Full Judgment Text
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CASE NO.:
Appeal (civil) 12915-12920 of 1996
PETITIONER:
B.S. Adityan & Ors.
RESPONDENT:
B. Ramachandran Adityan & Ors.
DATE OF JUDGMENT: 16/04/2004
BENCH:
S. RAJENDRA BABU & DORAISWAMY RAJU
JUDGMENT:
J U D G M E N T
RAJENDRA BABU, J. :
A deed of declaration was executed by S.B.
Adityan consisting of himself, his elder brother S.T.
Adityan and the first respondent herein, B.
Ramachandran Adityan as Trustees on 1.3.1954.
Under a deed of resignation dated 19.5.1959 the first
respondent herein resigned as Trustee and also as
Director of Daily Thanthi. By a deed of appointment
of trustees executed on 22.5.1959 the first appellant
B.S. Adityan son of S.P. Adityan and the second
appellant were appointed as one of the new trustees
and also to be the Director of Daily Thanthi. A
supplementary deed was also executed on 28.6.1961.
On 8.11.1961 the Founder resigned. On 2.3.1962 a
decree was passed by the High Court in C.S. No.
90/1961 approving the supplementary deed dated
28.6.1961. On 27.12.1963 S.T. Adityan resigned. In
the last week of June 1978 the Founder executed
three deeds of appointments of trustees appointing
himself, his elder brother S.T. Adityan and the first
respondent as additional trustees of Thanthi Trust.
The Appellants filed applications under Section 92 Civil
Procedure Code (CPC) for leave to file suits
challenging the said appointments and leave was
granted and the said suits are numbered as C.S. Nos.
352 and 353 of 1978. On 29.8.1978 the first
respondent and his uncle S.T. Adityan filed application
under Section 92 CPC for leave to file a suit for
removing appellants Nos. 1 and 2 as trustees. On
13.9.1978 an temporary order of injunction was made
by the High Court restraining the newly appointed
trustees from interfering with the management of the
trust on the condition that the first appellant must
deposit a sum of Rs. 1 lakh per month. All the three
newly appointed trustees, that is, Founder, S.T.
Adityan and the first respondent executed resignation
deeds and withdrew the application No. 3147/1978
filed under Section 92 CPC. Inasmuch as the newly
appointed trustees resigned their trusteeship and
withdrew their application under Section 92 CPC, the
appellants proceeded on the basis that suits C.S. Nos.
352 and 353 of 1978 had become unnecessary and
withdrew the same.
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While the matter stood thus, on 20.1.1981
Kannan Adityan and Kathiresa Adityan filed an
application No. 165/1981 under Section 92 CPC for
leave to file a suit for appointing them as additional
trustees and for rendition of accounts by the first and
second appellants. The appellants filed application No.
879/1991 for permission of court to cross-examine the
applicants therein, that is, Kannan Adityan and
Kathiresa Adityan, to establish the fact that it was the
father of the petitioners therein who was supplying all
documents and materials and who was conducting the
proceedings and that they were 21 and 18 years of
age and were students then studying in the
Engineering College. The said application filed by
the appellants came to be dismissed by the learned
single Judge. On appeal filed in O.S.A. No. 152/1981
the Division Bench held that it would be in the interest
of justice to allow the appellants therein to cross-
examine Kannan Adityan and Kathiresa Adityan.
When the matter was carried to this Court, this Court
dismissed the Special Leave Petition No. 6040 of 1982
by observing that the cross-examination, however,
was confined to the question of sanction and principles
governing the same. An application had been filed
under Order XI Rule 21 CPC which having been
dismissed and on appeal having been confirmed by
the Division Bench, the same matter was carried to
this Court by way of a special leave petition. This
Court disposed of the said special leave petition and
ultimately by an order made on 18.1.1993 dismissed
it.
The trustees, namely, the first and the second
appellants, resolved to appoint Mr. Maruthai Pillai,
Mrs. Sarojini Varadappan and Mr. R. Somasundaram
as additional trustees. On 3.1.1994 respondents Nos.
