IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HONOURABLE MR. JUSTICE THOMAS P.JOSEPH FRIDAY, THE 21ST NOVEMBER 2008 / 30TH KARTHIKA 1930 WP(C).NO. 30820 OF 2008(R) ---------------------------------------- CMA.131/2008 OF ADDL.DISTRICT COURT, THRISSUR OS.442/2008 OF ADDL.SUB COURT, IRINJALAKUDA .................... PETITIONER(S): ---------------------- CHALAKKUDY N.S.S. EDUCATIONAL CULTURAL & CHARITABLE SOCIETY, REG.NO.254/1980,CHALAKUDY, REP.BY ITS PRESIDENT, P. THARANATHA MENON, AGED 83 YEARS, S/O. LAKSHMIKUTTY AMMA. BY ADV. SRI.RENJITH THAMPAN SRI.V.M.KRISHNAKUMAR RESPONDENT(S): ------------------------- 1. E.NARAYANA MENON, AGED 9 YEARS, S/OKRISHNAN NAIR, VAIRELI HOUSE, CHENATHUNADU, KIZHEKKE CHALAKUDY. 2. GOVINDA PANICKER, AGED 72 YEARS, S/O. KALLARAKKAL KRISHNAN NAIR, CHENATHUNADU, KIZHEKKE CHALAKUDY. 3. CHANDRASEKHARAN, AGED 64 YEARS, SREENILAYAM, RB ROAD, KOZHEKKE CHALAKKUDY. 4. AJITHKUMAR, AGED 42 YEARS, S/O.KUZHIKKATTIL KOZHUNARAYANA MENON, I.Q. ROAD,KIZHAKKE CHALAKUDY. 5. MOHANEN, S/O.GOURIAMMA, POUKKATTU HOUSE, NEAR MADATHAMPILLY TEMPLE KIZHAKKE CHALAKUDY. 6. SADANANDAN, AGED 59 YEARS KUZHIKKATTIL HOUSE, I.Q.ROAD, KIZHAKKE CHALAKUDY. 7. SREEKUMAR, AGED 37 YEARS, KUZHIKKATTIL HOUSE, I.Q.ROAD KIZHAKKE CHALAKUDY. 8. BALAKRISHNAN, AGED 66 YEARS, S/O.THAPPAT MADHAVI AMMA, PADINJARE CHALAKUDY. 9. ASOKKUMAR AGED 49 YEARS, S/O.MELEDATH SANKARAN NAIR, PADINJARE CHALAKUDY ADV. SRI.MILLU DANDAPANI FOR R1,5&9 SRI.MILLU DANDAPANI FOR R2 TO 4 & 6 TO 8 THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 11.11.2008, THE COURT ON 21.11.2008 DELIVERED THE FOLLOWING: THOMAS P.JOSEPH, J. = = = = = = = = = = = = = = = = = = = = = = = = W.P(C) No. 30820 of 2008 = = = = = = = = = = = = = == = = = = = = = = = = = Dated this the 21st day of November, 2008 J U D G M E N T ---------------------- First defendant in O.S. No.442 of 2008 of the court of learned Subordinate Judge, Irinjalakuda is the Writ Petitioner. Respondents 1 to 9 filed that suit to direct the petitioner and defendants 2 to 5 by a decree for mandatory injunction to produce the accounts of the petitioner for the period from March, 2005 to March, 2008, declaration that the petitioner and defendants 2 to 5 have no right to enhance the fee of students in the School run by the petitioner against the majority decision of the Board of Directors of the petitioner and for prohibitory injunction restraining the petitioner and defendants 2 to 5 from collecting enhanced fee except the admission fee which was enhanced by 50%. Along with the suit, respondents filed I.A. No.2300 of 2008 for an order of temporary prohibitory injunction and I.A. No.2301 of 2008 seeking leave of the court to institute the suit under Section 92 of the Code of Civil Procedure (for short, the “Code”). Petitioner filed objection to both the applications. In the meantime, petitioner approached this Court in W.P(C) No.20201 of 2008 seeking direction to the W.P(C) No.30820 of 2008 -: 2 :- learned Sub Judge to dispose of I.A. No.2301 of 2008. A learned Single Judge of this Court as per order dated 4.7.2008 directed the learned Sub Judge to consider I.A. No.2301 of 2008 either before the disposal of the injunction application (I.A. No.2300 of 2008) or along with the same in accordance with law. Learned Sub Judge heard the parties on both the applications. As per Exhibit P5 order dated 31.7.2008 on I.A. No.2300 of 2008 (application for temporary injunction) learned Sub Judge found that the petitioner is a public trust, but disallowed the prayer of the respondents for temporary injunction. Respondents- plaintiffs challenged the dismissal of I.A.No.2300 of 2008 in C.M.A. No.131 of 2008 in the court of the First Additional District Judge, Thrissur. While so, petitioner again approached this Court in W.P(C) No.26750 of 2008 challenging the order in I.A. No.2301 of 2008 (granting leave under Section 92 of the Code). When the Writ Petition came up for hearing before a learned Single Judge of this Court on 3.9.2008, it was submitted on behalf of the petitioner that respondents have filed appeal challenging Exhibit P3, order in that proceeding (order on I.A. No.2301 of 2008) before the District Court, Thrissur. Learned Single Judge observed that being a common order, learned District Judge necessarily has to consider the maintainability of the suit in view of Section 92 of the Code and permitted the petitioner to challenge the question of leave granted under Section 92 W.P(C) No.30820 of 2008 -: 3 :- of the Code also in the pending appeal (C.M.A. No.131 of 2008). Before the learned Additional District Judge both sides addressed arguments regarding the correctness of the order granting leave and refusal to grant temporary injunction. Learned Additional District Judge vide Exhibit P6, judgment dated 13.10.2008 confirmed the finding of the learned Sub Judge that the petitioner is a public trust and hence suit under Section 92 of the Code is maintainable. Learned Additional District Judge reversed the finding of the learned Sub Judge regarding temporary injunction, held that there was no decision at all in the Director Board meeting of the petitioner on 11.6.2008 to enhance the tuition fee and granted temporary injunction as prayed for. Exhibit P6, judgment is under challenge in this Writ Petition. 