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CASE NO.: Appeal (civil)  12915-12920 of 1996

PETITIONER: B.S. Adityan & Ors.                              

RESPONDENT: B. Ramachandran Adityan & Ors.     

DATE OF JUDGMENT: 16/04/2004

BENCH: S. RAJENDRA BABU & DORAISWAMY RAJU

JUDGMENT: J U D G M E N T

RAJENDRA BABU,  J.  :

       A deed of declaration was executed by S.B.  Adityan consisting of himself, his elder brother S.T.  Adityan and the first respondent herein, B.  Ramachandran Adityan as Trustees  on 1.3.1954.   Under a deed of resignation dated 19.5.1959 the first  respondent herein resigned as Trustee and also as  Director of Daily Thanthi.  By a deed of appointment  of trustees executed on 22.5.1959 the first appellant  B.S. Adityan son of S.P. Adityan and  the second  appellant  were appointed as one of the new trustees  and also to be the Director of Daily Thanthi.   A  supplementary deed was also executed on 28.6.1961.   On 8.11.1961 the Founder resigned.  On 2.3.1962 a  decree was passed by the High Court in C.S. No.  90/1961 approving the supplementary deed dated  28.6.1961.  On 27.12.1963 S.T. Adityan resigned.  In  the last week of June 1978 the Founder executed  three deeds of appointments of trustees appointing  himself,  his elder brother S.T. Adityan and the first  respondent as additional trustees of Thanthi Trust.   The Appellants filed applications under Section 92 Civil  Procedure Code (CPC) for leave to file suits  challenging the said appointments and leave was  granted and the said suits are numbered as C.S. Nos.  352 and 353 of 1978.   On 29.8.1978 the first  respondent and his uncle S.T. Adityan filed application  under Section 92 CPC for leave to file a suit for  removing appellants Nos. 1 and 2 as trustees.  On  13.9.1978 an temporary order of injunction was made  by the High Court restraining the newly appointed  trustees from interfering with the management of the  trust on the condition that the first appellant must  deposit a sum of Rs. 1 lakh per month.  All the three  newly appointed trustees, that is, Founder, S.T.  Adityan and the first respondent executed resignation  deeds and withdrew the application No. 3147/1978  filed under Section 92 CPC.  Inasmuch as the newly  appointed trustees resigned their trusteeship and  withdrew their application under Section 92 CPC,  the  appellants proceeded on the basis that suits C.S. Nos.  352 and 353 of 1978 had become unnecessary and  withdrew the same.  

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       While the matter stood thus,  on 20.1.1981  Kannan Adityan and  Kathiresa Adityan filed an  application No. 165/1981 under Section 92 CPC for  leave to file a suit for appointing them as additional  trustees and for rendition of accounts by the first and  second appellants. The appellants filed application No.  879/1991 for permission of court to cross-examine the  applicants therein, that is, Kannan Adityan and  Kathiresa Adityan, to establish the fact that it was the  father of the petitioners therein who was supplying all  documents and materials and who was conducting the  proceedings and that they were 21 and 18 years of  age and were students then studying in the  Engineering College.    The said application filed by  the appellants came to be dismissed by the learned  single Judge.  On appeal filed in O.S.A. No. 152/1981  the Division Bench held that it would be in the interest  of justice to allow the appellants therein to cross- examine Kannan Adityan and Kathiresa Adityan.   When the matter was carried to this Court,  this Court  dismissed the Special Leave Petition No. 6040 of 1982  by observing that the cross-examination, however,  was confined to the question of sanction and principles  governing the same.  An application had been filed  under Order XI Rule 21 CPC which having been  dismissed and on appeal having been confirmed by  the Division  Bench, the same matter was carried to  this Court by way of a special leave petition.  This  Court disposed of the said special leave petition and  ultimately by an order made on 18.1.1993 dismissed   it.  

