Holding

Section 34 does not empower the court to grant directions for extinction of a trust or to enforce Section 83; the High Court correctly refused jurisdiction and the appeal is dismissed.

Summary

The case concerned a pension fund set up as a trust by Mis Dunlop India Ltd. After the beneficiaries had been paid, the trustees applied to the Calcutta High Court under Section 34 of the Indian Trusts Act seeking a direction on the surplus fund. The High Court refused to entertain the application, holding that Section 34 only allows the court to give opinion, advice or direction on the management or administration of trust property and not to order extinction of the trust or invoke Section 83. The Supreme Court affirmed this view, stating that the court cannot exceed the jurisdiction conferred by Section 34, that a question of extinction is a matter of importance and difficulty requiring a full suit, and that appellate courts should not interfere with a lower court’s refusal to exercise discretionary jurisdiction. Consequently, the appeal was dismissed. The Court also held that Article 142 could not be invoked in this context.

Issues considered

The applicability of Section 34 of the Indian Trusts Act, 1882 to the trustees' application for direction on the surplus trust fund.
Whether the High Court had jurisdiction to entertain the application and grant a direction under Section 34.
Whether Section 83 of the Indian Trusts Act could be invoked to return the surplus to the settlor.
Whether an appellate court can interfere with a lower court's refusal to exercise its discretionary jurisdiction under Section 34.
Whether Article 142 of the Constitution can be invoked to compel a direction for refund of the surplus.

Legislation cited

Companies Act, 1956s. 3(1)(ii)
Constitution of Indias. 142
Indian Succession Act, 1925s. 302
Indian Trusts Act, 1882s. 11, s. 34, s. 56, s. 77, s. 83
Sick Industrial Companies (Special Provisions) Act, 1985

Subjects

Indian Trusts ActSection 34Section 83trust extinctiondiscretionary jurisdictionsummary jurisdictionappellate jurisdictionArticle 142pension fundtrust propertyletters patent appealtrust deed interpretation

Judgment

-J ASH OK KUMAR KAPUR AND ORS A
v.
ASHOK KHANNA AND ORS

MARCH 13, 2007

[S.B. SINHA AND MARKANDEY KA TJU, JJ.) B

>
Indian Trusts Act, 1882; Ss. 34 and 83:
""'
Trust-Staff Pension Fund-Filing of suits by Managing Director and
others for realization of pension-Company filing an application under c
Section 34 of the Act for appropriate direction as the Trust has been completely
executed without exhaustion of Trust property-Dismissed by Single Judge
of the High Court-Letters Patent Appeal dismissed by Division Bench of the
High Court-On appeal, Held: Per Sinha, J: Jn terms ofprovision under S.
34 of the Act, jurisdiction of the Court not only confined to opinion or advice D
but also extends to issuance of direction-But the Court could not exercise
-} jurisdiction which is not vested in it-Advice/opinion/direction could be
made in respect of administration of the Trust-Summary jurisdiction would
not be exercised in the event exclusionary clause comes into operation-
Extinction of Trust and Interpretation of Trust deed are questions of importance
and matter of detail proceeding as these involve determination of liabilities E
of the Trustees -Since the question posed before the High Court was difficult
one, High Court was right in refusing to exercise its discretion-Since suits
for realization of pension are pending, it cannot be said that all the
beneficiaries of the Trust have been paid of-In the facts and circumstances
of the case, bonafide of trustees in moving an application under s. 34 for
- ~- directions in regard to the balance fund available with the Trust is suspect-
F
S. 83 of the Act not attracted since the Court in exercise of its discretionary
summary jurisdiction cannot conclusively determine the rights and obligation
of trustees vis-a-vis the State on the one hand and beneficiary thereof on the
other-No case has been made out for interference with the impugned
judgment-Moreover, when a Court refuses to exercise its discretionary G
::.I jurisdiction, an appellate Court shall not interfere therewith-Article 142 of
the Constitution of India in a case of this nature may not be invoked
particularly when the Court is exercising its appellate jurisdiction-
Constitution ofIndia, 1950-Article 142-0.fficial Trustees Act, 1930-/ndian
957 H
958 SUPREME COURT REPORTS [2007] 3 S. C.R.

A Succession Act, 1925-Section 302-Charitable and Religious Trusts Act,
1920-S. 7.

Per Markandey Katju, J.:

All the beneficiaries under the Trust have been paid off-Certain amount
B has been transferred to Life Insurance Corporation, balance amount
remaining with the Trust fund-It is required to be refimded to the company
in terms of Section 83 of the Act-Trust has been executed without exhaustion
of the funds-Section 34 of the Act not attracted as the object of the Trust ...
has been fulfilled and the only question left was about the use of remaining >-
C fimd with the Trust--Under the circumstances, a direction under Article 142
of the Constitution could be issued to the Trust to refund the balance fund
to the company.

In view of difference of opinion, the matter referred to larger Bench.

D Mis. Dunlop India Ltd. floated a Fund for providing pension and annuities
to the members of the executive management staff of the Company. The terms
of the deed were amended from time to time. Respondent No. 3, Managing
Director of the Company, has filed a suit for realization of an amount of pension
quantified at Rs.45 lacs and two other suits were filed by other members which
are pending in the Court. An application was filed by the trustees before the
E High Court purported to be under Section 34 of the Indian Trusts Act, alleging,
inter alia, that the purpose of the trust has been completely fulfilled and/or
trust has been completely executed without exhaustion of the trust fund and
praying for an appropriate direction and/or advise and/or opinion with regard
to the balance amount available with the Trust and accrued interest lying in
Special Deposit of the Life Insurance Corporation of India. In the said
F proceeding, only Respondent No.I was made a party in a representative
capacity. It was contended that out of 186 employees who were eligible to
receive pension fund, 140 employees consented that the surplus amount be
refunded to the Company. Single Judge of the High Court while holding that
the application under Section 34 of the Act was not maintainable, opined that
G the payment of pension was to be made not only to the existing members but
also to the widow and dependents in terms of the extant rules; that only because
in terms of the advertisement issued in two newspapers, consent of all the \.:
members could not be held to have been impliedly obtained because numerous
dependents had not appeared. Letters Patent Appeal filed by the Trustee was
dismissed by the Division Bench of the High Court Hence the present appeal.
H
ASHOK KUMAR KAPUR v. ASHOK KHANNA 959
-)
Appellants-Trustee contended that the power of the principal Civil Court A
of original jurisdiction being not only limited to opinion or advice, but also to
issue directions. Under the circumstances, the High Court wrongly refused
to exercise its jurisdiction; that the terminology 'detail, difficulty or
importance' contained in Section 34 of the Act refers to the power of the court
for summary disposal and not for exercising its discretionary jurisdiction; B
that the opinion, advice or direction if issued would be a judgment within the
meaning of Clause 15 of the Letters Patent of the Calcutta High Court and,
;
thus, a Letters Patent appeal would be maintainable; and that Respondent No.3
being not a member of the Fund had no locus standi to file the application
claiming pension from the fund.