2. Heard both sides. 3. Points for consideration are: (1) Whether leave granted under Section 92 of the Code is legal and proper? and (2) Whether interference is required with the order of temporary injunction? 4. Perused the relevant records. 5. Point No.1: Learned counsel for the respondents- plaintiffs raised preliminary objection to the petitioner challenging the correctness of the order of the learned Sub Judge granting leave under W.P(C) No.30820 of 2008 -: 4 :- Section 92 of the Code. Learned counsel contended that respondent had prayed for leave while instituting the suit, under Section 92 of the Code as per I.A. No.2301 of 2008 and that application was allowed by the learned Sub Judge after hearing both sides. According to the learned counsel, under Section 104(1)(ffa) of the Code only an order refusing leave to institute suit under Section 92 of the Code alone is appealable and an order granting leave under Section 92 of the Code is not appealable but could only be subjected to a revision under Section 115 of the Code. Hence the learned Additional District Judge had no jurisdiction to consider the correctness of the order of the learned Sub Judge granting leave under Section 92 of the Code. It is contended by the learned counsel that what is under challenge in this proceeding is only Exhibit P6, judgment dated 13.10.2008 in C.M.A. No.131 of 2008 and that if the learned Additional District Judge could not consider the correctness of the order under Section 92 of the Code, the order passed by the learned Sub Judge on I.A. No.2301 of 2008 remained intact and hence without challenging that order, petitioner cannot assail the finding of the learned Additional District Judge. Learned counsel for the petitioner in reply contended that this Court as per the judgment in W.P(C) No.26750 of 2008 had permitted the petitioner to raise its challenge to the order granting leave, in C.M.A. No.131 of 2008 and hence the learned Additional District Judge W.P(C) No.30820 of 2008 -: 5 :- was bound to consider that question and answer the same. It is also pointed out by the learned counsel that this Court is requested to exercise its supervisory jurisdiction under Article 227 of the Constitution. A technical plea raised by the respondents may not be allowed to triumph. 6. I stated that it is as per I.A. No.2301 of 2008 that respondents sought for and obtained leave under Section 92 of the Code from the learned Sub Judge. As pointed out by learned counsel for the respondents, an appeal under Section 104(1)(ffa) of the Code would lie from an order under Section 92 of the Code only if leave is refused. When leave is granted, remedy of the petitioner was to challenge it under Section 115 of the Code. Instead of availing that remedy, petitioner chose to file a petition (W.P(C) No.26750 of 2008) in this Court under Article 227 of the Constitution. It is seen from the judgment dated 3.9.2008 in W.P(C) No.26750 of 2008 that when that petition came up for hearing it was represented before the learned Single Judge on behalf of the petitioner that the “plaintiffs have filed an appeal challenging Ext. P3 order before the District Court, Thrissur and it is pending” (Exhibit P3 order referred to in W.P(C) No.26750 of 2008, it is conceded, is the order on I.A. No.2301 of 2008 granting leave). Learned Single Judge permitted the petitioner to challenge the correctness of the order granting leave under Section 92 of the Code W.P(C) No.30820 of 2008 -: 6 :- also in C.M.A. No.131 of 2008. It is accordingly that learned Additional District Judge considered the correctness of the order granting leave under Section 92 of the Code. It is true that in W.P(C) No.26750 of 2008 no notice was given to the respondents. But it is also pertinent to note that respondents had not brought to the notice of the learned Additional District Judge that in view of Section 104(1) (ffa) of the Code, correctness of the order granting leave could not or should not be considered in that C.M. Appeal. On the other hand, reading of Exhibit P6, judgment dated 13.10.2008 in the C.M. Appeal would show that respondents-plaintiffs had joined issue with the petitioner before the learned Additional District Judge in the matter of granting leave under Section 92 of the Code and submitted arguments. Moreover, though in this petition the relief sought for is to “call for records leading to Ext.P6 and issue a writ in the nature of certiorari quashing Ext.P6”, there is also a prayer to “issue such other orders, writs or directions as are deemed fit by this Hon'ble Court” and in ground No.