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Sewdayal Ramjeedas v. Official Trustee Of Bengal
Factual and Procedural Background
The originating summons was filed on 8th March by Sewdayal Ramjeedas, a firm described as carrying on business in copartnership or coparcenary at No. 130, Machuabazar Street, against the Official Trustee of Bengal. The Official Trustee is the sole trustee of three deeds of trust executed by Chandicharan (Chandicbaran) Das, who died intestate on 19th July 1928 leaving a widow (Sm. Sarengabala Dasi), two minor sons and a minor married daughter. The three trust deeds are dated 27 April 1921, 10 May 1924 and 20 December 1926.
The deeds generally create a life interest in the settlor, provide monthly payments (in one deed Rs.20 to each daughter on marriage; in others a monthly payment to the widow), and then direct that the balance of income or the trust corpus be held for the settlor's son or sons in equal shares and made over to them on attaining 21 years, with the trustee having a discretion to apply income for maintenance and to accumulate the balance. The 1924 deed contains a proviso that in default of male issue and disposition by will, the estate should be applied to charitable objects.
The plaintiff firm are payees of two promissory notes executed by the settlor on 27 January 1927 and 15 November 1927 (Rs.1,500 and Rs.2,000). They claim an equitable interest in the trust estate by reason of an alleged appropriation of rent of premises (the Strand Bank Press) against those notes; the Official Trustee disputes that arrangement and contends it ceased on the settlor's death. That dispute is the subject of a separate suit, and there is also a prior originating summons by the Official Trustee for construction of the three deeds.
Procedurally, the summons (filed 8th March) was listed before Lort-Williams, J., amended on 12 May to add the widow and children as parties, appeared in court on several dates (including 26 June when counsel for all parties were present), and was later transferred to Remfry, J. After appearances and correspondence (including a plaintiff's attorney's letter of 26 June proposing consolidation and construction in both originating summonses), the Official Trustee's attorney agreed to the proposal but the added defendants did not reply; the court treated their silence as implied consent not to object to the procedure. The defendants raised two preliminary points before the court: that the summons was misconceived and outside Chap. 13 of the Rules and Orders, and that as to the deed of 1926 the trust property included immovable property partly outside Calcutta so leave under Cl.12, Letters Patent was required and not obtained.
Legal Issues Presented
- Whether, on true construction of the three deeds, there is a resulting trust in favour of the settlor's estate (i.e., whether the dispositions are void for remoteness and revert to the settlor's estate).
- Whether the Official Trustee holds the estates (or residue) under the three deeds on behalf of the heirs of the settlor, subject to payment of his debts and liabilities.
- Whether the monthly payments to the daughters (under the 1921 deed) and the dispositions in favour of the sons infringe the rule against perpetuities as formulated in Section 14 of the Transfer of Property Act, 1882, and, if so, whether Section 15 (as unamended) operates to defeat the whole class gift.
- Whether the gifts to the sons vest immediately on the death of the tenant-for-life (so as to be saved by Section 19), or whether vesting is postponed until attainment of 21 years, making them contingent and potentially void under Section 14.
- Whether Section 15 (as unamended) applies to Hindus in the circumstances of these deeds, or whether Hindu law or the Hindu Disposition of Property Act, 1916, exempts such dispositions from Section 15.
- Preliminary procedural issues: (a) whether the originating summons was a misconceived procedure under the Court's rules, and (b) whether the Court has jurisdiction to decide questions affecting immovable property partly situated outside Calcutta without leave under Cl.12, Letters Patent.
Arguments of the Parties
Plaintiff (Sewdayal Ramjeedas) — Principal contentions
- The monthly payments to the daughters and the dispositions in favour of the sons violate the rule against perpetuities in Section 14, making those gifts void and resulting in a resulting trust to the settlor's estate.
- They assert an equitable interest by way of appropriation of rent towards promissory notes executed by the settlor, and seek construction/declarations accordingly.
Defendants (Official Trustee and added defendants) — Principal contentions
- The gift to the sons is not invalid under the rule against perpetuities because the gift became vested on the death of the tenant-for-life and is therefore saved by Section 19.
- Even if the instrument on its face postpones distribution until attaining 21, in fact the two sons will (if they live) attain 21 within 18 years of the settlor's death, so the rule is not infringed in practice.
- As an alternative, they contend that Hindus are exempt from the operation of Section 15 (as unamended) because of Hindu law and the Hindu Disposition of Property Act, 1916.
- Procedurally, they argued the originating summons was misconceived and outside the scope of Chapter 13 of the Rules and Orders, and that the Court lacked jurisdiction over land partly outside Calcutta because no leave under Cl.12, Letters Patent had been obtained.