Respondent No.3 submitted that Section 34 has a limited application
c
keeping in view the exclusionary clause contained in the expression "other
than questions of detail, difficulty or importance, not proper in the opinion of
the court for summary disposal" and, thus, the courts below rightly refused
to exercise their jurisdiction in the matter; and that the term 'opinion, advice
or direction' would not corifer a jurisdiction to finally decide the rights of the D
persons interested in the trust.

Referring the matter to larger Bench, the Court

HELD: Per S.B. Sinha, J.:
E
I.l. The jurisdiction of the court under Section 34 of the Indian Trust
Act, 1882 is confined to opinion, advice or direction. An application would be
maintainable on any present questions. Such questions must arise "respecting
the management or administration of the trust property". The questions
should not be of any 'detail, difficulty or importance or otherwise not proper
- ·r in the opinion of the court for summary disposal'. [Para 16) [971-D) F
1.2. If an opinion is rendered, or advice is given, or a direction is issued,
the same shall be deemed, so far the trustee is concerned, in regard to his
own responsibility to have discharged his duty as such trustee in the subject-
matter of the application. (Para 1711971-E) G
1.3. Such an application may be filed without instituting a suit but
maintainability of such an application would mainly depend upon the nature
and purport thereof. Merely an option has been conferred on a trustee to file
either a suit or to move the court for its opinion, advice or direction in terms
H
960 SUPREME COURT REPORTS [2007] 3 S.C.R.

A of Section 34 of the Act. Such an option can be exercised only when recourse \ .
to both the remedies are available. [Para 18) (971-G, HJ

1.4. The jurisdiction of the court is not only confined to opinion or advice
but also extends to issuance of direction, but such opinion rendered, or advice
given or direction issued only to a trustee. (Para 19) (972-AJ
B
1.5. It does not envisage an adjudication. It does not ordinarily envisage
determination of the right, title or interest of a member of the trust or a
beneficiary in relation to the trust property, although such a question may
•.
have to be incidentally dealt with. (Para 19) (972-B]

C 1.6. The provisions of Section 34 of the Act must be given its literal
meaning. The court cannot exercise a jurisdiction which is not vested in it.
A court can exercise jurisdiction, provided it is vested therewith. An order
without jurisdiction over the subject-matter would render the decision a nullity.
(Para 20] (972-C]
D
Official Trustee, West Bengal and Ors. v. Sachindra Nath Chatterjee and
Anr, (1969) 3 SCR 92: AIR (1969) SC 823, relied on.

2.1. The right of a member of a trust to receive pension poses a difficult
question. It may also pose a question of importance, keeping in view the fact
E that by reason thereof, the obligation of the trustee would come to an end. It
is one thing to say that an advice, opinion or direction can be made respecting
the administration of the trust; but what that means would evidently depend
upon the terms of the trust deed. (Para 23] (974-C]

2.2. Part II of the trust deed lays down the mode and manner in which
F the trust properties are to be administered. It does not lay down a right on
the part of the trustee to put an end his right to get himself discharged from
his obligation. If for some reason or the other, it is contended by the trustee
that the trust stands extinguished, any remedy in respect thereof must be
found within Chapter VIII of the Act and nototherwise. [Para 24) [974-01
G 3.1. It is for the Court concerned to arrive at an opinion as to whether
the questions posed are matters of detail, difficulty or importance. Summary ~
jurisdiction would not be exercised in the event the exclusionary clause comes
into operation. (Para 26) (974-Fl

H 3.2. Even if it is assumed that the application under Section 34 of the
ASHOK KUMAR KAPUR v. ASHOK KHANNA 961
- JI
Act was maintainable, the court, however, keeping in view the number of A
persons who would be entitled to oppose the prayer of extinction of trust, would
decline to exercise its jurisdiction. Interpretation of the trust deed
furthermore is a question of importance. It is also a matter of ddail in the
proceeding as to whether the trustees have been able to discharge their entire
liabilities. [Para 2711974-GI
B
3.3. The Division Bench of the High Court opined that the trust is an
' irrevocable one. It may or may not be correct; but the question posed admittedly
. ""- is a difficult one and if for the said purpose it had refused to exercise its
discretionary jurisdiction no fault can be found therewith. [Para 281 [975-A)

4.1. Three suits are pending. It is, thus, not correct to contend that all
c
the beneficiaries of the trust have been paid off. The power of the Company
to make rectification of the terms and conditions of the trust vis-a-vis the
power of the trustees to revoke the same with retrospective effect is a matter
which is pendin·g consideration in a court of law. No finai opinion can be
rendered in that behalf. !Para 30) (975-C) D
- )' 4.2. Bona fide of the trustees in moving such an application is suspect.
The trustees intended to pay a huge sum of Rs.20 crores to the Company for
its revival. Once it is revived, the employees who are existing would continue
and new employees may also be appointed. It is, therefore, difficult to
comprehend the stand of the trustees that as the Company had been declared E
sick by the Board of Industrial & Financial Reconstruction (BIFR), the same
would lead to an irresistible conclusion that no further employee would be
appointed. The contention of the trustees appears to be fallacious.
(Para -311 [975-E, Fl

