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Structured Summary of the Opinion (Bhlmasankaram, J.)

Factual and Procedural Background

This suit arises from a dispute concerning certain property in Eluru, West Godavari District, described in the plaint as belonging to the "Eluru Besta Mahajana Sangham" (a registered society formed circa 1935 for the social, economic and educational uplift of the Besta community). The property, a site called "Besthala Panja" (about 300 sq. yards), was alleged to have been dedicated by the community as a religious or charitable endowment and used for community purposes including installation of peers during the Moharrum festival and as a meeting place.

Two buildings were constructed on the site from community contributions; one building contained four rooms rented as shops. The society president was authorised to let these rooms and apply income for community purposes. The plaint alleges that heirs and successors (including the daughter’s son of a former president, one Mahankali Ramachandra Rao, and Mahankali Sreeramulu who purchased from him) engaged in fraudulent conveyances and breaches of trust, and that subsequently Mahankali Narasimha Rao (son of Sreeramulu) misappropriated income, sold part of the site by sale-deed dated 30 January 1946 to the second defendant, and mortgaged other portions to the third defendant.

The plaintiffs (the society's president and secretary), after obtaining the permission of the Advocate-General, instituted the suit seeking reliefs including removal of the present trustee (N. Rao), framing a management scheme, appointment of new trustees (the president/secretary), account and inquiry into management by the first defendant and his father, declaration that the property is trust property for the benefit of the Besta community, possession to the president and secretary, and costs.

Tenants and other persons were impleaded as defendants; some defendants were set ex parte. The contesting defendants raised several pleas in their written statements, notably that by reason of the Madras Act XIX of 1951 (the Madras Hindu Religious and Charitable Endowments Act), specifically section 93, the civil court could not entertain the suit. The trial court dismissed the suit on the ground that it was not maintainable. The plaintiffs (as appellants) appealed; the present opinion affirms dismissal though for different reasons developed in the judgment.

Legal Issues Presented

  1. Whether the suit is barred from being instituted in a civil court by section 93 of Madras Act XIX of 1951 because it is "in respect of the administration or management of a religious institution or any other matter or dispute for determining or deciding which provision is made in this Act".
  2. Whether section 93 can apply to a charitable endowment prior to any notification under section 3 of the Act extending the Act's provisions to that endowment (i.e., whether the absence of notification prevents section 93 from excluding civil court jurisdiction).
  3. Whether the remedies sought in the plaint (removal of trustee, framing of scheme, appointment and vesting of trustees, account and inquiry, declaration, possession) are matters which the Act (and government authority under the Act) is empowered to provide, thereby ousting civil court jurisdiction.

Arguments of the Parties

Appellants' Arguments

  • The appellants contended that no provision of the Act can apply to a charitable endowment until the government issues a notification under section 3 extending specified provisions to that endowment; because no such notification had been made for the suit endowment, section 93 should not operate to oust the civil court's jurisdiction in this case.
  • Mr. Virabhadrayya at one stage contended that the property was partly charitable and partly religious and thus fell outside the precise definitions of either head under the Act (i.e., argued that it was neither a religious endowment as defined nor a charitable endowment as defined), implying the Act would not apply.
  • Mr. Veerabhadrayya (for the appellants) argued that subsection (3) of section 5 expressly removes sections 92 and 93 of the Civil Procedure Code from applicability to Hindu religious institutions and endowments, but there is no similar provision regarding charitable endowments; therefore, a suit like the present should still be governed by section 92 CPC and maintainable in civil court.

Respondents / Contesting Defendants' Arguments

  • The contesting defendants pleaded that because of the provisions of the Madras Act XIX of 1951, in particular section 93, the suit could not be entertained by the civil court. In short, they relied on section 93 to contend that civil jurisdiction was ousted for disputes concerning administration or management of the endowment.

Table of Precedents Cited

Precedent Rule or Principle Cited For Application by the Court
Ayisomma v. Kunhali, (1957) 1 M.L.J. 5 Authority for the proposition that a civil court has jurisdiction to decide whether a particular institution is a public temple or not when that question arises incidentally to other disputes in the case. The court relied on this precedent to acknowledge that civil courts may determine questions about the character of an institution (e.g., whether it is a charitable endowment) when such questions arise incidentally. The court nonetheless distinguished the present case because the plaintiffs did not contest the character of the trust in the plaint and the reliefs claimed were founded on allegations of mismanagement.
Mahant Pragdasji v. Narsibhai, (1952) S.C.J. 224 Principle that where a suit fails for want of a cause of action under section 92 CPC, an incidental declaration as to existence of a public trust cannot save the suit or be made part of the final decree in favour of the plaintiff. The court applied this reasoning to hold that an incidental prayer for declaration that the property is trust property does not render the suit maintainable if the primary reliefs (based on mismanagement) cannot be entertained by the civil court.

