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Case Number

Second Appeals Nos. 112 and 113 of 1919.

Attorney(S)

The Hon'ble (The Advocate-General) Mr. K. Srinivasa Aiyangar and Mr. S. Rangachari for the Appellant.
Messrs. T. Ranguchariar and Muthiah Mudaliar for the Respondents.

Judges

Ayling
Hughes, JJ.

Acts

Sect. 123 of the Transfer of Property Act
Sect. 47 of the Indian Registration Act,
Sect. 47 of the Registration Act

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Smart Summary

Summary of the Opinion — Trust Deed Ex. A (Second Appeals)

Factual and Procedural Background

The opinion concerns the validity of a trust deed (referred to as Ex. A) executed by Vaithilingam Pillay. Relevant dates and events stated in the opinion are:

9 September 1891 — Vaithilingam Pillay executed the trust deed Ex. A, purporting to endow specified properties for temple charities and a chatram, and appointed trustees to administer them.
10 September 1891 — The donor adopted the appellant (a minor) as his son.
12 September 1891 — A partition was effected between the donor and his adopted son (with the latter's natural father acting as guardian), excluding the trust properties.
15 September 1891 — The donor registered Ex. A.

Procedurally, suits under Section 92 of the Civil Procedure Code were brought for enforcement of the trusts constituted by Ex. A. The validity of Ex. A was challenged; the particular legal contention summarized below was raised at the appellate stage in these Second Appeals.

Legal Issues Presented

Whether the trust deed Ex. A was valid when it was executed on 9 September 1891 but not registered until 15 September 1891, given that the donor adopted a son in the interval (i.e., whether registration prior to adoption was required under Section 123 of the Transfer of Property Act).
Whether the plaintiffs in O.S. No. 78 of 1916 had sufficient interest to maintain the suit under Section 92 of the Civil Procedure Code in respect of the charity (especially as to the chatram).

Arguments of the Parties

Appellant's Arguments (as presented in the opinion)

The appellant (the adopted son) contended that Vaithilingam Pillay lacked competence after the adoption to alienate the properties in favour of the trusts, and therefore could not validly complete any alienation by registering Ex. A after the adoption.
Specifically, the appellant argued that because Ex. A was not registered prior to the adoption, it was invalid under Section 123 of the Transfer of Property Act.

Plaintiffs' Arguments (as presented in the opinion)

The plaintiffs maintained that Ex. A was a dedication of property for charitable purposes (a dedication to an idol/charity) rather than a transfer of ownership constituting a "gift" under Section 123 of the Transfer of Property Act, and therefore did not require registration.
The plaintiffs additionally argued (later in the judgment) that the defendant was estopped from challenging the trust because he had derived advantage from the arrangement; this contention was rejected on the facts by one judge.