       The trustees, namely,  the first and the second  appellants, resolved to appoint Mr. Maruthai Pillai,  Mrs. Sarojini Varadappan and Mr. R. Somasundaram  as additional trustees.  On 3.1.1994 respondents Nos.  1 to 4 filed an application No. 33/1994 for leave to file  a suit under Section 92 CPC for framing a scheme, for  removal of appellants No.  1 and 2 as trustees and for  accounts.  An  application No. 1030/1994 was filed  seeking to implead Maruthai Pillai, Mrs. Sarojini  Varadappan and R. Somasundaram as parties to  application No. 33/1994.  A number of incidental  applications Nos. 214/1994, 215/1994, 1901/1994  and 153/1994 were  filed for various reasons like  appointment of receiver, impleadment of parties and  for publication of the proceedings in newspapers.  The  appellants also filed an application to dismiss the said  applications filed under Section 92 CPC in limini. C.S.  No. 1509/1994  was filed by Kannan Adityan and  Kathiresa Adityan for a declaration as follows :-

"The order of dismissal passed in  Application No. 165/1981 filed by the  plaintiffs herein under the provisions of  Section 92 of the CPC for grant of leave of  this Hon’ble Court and the unnumbered  suit filed along with the said application  and confirmed by the Division Bench and  by Supreme Court of India by order dated  18.1.1993 made in S.L.P. No. 3362 and  3363 of 1987 are vitiated by fraud,  without jurisdiction non est in law and  void, and consequently to set aside all the  orders made in Application No. 165 of

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1981 and the unnumbered suit filed along  with the said application including that of  the order dated 18.1.1993 passed by the  Supreme Court of India in S.L.P. No. 3362  and 3363 of 1987 and restore application  No. 165 of 1981 along with the suit  referred to above to file and to hear the  same afresh."

       Application filed by the appellants for dismissal  of application No. 33/1994 filed under Section 92 CPC  was dismissed by a learned Single Judge and several  orders were made in other applications.   While O.S.A.  No. 62/1996 was filed against the order dismissing  application No. 33/1994 filed under Section 92 CPC,   O.S.A. Nos. 63 and 64 of 1996 were filed in regard to  certain other incidental reliefs. The Division Bench by  an order made on 16.7.1996 allowed the appeals and  thus by allowing O.S.A. No. 62/1996 it allowed  application No. 33/1994 granting leave to the  appellants therein to file suit under Section 92 CPC  against the appellants herein.  In the said order the  Division Bench also considered the scope of Section 92  CPC, impact of the amendment of the Civil Procedure  Code in 1976 requiring the Court to give permission in  place of the Advocate General to give consent thereto,  and also noticed several decisions of the Courts on the  aforesaid matters.  While some of the decisions have  taken the view that an order granting such permission  is an administrative order,  some other courts have  taken the view that such an order is liable to be  reviewed under Article 226 of the Constitution.   The  High Court went on to hold that a notice to defendants  before leave is not necessary as a rule of law but as a  rule of caution, the court should normally give notice  to the defendants before granting permission to  institute a suit under Section 92 CPC; that the  defendants could bring to the notice of the court that  the allegations made in the plaint are frivolous or  reckless and that in a given case, they could point out  that the persons who are applying for leave are doing  so merely with a view to harass the trust or have such  antecedents that it would be undesirable to grant  leave to such persons; that Section 141 CPC is not  applicable to a proceeding which is administrative in  nature.  The High Court examined the facts of the  case in the light of principles adverted to by it.    

       In the normal course if an appeal is filed against  an order granting permission to a party to file a suit  as falling under Section 92 CPC, we do not normally  interfere with an order made by the High Court nor do  we think of entertaining a proceeding of this nature  under Article 136 of the Constitution because the  order made thereunder will not determine the rights of  the parties, but only enable a party to initiate a  proceeding.          Shri K. Parasaran, learned senior counsel  appearing for the appellants herein, submitted that  the present case is one of the third round of litigation  in respect of the some trust property;  that what is to  be considered in the present case is not trust in  relation to an immovable property but in relation to a