Table of Precedents Cited
| Precedent | Rule or Principle Cited For | Application by the Court |
|---|---|---|
| Leake v. Robinson [1817] 2 Mer. 363 | Doctrine that if a gift to a class fails as to some members by reason of remoteness (Ss.13/14), the interest fails as to the whole class (embodied in S.15 Transfer of Property Act). | The court treated S.15 as giving statutory expression to the Leake doctrine and considered whether S.15 (as unamended) applies to Hindu dispositions; concluded S.15 applies where Section 14 is infringed unless some Hindu rule explicitly conflicts with it. |
| Galstaun v. Diana Sarkies, A.I.R. 1929 Cal. 227 | Held that for the purpose of Cl.12, Letters Patent, an originating summons is a "suit." | Used to support the proposition that the present originating summons counts as a "suit" for jurisdictional analysis under Cl.12. |
| Provas Chandra Sinha v. Ashutosh Mukherji, A.I.R. 1930 Cal. 258 | Adopted a definition of "suits for land" under Cl.12: suits where, having regard to the pleaded issues, the decree will directly affect proprietary or possessory title to immovable property. | The court relied on this decision (and Page, J.'s formulation) to hold the present proceeding is a suit for land and thus requires leave under Cl.12 for property partly outside Calcutta. |
| Gokuldas v. Chaganlal, A.I.R. 1927 Cal. 768 | Page, J.'s earlier formulation of the definition of "suits for land" (quoted and discussed in Provas Chandra Sinha). | The court accepted Page, J.'s definition as persuasive and applied it to conclude that the present suit will directly affect proprietary title and is therefore a suit for land. |
| The Delhi and London Bank v. Wordie [1876] 1 Cal. 249 | Illustrates that a suit compelling sale of land conveyed to trustees for creditors is a suit for land even though plaintiff may not claim proprietary title. | The court cited this authority to rebut the argument that the present claim is not a suit for land merely because the plaintiffs do not claim proprietary title for themselves. |
| Juggodumba Dossee v. Puddomoney Dossee [1875] 15 Beng L.R. 318 | Held that certain suits concerning debuttar lands outside Calcutta were not suits for land where no decree directly affected proprietary interests (property vested in idols and plaintiffs had no beneficial interest). | The court distinguished that authority as inapplicable: in the present case a decree would directly affect proprietary title and therefore Juggodumba Dossee did not support defendants' jurisdictional argument. |
| Nagendra Nath v. Eraligool Co. Ltd., A.I.R. 1922 Cal. 443 | Re-affirmed The Land Mortgage Bank v. Sudurudeen that a vendor's suit for specific performance is not a "suit for land" within Cl.12. | The court noted this authority but held it distinguishable and not applicable to the present case. |
| The Land Mortgage Bank v. Sudurudeen Ahmed [1892] 19 Cal. 358 | Vendor's suit for specific performance does not amount to a suit for land within Cl.12. | Referenced to show prior limitations on what counts as "suit for land"; the court found this precedent inapplicable to the facts before it. |
| Chance v. Chance [1853] 16 Beav. 572 | Illustrative English case where words indicated postponement of vesting of interest until a specified age (age 25), thus distinguishing vesting in interest from vesting in possession. | The court distinguished Chance on its facts, concluding that the wording in the present deeds ("to be made over") was more consistent with immediate vesting in interest and postponement of possession rather than postponement of vesting in interest. |
| In re Parker; Barker v. Barker [1880] 16 Ch. D. 44 | English authority holding the exception to the contingent-vested rule cannot apply where only a discretionary power is given to trustees to apply income for benefit. | Cited by defendants' counsel; the court acknowledged the English rule but held that, on the instruments before it, the trustees possessed only a power (not a direction) and so the exception to S.21 did not apply. |
| In re Mervin; Mervin v. Crossman [1891] 3 Ch. 197 | Another English decision supporting the principle in In re Parker concerning discretionary trustee powers and the exception to contingency. | Used similarly to show the English approach; the court nonetheless considered the textual distinction in the present deeds and rejected application of the exception. |
| Ratanbai Rastamji v. Cawasji Edalji, A.I.R. 1923 Bom. 96 | Held that corresponding exceptions in the Succession Act are wider than English law; relevant to interpretation of exceptions in Indian statutes. | The court cited this decision to observe that Indian statutory language may be wider than English authorities, but on the facts held there was only a discretion and no direction within the statutory exception. |
| Ram Lal Sett v. Kanai Lal Sett [1886] 12 Cal. 663 | Dealt with gifts to classes under Hindu law and held that Leake v. Robinson principle did not apply in the particular Tagore-type context then in issue. | The court considered it but distinguished the kind of remoteness involved there from the remoteness under Section 14; concluded that Ram Lal Sett did not establish a Hindu rule excluding S.15 where Section 14 is infringed. |
| Bhagabati Barmanya v. Kalicharan Singh [1911] 38 Cal. 468 | Approved Wilson, J.'s judgment in Ram Lal Sett; concerned with will and Hindu law. | Referenced in discussing whether Hindu law or the 1916 Hindu Disposition of Property Act excludes application of S.15; the court held these authorities did not demonstrate an inconsistency with S.15. |
| Rojomoyee Dassee v. Troylukho Mohiney Dassee [1901] 23 Cal. 260 | Stanley, J. applied the Leake doctrine to a Hindu will dated 1892, considering it consonant with Hindu law. | Cited to support the proposition that the Leake doctrine has been applied in Hindu contexts and that S.15 should operate where Section 14 is infringed. |
| Ranganadha Mudaliar v. Baghirathi Ammall [1903] 29 Mad. 412 | Considered that, had a particular gift infringed S.14, Section 15 would apply. | Used to support court's view that absence of explicit mention of S.15 in the Hindu Disposition of Property Act, 1916, does not mean S.15 is displaced where S.14 is breached. |
Court's Reasoning and Analysis
The court addressed the procedural objections first. It held that the defendants could not take the objection that the summons was misconceived because the course of the proceedings and the conduct of the added defendants (failure to reply to the plaintiff's proposal and presence before the court on dates when consolidation/construction was discussed) amounted to implied consent; consequently the defendants had waived the right to challenge the form of the proceedings on that ground.