Table of Precedents Cited

Precedent	Rule or Principle Cited For	Application by the Court
Venkati Rama Reddi v. Pillati Rama Reddi (Full Bench)	Holds that once a deed of gift is duly executed, the Registration Act permits it to be registered even without the donor's agreement, and upon registration the gift takes effect from the date of execution; registration can be effected without the donor's co-operation.	Justice Ayling relied on this Full Bench ruling to conclude that the gift was complete on the date of execution and that the donee could enforce registration; he treated this as supporting the view that registration after adoption did not invalidate the gift. Justice Hughes cited the case but noted that subsequent authority has read it more narrowly.
Padmavati v. Shrinivasa Kampti	Considers and limits the Full Bench ruling, indicating that the Full Bench should be read as holding that if the donor has done all in his power to complete the gift (e.g., registered it himself or handed the deed to the donee), he cannot thereafter retract it.	Justice Ayling criticized the narrower reading and thought it did not give full effect to the Full Bench. Justice Hughes relied on Padmavati's narrowing to hold that in the present case the donor had not completed the gift before adoption and therefore registration after adoption could not complete the gift.
Gangadara Mudali v. Sambasiva Mudali	Referenced in the opinion as a case quoted by Abdur Rahim, J., in Padmavati; the opinion notes a citation mistake.	Justice Ayling states that the reference was a mistake and that the case intended was Venkati Rama Reddi v. Pillati Rama Reddi; the Court did not apply this case substantively.
Ramalinga Chetti v. Sivachidamabara Chetty	Relates to dedications on special occasions where the donor constituted himself trustee and there was no transfer of ownership (thus not a gift under Section 123).	Justice Hughes distinguished that line of authority from the present case, observing that in those decisions there was no transfer because the executant made himself trustee, whereas in Ex. A the deed was to trustees transferring ownership.
Palleya v. Ramavadhanulu	Another decision where the donor made himself trustee and there was no transfer of ownership; cited for the proposition that such declarations are not gifts under Section 123.	Justice Hughes cited this case to illustrate prior holdings where declarations of trust (with the executant as trustee) did not amount to a gift needing registration; used to contrast with the facts of Ex. A.
Unreported — Appeal No. 108 of 1914 (Ex. IV)	Held that a declaration of trust for charitable purposes, where the executant declared herself the first trustee, was not a gift within Section 123.	Justice Hughes mentioned this unreported decision to show precedents where instruments were treated as declarations of trust not requiring registration; used as a point of comparison with Ex. A.
Garuda Sanyasayya v. Narella Murthenna	Cited on the question of the plaintiffs' right to maintain a suit under Section 92 CPC (standing/interest to sue in respect of a charity).	Justice Ayling relied on this case (along with the next) to hold that the plaintiffs had sufficient standing to sue in O.S. No. 78 of 1916.
Gopala Krishnier v. Ganapathy Aiyar	Also cited concerning the plaintiffs' entitlement to maintain suit under Section 92 CPC.	Justice Ayling cited this authority in support of his view that the plaintiffs' pleaded facts were sufficient to entitle them to sue.
T.R. Ramachandra Aiyar v. Parameswaran Unni	Referenced in relation to the question of plaintiffs' entitlement to sue; no conflicting principle was found in this authority according to the opinion.	Justice Ayling states he does not find anything in that case contrary to his conclusion on plaintiffs' standing.

Court's Reasoning and Analysis

Justice Ayling — Majority Reasoning (as expressed)

Justice Ayling framed the central question as whether Ex. A was valid although executed on 9 September 1891 and registered only after the donor adopted a son. He accepted, for purposes of analysis, that Section 123 of the Transfer of Property Act was argued to apply but observed that the issue had a technical aspect and must be accepted if sound in law.

His analysis proceeded along these lines (stated in the opinion):

He was inclined to agree with the District Judge that the gift was "complete on the date of Ex. A" (i.e., on execution), even though it was not enforceable at law until registered, and that the appellant could not have restrained the donor from registering the document later.
He found this view consonant with the spirit of Section 47 of the Indian Registration Act and with the Full Bench ruling in Venkati Rama Reddi v. Pillati Rama Reddi, which states that a duly executed instrument may be registered and takes effect from the date of execution even if the donor does not agree to registration.
He rejected the narrower interpretation of the Full Bench reading advanced in Padmavati v. Shrinivasa Kampti (as quoted by Abdur Rahim, J.), and considered that the Full Bench clearly implied that execution completed the gift and that the donee could thereafter enforce registration even if the donor changed his mind.
On that basis he concluded that the donor could not be restrained from registering Ex. A at the instance of the adopted son or anyone acting on his behalf, and that the gift was not invalidated by the fact that registration occurred after the adoption.
Because of this conclusion, he stated it was unnecessary to decide the separate question of the applicability of Section 123 of the Transfer of Property Act to the transactions of this kind.
He also addressed standing: he agreed with the lower courts that the facts pleaded were sufficient to entitle the plaintiffs to sue under Section 92, citing Garuda Sanyasayya v. Narella Murthenna and Gopala Krishnier v. Ganapathy Aiyar.