- Y· 5.1. Submission that Section 83 is squarely attracted cannot be F
appreciated for more than one reason. Firstly, because it is a seriously
disputed question of fact. Secondly, the court exercising its summary
jurisdiction for the purpose of giving advice, opinion or direction cannot finally
determine the rights and obligations of the trustees vis-a-vis the State on the
one hand and the beneficiary thereof on the other. Thirdly, even if a few G
:I persons opposed extinction of the trust, the same itself should be treated to
be sufficient for the court to refuse to exercise its summary jurisdiction under
Section 34 of the Act. (Para 321 (975-H; 976-A, BJ

Hasan Bin Mubarak v. Chief Judge, City Civil Court, Hyderabad and
H
962 SUPREME COURT REPORTS [2007] 3 S.C.R.

A Ors., AIR (1999) AP 11 and Krishen Kumar Khosa v. Krishen Lal and Ors., '- .
AIR (1979) J&K 13, approved.

Prince Muffakham Jah Bahadur and Ors. v. H.E.H. Nawab Mir Barkat
Ali Khan Bahadur Prince Mukarram Jah and Others., AIR (1989) AP 68 and
Sahebzadi Amina Marzia v. Syed Mohd. Hussain and Ors., AIR (1981) AP
B 340, referred to.
Smt. Niiima Ghosh and Anr v. Prakriti Bhusan Mitter, AIR (1982) Cal.
14, distinguished.
)"

5.2. Whereas a direction to sell a portion of the trust property may be
C issued for the benefit of the trust as also the beneficiary thereof and not for
preserva~ion of the property, the same test cannot be applied for the purpose
of obtaining in truth and substance an order of extinction of the trust. The
two reliefs are absolutely different. No case has been made out by the appellant
for interference with the impugned judgment. [Paras 39, 40) [979-D, E)
D 6.1. It is well-settled that if the jurisdiction of a court in relation to the
subject-matter thereof is limited, any decision rendered by it would be a nullity.
In such an event, even the principle of res judicata will have no application. 1 -
[Para 41 J [979-FJ

E Official Trustee of West Bengal v. Stephen Court Ltd., (2006) 14 SCALE
285 and Harshad Chiman Lal Modi v. DLF Univesal Ltd. and Anr., [2005) 7
sec 791, referred to.
6.2. It is also well-settled that when a Court refuses to exercise its
discretionary jurisdiction, normally an appellate court shall not interfere
F therewith. [Para 43[ (980-B)

Manjunath Anandappa Ur/ Shivappa Hanasi v. Tammanasa and Ors.,
[2003) JO sec 390, relied on.

6.3Article142 of the Constitution of India in a case of this nature may
G not be invoked, particularly when this Court is exercising its appellate
jurisdiction. If the High Court had no jurisdiction to entertain the application
and in any event having regard to the fact that both the Single Judge as also
the Division Bench of the High Court had not exercised their discretionary
jurisdiction, it is not a case where jurisdiction under Article 142 of the
Constitution of India should be invoked particularly in view of the fact that
H
ASHOK KUMAR KAPUR v. ASHOK KHANNA 963
~
1

- the appellant is not remedilcss. It can file a suit. It can take recourse to A
other remedies which are available in law. (Para 44( (980-C(

Per Markandey Katju, J. :

I. I. All the beneficiaries under the Trust have been paid off and hence
the purpose has been completely fulfilled and executed without exhaustion of B
the funds of the Trust, except to the extent of Rs. 3,88,55,682.00, which amount
after one time payment has l)een transferred to the Life Insurance Corporation
>
of India. Consequently, the Trust has no further liability/responsibility
towards any of its beneficiaries. The balance sum remaining with the Trust
fund being Rs. 20,83,95,690.00 has therefore, to be returned to the Company C
in view of Section 83 of the Indian Trust Act. After all, the entire money
donated to the Trust fund was donated by the Company and hence it has to be
returned to the Company. [Para 6( (980-H; 981-A, B, C)

1.2. Section 34 of the Act may not be strictly applicable in the present
case because that provision enables the principal Civil Court of original D
jurisdiction to give an opinion, advice or direction on any present questions
respecting the management or administration of the trust property. The words
'management or administration of the trust property' would not apply when
the object of the Trust itself has been fulfilled and now the only question
remains is as to what has to be done about the remaining fund with the Trust
In such a case, a direction should be issued under Article 142 of the E
Constitution of India to refund the balance money lying with the Trust to the
Company which had donated the funds to the Trust. Such a direction should
be given in view of Section 83 of the Act, and also because the money can now
only go back to the Company since all the beneficiaries have been paid off.
Any other view would be unreasonable because the balance amount lying with F
the Trust cannot obviously remain idle. To direct the Company to file a suit
for this purpose would only cause further delay and multiplicity of
proceedings. (Para 7( (981-D, E, Fl

- 1.3. The Settler (the Company) is admittedly facing severe financial
crisis having become sick and proceedings are pending for its revival before
the appellate authority for financial reconstruction. Hence, it would be
appropriate if the funds are returned to the Company as it may help revive
the Company. (Para 8( [981-G(
G

1.4. Under the Rules of the Fund, 186 members and/or beneficiaries
would be entitled to receive a sum of Rs. 3,88,55,682.00, as calculated by the H
964 SUPREME COURT REPORTS [2007] 3 S.C.R.