On the jurisdiction point, the court adopted the proposition that an originating summons is a "suit" for the purposes of Cl.12, Letters Patent (citing Galstaun v. Diana Sarkies and Provas Chandra Sinha). It accepted Page, J.'s test (from Gokuldas v. Chaganlal and reiterated in Provas Chandra Sinha) that a "suit for land" means a suit in which, having regard to the issues raised in the pleadings, the decree or order will directly affect the proprietary or possessory title to land. Applying that test, the court found that the plaintiffs sought a declaration that on the death of the tenant-for-life the title did not remain in the Official Trustee in trust for the sons but reverted to the settlor's estate and thereby became available to satisfy creditors: such a declaration would directly affect proprietary title. Therefore the proceeding was a suit for land; since part of the immovable property under the 1926 deed lay outside Calcutta and no leave under Cl.12 had been obtained, the court held it had no jurisdiction to try or determine matters insofar as they concerned the deed of 1926.
Although the lack of jurisdiction as to the 1926 deed was sufficient to dispose of that aspect, the court (having been invited by the parties) proceeded to consider the merits of the substantive questions.
The principal substantive legal issue was whether the gifts to the sons violated the rule against perpetuities in Section 14 of the Transfer of Property Act (no transfer may create an interest to take effect after the lifetime of one or more persons living at the date of transfer and the minority of some person in existence at the end of that period — the longest permissible postponement being 18 years after death). If the interest was contingent and postponed beyond that period, Section 15 (as unamended) would operate to defeat the whole class.
The court analyzed whether the gifts vested immediately on the death of the tenant-for-life (thus saved by Section 19) or whether the vesting in interest itself was postponed until attainment of 21 (making them contingent). Section 19 provides that an interest created in favour of a person without specifying the time when it is to take effect is vested unless a contrary intention appears; the explanation to Section 19 disallows inferring a contrary intention merely from postponement of enjoyment, reservation of a prior interest, accumulation of income or a provision that upon a particular event the interest shall pass to another.
Examining the deed language (notably the phrase that the trustee shall "hold for the use and benefit of the son or sons" and that the property is "to be made over to him or them on the attainment by him or them of the age of 21 years"), the court concluded these words supported an immediate vesting of interest (vested in interest) with a postponement only of vesting in possession — i.e., "made over" indicates a delivery of possession of that which is already vested in interest. The court therefore held Section 19 applied and that the sons obtained vested interests on the death of the tenant-for-life, subject to being divested if a son died before attaining 21.
The court distinguished Chance v. Chance on its wording (there the words "to be transferred" were held to postpone vesting in interest). The court also considered whether the statutory exception in Section 21 (which saves as vested certain interests where the transferor also gives absolutely the income or directs the income to be applied for the benefit before the age) could convert an apparently contingent gift into a vested one. Relying on English authorities (In re Parker; In re Mervin) the court accepted that where only a discretionary power is given to a trustee to apply income, English law would treat that as insufficient for the exception. The court, however, examined the Indian authorities (Ratanbai Rastamji) and the wording of the instruments and concluded that in the present instruments there was merely a trustee's discretion (a power) and not an unconditional direction to give income absolutely; hence the Section 21 exception did not apply to convert a contingent gift into a vested interest on those grounds. That made the application of Section 19 (textual construction favoring vesting in interest) central.
Finally, the court examined whether, if a postponement made the gifts contingent and thereby potentially void under Section 14, Section 15 (as unamended) would operate to defeat the whole class where the parties are Hindus and the Hindu Disposition of Property Act, 1916, exists. The court reviewed the relevant authorities (including Ram Lal Sett, Bhagabati Barmanya, Rojomoyee Dassee, and Ranganadha Mudaliar) and legislative context. It observed that the 1916 Act made Hindu dispositions valid subject to the limitations of Sections 13 and 14 of the Transfer of Property Act but did not expressly mention Section 15; nonetheless the court held there was no inconsistency or Hindu rule shown that displaced Section 15 where Section 14 had been infringed. The court therefore held that if the gifts were found to be contingent beyond the permissible period under Section 14, Section 15 (as unamended) would apply and defeat the whole class.