(I) of this petition it is contended that “the finding of the court in the last portion of paragraph 10 of Ext.P5 order, that first respondent is a public trust is absolutely without any basis”. Exhibit P5, order referred to in this petition is the order of the learned Sub Judge on I.A. No.2300 of 2001 and paragraph 10 of Exhibit P5 dealt with the grant of leave under Section 92 of the Code. Therefore, W.P(C) No.30820 of 2008 -: 7 :- it can be said that petitioner is also challenging the correctness of the finding entered by the learned Sub Judge as regards the application of Section 92 of the Code. Moreover, this Court is requested to exercise the power under Article 227 of the Constitution which is supervisory in character. Supervisory jurisdiction required this Court to correct the illegality or irregularity committed by the subordinate courts. In the circumstances, I am not inclined to uphold the preliminary objection raised by the respondents-plaintiffs that petitioner cannot, in this proceeding challenge the correctness of the order of the learned Sub Judge granting leave under Section 92 of the Code. 7. It is contended by the learned counsel for petitioner that the averments in the pliant or the affidavit in support of I.A. No.2301 of 2008 are not sufficient to warrant the conclusion that petitioner is a public trust coming under the mischief of Section 92 of the Code. It is also contended that Exhibit A1, byelaw of the petitioner would show that petitioner is a Society registered under the provisions of the Travancore Cochin Literary Scientific and Charitable Societies Registration Act, 1955 (for short, “the Act). Learned Sub Judge, without proper consideration of the matter and merely basing on Exhibit B1 came to the conclusion that petitioner is a public trust. Learned counsel contended that Exhibit B1 (copy of petition in O.P.No.395 of 2007 filed by 7 persons including respondents 1 and 5 W.P(C) No.30820 of 2008 -: 8 :- herein in the District Court, Thrissur under Section 25 of the Act) is not a plaint filed under Section 92 of the Code as thought by the learned Sub Judge. Learned counsel placed reliance on the decisions in Kesava Panicker v. Damodara Panicker (1975 KLT 797 (F.B.), Sukumaran v. Akamala Sree Dharma Sastha Idol (1992 (1) KLT 432), Amrithakumari v. Ramanathan (1998 (2) KLT 305) and Abhaya v. Raheem (2005 (3) KLT 891). Learned counsel for the respondents contended that what was argued before the learned Additional District Judge on behalf of the petitioner is that petitioner is a private trust, courts below considered the materials on record and came to the conclusion that petitioner is a public trust, only prima facie evidence is required to come to that conclusion and that there is no illegality or irregularity committed by the courts below in reaching the conclusion that the petitioner is public trust. Learned counsel also relied on the decisions in Kesava Panicker v. Damodara Panicker and Amrithakumari v. Ramanathan to support the contention that only prima facie evidence is required. 8. Section 92 of the Code relates to breach of any express or constructive trust created for public purpose of a charitable or religious nature. To attract that provision it must prima facie be shown that petitioner is a public trust. A trust is an obligation annexed to the W.P(C) No.30820 of 2008 -: 9 :- ownership of property and arising out of a confidence reposed and accepted by the owner, or declared and accepted by him for the benefit of another, or of another and the owner. In effect, a trust is the gift or dedication of property for the benefit of the beneficiaries to a person or institution by or through the intervention of trustees. In a trust, the beneficiary is clothed with equitable title to property though legal title resides in the trustee. There must be fiduciary relationship between the trustee and beneficiary. Trust is private when the beneficiaries are specific individuals and public when they are the general public or a class thereof. It would appear from Exhibit P6, judgment of the learned Additional District Judge that it was argued before him on behalf of the petitioner that it is a private trust. Learned counsel for the petitioner states that it was a wrong submission made on behalf of the petitioner. The mere fact that it was stated so before the learned Additional District Judge would not make the petitioner a private trust if it is not so. I am not inclined to think that because it was so submitted before the learned Additional District Judge, petitioner is precluded from contending that no trust is involved in the matter and much less, a public trust. 