A LIC, applying the mode of 'Actuarial Valuation', and the same is also \, .
undisputed by any of the beneficiaries. (Para 1111982-C]

1.5. In accordance with the valuation carried out by the LIC, the
appellants, out of the funds lying in the Special Deposit Account with the United
Bank of India transferred a sum of Rs. 3,88,55,682.00 to the LIC and took
B out policies in favour of the present members and/or beneficiaries of the Fund
w.e.f. 01.4.2001. As a result, full provision has been made for the payment
required to be made under the Rules of the Fund to its present members and
/or beneficiaries, upon superannuation, and it is again undisputed that as and ;.

when the respective members become eligible for the pension, the same will
c be paid by the LIC to the members/pensioner directly and the Fundffrust in
no way will be responsible or accountable for the same. [Para 12) [982-D, E)

2. Three persons who filed Suit retired betwee!J 1994-97 and as on date
are getting their pension from the LIC. Thus, the interest of every beneficiary
under the Trust has been taken care of and annuities have been purchased by
D the Trust in the names of the beneficiaries as per the valuation carried out by
the LIC and in terms of the pensionary benefits to be received by the concerned
beneficiary. Therefore, there is no employee/beneficiary left who is entitled ~ -
to get any pension out of the Trust in issue, which material fact has been
ignored by the courts below. Therefore, the appeal deserves to be allowed and
the money lying with the Trust fund should be directed to be returned to the
E. Company forthwith. (Para 181 (983-F, GI

CIVIL APPELLATE JURISDICTION: Civil Appeal No. 1320 of2007.

From the Judgment and Order dated 06.02.2006 of the High Court at
p Calcutta in APOT No. 584 of 2005 in APO No. 508 of2005.

R.F. Nariman, U.U.Lalit, C. Kukund, Ashok Jain, Pankaj Jain and Bijoy
""' -
Kumar Jain for the Appellants.

Ranjit Kumar, Rakesh Dwivedi, Senthil Jagadeesan, Swati Sinha, Jayasree
G Singh (for Fox Manda! & Co.) Shashank Sharma, Dr. Kailash Chand and Anu
Gupta for the Respondents.

The Judgment of the Court was delivered by

S.B. SINHA, J. I. Leave granted.
H
ASHOK KUMAR KAPUR v. ASHOK KHANNA [S.B. SINHA, J.] 965
- _, INTRODUCTION. A
2. Interpretation of Section 34 of the Indian Trusts Act, 1882 (for short,
'the Act') is involved in this appeal which arises out of a judgment and order
dated 06.02.2006 passed by a Division Bench of the Calcutta High Court in
APOT No. 584 of 2005, affirming a judgment and order of a learned Single
Judge of the said Court. B
BACKGROUND FACTS:

3. Mis Dunlop India Ltd. (for short, 'the Company') is an existing
company within the meaning of Section 3(1 )(ii) of the Companies Act, 1956.
The Company floated a Fund known as 'Dunlop Executive Staff Pension Fund' C
for providing pension and annuities to the members of the executive
management staff of the Company. Clause (3) of the said deed reads as
under:

"These presents shall constitute a trust upon and subject to the
Rules and to the law for the time being in force in India relating to D
Pension Funds which trust irrevocable and no moneys belonging to
the Fund in hand of the trustees shall be recoverable by the Company
or shall the Company have any lien or charge of any description on
the same."

4. Part I of the said deed provides for the 'Rules of Dunlop Executive
E
Staff Pension Fund.

"Member" has been defined in Rule 2(k) to mean :

"Member" shall mean a member of the executive staff or of the
management staff of the employers who has been admitted as a F
member of the Fund in accordance with the Rules but shall not include
an employee who having been admitted as a member has subsequently
retired or whose service has otherwise been terminated by reason of
dismissal, resignation, retrenchment or otherwise."
G
5. Part-II of the said deed provides for administration of the Trust.
Whereas part III provides for membership, part IV provides for contributions.
Rule I !(a) of the said deed reads as under :

"The employers may at their absolute discretion pay to the trustees
in respect of each member an initial contribution of such sum and in H
966 SUPREME COURT REPORTS (2007) 3 S.C.R.

A such instalments as they may think fit in respect of the past services
of a member subject to the provision of Rule 88 of the Income Tax
Rules, 1962 and to any condition that the Central Board of Direct
Taxes may think fit to specify in that regard."

6. The terms of said deed were amended from time to time. Although
B in terms of the original deed a member would have been entitled to pension
on completion often years' of service, Rule 14(b) (iii) was introduced in terms
whereof the eligibility period was reduced to two years. The said provision •
reads as under : )o

"l 4(b) (iii) In case of whole time Directors, Senior Vice Presidents and
c Vice Presidents who retire at or after attaining the normal age of
retirement or on completion of the stipulated period of service/contract,
a pension shall be payable calculated as per rules l 4(a). The pension
so calculated shall not however be less than 50% of his last drawn
salary nor shall it exceed 100% of such salary PROVIDED that in the
event of early separation from the services of the Company, a pension
D
may be granted at the sole discretion of the Company calculated at
such rate as may be decided by the Company."

Provided furth1~r in the event of such employee leaving the service of
the Company after completion of two years of service with mutual
E consent and does not have any adverse records of his performance
shall be paid a monthly pension which shall be not Jess than 50% of
his last drawn salary nor shall it exceed 100% of such salary."

7. The said amendment was made with retrospective effect. However,
it was sought to be deleted by a deed of variation dated 25.09.2000 from
F 01.04.1997, which again in terms of another deed of variation dated 28.03.2001 ·'"(_ -
was sought to be given a retrospective effect from 01.04.1995.

8. Respondent No. 3 herein was the Managing Director of the Company.
Admittedly, he has filed a suit for realization of an amount of pension quantified
at Rs.45 lacs. Two other suits by two other members of the Fund are also
G admittedly pending.

9. The Company became sick. It was declared as such by the Board
of Industrial Financial Reconstruction on or about 22.01.1988.

10. Allegedly, three other funds were created by the Company in the
H year 200 I, known as (i) 'Dunlop Administrative Executive Staff Pension Fund',
ASH OK KUMAR KAPUR v. ASHOK KHANNA [S.B. SINHA, J.] 967
(ii) 'Dunlop Sahagunj Executive Staff Pension Fund', and (iii) Dunlop Ambattur A
Executive Staff Pension Fund'. The details whereof or the purpose for which
the same were constituted is not known.