Court's Reasoning and Analysis

The court's analysis proceeds from statutory interpretation of the Madras Act XIX of 1951, particularly sections 3, 6 and 93, and the definitions therein:

  1. Definitions and statutory scheme:
    • Section 6 definitions: "charitable endowment" (clause 4) includes property given or endowed for the benefit of or used by the Hindu or Jain community for objects of utility (examples provided). "Religious institution" (clause 15) includes a math, temple or specific endowment. "Specific endowment" (clause 16) is property endowed for specific religious charity.
    • Section 3: government may, by notification in the local gazette, extend "all or any of the provisions of the Act" to any Hindu or Jain public charitable endowment which it believes to be mismanaged and where it is necessary in the interests of administration; upon notification, the provision(s) shall apply as if the endowment were a "specific endowment".
    • Section 93: bars any suit or legal proceeding in respect of the administration or management of a religious institution or any matter or dispute for determining or deciding which provision is made in the Act, except in conformity with the Act.
  2. Application to facts:
    • The court accepted that the property in question falls within the definition of a charitable endowment as pleaded (the plaint itself described it as a "charitable or religious endowment"). The occasional installation of peers during Moharrum did not negate its charitable character.
    • The court found section 93's language broad enough to cover suits like the present one: it excludes civil court jurisdiction for suits relating to charitable endowments if any reliefs asked are based on allegations of mismanagement.
    • Reliefs sought (removal of trustee, framing scheme, appointment/vesting of trustees, accounts and inquiries, declaration, possession) are, the court noted, within the scope of powers provided to officers or authorities under the Act (the opinion specifically maps the listed reliefs to sections of the Act: removal under s.45; scheme framing and appointment under s.58; account/inquiry under s.60; declaration linked to s.57; possession related to s.87).
  3. On the appellants' contention that section 93 cannot apply absent a section 3 notification:
    • The court rejected this argument. It reasoned that section 93 interdicts civil court determination of matters as to whether an endowment is being mismanaged because the ascertainment of facts upon which a notification could be made is entrusted to the government under section 3. Thus, the court held that civil adjudication of mismanagement allegations would undercut the decision-making role committed to the government by the Act.
  4. On the argument invoking section 92 CPC:
    • The court held that section 93 of the Madras Act (read with section 3) excludes civil court jurisdiction over these matters, so section 92 CPC cannot preserve jurisdiction because section 92 applies only where a suit is triable by a civil court. In the face of the Act's provisions vesting authority with the government, jurisdiction under section 92 CPC is effectively taken away for Hindu or Jain charitable trusts within the Act's ambit.
  5. Incidental declaration point:
    • Relying on Mahant Pragdasji, the court held that an incidental prayer for declaration that the property is trust property cannot render the suit maintainable when the principal reliefs (based on mismanagement) cannot be granted by a civil court.
  6. Conclusion from reasoning:
    • Because the suit is founded on allegations of breach of trust and seeks reliefs that the Act entrusts to governmental authorities and officers under specified sections, the civil court is barred by section 93 from trying the suit.

Holding and Implications

Holding: The court held that the suit could not be tried by a civil court and therefore the appeal fails. The appeal was dismissed with costs.

Implications:

  • The direct legal consequence is that the cause of action founded on alleged mismanagement of the endowment cannot be adjudicated in the civil court; appropriate remedies and inquiries concerning alleged breach of trust and administration of the endowment are to be pursued under the Madras Hindu Religious and Charitable Endowments Act by the authorities and procedures contemplated therein (e.g., actions under sections 45, 58, 60, 57, 87 as identified in the opinion).
  • The court noted that an incidental request for a declaratory relief that the property is trust property does not render the suit maintainable in civil court if the main reliefs are barred; accordingly, the incidental declaration could not save the suit.
  • This opinion affirms the trial court's dismissal on grounds of non-maintainability in civil court; the opinion does not announce or describe any novel legal principle beyond the application and interpretation of the Act to the facts of this suit.