Holding and Implications
The court gave both procedural and substantive answers. Procedurally, the court held that it has no jurisdiction to try or determine questions so far as they concern immovable property covered by the deed of 20th December 1926 which lies partly outside Calcutta because no leave under Cl.12, Letters Patent had been obtained.
Substantively the court answered the specific questions propounded by the originating summons as follows (the court's core rulings are emphasized below):
- Question — Whether on true construction of the three deeds there is a resulting trust in favour of the estate of the settlor Chandicharan Das? — Answer: No.
- Question — Whether the defendant is holding the estates covered by the three deeds (or the residue or any portion) on behalf of the heirs of the settlor subject to payment of his debts? — Answer: No.
- As to the deed of 27th April 1921: the gift of Rs.20 a month to the daughters on marriage is invalid by reason of Sections 14 and 15 of the Transfer of Property Act. Each son obtained a vested interest in a moiety of the trust fund on the death of the widow, subject to divestment if he died before attaining 21.
- As to the deeds of 10th May 1924 and 20th December 1926: subject to the monthly payments to the widow, each son obtained a vested interest in a moiety of the trust fund on the death of the settlor, subject to divestment if he died before attaining 21.
Costs: the plaintiff firm must pay the costs of all the defendants taxed as of a hearing on Scale No. 2, but only one set of costs to be allowed to the added defendants. The Official Trustee is entitled in the first instance to take his costs out of the trust property taxed as between attorney and client on Scale No. 2.
Implications: The decision (1) limits the court's competence to determine matters affecting immovable property outside its territorial jurisdiction absent leave under Cl.12; (2) interprets the relevant trust wording to mean vesting in interest on death of the life tenant (thus saving the sons' interests under Section 19 where such construction is possible); and (3) confirms that where, on proper construction, a disposition is postponed beyond the permissible period under Section 14, Section 15 (as unamended) will operate to defeat the whole class unless a rule of Hindu law inconsistent with Section 15 is clearly shown. The opinion does not purport to lay down a novel general rule beyond the specific constructions applied here; its direct legal effect is limited to the parties and the trusts under consideration.
1. This originating summons was filed on 8th March of this year. It is taken out by Sewdayal Ramjeedas, described as a firm carrying on business in copartnership or coparcenary as members of a joint Hindu Mitakshara family at No. 130, Machuabazar Street. Originally the only defendant was the Official Trustee of Bengal, who is now sole trustee of three deeds of trust executed by a settlor of the name of Chandicbaran Das, who died intestate on 19th July 1928, leaving him surviving his widow Sm. Sarengabala Dasi, two minor sons, and a minor married daughter. The deeds of trust are dated 27th April 1921, 10th May 1924 and 20th December 1926. The deed of 27th April 1921, gives a life interest to the settlor and directs that after his death the trustee or trustees for the time being shall, after paying Rs. 20 a month to the daughter or each of the daughters of the settlor for their lives from the date of their marriage, pay the balance of the income to the widow for life for the maintenance of herself and her children, and thereafter hold the trust fund for the use and benefit of the son or sons, of the settlor, if more than one, in equal shares, to be made over to him or them on the attainment by him or them of the age of 21 years, with power in the meantime to the trustee or trustees to spend such sum or sums out of the income for the maintenance, education, advancement or benefit of such son or sons as the trustee or trustees shall think fit, and accumulate the balance (if any) to form part of the corpus to be dealt with as there in before directed. This is followed by a power to the settlor to vary by will subject to certain limitations.
2. The deed of 10th May 1924, also gives a life interest in the trust fund to the settlor and directs the trustee, after making provision for a monthly payment of Rs. 30 to the widow for life, to hold the rest of the trust estate, moveable or immovable, for the use and benefit of the son or sons of the settlor. The language of the first trust deed, as to the interest of such son or sons, is repeated. There then follows a proviso that in case of failure of issue in the direct male line of the settlor and, in default of any disposition by will by the settlor, the trust estate shall be applied in the founding of beds in a recognized hospital or towards some similar charitable object.
3. A power to vary by will similar to that in the first trust deed follows. The provisions of the deed of 20th December 1926, are similar to those of the deed of 10th May 1924. I am informed that the trust funds covered by the deeds of 1921 and 1924 have almost or entirely disappeared, and that the important fund is that covered by the deed of 1926. It is admitted that among the immovable properties covered by the deed of 1926 is one situated outside the local limits of the ordinary original civil jurisdiction of the Court.
4. The plaintiff firm claim to be interested in the trust estate in the following way. They are the payees of two promissory notes executed by the settlor on 27th January 1927 and 15th November 1927, for Rs. 1,500 and Rs. 2,000, respectively.
5. There has been no actual payment in respect of these notes, but, according to the plaintiff firm, there was an agreement with the settlor that the firm would be at liberty to appropriate the rent of the Strand Bank Press, premises of which the firm were tenants and the settlor part owner, against the amount due on the notes. Such appropriations were made during the settlor's lifetime, but the official trustee maintains that this arrangement ceased to operate after the settlor's death, when his interest in the premises came to an end. This dispute is the subject of a separate suit instituted by the official trustee and there is also a prior originating summons taken out by the official trustee for construction of the three deeds of trust.