PROCEEDINGS:

11. An application was filed by the trustees of the said trust before the B
High Court of Calcutta purported to be under Section 34 of the Act, alleging,
inter alia, that the purpose of the trust has been completely fulfilled and/or
trust has been completely executed without exhaustion of the trust property
"" to the extent ofRs.3,99,55,682/-. In the said application, inter alia, the following
prayer was made :
c
"(a) Appropriate direction and/or advise and/or opinion be given by
this Hon'ble Court with regard to the sum of Rs. 20,83,95,690/-
and accrued interest lying in Special Deposit Account No. 31
76."
12. In the said proceeding, only Respondent No. I herein was made a D
party in a representative capacity. It was contended that out of 186 employees

- . who were eligible to receive pension fund, 140 employees consented that the
surplus amount be refunded to the Company. In the said proceeding, an
application seeking leave was filed under Order I Rule 8 of the Code of Civil
Procedure, which was allowed by an order dated 19. I 0.200 I. Respondent
No.3 herein filed an application for getting himself imp leaded as a party which E
was allowed. By a judgment and order dated 23.12.2004, a learned Single
Judge of the Calcutta High Court while holding that the said application
under Section 34 of the Act was maintainable, opined that the payment of
pension was to be made not only to the existing members but also to the
widow and dependents in terms of the extant rules. It was held that only F
-- 'r" because in terms of the advertisement issued in two newspapers, namely, a
Bengali Daily - 'Aaj Kai' and an English Daily - 'Financial Express', consent
of all the members could not be held to have been impliedly obtained only
because numerous dependents had not appeared. Inter alia, on the
aforementioned premise, the application was dismissed.
G
13. On an intra-court appeal, a Division Bench of the said Court by
reason of the impugned judgment although opining that a Letters Patent
appeal was not maintainable, went into the merit of the matter and dismissed
the same, holding :

"After analysing those clauses in our opinion, the trust shall be H
968 SUPREME COURT REPORTS [2007] 3 S.C.R.

A irrevocable one and no moneys belonging to the funds in the hands
of the trustees shall be recoverable by the company nor shall the
company have any lien or charge of any description to the same.
Therefore, we are sure that the purpose of the trust exists and/or
remains valid until the last surviving employees receive its benefit out
of the trust fund and furthermore, under Clause 3 of the said Trust
B Deed funds lying in the hands of the said trustees are not coverable
by the company nor the company shall have any lien or charge of any
description on the said trust fund. Therefore, we do not have any
hesitation to hold that no opinion can be expressed by the Court that
the amount so lying in the hands of the trustees can be recoverable
c by the company or may be transferred in any manner to the company.
Therefore, we are not in a position to accept the contention of Mr.
Sarkar that during the financial stringency they shall have the right
to utilize the said fund and the amount lying in the said trust fund can
be transferred to the company for meeting its liabilities. After
scrutinizing the Clauses of the said Trust Deed we have come to the
D conclusion that the purpose of the trust exists and remains valid until
the last surviving employees receive its benefits out of the said trust
fund. We do not have any hesitation also to express our opinion as
His Lordship expressed in His Lordship's decision that the trust exists
and we also have to accept the contention of Learned counsel
E appearing on behalf of the respondent in the instant case that the
instance case is squarely covered under the Illustration (b) of Section
56 of the Indian Trust Act and the trustees are bound to fulfil the
purpose of the trust and to obey the directors of the author of the
trust, except if any modification is made by consent of all the
beneficiaries, being competent to contact. It appears to us that in
F the guise of getting an opinion from the court, the company thought
it fit to extinguish the trust in question and the amount lying in the
hands of the trustees in respect of the said fund to have a lien over
the same to utilize the same which is totally barred under Clause 3 of
the said Trust Deed ... "
G SUBMISSIONS :

14. Mr.R.F. Nariman, the learned Senior Counsel appearing on behalf of
the appellants, principally raised the following contentions in support of this
appeal :
H
ASHOK KUMAR KAPUR v. ASHOK KHANNA [S.B. SINHA, J.] 969
(i) The power of the principal Civil Court of original jurisdiction A
being not only limited to opinion or advice, but also to iss.ue
directions, the High Court wrongly refused to exercise its
jurisdiction, although Section 83 of the Act was squarely
attracted.

(ii) The expression 'principal Civil Court of original jurisdiction' B
contained in Section 34 would also attract the principles of res
judicata.

... (iii) Such direction can be issued, inter alia, in tenns of Section 83
of the Act, as it would come within the purview of the tenn
'administration of trust property'; c
(iv) The tenninology 'detail, difficulty or importance' contained in
Section 34 of the Act refers to the power of the court for
summary disposal and not for exercising its discretionary
jurisdiction of the court.

(v) Such opinion, advice or direction if issued would be a judgment D
within the meaning of Clause 15 of the Letters Patent of the
Calcutta High Court and, thus, a Letters Patent appeal would be
maintainable.

(vi) Respondent No.3 being not a member of the Fund had no locus
standi to main the application. E
Mr. Rakesh Dwivedi, the learned Senior Counsel appearing on behalf of
Respondent No.3, on the other hand, would .submit :

(i) Operation of Section 34 being related to the 'management' or
'administration' of the trust property; matters which come within p
·- r· the purview of extinction of the trust as contained in Chapters
VIII of the Act, would not come with the purview thereof.

(ii) Section 34 has a limited application keeping in view the
exclusionary clause contained in the expression "other than
questions of detail, difficulty or importance, not proper in the G
opinion of the court for summary disposal" and, thus, the courts
below rightly refused to exercise their jurisdiction in the matter.
(iii) The learned Single Judge as also the Division Bench of the High
Court having found difficulties in the matter as also in view of
the importance of the question having refused to exercise the H
970 SUPREME COURT REPORTS [2007] 3 S. C.R.