Disposition in the opinion: "The appeal fails and is dismissed with costs. One set. Appeal dismissed."

    Garige Venkataratnam v. Mahankalil Narasimha Rao

    Bhlmasankaram, J.:-

    (1) The suit out of which this appeal arises was dismissed by the trial court on the ground that it is not maintainable. As we have also reached the same conclusion, although for different reasons, this judgment will deal only with that question to which, indeed, the argument before us have been confined. The point arises in this way : there is in the town of eluru in west godavari district a registered society known as the " eluru besta mahajana sangham" of which the two plaintiffs are the president and the secretary. It is described in the plaint as having been formed in or about the year 1935 " for the social, economic and educational uplift of the members of the besta community ". A site called " besthala panja " (the extent of which is 300 square yards) owned by the community was dedicated by them " as a religious or charitable endowment " ; to quote from the plaint, "the members of the community were installing peers during the moharrum festival every year in the said panja, and were also using the said panja as a meeting place of all their caste men, and for all other allied and common purposes of the community ".

    (2) In due course, two buildings were constructed upon the site from contributions raised from the caste men and one of the buildings has four rooms that can be let out for use as shops. The president of the sangham was authorised to let them out and spend the income therefrom as well as that from the general contributions for the common purposes of the community. But one mahankali ramachandra rao (the daughter's son of vaddi satteyya, a former president, claiming to be the owner, in his right as heir to the said satteyya) purported to dispose of a part of the site and the building thereon in favour of one mahankali sreeramulu. Mahankali sreeramulu who purchased it from him was also a president of the society and the sale - deed is described in the plaint as " fraudulent, collusive, devoid of any consideration, and is not at all binding on the members of besta community ". The plaint adds : "the action of satteyya's heir and late sreeramulu constituted breaches of trust ".

    (3) It goes on to make the following allegations : -

    "the first defendant, narasimha rao, who is the son of sreeramulu, after the death of his father in november, 1942, acted for three or four years as manager and trustee for the abovesaid endowed properties, and was spending the income from them and contributions from caste men for the common purposes of the community including celebration of ' peerla utsavam ' during moharrum festival. But, later on, taking advantage of the dissensions in the community men, he began to misappropriate the incomes of the properties for himself. Added to that, the plaintiffs understand that the said narasimha rao illegally and unauthorisedly sold away by a sale - deed, dated 30th january, 1946 to the second defendant the tiled building and a site of about 116 sq. Yds. Out of the said site, belonging to the community. The first defendant also mortgaged the remaining site and the terraced building with shops to the third defendant. The said sale and mortgage are not true and valid, and are not supported by consideration and are collusive and not binding on the community."

    The plaint then avers that the members of the community demanded of sri narasimha rao to hand over the properties and render a proper account of his and his father's management and that although he agreed by a letter, dated 6th february, 1946, to do so, he has not done it. After obtaining therefore, the permission of the advocate - general, the plaintiffs instituted the present suit in paragraph 12 of which they asked for the following reliefs : -

    " (1) for removing the present trustee, mahankali narasimha rao ; (2) for framing a scheme for the management of the trust properties ; (3) for appointing for the " eluru bestha mahajana sangham " its president or secretary as the new trustee or trustees and for vesting the trust properties in the new trustees ; (4) for directing the accounts and enquiries of the management by first defendant and his father, late sriramulu garu of the trust properties ; (5) for costs and other incidental reliefs which this honourable court may think fit and proper ; (6) for declaration that the plaint property is trust property for the benefit of the bestha community of eluru ; and (6 - a) for possession of the above trust property to the president and the secretary of the said sangham the new trustee or trustees. "

    The tenants of the shops and the house are impleaded as defendants 4 to 7 (who were set ex parte at the trial) and defendant 8 is the wife of late mahankali sreeramulu and mother of the first defendant. The contesting defendants raised various pleas in their written statements and among them is the plea that because of the provisions of the madras act xix of 1951 the suit could not be entertained by the civil court. The question for our determination is whether the contention is sound. Section 93 of the act upon which reliance is placed in support of the contention runs as follows : -

    "no suit or other legal proceeding in respect of the administration or management of a religious institution or any other matter or dispute for determining or deciding which provision is made in this act shall be instituted in any court of law, except under, and in conformity with the provisions of this act"
    .