6. Broadly, the points at issue on the merits are these. The plaintiff firm maintain that the monthly payment to the daughters and the dispositions in favour of the sons are bad as infringing the rule against perpetuities formulated in Section 14 of the Transfer of Property Act, 1882, and that there is in consequence a resulting trust to the settlor's estate. The defendants maintain that the gift to the sons at any rate is not it by the rule, and as an alternative defence they submit that Hindus are exempt from the operation of S. 15 of the unamended Act, which gives statutory expression to what is called the rule in Leake v. Robinson . [1817] 2 Mer. 363 and is as follows:
“If, on a transfer of property, an interest therein is created for the benefit of a class of persons, with regard to some of whom such interest fails by reason of any of the rules contained in Ss. 13 and 14, such interest fails as regards the whole class.”
7. I have not been told whether the was sons of the settlor were born prior to the date of the execution of all or any of the deeds of trust, but I understand that it is not disputed that they will both, if they live, attain the age of 21 years in less than 18 years from the death of the settlor.
8. The defendants have, before me, raised two preliminary points: first that the summons is misconceived and that the proceedings are beyond the scope of Chap. 13 of the Rules and Orders of this Court; and secondly, that with regard to the third deed at any rate this is a suit for land situated partly outside Calcutta, and therefore since no leave has been asked for or obtained under Cl. 12, Letters Patent, the Court has no jurisdiction to entertain it.
9. In my opinion, it is not, in the circumstances of the particular case, open to the defendants now to take the first point; as I have said, the summons was filed on 8th March 1930. In due course, it came into the list of Lort-Williams, J., and was adjourned from time to time. On 12th May, an order was passed for making the widow and the three minor children of the settlor parties to the summons and for consequential amendments. After the widow and her children had been duly made parties the summons again appeared in the list on several occasions. I understand that one of such occasions was 26th June 1930, when counsel for all parties, including counsel for the added defendants, were present. Lort-Williams, J., apparently made certain suggestions with a view to consolidate the various proceedings, and on the same day the attorney for the plaintiff firm wrote to the attorney for the official trustee proposing a certain course:
“which I hope will commend itself to you and the other parties.”
10. Among the proposals was:
“(4) That the Court should be invited to construe the various deeds of trust and express its opinion in terms of both the originating summonses.”
11. A copy of the letter was forwarded to the attorney for the added defendants. The official trustee's attorney replied specifically agreeing to the plaintiff firm's suggestion, but the attorney for the added defendants did not communicate his views. On 30th June, all parties again appeared before Lort-Williams, J. There was another adjournment and on 10th July, the summons, together with the other proceedings, was transferred to the list of Remfry, J.
12. There is nothing on record to show that, on any occasion subsequent to 26th June, the added defendants indicated that they had any objection to the matter being disposed of in the way suggested in the letter of that date, and in my opinion this, coupled with their failure to reply to the letter, clearly indicates that they were prepared to consent to the plaintiff firm's suggestion as to the manner in which the matters at issue should be disposed of: and I hold it is not now competent for them to take exception to the form of the proceedings.
13. The next point for decision is whether, having regard to the fact that part of the immovable property disposed of by the deed of 1926 is outside Calcutta, I have jurisdiction to deal with the summons, leave not having been obtained in terms of Cl. 12, Letters Patent; or in other words, whether this is a suit for land or other immovable property within the meaning of that clause.
14. It is elementary that if the Court has no jurisdiction having regard to the subject-matter of the suit and the failure of the plaintiff to obtain the necessary leave of the Court, no consent, express or implied on the part of the defendants, can cure the defect.
15. Further, it is clear that for the purpose of Cl. 12, an originating summons is a “suit:” Galstaun v. Diana Sarkies* . A.I.R 1929 Cal. 227 and Provas Chandra Sinha v. Ashutosh Mukherji . A.I.R 1930 Cal. 258. Of recent years there appears to have been a tendency in the other High Courts to place a narrower construction on the words “suits for land” than finds favour in the Calcutta High Court. In Provas Chandra Sinha v. Ashutosh Mukherji, Page, J., re-stated the definition previously formulated by him in Gokuldas v. Chaganlal . A.I.R 1927 Cal. 768 which was to the following effect:
“In my opinion suits for land or other immovable property in Cl. 12, Letters Patent, means suits in which having regard to the issues raised in the pleadings the decree or order will affect directly the proprietary or possessory title to land or other immovable property.”
16. Now it must be conceded that the passage in Gokuldas v. Chaganlal, where Page, J. formulated the definition set out above is in a sense obiter, since he decided that the case did not fall within the definition but held that the Court had no jurisdiction on other grounds. But even if I am not disposed to assent to the definition without further examination, I see no reason to think that Provas Chandra Sinha v. Ashutosh Mukherji was wrongly decided. That case resembled the present case in this that the plaintiff sought in the summons to have it decided inter alia whether certain testamentary dispositions of immovable properties outside Calcutta were void for remoteness.