1 to 4 filed an application No. 33/1994 for leave to file
a suit under Section 92 CPC for framing a scheme, for
removal of appellants No. 1 and 2 as trustees and for
accounts. An application No. 1030/1994 was filed
seeking to implead Maruthai Pillai, Mrs. Sarojini
Varadappan and R. Somasundaram as parties to
application No. 33/1994. A number of incidental
applications Nos. 214/1994, 215/1994, 1901/1994
and 153/1994 were filed for various reasons like
appointment of receiver, impleadment of parties and
for publication of the proceedings in newspapers. The
appellants also filed an application to dismiss the said
applications filed under Section 92 CPC in limini. C.S.
No. 1509/1994 was filed by Kannan Adityan and
Kathiresa Adityan for a declaration as follows :-
"The order of dismissal passed in
Application No. 165/1981 filed by the
plaintiffs herein under the provisions of
Section 92 of the CPC for grant of leave of
this Hon’ble Court and the unnumbered
suit filed along with the said application
and confirmed by the Division Bench and
by Supreme Court of India by order dated
18.1.1993 made in S.L.P. No. 3362 and
3363 of 1987 are vitiated by fraud,
without jurisdiction non est in law and
void, and consequently to set aside all the
orders made in Application No. 165 of
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1981 and the unnumbered suit filed along
with the said application including that of
the order dated 18.1.1993 passed by the
Supreme Court of India in S.L.P. No. 3362
and 3363 of 1987 and restore application
No. 165 of 1981 along with the suit
referred to above to file and to hear the
same afresh."
Application filed by the appellants for dismissal
of application No. 33/1994 filed under Section 92 CPC
was dismissed by a learned Single Judge and several
orders were made in other applications. While O.S.A.
No. 62/1996 was filed against the order dismissing
application No. 33/1994 filed under Section 92 CPC,
O.S.A. Nos. 63 and 64 of 1996 were filed in regard to
certain other incidental reliefs. The Division Bench by
an order made on 16.7.1996 allowed the appeals and
thus by allowing O.S.A. No. 62/1996 it allowed
application No. 33/1994 granting leave to the
appellants therein to file suit under Section 92 CPC
against the appellants herein. In the said order the
Division Bench also considered the scope of Section 92
CPC, impact of the amendment of the Civil Procedure
Code in 1976 requiring the Court to give permission in
place of the Advocate General to give consent thereto,
and also noticed several decisions of the Courts on the
aforesaid matters. While some of the decisions have
taken the view that an order granting such permission
is an administrative order, some other courts have
taken the view that such an order is liable to be
reviewed under Article 226 of the Constitution. The
High Court went on to hold that a notice to defendants
before leave is not necessary as a rule of law but as a
rule of caution, the court should normally give notice
to the defendants before granting permission to
institute a suit under Section 92 CPC; that the
defendants could bring to the notice of the court that
the allegations made in the plaint are frivolous or
reckless and that in a given case, they could point out
that the persons who are applying for leave are doing
so merely with a view to harass the trust or have such
antecedents that it would be undesirable to grant
leave to such persons; that Section 141 CPC is not
applicable to a proceeding which is administrative in
nature. The High Court examined the facts of the
case in the light of principles adverted to by it.
In the normal course if an appeal is filed against
an order granting permission to a party to file a suit
as falling under Section 92 CPC, we do not normally
interfere with an order made by the High Court nor do
we think of entertaining a proceeding of this nature
under Article 136 of the Constitution because the
order made thereunder will not determine the rights of
the parties, but only enable a party to initiate a
proceeding.
Shri K. Parasaran, learned senior counsel
appearing for the appellants herein, submitted that
the present case is one of the third round of litigation
in respect of the some trust property; that what is to
be considered in the present case is not trust in
relation to an immovable property but in relation to a
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newspaper "Dina Thanthi" or "Daily Thanthi" at
present being published as a daily newspaper in Tamil
language together with the goodwill thereof, the Head
Office of which being presently situated at 60,
Cutchery Road, Mylapore, Madras as a going concern
with all its assets and liabilities and all the printing
machine, printing types, furniture and accessories of
the newspaper formed part of the trust property; that
it is a running newspaper business which is the
property held under and impressed with Trust which
required great skill to run a venture of such a nature;
