed alongwith the plaintiffs. Granting the injunction as claimed will have the effect of allowing the trust to function without all the office bearers. Also as aforesaid Dr Balbir Singh who was appointed as the General Secretary as per the elections/appointments relied upon in the plaint is not a party to the suit. Obviously, he was not willing to join with the plaintiffs. In his absence, it cannot be said whether he is interested in continuing to function as the General Secretary of the trust or not. If he is not, grant of injunction would be meaningless inasmuch as there would be then no General Secretary of the trust. 23. The appointment of office bearers as pleaded by the plaintiffs themselves, according to me is not lawful. The trustees of a public charitable trust are to exercise their duties/functions themselves and not by delegation. The Indian Trust Act, though applicable to private charitable trusts, but principles whereof are applicable to public charitable trusts also, in Section 47 thereof, provides so. The Apex IA.No.2857/2008 in CS(OS) 420/2008 Page 13 of 19 Court recently in J.P. Srivastava & Sons Pvt Ltd Vs Gwalior Sugar Co Ltd AIR 2005 SC 83, cited with approval Atmaram Ranchodbhai Vs Gulamhusein Gulam MANU/GJ/0112/1973 holding, whether a trust is a private trust governed by the Indian Trusts Act or is a public charitable or religious trust, a trustee cannot delegate any of his duties, functions and powers to a co- trustee or to any person unless the instrument of trust so provides or the delegation is necessary or the beneficiaries competent to contract consent to the delegation or the delegation is in the regular course of business. It was further held that the trustees even by a unanimous resolution authorise one of themselves to act as managing trustee for executing the duties, functions and powers relating to the trust and everyone