Justice Hughes — Dissenting Reasoning (as expressed)

Justice Hughes set out a contrary analysis and reached the opposite conclusion on the primary issue:

He characterized Ex. A as a gift to trustees for charitable purposes and concluded it fell within Section 123 of the Transfer of Property Act and therefore required registration.
He considered prior authorities dealing with dedications where the executant constituted himself trustee (Ramalinga Chetti; Palleya v. Ramavadhanulu and the unreported Appeal No. 108 of 1914) and distinguished them on the ground that in those cases there was no transfer of ownership because the executant was the trustee; by contrast, in Ex. A the instrument operated as a transfer to trustees.
Applying the Full Bench decision in Venkati Rama Reddi, he noted that the Full Bench contained a passage that could be read to allow registration to give effect from the date of execution; however, he accepted the narrower reading in Padmavati v. Shrinivasa Kampti — that the Full Bench does not permit a donee to compel registration where the donor had not done all that lay in his power to complete the gift (for example, by handing the deed to the donee).
On that basis Hughes, J. concluded that in the present case the donor had not made a complete gift before the adoption; the property remained the donor's and, since adoption introduced a coparcenary interest, the donor could not validly complete the gift after adoption by effecting registration.
He rejected the plaintiffs' estoppel argument in view of the Appellate Court's factual findings.
On the question of plaintiffs' standing under Section 92, he found that two plaintiffs (relatives of the donor who would have been entitled to succeed but for the adoption) and the first plaintiff (a Brahmin resident of a neighbouring village who could be a beneficiary) had sufficient interest to maintain the suit.

Holding and Implications

Holding (final decision of the Court):

SECOND APPEALS DISMISSED WITH COSTS.

The opinion concludes: "the decrees of the Lower Appellate Court will be confirmed and the Second Appeals dismissed with costs." (This is the Court's final operative order stated in the opinion.)

Direct implications for the parties:

The decrees of the Lower Appellate Court are confirmed by the present Court.
The Second Appeals brought against those decrees are dismissed and costs are awarded against the appellants.

The opinion contains differing analyses by two judges (Ayling, J. and Hughes, J.). Justice Ayling took the view that execution of Ex. A completed the gift and that registration after adoption did not invalidate it; Justice Hughes took the opposite view, relying on the necessity of prior completion under Section 123 as narrowly interpreted by Padmavati. The Court's final order follows Justice Ayling's view (i.e., dismissal of the appeals). The opinion does not state any broader new precedent beyond the application of existing statutes and authorities; therefore the practical effect expressed in the opinion is limited to the confirmation of the lower courts' decrees and dismissal of the appeals with costs.

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Kaliyanasundaram Pillai v. S. Krishnaswami Iyer

Ayling, J. — The main question in these appeals is as to the validity of the trust deed Ex. A. By this document executed on 9th September 1891, appellant's adoptive father Vaithilingam Pillay purported to endow certain properties in favour of Kattalais in a temple and charities in a chatram, and appointed trustees to administer them. Next day he adopted the appellant and on 12th September 1891 he affected a partition with his adopted son (with the latter's natural father as guardian of the minor) excluding the trust properties. On 15th September 1891 he registered the trust deed Ex. A.

It is not contested that after the adoption it would not be competent to Vaithilingam Pillai to alienate the properties in favour of these trusts and appellant's contention is that he was equally incompetent to (as he puts it) complete the alienation by registering Ex. A. In other words Ex. A not having been registered before the adoption is invalid under Sect. 123 of the Transfer of Property Act.

This plea is raised in defence of suits under Sect. 92 of the Civil Procedure Code for the enforcement of the trusts. It does not appear to have been put forward in the first Court, where the validity of Ex. A was unsuccessfully attacked on other grounds, and is, of course, a purely technical plea, devoid of merit; but none the less, it must be admitted and given effect to, if sound in law.