that immovable properties had been subsequently
acquired for the Trust where offices have been located
and business is carried out and there are also guest
houses at one or two centres. The appellants filed an
application No. 2421 of 1994 under Section 92 CPC
read with Section 151 CPC to dismiss the application
filed by respondents 1 to 4 for leave to file a suit
under Section 92 CPC for framing a scheme, for
removal of appellants Nos. 1 and 2 as trustees and for
accounts. The learned Single Judge, by an order made
on 21.12.1999, allowed application filed by the
appellant herein in application No. 2421 of 1994 to
dismiss the application filed under Section 92 read
with Section 151 CPC. On appeal, as stated earlier,
the Division Bench also in original side granted leave
to respondents Nos. 1 to 4 to file suit under Section
92 CPC against the appellants in the present case.
The learned counsel for the appellants urged that
the order that was passed under Section 92 CPC
granting permission to file a suit is whether
administrative in character or otherwise; that this
does arise when the objections of the defendants are
considered; that as to scope of the meaning of the
expressions "order, judgment, decree and
adjudication". He drew our attention to decision in
Pitchayya & Anr. v. Venkatakrishnamacharlu &
Ors., AIR 1930 Madras 129, to the effect that the
object of Section 92 CPC is to safeguard the rights of
public and of institutions under trustees. In this
regard, he specifically drew our attention to National
Sewing Thread Co. Ltd. v. James Chadwick &
Bros. Ltd., 1953 SCR 1028. He also adverted to
decision in R.M.A.R.A. Adaikappa Chettiar & Anr.
v. R. Chandrasekhara Thevar, AIR(35)1948 PC 12,
to contend that where a legal right is in dispute and
the ordinary courts of the country are seized of such
dispute the courts are governed by ordinary rules of
procedure applicable thereto and an appeal lies if
authorised by such rules, notwithstanding that the
legal right claimed arises under a special stature
which does not in terms confer a right of appeal. In
R.M. Narayana Chettiar & Anr. v. N. Lakshmanan
Chettiar & Ors. 1991 (1) SCC 48, this Court has
examined in detail the scope of Section 92 CPC and
explained the object underlying therein in granting
permission to file a suit. In this case, this Court held
that court should normally give notice to the
defendants before granting leave as a rule of caution
but court is not bound to do so in all circumstances
and non-issuance of notice would not render the suit
bad or non-maintainable and defendants can at any
time apply for revocation of the leave and provision
under Section 104(1)(ffa) for appeal against refusal of
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grant of leave does not lead to a different conclusion.
In the light of this decision, we do not consider it
necessary to advert to other decisions cited by the
learned counsel. More so, the matter was considered
by the Law Commission in its Report submitted in
April 1992 on this aspect of the matter. After noticing
various decision of different courts and the decision in
R.M. Narayana Chettiar’s case (supra), the Law
Commission recommended that to expect the court to
issue notice and then to try the several points of detail
before granting leave in the light of the objections put
forth by the respective defendants, would mean that
there will be a trial before trial and this would not be
desirable. The recommendation of the Law
Commission was, therefore, to insert an Explanation
below Section 92 CPC to the effect that the court may
grant leave under this Section without issuing notice
to any other person, but this does not, of course,
mean that the court will grant leave as a matter of
course. Particular emphasis is made and heavy
reliance is placed on the decision of this Court in
Shankarlal Aggarwal & Ors. v. Shankarlal Poddar
& Ors., 1964 (1) SCR 717, to emphasise distinction
between administrative and judicial orders. It is
urged that order from which the appeal was preferred
was not a judgment within the meaning of clause 15
of the Letters Patent and so no appeal lies to the
Division Bench. Reference is made to the decision
of this Court in Institute of Chartered Accountants
v. L.K. Ratna & Ors., 1986 (3) SCR 1049, to bring
out distinction between administrative and judicial
order. Scope of Section 92 CPC was examined in
Charan Singh & Anr. v. Darshan Singh & Ors.,
1975 (3) SCR 48, where the whole case turned on the
facts arising in that particular case.