A discretionary jurisdiction, this Court should not interfere \.-.·
therewith.
(iv) The term 'opinion, advice or direction' would not confer a
jurisdiction to finally decide the rights of the persons interested
in the trust.
B RELEVANT STATUTORY PROVISIONS

15. Sections 11, 56, 77 and 83, which are relevant for the purpose of this
appeal, read as under :

"I I. Trustee to· execute trust.- The trustees is bound to fulfil the
C purpose of the trust, and to obey the directions of the author of the
trust given at the time of its creation, except as modified by the
consent of all the beneficiaries being competent to contract.

Where the beneficiary is incompetent to contract, his consent may, for
the purposes of this section, be given by a principal civil court of
D original jurisdiction.

Nothing in this section shall be deemed to require a trustee to obey
any direction when to do so would be impracticable, illegal or manifestly
injurious to the beneficiaries.
Explanation. - Unless a contrary intention be expressed, the purpose
E of a trust for the payment of debts shall be deemed to be (a) to pay
only the debts of the author of the trust existing and recoverable at
the date of the instrument of trust, or, when such instrument is a will,
at the date of his death, and (b) in the case of debts not bearing
interest, to make such payment without interest."
F '56. Right to specific execution. - The beneficiary is entitled to have
the intention of the author of the trust specifically executed to the
extent of the beneficiary's interests.
Right to transfer of possession. - And, where there is only one
beneficiary and he is competent to contract, or where there are several
G beneficiaries and they are competent to contract and all of one mind,
he or they may require the trustee to transfer the trust-property to him
or them or to such person as he or they may direct.

When property has been transferred to bequeathed for the benefit of
a married woman, so that she shall not have power to deprive herself
H
ASHOK KUMAR KAPUR v. ASHOK KHANNA [S.B. SINHA, J.] 971
of her beneficial interest, nothing in the second clause of this section A
applies to such property during her marriage."

"77.-Trust how extinguished - A trust is extinguished -

(a) When its purpose is completely fulfilled; or

(b) When its purpose becomes unlawful; or B
(c) When the fulfillment of its purpose becomes impossible by
destruction of the trust-property or otherwise; or

(d) When the trust, being revocable, is expressly revoked."

83. Trust incapable of execution or executed without exhausting
c
trust-property. - Where a trust is incapable of being executed, or
where the trust is completely executed without exhausting the trust-
property, the trustee, in the absence of a direction to the contrary,
must hold the trust-property, or so much thereof as is unexhausted,
for the benefit of the author of the trust or his legal representative." D
APPLICATION OF LAW:

16. The jurisdiction of the court under Section 34 admittedly is confined
to opinion, advice or direction. An application would be maintainable on any
present questions. Such questions must arise "respecting the management E
or administration of the trust property". The questions should not be of any
'detail, difficulty or importance or otherwise not proper in the opinion of the
court for summary disposal'.

17. Copy of the application must be served upon the persons interested
in the application. If an opinion is rendered, or advice is given, or a direction F
is issued, the same shall be deemed, so far the trustee is concerned, in regard
to his own responsibility to have discharged his duty as such trustee in the
subject-matter of the application.

18. It may be that such an application may be filed withou! instituting
a suit but maintainability of such an application would mainly depend upon G
the nature and purport thereof. Merely an option has been conferred on a
trustee to file either a suit or to move the court for its opinion, advice or
direction in terms of Section 34 of the Act. Such an option can be exercised
only when recourse to both the remedies are available.
H
972 SUPREME COURT REPORTS [2007] 3 S.C.R.

A 19. We may proceed on the basis that the jurisdiction of the court is
not only confined to opinion or advice but also extends to issuance of
direction, but such opinion rendered, or advice given or direction issued only
to a trustee. Consequence of issuance of such a direction is also stated in
paragraph 3 of Section 34 in terms whereof a legal fiction is created by reason
B whereof the trustee would be deemed to have discharged his obligation in
regard to his own responsibility in the subject-matter of the application. It
does not envisage an adjudication. It does not ordinarily envisage determination
of the right, title or interest of a member of the trust or a beneficiary in relation
to the trust property, although such a question may have to be incidentally
dealt with.
c 20. The provisions of Section 34 of the Act must be given its literal
meaning. The court cannot exercise a jurisdiction which is not vested in it.
A court can exercise jurisdiction, provided it is vested therewith. An order
without jurisdiction over the subject-matter would render the decision a
nullity.
D
21. Construction of the aforementioned provision which is in pari materia
with Section 10(1) of the Official Trustees Act, 1930 came up for consideration
before this Court in Official Trustee, West Bengal and Ors. v. Sachindra Nath
Chatterjee and Anr., [1969] 3 SCR 92: AIR (1969) SC 823. Therein, it was
clearly held that in terms of Section 33 of the Act, the rate of interest cannot
E be directed to be altered, stating :

"21. It was then said that the order in question could have been made
by Ramfry, J., in the exercise of his inherent powers as a Judge sitting
on the original side of the Calcutta High Court. It was argued that
a Judge sitting on the original side of the High Court of Judicature
F at Calcutta has all the powers of a Chancery Judge in England as that
power has betm conferred on him by the Letters Patent granted to that
High Court. We shall assume it to be so. We may note that the settler
did not invoke the inherent jurisdiction of the High Court nor did the
Judge purport to exercise that power. But, still, that cannot invalidate
G the order made if the Court had the inherent jurisdiction to make that
order. Hence the real question is had he that inherent jurisdiction?
Chapter XIII of the Calcutta High Court Rules prescribes what orders
can be obtained in an originating summons proceedings. The
jurisdiction of the Judge acting under that Chapter is a summary
jurisdiction. Rule I of that Chapter empowers the Judge to entertain
H
ASHOK KUMAR KAPUR v. ASHOK KHANNA [S.B. SINHA,.:.] 973