The question raised, though simple of statement, is by no means easy of solution, but I am inclined to agree with the District Judge that the gift was complete on the date of Ex. A, though not enforceable at law, until it was registered and that appellant could not have restrained Vaithilingam Pillai, from registering the document.

This view appears to me to be in accordance with the spirit both of Sect. 47 of the Indian Registration Act, and of the Full Bench ruling of this Court in Venkati Rama Reddi v. Pillati Rama Reddi. It has been argued that Vaithilingam Pillai, after the execution of Ex. A, still retained the option of rendering his gift invalid, by refusing to register the document, and that, if so much freedom of choice remained with him, it was not competent for him, after adopting a son to take the final step of registration. For the first proposition reliance is placed on a later ruling in Padmavati v. Shrinivasa Kampti, in which the effect of the Full Bench ruling above quoted is considered. The case quoted by Abdur Rahim, J., is Gangadara Mudali v. Sambasiva Mudali(3), but this is clearly a mistake, for Venkati Rama Reddi v. Pillati Rama Reddi. With all respect, I think due effect was not given by the learned judges in this case to the Full Bench ruling. Abdur Rahim, J. says “all that it lays down is that if the donor has done all that lies in his power to complete the gift, either by having it registered himself, or by handing it (the gift deed) to the donee, then he cannot afterwards retract the gift.” I can find nothing in the Full Bench judgment to this effect. Ex-hypothesi the document was not registered by the donor and there is no suggestion that the deed was handed over to the donee. What the learned judges say is this:

“There is nothing in this section which requires the donor to have the deed registered; all that is required is that he should have signed the registered instrument. Once such an instrument is duly executed, the Registration Act allows it to be registered, even though the donor may not agree to its registration and upon registration the gift takes effect from the date of execution. The doctrine that a donor who has left his gift incomplete cannot be compelled to complete it, has no application to a case like this; for, so far as he is concerned he has by executing the deed done all that he need do, for registration can be effected, even without his co-operation”. (The italics are mine) The passage seems to be to clearly imply that the gift was completed by the execution of the document and that the donee could thereafter enforce registration, even although the donor subsequently changed his mind and wished to withdraw from the gift.

If this is so, it seems to follow that the donor could not have been restrained from registering it at the instance of the adopted son, or any one acting on his behalf; and that the gift was not invalidated by the fact that registration was deferred till after the adoption.

As the applicability of Sect. 123 of the Transfer of Property Act to transactions of this kind, I am inclined to agree with my learned brother: but in the view I have taken, as above indicated, it is unnecessary to discuss the point.

The only other question calling for decision is as to the right of the plaintiffs in O. S. No. 78 of 1916 to maintain the suit. Here also I think the decision of the Lower Courts is correct and that the facts set out in paragraph 20 of the judgment of the District Judge are sufficient to entitle plaintiffs to sue. Vide Garuda Sanyasayya v. Narella Murthenna and Gopala Krishnier v. Ganapathy Aiyar. I do not find anything to the contrary to this, in T.R Ramachandra Aiyar v. Parameswaran Unni.

I would dismiss these Second Appeals with costs.

Hughes, J.—One Vythilingam Pillai executed Ex. A, on 9th September 1891, whereby he set apart a certain extent of his immoveables for certain charitable purposes and appointed trustees and gave them possession of the property, with instructions to manage the charities. On 10th September 1891, he adopted the defendant, who was then a minor, is his son. On 15th September 1891 he registered Ex. A.

The first question that we have to dispose of, which is common to both the appeals, is whether the gift to the trust is valid. The contention of the defendant is that the gift must be by registered deed and that the deed of trust not having been registered before the adoption of the defendant, his father had no power to complete the gift.

The plaintiffs maintain that by Ex. A there was merely a dedication of property for charity and such dedication is valid without deed and registration. They contend that it is not a case of gift at all and Sect. 123 of the Transfer of Property Act has no application.