17. What is it that the plaintiffs seek here? Surely to have it established that, on the death of the tenant for life, the title to the immovable property no longer remained in the official trustee in trust for the sons as they attain the age of 21 years, but reverted to the estate of the settlor, and that the property accordingly has become available to satisfy the claims of their creditors.
18. I do not think that the suit is not a suit for land because the plaintiff does not claim a proprietary title for himself. That appears to me to follow from the decision of this Court in The Delhi and London Bank v. Wordie . [1876] 1 Cal. 249. That was a suit to compel the sale of certain lands which had been conveyed by two persons to trustees on a trust for sale for the benefit of their creditors. It is true that one of the alleged transferor denied the validity of the transfer, but this aspect of the case was not made the ground for the decision by Phear, J., and in my opinion there is nothing in the Judgment of Garth, C.J, to warrant the conclusion that the view of the Court on appeal would have been different had the validity been admitted.
19. I think that to hold that this is not a suit for land would be tantamount to holding that Provas Chandra Sinha v. Ashutosh Mukherji was wrongly decided. I agree with the view taken by Page, J., in that case, and I hold that this is a suit for land and as no leave has been given I have no jurisdiction to try or determine it, at any rate, as far as the deed of 1926 is concerned.
20. I do not consider that the two authorities upon which Mr. H.D Bose relies have any application to the present case.
21. In Juggodumba Dossee v. Puddomoney Dossee . [1875] 15 Beng L.R 318., lands outside Calcutta had been given by way of debuttar to certain idols; the plaintiffs who claimed to be shebaits complained that they had been ousted by their coshebaits the defendants, and sought a declaration that they were entitled to be shebaits jointly with the defendants, ancillary reliefs such as the appointment of a receiver, an injunction and settlement of a scheme were also prayed for. It was held that the suit was not one for land or other immovable property. In that case, as pointed out by Markby, J., no decree bearing directly upon land or any interest in land was sought, it being common ground that the property was vested in the idol and that neither plaintiffs nor defendants had any beneficial interest in the land. Nagendra Nath v. Eraligool Co. Ltd. . A.I.R 1922 Cal. 443 appears to me to amount to no more than this: it re-affirmed the familiar decision in The Land Mortgage Bank v. Sudurudeen, Ahmed . [1892] 19 Cal. 358. to the effect that a vendor's suit for the specific performance of an agreement to sell immovable property is not a suit for land within the meaning of Cl. 12, and laid it down that such a suit does not become a suit for land, because the defendant denies the title of the plaintiff to some portion of the land that the latter has contracted to convey. Neither case, as I have said has anything in common with the case before me.
22. Although this ground appears to ma sufficient to dispose of the summons at any rate in its present form I propose to deal with the merits of the questions raised, a course which I was invited to take by all parties during the hearing.
23. The main question is that relating to the gift to the sons. The so called rule against perpetuity is thus formulated in Section 14 of the Transfer of Property Act:
“No transfer of property can operate to create an interest which is to take effect after the lifetime of one or more persons living at the date of such transfer and the minority of soma person who shall be in existence at the expiration of that period, and to whom, if he attains full age, the interest created is to belong;”
and it is pointed out that the longest period to which the gift could be postponed without violating the terms of the section is 18 years from the death of the settlor. Assume, with regard to the deed of 1926, a son to be born to the settlor in 1927 and the settlor to the in 1923, the son would attain majority in 1945 but the deed attempes to postpone the operation of the disposition until 1948.
24. The rule it is said is therefore infringed and owing to the operation of S. 15 (as unamended), the gift to the whole class fails.
25. The defendants however contend that the gift became vested at the death of the tenant-for-life being covered by S. 19 of the Act, and they also say that even if the gift does in terms infringe the rule nevertheless the settlor's two sons will take, since they will, in fact, attain the age of 21 within 18 years from the settlor's death. They say that S. 15 has no application to Hindus. It may here be convenient to consider what has been the history of the law as regards this matter. Undoubtedly, under Hindu law, a gift cannot be made to a person who is not in existence at the date of the gift. Jatindra Mohan Tagore v. Ganendra Mohan Tagore . [1872] 9 Beng L.R 377. The Transfer of Property Act which came into force on 1st July 1882, although providing for gifts to unborn persons under certain limitations: see S. 13, left the rule untouched, since under S. 2 of the Act, nothing in Chap. 2 there of was to be deemed to affect any rule of Hindu, Mahomedan, or Buddhist law.
26. In 1916, that is to say, prior to the date of any of the deeds with which this summons is concerned, it was enacted by the Hindu Disposition of Property Act, which extends to the whole of British India except the province of Madras that, subject to the limitations and provisions therein specified, no disposition of property by a Hindu, whether by transfer inter vivos or by will shall be invalid by reason only thit any person, for whose benefit it shall have been made, was not in existence at the date of such disposition. S. 3 enacts that, in respect of dispositions by transfer inter vivos, the limitations and provisions shall be those contained in Sections 13, 14 and 20 of the Transfer of Property Act, 1882.