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newspaper "Dina Thanthi" or "Daily Thanthi" at  present being published as a daily newspaper in Tamil  language together with the goodwill thereof,  the Head  Office of which being presently situated at 60,  Cutchery Road, Mylapore, Madras as a going concern  with all its assets and liabilities and all the printing  machine, printing types, furniture and accessories of  the newspaper formed part of the trust property;  that  it is a running newspaper business which is the  property held under and impressed with Trust which  required great skill to run a venture of such a nature;   that immovable properties had been subsequently  acquired for the Trust where offices have been located  and business is carried out and there are also guest  houses at one or two centres.   The appellants filed an  application No. 2421 of 1994 under Section 92 CPC  read with Section 151 CPC to dismiss the application  filed by respondents 1 to 4 for leave to file a suit  under Section 92 CPC for framing a scheme, for  removal of appellants Nos. 1 and 2 as trustees and for  accounts. The learned Single Judge, by an order made  on 21.12.1999, allowed application filed by the  appellant herein in application No. 2421 of 1994 to  dismiss the application filed under Section 92 read  with Section 151 CPC.  On appeal, as stated earlier,  the Division Bench also in original side granted leave  to respondents Nos. 1 to 4 to file suit under Section  92 CPC against the appellants in the present case.

       The learned counsel for the appellants urged that  the order that was passed under Section 92 CPC  granting permission to file a suit is whether  administrative in character or otherwise; that this  does arise when the objections of the defendants are  considered; that as to scope of the meaning of the  expressions "order, judgment, decree and  adjudication".    He drew our attention to decision in  Pitchayya & Anr. v. Venkatakrishnamacharlu &  Ors.,  AIR 1930 Madras 129, to the effect that the  object of Section 92 CPC is to safeguard the rights of  public and of institutions under trustees.   In this  regard,  he specifically drew our attention to National  Sewing Thread Co. Ltd.  v. James Chadwick &  Bros. Ltd., 1953 SCR 1028.  He also adverted to  decision in R.M.A.R.A. Adaikappa Chettiar & Anr.     v. R. Chandrasekhara Thevar, AIR(35)1948 PC 12,  to contend that where a legal right is in dispute and  the ordinary courts of the country are seized of such  dispute the courts are governed by ordinary rules of  procedure applicable thereto and an appeal lies if  authorised by such rules, notwithstanding that the  legal right claimed arises under a special stature  which does not in terms confer a right of appeal.  In   R.M. Narayana Chettiar & Anr. v. N. Lakshmanan  Chettiar & Ors.  1991 (1) SCC 48, this Court has  examined in detail the scope of Section 92 CPC and  explained the object underlying therein in granting  permission to file a suit.  In this case,  this Court held  that court should normally give notice to the  defendants before granting leave as a rule of caution  but court is not bound to do so in all circumstances  and non-issuance of notice would not render the suit  bad or non-maintainable and defendants can at any  time apply for revocation of the leave and provision  under Section 104(1)(ffa) for appeal against refusal of

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grant of leave does not lead to a different conclusion.     In the light of this decision,  we do not consider it  necessary to advert to other decisions cited by the  learned counsel.   More so, the matter was considered  by the Law Commission in its Report submitted in  April 1992 on this aspect of the matter. After noticing  various decision of different courts and the decision in  R.M. Narayana Chettiar’s case (supra),  the Law  Commission recommended that to expect the court to  issue notice and then to try the several points of detail  before granting leave in the light of the objections put  forth by the respective defendants,  would  mean that  there will be a trial before trial and this would not be  desirable.  The recommendation of  the Law  Commission was, therefore, to insert an Explanation  below Section 92 CPC to the effect that the court may  grant leave under this Section without issuing  notice  to any other person, but this does not, of course,  mean that the court will grant leave as a matter of  course.    Particular emphasis is made and heavy  reliance is placed on the decision of this Court in  Shankarlal Aggarwal & Ors. v. Shankarlal Poddar  & Ors., 1964 (1) SCR 717, to emphasise distinction  between administrative and judicial orders.   It is  urged that order from which the appeal was preferred  was not a judgment within the meaning of clause 15  of the Letters Patent and so no appeal lies to the  Division Bench.     Reference is made to the decision  of this Court in Institute of Chartered Accountants    v. L.K. Ratna & Ors.,  1986 (3) SCR 1049, to bring  out distinction between administrative and judicial  order.   Scope of Section 92 CPC was examined in  Charan Singh & Anr. v. Darshan Singh & Ors.,   1975 (3) SCR 48, where the whole case turned on the  facts arising in that particular case.   

       Our attention was also drawn to a decision of  this Court in T. Arivandandam v. T.V. Satyapal &  Anr., 1978 (1) SCR 742, to contend that the court has  a duty in vexatious suits to exercise appropriate  powers under Order VII Rule 11 CPC.  Our attention is  also drawn to the decision in John v. Rees & Ors.,  1969 (2) All ER 274.  He particularly emphasised that  it is not appropriate to give decision against a party  without affording an opportunity to him. Though  reference has been made to several other decisions,   we do not think it necessary to advert to the same.   