We have been referred to the case of Ramalinga Chetti v. Sivachidamabara Chetty. But that was a case relating to dedication on special occasions like death or marriage and the donor constituted himself the trustee and there was no transfer. In another case quoted, Palleya v. Ramavadhanulu, the donor again made himself trustee and there was no transfer of ownership of the trust property. In Appeal No. 108 of 1914 (unreported) a deed Ex. IV therein was a declaration of trust for charitable purposes and held to be not a gift within Sect. 123 of the Transfer of Property Act. Plainly this is because the executant declares herself to be the first trustee and there was no transfer.

Plaintiffs contend that Ex. A deals with a gift to an idol and not to a sentient being and therefore is not a gift at all. But clearly it is a gift to trustees for the benefit of charity and I think it comes within Sect. 123 of the Transfer of Property Act and requires registration.

The deed was executed on 9th September 1891 and registered by the donor on 15th September 1891, he having adopted a son in the interim. No doubt under Sect. 47 of the Registration Act the registered document would operate from the date of its execution; but the point, I think, is that on 9th September 1891, the gift was not complete. It was open to the donor to revoke it; the property remained his, even at the time of the adoption and as by the adoption a coparcener was introduced, it was not open to the donor to do what he had not done before and to give away the property by effecting the registration. The decision in Venkati Rama Reddi v. Pillati Rama Reddi has been referred to. It was there held that once a deed of gift is duly executed, the Registration Act allows it to be registered, even though the donor may not agree to its registration and upon registration the gift takes effect from the date of execution. There is an important passage in the judgment to this effect. “The doctrine that a donor who has left his gift incomplete cannot be compelled to complete it, has no application to a case like this, for, so far as he is concerned he has, by executing the deed, done all that he need do, for registration can be effected even without his co-operation.” But it has been pointed out in Padmavati v. Shrinivasa Kampti that this Full Bench decision is based on the reasoning that a deed of gift may be registered on presentation by the donee, and that it does not go so far as to say that directly a deed of gift is executed, even though the donor never delivers it to the intended donee, yet the donee can compel him to register it. “All that it lays down is that if the donor has done all that lies in his power to complete the gift either by having it registered himself, or by handing it to the donee, then he cannot afterwards retract the gift.”

I think therefore in the present case it must be held that the donor made no complete gift before the adoption and after the adoption he could not give away any property by completing the gift by registration.

This is sufficient to dispose of the appeals I should mention however that the plaintiffs further contended that the defendant is estopped by the fact that he derived advantage from the whole arrangement. But in view of the finding of fact in paragraph 12 of the Appellate Court's judgment I think there is no estoppel.

In Second Appeal No. 113, the point has been argued that plaintiffs are not entitled to sue under Sect. 92, as they have no interest in the trust. That appeal deals with the charity so far as it relates to the chatram. Two of the plaintiffs are relatives of the donor, who would be entitled to succeed but for the adoption, and 1st plaintiff, as a Brahmin resident of a neighbouring village, may be said to have a real interest as a beneficiary. I think there is no force in this point.

In the result I would allow both second appeals with costs and dismiss both suits with costs.

By the Court.—In the result the decrees of the Lower Appellate Court will be confirmed and the Second Appeals dismissed with costs.

.

K.V.SAppeals dismissed.

Kaliyanasundaram Pillai v. S. Krishnaswami Iyer

Summary of the Opinion — Trust Deed Ex. A (Second Appeals)

Factual and Procedural Background

Legal Issues Presented

Arguments of the Parties

Appellant's Arguments (as presented in the opinion)

Plaintiffs' Arguments (as presented in the opinion)

Table of Precedents Cited

Court's Reasoning and Analysis

Justice Ayling — Majority Reasoning (as expressed)

Justice Hughes — Dissenting Reasoning (as expressed)

Holding and Implications

Kaliyanasundaram Pillai v. S. Krishnaswami Iyer

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