__, an application in respect of matters enumerated in clauses (a) to (g) A
of that rule. Admittedly clauses (a), (b), (f) and (g) are not relevant
for our present purpose. Under clause (c) the Court could only decide
about furnishing of any particular accounts by trustees and vouching
(where necessary) of such accounts. Under cl. (c) it could direct the
trustees to pay into Court any monies in his hands and under clause B
(e) direct him to file an account and vouch the same to do or abstain
from doing any particular act in his character as a trustee. The orders
under Chapter XIII are made in chambers. As mentioned earlier the
>
proceedings under that Chapter are summary proceedings. No rule in
that Chapter was brought to our notice under which the order in
question could have been made. C
xxx xxx xxx
25. It will be noticed that the powers given under those four heads
are those relating to management and administration of trust property.
That power is similar to the power conferred in Courts by Sec. 34 of D
the Trusts Act and S. 43 of the Trustees and Mortgagees Powers Act,
1866. In fact in this country we have condified the very powers that
were exercised by the Chancery Courts in England under their equitable
jurisdiction. The Court of Appeal in Chapman's case, 1953-1 Ch 218
Evershed M.R. and Romer. JJ., Denning L. J. dissenting stated the law
on the point thus: E
The inherent jurisdiction of the Court of Chancery is of a limited
character. It is a jurisdiction to confer upon the trustee, quoad items
of trust property vested in them, administrative powers to be exercised
by them where a situation has arisen in regard to the property creating
what may be fairly called an "emergency". The inherent jurisdiction F
does not extend to sanctioning generally the modification or remoulding
of the beneficial trusts of a settlement.

xxx xxx xxx
27. From whatever angle we may examine the validity of the order G
made by Ramfry, J., it appears clear to us, that the said order was
outside the jurisdiction of the learned Judge. It was not merely a
wrong order, or an illegal order, it was an order which he had no
competence to make. It is not merely an order that he should have not
passed but it is an order that he could not have passed and therefore
H
974 SUPREME COURT REPORTS (2007] 3 S.C.R.

A a void order."
'>. -
22. Section 34 occurs in Chapter IV titled "Of the rights and powers of
trustees" beginning from Section 31 relating to 'right to title deed' to Section
45 relating to "Suspension of trustee's posers by decree'. Chapter VIII, on
the other hand, provides for extinction of trusts. Chapter IX relates to matters
B pertaining to certain obligations in the nature of trusts.

23. The right of a member of a trust to receive pension poses a difficult
question. It may also pose a question of importance, keeping in view the
fact that by reason thereof, the obligation of the trustee would come to an
C end. It is one thing to say that an advice, opinion or direction can be made
respecting the administration of the trust; but what that means would evidently
depend upon the terms of the trust deed.

24. We have noticed hereinbefore that Part II of the trust deed lays
down the mode and manner in which the trust properties are to be administered.
D It does not lay down a right on the part of the trustee to put an end his right
to get himself discharged from his obligation. If for some reason or the other,
it is contended by the trustee that the trust stand extinguished, any remedy
in respect thereof must be found within Chapter VIII of the Act and not
otherwise.

E 25. Similar provisions exist in the Official Trustees Act, 1930, Section
302 of the Indian Succession Act, 1925 and Section 7 of the Charitable and
Religious Trusts Act, 1920.

26. The courts of India have all along held that their jurisdiction, in this
behalf, is limited. In any event, it is for the court concerned to arrive at an
F opinion as to whether the questions posed are matters of detail, difficulty or
importance. Summary jurisdiction would not be exercised in the event the '"'( ,.
exclusionary clause comes into operation.

27. We will assume for the time being that the application under Section
34 of the Act was maintainable. Tlie court, however, keeping in view the
G number of persons who would be entitled to oppose the prayer of extinction
of trust, would decline to exercise its jurisdiction. Interpretation of the trust
deed furthermore is a question of importance. It is also a matter of detail in .("
the proceeding as to whether the trustees have been able to discharge their
entire liabilities.
H
ASHOK KUMAR KAPUR v. ASHOK KHANNA [S.B. SINHA. J.] 975

28. The Division Bench of the High Court, as noticed hereinbefore, A
opined that the trust is an irrevocable one. It may or may not be correct; but
the question posed admittedly is a difficult one and if for the said purpose
it had refused to exercise its discretionary jurisdiction, in our opinion, no fault
can be found therewith.

29. We have also some difficulty in appreciating the submissions of Mr. B
Nariman that all the members of the trust must be deemed to have consented
• to the extinction of the trust on the ground that the purpose of the trust had
.. been fulfilled.

30. Admittedly, three suits are pending. It is, thus, not correct to contend C
that all the beneficiaries of the trust have been paid off. The power of the
Company to make rectification of the terms and conditions of the trust vis-
it-vis the power of the trustees to revoke the same with retrospective effect
is a matter which is pending consideration in a court of law. No final opinion
can be rendered in that behalf.
D
31. If the terms and conditions of the trust are to remain in operation
• t in view of clause 3 of the Deed of Trust, it is really difficult for us to
comprehend as to why three more trusts were created. The purpose for which
the same had been created and the trustees had been asked by the Company
to pay back the balance amount to the Company for its rehabilitation is a tell
tale one. Bona fide of the trustees in moving such an application is suspect E
The trustees intended to pay a huge sum of Rs.20 crores to the Company for
its revival. Once it is revived, the employees who are existing would continue
and new employees may also be appointed. It is, therefore, difficult for us
to comprehend the stand of the trustees that as the Company had been
declared sick by the BIFR, the same would lead to an irresistible conclusion F
that no further employee would be appointed. The contention of the trustees
appears to be fallacious. Once the Company had taken recourse to the
provisions of the Sick Industrial Companies (Special Provisions) Act, 1985, an
operating agency must have been appointed and even without aid and
assistance of all the trustees scheme(s) might have been framed by the
operating agency for revival of the Company. How and in what manner the G
BIFR or for that matter AIFR intended to proceed the matter is one which falls
within the jurisdiction of the authorities created under the SICA. The Civil
Court will have no say in the matter.