9. Exhibit P2 is the plaint. Exhibit P2 describes the petitioner-first defendant as a Society registered under the provisions of the Act. Respondents are stated to be founder members as well as W.P(C) No.30820 of 2008 -: 10 :- members of the Director Board of the petitioner. In paragraph 3 of the plaint the objectives of the petitioner are stated. In short, the objectives stated are to provide education to all needy children irrespective of Caste, Creed or Community and to promote Science, Literature, Fine Arts and other Social, Ethical and Cultural activities amongst the public. Exhibit A1 states that management of the affairs of the petitioner is entrusted to a Managing Committee. It is stated in Exhibit A1 that apart from the initial capital the funds shall be raised by public contributions and that the Managing Committee shall have every power to work out ways and means to raise funds. In the additional objective of the petitioner it is stated that petitioner can purchase for it and for its benefit any property whatever and invest its money or sell, exchange or surrender its property. It is nowhere stated in the plaint that a trust, private or public was formed. There is also no averment in the plaint or the affidavit in support of I.A. No.2301 of 2008 that the petitioner before its formation as a Society acquired properties for the benefit of the public or that such properties were either gifted or dedicated for the use of the beneficiaries. Exhibit P2 (plaint) and the affidavit in support of I.A. No.2301 of 2008 only state about the objectives of the petitioner and the attempts allegedly made by defendants 2 to 5 to move against such objectives to advance their own personal interests. W.P(C) No.30820 of 2008 -: 11 :- 10. In Kesava Panicker's case it was held that the effect of the Societies Registration Act is not to invest properties with the character of a trust property and that even if the society was formed for charitable purpose, the property acquired for that purpose will belong to the society, there is no trust and no trust could also be predicated. In that case even long before the formation of the Society, funds were collected from the public towards share money as evidenced by the documents produced. In Sukumaran's case the conditions necessary for the application of Section 92 of the Code were laid down. They are: (i) trust is created for public purposes of a charitable or religious nature; (ii) there was a breach of trust or a direction of court is necessary in the administration of such a trust and (iii) the relief claimed is one or other of the reliefs enumerated therein. It was also held thus: “.......the effect of the Societies Registration Act is not to invest properties of the society with the character of trust property. Even if the purpose for which the society was formed was charitable purpose the property acquired for this purpose will belong to the society and there is no trust and no trust can be predicated...if there was a trust created by the pubic, for a public charitable purpose W.P(C) No.30820 of 2008 -: 12 :- namely establishing, managing and running a school the fact of the registration of the society could not change the character of the properties which had already been constituted trust properties and impressed with the trust and any addition to those properties must also have the same character”. 11. In Kesava Panicker's case and Sukumaran's case there was evidence to show that a public trust was created and later it was registered under the provisions of the Act. In Abhaya's case it was pointed out that formation of a society under the Act to carry out any charitable or social purpose will not make the society a public trust and that whenever society acquires property it cannot be said that it declares itself as a trustee of that property. Property continued to be that of the society which is a legal person which is subject to the provisions of the Act. 12. It is seen from Exhibit P5, order of the learned Sub Judge that much emphasis was given to Exhibit B1, copy of the petition in O.P.No.395 of 2007 filed by some of the members of the Society including respondents 1 and 5 in the District Court, Thrissur. According to the learned Sub Judge, by filing that petition before the District Court respondents 1 and 5 admitted that the petitioner is a public trust. It is however, to be noted that Exhibit B1 is not a plaint W.P(C) No.30820 of 2008 -: 13 :- filed under Section 92 of the Code. Instead, it is a petition filed under Section 25(1) of the Act. A petition filed under Section 25(1) of the Act cannot be treated as equivalent to a plaint filed under Section 92 of the Code. I am also not able to find any admission in Exhibit B1 that petitioner is a public trust. 