Case: Mulla Gulam Ali and Safiabai D. Trust Vs. Messrs Deelip Kumar and Company

The brief facts leading to the case are as follows :The appellant let out the ground floor of the suit property to the respondent on a monthly rent of Rs. 225/to locate a shop. On the basis that the respondent had committed wilful default in the payment of rent for the period from9 to August 1982, a notice was issued on2 demanding the arrears of rent and, thereafter, on2 notice was issued to the effect that the rental agreement between the appellant and the respondent had come to an end as on2. Inasmuch as the respondent did not deliver the possession of the property, a suit was filed on behalf of the appellant. In the plaint it was also alleged that the appellant is a public charitable trust and the suit property belongs to it and hence is exempted from the application of the Tamil Nadu Buildings (Lease and Rent Control) Act. The respondent contested that the appellant is a public charitable trust. It is also pleaded that even after putting an end to the rental agreement and demand for the delivery of possession of the property rent having been received by the appellant, the appellant had waived the notice issued by him terminating the rental agreement. On these pleadings two important issues were raised as to whether the appellant is a charitable trust or not and whether the notice issued by the appellant had been waived. The trial Court examined exhibit No. 2 which is a certified copy of the Memorandum of Association of appellant trust and exhibit 9 which is a Deed of Settlement executed by Ibrahim Kulamali Dhanaliwala and ors. in favour of the plaintiff, other documents produced by it to show its conduct in having made certain donations to various institutions, came to the conclusion that it is a public charitable trust. The trial Court also held that after receipt of the notice by the respondent rental arrears prior tothe date on which the rental agreement came to an end were sent by the demand draft and that was accepted and, therefore, there was no. waiver at all. These findings stood affirmed by the Appellate Court on appeal. Thereafter, the matter was carried in second appeal to the High Court. The High Court found that the Courts below were wrong in holding that appellant is public charitable trust solely on the ground that public are the beneficiaries without considering the vital question control and management of the trust which the present case is entirely vested in a group of persons belonging to the same family. To reach this conclusion the High Court adverted to various texts set out in decisions of this Court in relation to findings whether temple is a private or public trust.

Court's reasoning:
4. The mere fact that the control in respect of the administration of the trust vested in a group of people will not itself take away the public character of the trust. Indeed if the trust is not administered properly and the objects of the trust are not carried out certainly for the benefit of the public resort can be had to Section 92 of the Civil Procedure Code and get a scheme framed for the proper administration of the trust and by displacing the trustees who are presently managing the trust. If that is the position in law we fail to understand as to how the High Court took the view that in spite of the finding recorded by the Courts below that the appellant is a public charitable institution and is engaged in such activities and has given several donations to several institutions which are exhibited as receipts before this Court, we find no. substance in the contention that it is not a charitable trust. The finding recorded by the High Court in this regard is, therefore, set aside and the findings recorded by the Courts below are restoredWe do not think so. This question has been answered by the trial Court and the First Appellate Court categorically to the effect that after the termination of the rental agreement what was paid were only arrears of rent for prior period. We do not think any useful purpose will be served in sending the matter back to the High Court on this aspect.