Section 92: Suits against Public Trusts - Part I

Section 92 of the Code of Civil Procedure deals with suits in respect of public trusts. In order for Section 92 of the CPC to be applicable, the following conditions must be satisfied:

1. There is a trust created for public purposes of charitable or religious nature.

2. There is an alleged breach of such trust, or the direction of the Court is necessary for the administration of such trust.

3. The suit is instituted in accordance with the procedure and by the persons mentioned in the Section

4. The suit is representative in character, instituted on behalf of the public, for a vindication of the public interest and not merely a private interest. It is filed by the Advocate General or by two or more persons having an interest in the trust and having obtained the leave of the Court

Unless these requirements are strictly followed, the suit cannot be said to be one instituted under Section 92 (Syed Moinuddin v. Tamil Nadu Wakf Board, AIR 1998 Mad 129). Several issues may arise in this regard. There have been a couple of decisions on the interpretation of the Section in the past few weeks, primarily in relation to maintainability and jurisdiction. The Supreme Court has ruled on jurisdiction under Section 92 here in Sri Jeyaram Educational Trust; the Calcutta High Court has explained some of the locus standi requirements here in Mridula Sodhani.

Several other issues also arise – some of them settled; others still pending a conclusive answer. First, what must the Court consider in deciding whether to grant leave or not? Secondly, is the defendant entitled to being heard before leave is granted? Thirdly, assuming the defendant’s application to revoke leave is dismissed, does the defendant still have the right to move an application for rejection of the plaint? Fourthly, if the Court refuses leave but on appeal the appellate Court grants leave without hearing the defendant, can the defendant move a application before the Court of first instance to revoke leave? If not, what other remedy would the defendant have in such a case?

The question of what should be considered by the Court in deciding whether to grant leave is important because an answer to this question will determine whether or not the Court’s function is purely mechanical in this regard. The provision in this regard has been amended – earlier, leave of the Advocate General was required; now, leave of the Court is required. It has been held that the order granting or refusing leave must be a reasoned order (Gurdwara Prabandhak Committee v. Amarjit Singh, AIR 1984 Del 39). An appeal has been provided against such an order in Section 104(1)(ffa), CPC. All these factors indicate that the Court’s function is not purely a mechanical one but a judicial one. It is submitted that prior to deciding the question, the Court must look at whether the procedural requirements of the Section have at least prima facie been satisfied. This would involve looking at the question – at a prima facie level – of whether the conditions mentioned at the beginning of this post have been fulfilled. Once there is such prima facie fulfillment, leave must be granted.

Prior to the amendment, there existed a conflict between the High Courts as to whether the Advocate General’s functions in deciding whether to grant leave or not were purely administrative (Abu Backer v. Advocate General, AIR 1954 Tr&C 331; Shantanand v. Advocate General, AIR 1955 All 372). A Full Bench of the Kerala High Court finally held that the function was an administrative one and not a judicial one (A.K. Bhasker v. Advocate General, AIR 1962 Ker 90). It is submitted that the nature of the amendments – changing the required leave to that of the Court instead of that of the Advocate General) reveals that the process is intended to be a judicial one. No other reason would justify the amendment. The factors mentioned in the beginning of this paragraph support this view.

A learned author comments that the Court’s function is purely administrative and non-judicial, because there is no requirement that the defendant must be heard (Mulla, The Code of Civil Procedure, p. 983 [2001 edition]). It is submitted that the position of law is that ordinarily, the defendant must be heard. Only in exceptional situations will the Court be justified in proceeding without hearing the defendants (B.S. Adityan v. B. Adityan, (2004) 9 SCC 720). And in such cases also, it is open to the defendants to apply for revocation of leave (Chettiar v. Chettiar, AIR 1991 SC 221).Furthermore, the fact that in exceptional situations the defendant is not heard is not sufficient to conclude that the function is non-judicial in its entirety. Even in granting ad-interim injunctions, at times, a Court will do so ex-parte. That does not mean that the Court is not sitting as a judicial body. Accordingly, it is submitted that the function is a judicial one; although the Court will grant leave based on its prima facie satisfaction. As such, the Court is required to look at its prima facie satisfaction as to the establishment of the requirements of Section 92. “Prima facie” in this context would mean that the maintainability of a suit under the Section depends on the allegations in the plaint. Assuming that the allegations are true, would a case be established such that all the ingredients of the Section are met? That is the question which the Court is required to ask at this stage (Charan Singh v. Darshan Singh, AIR 1975 SC 371; Kabul Singh v. Ram Singh, AIR 1986 All 75). The logic behind this appears to be that a full-fledged trial would be necessary to check the veracity of the allegations. That is not possible at this stage, and would defeat the purposes of the Section. By adopting the test stated above, the Courts can weed out frivolous and vexatious claims, thereby carrying out the legislative mandate behind the Section. Thus, while Section 92 does not require issuance of notice to the defendants before granting leave, since proceedings for granting leave are judicial proceedings, it is ordinarily proper to pass orders after hearing the defendants. In other words, the order granting or refusing the leave should be reasoned order after giving opportunity to trustees to oppose it. However, this is not a hard and fast rule, as explained in by the Supreme Court (B.S. Adityan v. B. Adityan, (2004) 9 SCC 720):

“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.”

(To be continued in Part II)