13. Learned Additional District Judge proceeded on the basis that it is contended by the petitioner that petitioner is a private trust and relying on the decisions referred in the judgment, came to the conclusion that only prima facie evidence is sufficient to hold that it is a public trust. Learned Additional District Judge also has not considered the averments in the plaint and affidavit in support of I.A. No.2301 of 2008 in the correct perspective and in the light of the binding decisions on the point. The averments in Exhibits P2 and P3 or, the clauses in Exhibit A1 (bye-law) do not show that the petitioner is a public trust. It is merely a Society registered under the Act and hence a legal person which acquired assets to carry out the objectives which includes charitable purpose also. Merely because a prayer for accounting is also asked for, it does not become a public trust. On a consideration of the mater, I am inclined to think that the finding entered by the courts below that the petitioner is a public trust coming under Section 92 of the Code is manifestly wrong, is against the materials on record and therefore, cannot be sustained. W.P(C) No.30820 of 2008 -: 14 :- 14. What then, is the next question. Should the plaint be returned as not maintainable? Learned counsel for the petitioner contended that the suit as framed if not maintainable under Section 92 of the Code, can only be returned. Counsel for the respondents contended that at any rate, the suit is perfectly maintainable in the Sub Court, in the ordinary course even if leave under Section 92 of the Code is refused. 15. Since Section 92 of the Code states that a suit of the nature referred to therein can be instituted by two or more persons “having obtained the leave of the court”, the grant of leave must precede the institution of the suit and the suit is deemed to be instituted when such leave is granted. The proper procedure is to seek leave by filing a separate original petition producing along with it necessary materials to show that a public trust is involved. A copy of the proposed plaint can also be produced along with the petition to show the nature of the reliefs proposed to be sought for, but production of the copy of the plaint is not a sine qua non for the grant of leave. The suit is not required to be numbered at that stage. Suit is to be numbered only when leave is granted. In this case what happened is that a regular suit was instituted and in that suit, an application under Section 92 of the Code for leave was also filed. The suit was numbered and the application was numbered as if it is an W.P(C) No.30820 of 2008 -: 15 :- interlocutory application in the suit (as I.A. No.2301 of 2008) after numbering the application for temporary injunction (as I.A. No.2300 of 2008). That procedure though, irregular was not objected by the petitioner or other defendants and the learned Sub Judge considered the application (I.A.. No.2301 of 2008) in the suit itself. 16. While answering point No.1, I found that the courts below were not correct in holding that the petitioner is public trust coming within the mischief of Section 92 of the Code. If so, what happens is only that I.A. No.2301 of 2008 is not maintainable and only to be dismissed. That did not mean that there was no proper presentation of the plaint on the regular side for the reasons I have already stated above. Plaint (Exhibit P2) does not even mention that it is filed under Section 92 of the Code. Even when the claim under Section 92 of the Code is excluded or found against, institution of the suit otherwise is not in any way affected as the suit otherwise is of a civil nature cognizable and triable by the regular civil court. Going by the total valuation of the reliefs in Exhibit P2 (plaint), it exceeds Rs.1,00,000/- which is the maximum pecuniary jurisdiction of the Munsiff's court. The plaint as seen from Exhibit P2 could have been presented only in the Sub Court, Irinjalakuda even if leave under Section 92 of the Code was not applied for or even disallowed at the threshold itself. Plaint need not be returned for re-presentation since it