27. The all-important question is the date of the vesting of the gifts. To taka the deed of 1926 first—since, from a practical point of view, this is the deed of greatest importance—do the gifts to the sons vest on the death of the tenant for life subject to a possibility of being divested in the casa of those sons who fail to attain the age of 21? If so, the gift is good. Or, is the operation of the gift postponed till the age of 21, i.e, three years beyond the attainment of majority? If so it is a contingent gift to a class dependent in the case of each member on his attaining 21, and, if the provisions of S. 15 apply, bad as regards the whole class.
28. The law as regards vested and contingent interests is contained in Ss. 19 and 31 of the Act read with Ss. 20 and 22:
19. Whore, on a transfer of property, an interest therein is created in favour of a person without specifying the time when it is to take affect, or in terms specifying that it is to take affect forthwith or on the happening of an event which must happen, such interest is vested, unless a contrary intention appears from the terms of the transfer.
A vested interest is not defeated by the death of the transferee before he obtains possession.
Explanation.—An intention that an interest shall not be vested is not to be inferred merely from a provision whereby the enjoyment thereof is postpone, or whereby a prior interest in the same property is given or reserved to some other persons, or whereby income arising from the property is directed to be accumulated until the time of enjoyment arrives, or from a provision that if a particular event shall happen the interest shall pass another person.
21. Where, on a transfer of property an interest therein is created in favour of a person to take effect only on the happening of a specified uncertain event, or if a specified uncertain event shall not happen, such person thereby acquires a contingent interest in the property. Such interest becomes a vested interest, in the former case, on the happening of the event, in the latter, when the happening of the event becomes impossible.
Exception.—Where, under a transfer of property, a person becomes entitled to an interest therein noon attaining a particular age, and the transferor also gives to him absolutely the income to arise from such interest before no reaches that age, or directs the in come or sci much thereof as may be necessary to be applied for his benefit, sue interest is not contingent.
29. Now, with regard to S. 19, it is, I think important to notice that the burden of proving the contrary intention is on those that assert it, and the weight of the burden is aggravated by the elimination, in the explanation, of circumstances which might, apart from the explanation, be thought sufficient to discharge it.
30. Now, when we look at the language of this deed, we find that the settlor has directed that, after the death of the tenant for life, and after making (which I suppose means subject to making), provision out of the trust found for the payment of Rs. 30 per month to the widow for life, the trustee is to hold the rest of the trust estate for the use and benefit of his son or sons to be made over to him or them on the attainment of 21 years. I have not found, nor could I expect to find, any casa in which the language is the same, but, in my opinion, the words “to hold for the use and benefit of” strongly support an immediate vesting of the interest disposed of, and I also think that the words “to be made over” are more consistent with the postponement of a vesting in possession of that which is vested in interest than with the postponement of the vesting in interest itself. I think Chance v. Chance . [1853] 16 Beav. 572., strongly relied on by Mr. H.D Bose, can be distinguished. There the words were:
“I give and bequeath and will, and direct the principal sum to be divided into two equal half parts or shires and one such half part or share to be transferred or paid unto and equally divided between all the children of C at the age of 25 years.”
31. It is significant that there are no words of gift purporting to operate on the death of the life tenant and, in my opinion, the words “to be transferred” differ from the words “to be made over,” inasmuch as the former import a postponement of vesting in interest.
32. The legislature has not thought fit to furnish illustrations to Section 19 of the Transfer of Property Act, and I am doubtful how far, if at all, it is permissible to refer to illustrations in one statute for the purpose of construing another in similar terms. However this may be, I think it right to draw attention to the language of Illus. (v), Section 119 of the Succession Act, 1925 (the vesting sections):
“(v) A bequeaths the whole of his property to B upon trust to pay certain debts out of the income, and then to make over the fund to C. At A'a death the gift to C becomes vested in interest to him.”
33. The defendants, moreover, contend that, if the language of the gift primarily connotes a contingency, the gift is however vested by reason of the exception to S. 21:
“Where under a transfer of property a person becomes entitled to an interest therein upon attaining a particular age, and the transferor also gives to him absolutely the income to arise from such interest before he reaches that age, or directs the income or so much thereof as may be necessary to be applied for his benefit, such interest is not contingent.”
34. Mr. H.D Bose relies on certain English cases in support of the proposition that the exception cannot apply where all that is given by the instrument is a discretionary power to the trustee to spend such sum or sums out of the income for the maintenance, education, and advancement or benefit of such son or sons as the trustee shall think fit. I think the proposition is certainly correct as far as English law is concerned: In re Parker; Barker v. Barker . [1880] 16 Ch. D. 44., In re Mervin; Mervin v. Crossman . [1891] 3 Ch. 197. Now it is pointed out in Ratanbai Rastamji v. Cawasji Edalji . A.I.R 1923 Bom. 96 that the words of the exception to S. 107 (the corresponding section of the Succession Act, 1865), are wider than the English law, but, even reeding the words of the exception to S. 21 without reference to English authorities, I feel compelled to hold that in the instruments with which I am dealing there is no direction within the meaning of the exception but merely a power. I am of opinion therefore that unless I am right in holding that the disposition in favour of the sons is covered by S. 19, it is contingent, and the vesting in interest is postponed to a period longer than that permissible under S. 14.