    (4) The question is whether the present suit is in respect of the administration or management of a religious institution or any other matter or dispute for determining or deciding which provision is made in the act. Before discussing the question, it is necessary to refer to section 3 of the act, whereby the government is empowered by notification in the local gazette to extend " all or any of the provisions of the act and of any rules made thereunder" to any hindu or jain public charitable endowment which they have reason to believe is being mismanaged, if they are satisfied that in th'e interests of the administration of such a charitable endowment it is necessary to do so. This section states that upon such notification the provisions so extended shall apply to such an endowment as if it were a " specific endowment ".

    (5) A proviso with which we are not concerned states that the issue of such a notification is subject to notice being given to the persons interested in the endowment. We must now turn to the definitions of the terms and phrases contained in the act. They are contained in section 6 and for our purposes, the following definitions are relevant: -

    "6. (4) ' charitable endowment' means all property given or endowed for the benefit of, or used as of right by, the hindu or the jain community or any section thereof, for the support or maintenance of objects of utility to the said community or section, such as rest - houses, choultries, patasalas, schools and colleges, houses for feeding the poor and institutions for the advancement of education, medical relief and public health or other objects of a like nature ; and includes the institution concerned ; (6. (15) ' religious institution ' means a math, temple or specific endowment ; (6. (16) ' specific endowment' means any property or money endowed for the performance of any specific service or charity in a math or temple, or for the performance of any other religious charity, but does not include an inam of the nature described in explanation (1) to clause (14) ;"

    (6) Now the effect of the statutory provisions may be summarised thus : where the government have reason to believe that any hindu (or jain) charitable endowment is being mismanaged and are satisfied that in the interests of the administration of such charitable endowment it is necessary to do so, they may notify that all or any of the provisions of this act shall apply thereto and thereupon such provisions shall extend to it as if it were a specific endowment ; that is to say, as if it were any property or money endowed for the performance of any ' religious charity', (a phrase which, too, is defined in clause 13 of section 6, a definition, however, which we need not cite). Now the words " religious institution " include a specific endowment. So, by section 93, any suit or other legal proceeding in respect of the administration or management of a specific endowment is expressly barred. It cannot be seriously disputed that the property to which the suit relates is a charitable endowment within the meaning of the definition, although mr. Virabhadrayya contended at one stage that it is partly charitable and partly religious and is therefore neither a religious endowment as defined in clause (14) of section 6 nor a charitable endowment as defined in clause (4) and that therefore it is outside the purview of the act. As to this contention, it will have been noticed that the plaint itself described it as a ' charitable or religious endowment ' ; further, the mere fact that once a year ' peerlu ' are installed in the place during the moharrum does not, in our opinion, affect its charitable nature, even assuming that doing so brings the endowment within the definition'of a religious endowment as being " property given or endowed for the performance. Of any. Religious charity ".

    (7) The argument on behalf of the appellants is that no provision of the act can apply to a charitable endowment until after a notification is made by the government extending specified provisions, and that not having been done with respect to the suit endowment section 93 does not apply to it.

    (8) It seems to us, however, that the language of section 93 is wide enough to cover a suit like the present ; it excludes from the jurisdiction of the civil court any suit relating to hindu charitable endowment if any of the reliefs asked for in that suit are based upon allegations of mismanagement. The relief prayed may be a general one such as the framing of a scheme in the interests of the administration of the endowment or it may be something particular such as the removal of a trustee. But in either case, if the ground of the relief sought is mismanagement, the civil court's jurisdiction must be held barred. When a question arises as to whether a charitable endowment is being mismanaged, the government are empowered to deal with the matter under section 3 of the act. They are also empowered to determine whether the framing of a scheme is necessary in such a case in the interests of the administration of the endowment and further to decide whether it is necessary to extend all or any of the provisions of this act to that institution. In our opinion, all these are " matters or disputes for determining or deciding which provision is made " in the act. The argument that section 93 which is one of the provisions of the act cannot apply before a notification is made by the government under section 3 of the act seems to us to be without force. It is true that before all of any of the provisions of this act are made applicable, the conditions specified in section 3 must be fulfilled. But the conditions laid down by section 3 can be fulfilled only by the government applying is mind to any allegations made before them concerning the institution. Whether it is being mismanaged and whether it is necessary to make a notification, are matters expressly committed to the decision of the government. Thus, the ascertainment of the facts upon which a notification could be based is a matter which is to be determined by the government. Section 93 of the act, in our opinion, clearly interdicts the determination of such a matter by the civil court.