Our attention was also drawn to a decision of
this Court in T. Arivandandam v. T.V. Satyapal &
Anr., 1978 (1) SCR 742, to contend that the court has
a duty in vexatious suits to exercise appropriate
powers under Order VII Rule 11 CPC. Our attention is
also drawn to the decision in John v. Rees & Ors.,
1969 (2) All ER 274. He particularly emphasised that
it is not appropriate to give decision against a party
without affording an opportunity to him. Though
reference has been made to several other decisions,
we do not think it necessary to advert to the same.
In this background, when a specific provision has
been made in the Code of Civil Procedure in Section
104(1)(ffa) allowing an appeal to be filed against an
order refusing to grant leave to file a suit, the appeal
filed by the respondents before the Division Bench
was certainly competent to be considered by that
Bench. In this case, on an earlier occasion, when one
of the suits was filed under Section 92 CPC, when the
founder had executed a deed of appointment of
trustees and certain interim orders were passed in
that suit, the said application was withdrawn without
obtaining leave under Order XXIII Rule 1 on
19.9.1978 inasmuch as the newly appointed trustees
had resigned their trusteeship and withdrew their
application under Section 92 CPC, the two suits C.S.
No. 352 and 353 of 1978 filed by appellants were
disposed of as having become infructuous. Later on
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another application No. 165 of 1981 had been filed
under Section 92 CPC for leave to file a suit for
appointing them as additional trustees and for
rendition of accounts. In that proceeding an
application No. 879 of 1991 was filed for permission of
court to cross-examine the applicants therein R.
Kannan Adityan and R. Kathiresa Adityan in particular
to prove the fact that it was the father of those
petitioners therein who was supplying all documents
and materials and who was conducting the
proceedings. Application filed to cross-examine
applicants was dismissed by the learned Single Judge.
On further appeal, the Division Bench held that it
would be in the interest of justice to permit the
appellants to cross-examine the said parties. The
matter was carried to this Court in Special Leave
Petition No. 6040 of 1982. This Court dismissed the
said Special Leave Petition noticing that the cross-
examination "will be confined to the question of
sanction and principles governing the same", of
course, after noticing entire documents. Again,
another application No. 4738 of 1982 was brought
before the court to dismiss application No. 165 of
1991 under Order XI Rule 21 CPC which was,
however, dismissed by the learned Single Judge and
the matter was carried in appeal which was also
dismissed by the Division Bench. That matter was
brought before this Court. This Court asked the
parties to file the appropriate affidavits in regard
thereto and thereafter all papers were place before
the Court. However, this Court dismissed the Special
Leave Petition. It is in this background the learned
counsel submitted that the court ought to have
examined the matter in all necessary details before
granting permission under Section 92 CPC. In R.M.
Narayana Chettiar’s case (supra), this Court
considered in detail the history of the legislation and
whether court is required to give an opportunity of
being heard to the proposed defendants before
granting leave to institute a suit under Section 92 CPC
and stated the law on the matter. Although as a rule
of caution, court should normally give notice to the
defendants before granting leave under the said
Section to institute a suit, the court is not bound to do
so. If a suit is instituted on the basis of such leave,
granted without notice to the defendants, the suit
would not thereby be rendered bad in law or non-
maintainable. Grant of leave cannot be regarded as
defeating or even seriously prejudicing any right of
the proposed defendants because it is always open to
them to file an application for revocation of the leave
which can be considered on merits and according to
law or even in the course of suit which may be
established that the suit does not fall within the scope
of Section 92 CPC. In that view of the matter, we do
not think, there is any reason for us to interfere with
the order made by the High Court.
However, we may notice one or two aspects. It
was not at all necessary for the High Court to have
examined the applicability of Section 141 CPC or
otherwise in a matter of this nature. So also
observations made by the High Court in para-28 as to
the performance of the learned counsel and general
remarks in para-41 as to events taking place in the
country are uncalled for and unwarranted in dealing
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with the appeal before it. Such stray excursion will
take the matter in dispute out of focus. The crux of
the matter was only whether in granting leave under
Section 92 CPC the proposed parties have to be heard
in the matter or not and whether the suit should have
been dismissed in limini under Order VII Rule 11 CPC,
particularly when the trustees who had filed the suit
had seized some interest in the matter and they were
not mere strangers to the suit or such persons at
whose instance the matter should not have been
heard such as insolvent or a party who does not have
sufficient interest in the matter.
In the result, we dismiss these appeals.