35. The final matter for decision is whether if the rule against perpetuities has been violated, the interest fails as to all the sons by reason of the provisions of S. 15 as unamended or whether, the parties being Hindus, that section has no application. Mr. S.M Bose points out that although the Hindu Disposition of Property Act, 1916, expressly makes the dispositions thereby rendered valid subject to the limitations provided by Ss. 13 and 14, nothing is said of S. 15.
36. On this point reference is also made to Ram Lal Sett v. Kanai Lal Sett . [1886] 12 Cal. 663. when in dealing with a deed of 1871, Garth, C.J, and Wilson. J., held that where a gift was in favour of a class some of whom were not in existence at the date of the will and therefore being Hindus were incapable of taking the gift inured for the benefit of those members of the class who were capable of taking, or in other words, that the principle of Leake v. Robinson, as explained in Pearks v. Moseley . [1880] 5 A.C 714 did not apply. The judgment of Wilson, J., was approved in emphatic language by Lord Macnaghten in Bhagabati Barmanya v. Kalicharan Singh . [1911] 38 Cal. 468 a case concerned with a will of 1868. It must be observed that in neither of these cases was there the type of “remoteness” contemplated by Section 14 of the Transfer of Property Act, but a remoteness peculiar to Hindu law based on the rule existing till 1916, forbidding gifts or bequests to unborn persons. It appears to me fallacious to argue that because the principle of Leake v. Robinson did not apply to a gift to a class avoided as to some of its members by the Hindu law there is therefore a rule of Hindu law within the meaning of S. 2(d) of the Act, which excludes gifts to a class covered by S. 14 from the operation of S. 15. It is significant to note that the late Sir Asutosh Mookerjee in his “Law of Perpetuities in British India” (Tagore Law Lectures, 1898), p. 178 wrote:
“I am not aware of any decision in which the doctrine of Leake v. Robinson has been repudiated when the gift to a class fails as regards some of its members by reason of the rule against perpetuities.”
37. In Rojomoyee Dassee v. Troylukho Mohiney Dassee . [1901] 23 Cal. 260 Stanley, J., applied that doctrine to the will of a Hindu dated 1892, observing that it seemed to him consonant with Hindu law and a convenient rule to follow. In Ranganadha Mudaliar v. Baghirathi Ammall . [1903] 29 Mad. 412 the Court was of opinion that the particular gift in the settlement did not infringe S. 14, but they also clearly considered that had it done so, S. 15 would have applied. Further, I do not think any inference should be drawn from the absence of reference to S. 15 in the Act of 1916. That Act while giving validity to dispositions by Hindus previously invalid by reason of the rule in the Tagore case, made such dispositions, when inter vivos subject to the limitations of Section 14 of the Transfer of Property Act. In a case therefore infringing those limitations, the disposition will be covered by the language of S. 15, although it is not expressly mentioned in the Act of 1916 subject to its being shown there is some rule of Hindu law at variance with that section.
38. I hold therefore that, if I am wrong in my view as to the vesting of the gift to the sons, and, if by reason of the postponement of the period of distribution to the age of 21, there is a possible failure in the case of any son, S. 15 (as unamended) applies and the gift fails as regards the whole class. This disposes of the main points raised in the summons. I therefore answer the questions as follows subject to what I have said as to the absence of jurisdiction in the Court to entertain the summons at any rate as far as the property covered by the deed of 1926 is concerned:
Question—Whether on a true construction of the said three several deeds of trusts, there is a resulting trust in favour of the estate of the settlor Chandicharan Das, to which the heirs of the settlor are entitled subject to payment of his debts.
Answer.— No.
Question (2)—Whether the defendant is holding the estates, covered by the said three deeds of trust, or the residue thereof or any portion of the said estate on behalf of the heirs of the settlor, Chandicharan Das, subject to payment of his debts and-liabilities.
Answer.— No.
Question (3) — As to the deed of trust, dated 27th April 1921, I hold that the gift of Rs. 20 a month to the daughters on marriage is invalid by reason of Sections 14 and 15 of the Transfer of Property Act, and I hold that each of the sons of the deceased settlor obtained a vested interest in a moiety of the trust found on the death of the widow subject to being divested if such son died before attaining the age of 21.
(b) As to the deeds of 10th May 1924, and 20th December 1926, subject to the provision of the monthly payments to the settlor's widow therein specified, each of the sons of the settlor obtained a vested interest is a moiety of the trust found on the death of the settlor subject to being divested if such son died before attaining the age of 21.
39. As to the costs, the plaintiff firm must pay the costs of all the defendants taxed as of a hearing on Scale No. 2, but only one set of costs to be allowed to the added defendants. The official trustee is entitled, in the first instance, to take his costs cat of the trust property taxed as between attorney and client on Scale No. 2.
B.V/R.K
40. Order accordingly.
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