    (9) Now the suit is entirely based on allegations of breach of trust and every one of the reliefs prayed lor in the plaint can flow from appropriate action that officers named, in the act may take. The first relief sought in the present plaint can result from action taken under section 45 of the act ; the second and third reliefs from action under section 58 ; the fourth from action under section 60; the 6th relief from action under section 57 and the relief numbered and lettered as 6 (a) from action under section 87. There are other provisions too which could be invoked. But it is pointed out by mr. Veerabhadrayya for the appellants that while subsection (3) of section 5 expressly provides that sections 92 and 93 of the code of civil procedure, 1908, shall cease to apply to hindu religious institutions and endowments there is no similar provision with regard to charitable endowments and that therefore a suit like the present is still governed by section 92 of the civil procedure code. We have already held that section 93 of the act excludes the jurisdiction of the civil court. Section 92 of the civil procedure code can only apply where a suit is triable by the civil court ; it specifics the reliefs to be obtained and the conditions subject to which such reliefs may be obtained where there is a breach of trust of a charitable or religious nature or where the direction of the court is deemed necessary for the admin'stralion of any such trust. But under the act, in the case of a hindu or jain charitable trust where there is an alleged breach of trust or where directions are necessary for its administration, the government is the authority to take appropriate action. The jurisdiction, therefore, under section 92, civil procedure code, is taken away by the combined effect of sections 3 and 93 of the act. Mr. Veerabhadrayya has referred to the decision in ayisomma v. Kunhali, (1957) 1 m. L. J. 5. There the learned judges held that a "civil court has jurisdiction to decide whether a particular institution is a public temple or not when such a question arises incidental to other disputes in the case before the court ". In that case, their lordships were dealing with section 84 of the madras hindu religious and charitable endowments act (ii of 1927). It is true that a dispute as to whether a property is or is not a charitable endowment within the meaning of the act may be determined by the civil court, because the act applies only to charitable endowments and wheie for instance the government purports to exercise its power under section 3 to what is not a charitable endowment, a person interested may seek relief in the civil court. But in the present case the plaintiff do not raise any dispute as to the character of the trust. The fact that the defendants do so in their written statements does not bear upon the question of jurisdiction of the court to try the suit as constituted by the allegations in the plaint because in deciding that question, we must assume that the allegations in the plaint are true. Further, if resort to the civil court for the positive declaration that " the plaint property is trust property, for the benefit of the besta community of eluru" is permissible even before the government are approached first, that relief is only incidentally asked in the plaint, as was done in the case before the supreme court in mahant pragdasji v. Narsibhai, (1952) s. C. J. 224, where their lordships observed as follows :

    "where in a suit brought under section 92, civil procedure code, the defendant denies existence of the trust and denies further that he was guilty of misconduct or breach of trust and it is found by the courts that the allegations of breach of trust are not made out, and it is not the case of the plaintiffs that any direction of the court was necessary for proper administration of trust, the very foundation of a suit under section 92 becomes wanting and the plaintiffs have no cause of action for the suit they instituted. In such a case, a finding about the existence of a public trust is wholly inconsequential and as it is unconnected with the grounds upon which the case is disposed of, it could not be made a part of the decree or final order in the shape of a decree in favour of the plaintiffs. When the defendant denies the existence of a trust, a declaration that the trust does exist might be made as ancillary to the main relief claimed under the section if the plaintiff is held entitled to it ; but when the case of the plaintiff fails for want of a cause of action there is no warrant for giving him a declaratory relief under the provisions of section 92, civil procedure code."

    Applying the reasoning of their lordships to the present case, if the suit cannot be maintained with respect to the other reliefs, and the mere fact that there is an incidental prayer for declaration assuming that it can be granted - does not render it maintainable. Therefore this contention too fails.

    (10) In the result, we agree with the trial court that the present suit cannot be tried by a civil court. The appeal fails and is dismissed with costs. One set. Appeal dismissed.

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    Garige Venkataratnam v. Mahankalil Narasimha Rao
    (Apr 22, 1960)