       In this background, when a specific provision has  been made in the Code of Civil Procedure in Section  104(1)(ffa) allowing an appeal to be filed against an  order refusing to grant leave to file a suit, the appeal  filed by the respondents before the Division Bench  was certainly competent to be considered by that  Bench.   In this case, on an earlier occasion, when one  of the suits was filed under Section 92 CPC, when the  founder had executed a deed of appointment of  trustees  and certain interim orders were passed in  that suit,  the said application was withdrawn without  obtaining leave under Order XXIII Rule 1 on  19.9.1978 inasmuch as the newly appointed trustees  had resigned their trusteeship and withdrew their  application under Section 92 CPC, the two suits C.S.  No. 352 and 353 of 1978 filed by appellants were  disposed of as having become infructuous.    Later on

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another application No. 165 of 1981 had been filed  under Section 92 CPC for leave to file a suit for  appointing them as additional trustees and for  rendition of accounts.  In that proceeding an  application No. 879 of 1991 was filed for permission of  court to cross-examine the applicants therein R.  Kannan Adityan and R. Kathiresa Adityan in particular  to prove the fact that it was the father of those  petitioners therein who was supplying all documents  and materials and who was conducting the  proceedings.  Application filed to cross-examine  applicants was dismissed by the learned Single Judge.  On further appeal, the Division Bench held that it  would be in the interest of justice to permit the  appellants to cross-examine the said parties.  The  matter was carried to this Court in Special Leave  Petition No. 6040 of 1982.  This Court dismissed the  said Special Leave Petition noticing that the cross- examination "will be confined to the question of  sanction and principles governing the same", of  course, after noticing entire documents.  Again,  another application No. 4738 of 1982 was brought  before the court to dismiss application No. 165 of  1991 under Order XI Rule 21 CPC which was,  however, dismissed by the learned Single Judge and  the matter was carried in appeal which was also  dismissed by the Division Bench.   That matter was  brought before this Court.  This Court asked the  parties to file the appropriate affidavits in regard  thereto and thereafter all papers were place before  the Court.  However,  this Court dismissed the Special  Leave Petition. It is in this background the learned  counsel submitted that the court ought to have  examined the matter in all necessary details before  granting permission under Section 92 CPC.  In R.M.  Narayana Chettiar’s case (supra), this Court  considered in detail the history of the legislation and  whether court is required to give an opportunity of  being heard to the proposed defendants before  granting leave to institute a suit under Section 92 CPC  and stated the law on the matter.  Although as a rule  of caution,  court should normally give notice to the  defendants before granting leave under the said  Section to institute a suit, the court is not bound to do  so.  If a suit is instituted on the basis of such leave,   granted without notice to the defendants,  the suit  would not thereby be rendered bad in law or non- maintainable. Grant of leave cannot be regarded as  defeating or even seriously prejudicing any right of  the proposed defendants because it is always open to  them to file an application for revocation of the leave  which can be considered on merits and according to  law or even in the course of suit which may be  established that the suit does not fall within the scope  of Section 92 CPC.  In that view of the matter,  we do  not think, there is any reason for us to interfere with  the order made by the High Court.            However, we may notice one or two aspects.  It  was not at all necessary for the High Court to have  examined the applicability of Section 141 CPC or  otherwise in a matter of this nature.  So also  observations made by the High Court in para-28 as to  the performance of the learned counsel and general  remarks in para-41 as to events taking place in the  country are uncalled for and unwarranted in dealing

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with the appeal before it.  Such stray excursion will  take the matter in dispute out of focus.   The crux of  the matter was only whether in granting leave under  Section 92 CPC the proposed parties have to be heard  in the matter or not and whether the suit should have  been dismissed in limini under Order VII Rule 11 CPC,  particularly when the trustees who had filed the suit  had seized some interest in the matter and they were  not mere strangers to the suit or such persons at  whose instance the matter should not have been  heard such as insolvent or a party who does not have  sufficient interest in the matter.   

       In the result, we dismiss these appeals.