32. Submission of the learned counsel that in this case Section 83 is
squarely attracted cannot be appreciated for more than one reason. Firstly, H
976 SUPREME COURT REPORTS [2007) 3 S.C.R.

A because it is a seriously disputed question of fact. Secondly, the court >- -
exercising its summary jurisdiction for the purpose of giving advice, opinion
or direction cannot finally determine the rights and obligations of the trustees
vis-a-vis the State on the one hand and the beneficiary thereof on the other.
Thirdly, even if a few persons opposed extinction of the trust, the same itself
should be treated to be sufficient for the court to refuse to exercise its
B summary jurisdiction under Section 34 of the Act.

33. Strong reliance has been placed by Mr. Nariman on Prince Muffakham
Jah Bahadur and Ors v. H.E.H. Nawab Mir Barkat Ali Khan Bahadur Prince
Mukarram Jah and Ors., AIR (I 989) AP 68. Therein, a Division Bench of
C the Andhra Pradesh High Court categorically held that there was no
opposition. It was found as of fact that the First Respondent would stand
to gain if the trust is dissolved which would be beneficial to all the trustees.
The court was in the fact situation obtaining therein was not required to go
into the question of maintainability of the application under Section 34 of the
Act. It is, however, interesting to note that in Para 15, it was noticed :
D
"At Page 514 ofUnderhill's Law of Trusts Trustee, Twelfth Edition, Art.
68 runs as follows :-

"If there is only one beneficiary, or ifthere are several (whether
entitled concurrently or successively) and they are all of one
E mind, and he or they are not under any disability (a), the specific
performance of the trust may be arrested, and the rust modified
or extinguished by him or them without reference to the wishes
of the settler or the trustee."

We think that approval and arrangement is a matter of judicial discretion
F depending upon the facts of each case. The Court must be satified
that each beneficiary is getting a substantial advantage. We do not
think that there can be any objection for an arrangement when its
object is to avoid fiscal burden."

34. The Andhra Pradesh High Court categorically opined that whether
G approval and arrangement should be granted or not is a matter of judicial
discretion depending upon the facts of each case and the court must be
satisfied that each beneficiary is getting a substantial advantage.
Unfortunately, attention of the High Court was not drawn to this Court's
decision in Sachindra Nath Chatterjee (supra). It is, therefore, not an
H authority for the proposition that such a direction can be issued in all
ASHOK KUMAR KAPUR v. ASHOK KHANNA [S.B. SINHA. J.] 977

situations. A
35. Reliance has also been placed on Sahebzadi Amina Marzia v. Syed
Mohd. Hussain and Ors., AIR (I 981) AP 340, wherein a direction was issued
to sell a portion of the property, having regard to the wealth tax liability which
could not be made otherwise. The same was found to be in the interest of
the beneficiaries as the said jewelleries were not to be of much use. B
36. We may, however, notice that in Hasan Bin Mubarak v. Chief Judge,
City Civil Court, Hyderabad and Ors., AIR (1999) AP 11, the same High
Court held :

" ... Section 34 of the Act contemplates only a summary disposal on C
non-controversial issues. The mental condition of a person being an
important personal problem, the Court cannot dispose of the same in
a summary manner. What the Court below has done was to examine
3rd respondent, who is alleged to be an insane person and give the
opinion on the basis of her statement. Though Ex.R-1, certificate, D
alleged to have been given by a psychiatrist, was marked, the Court
made no effort to examine the said doctor. Obviously, this could not
have been done because the matter has to be disposed of in a
summary manner. Thus, it is evident that the advice that was sought
for by the trustee required a determination on contentious facts and
the jurisdiction of the Court under section 34 being only in the nature E
of giving guidelines or directions without entering into the merits, the
application ought not to have been entertained by the Court. The
trustee might have got a valid and satisfactory opinion had he
approached a qualified medical man or the Court in a properly instituted
suit.
F
- r 23. In Avoch Thevar case (supra) following the decision in Armugan
Chetty v. Raja Jagaveera ILR 28 Madras 444, it was clearly held that
while providing the trustees a right to apply to the Court for opinion
to the Management and the Members, Section 34 embodied at the
same time, a limitation governing the questions to be asked viz. that G
there should not be hypothetical and any questions of details or
difficulty or importance, not proper in the opinion of the Court for
summary disposal. None of the passages quoted or citations relied
upon by the learned counsel for the respondents came to his
assistance."
H
978 SUPREME COURT REPORTS (2007] 3 S.C.R.

A 37. Yet again in Krishen Kumar Khosa v. Krishen Lal and Ors., AIR ) .
(1979) J&K 13, it was held :

"From a bare perusal of the petition it becomes obvious that the
petitioner is not in possession of the Trust property but is desirous
of getting himself declared a trustee in opposition to respondent No.
B I who according to him, has usurped his functions to which he was
entitled to under the Guru Jeer's alleged will. Obviously the petition
was not for seeking any advice, opinion or direction from the court.
It raised questions of difficulty detail and of importance which not be
disposed of in summary proceedings as one at hand. Mr. Gupta has
vehemently argued that he was entitled to seek the direction from the
c court which would according to him include even a declaration to the
effect that it was in fact the petitioner who was the trustee and not
respondent No. I. He has cited some authorities such as AIR 1953
Nag 89 (FB), AIR 1965 SC 342, and AIR 1966 SC 81 in support of his
contention that the expression "direction" means and includes an
D order of the court and does not merely mean an advice or opinion. On
a perusal of these judgments I am however, of the view that the
expression 'direction' as used in the Trusts Act has entirely a different
meaning than the meaning that may have been given to it in various
other enactments discussed in the above said judgments. Though
Mr. Gupta has remarked the interpretation laid down on the expression
E "opinion, advice, and direction" appearing in S. 34 of the Trusts Act
in Muhmmad Hashim Gazdar, AIR 1945 Sind 81 (FB) and AIR 1934
Oudh 118 (2) being the interpretation laid down long ago and therefore
not applicable to the situation prevailing in 1978, yet I am of the view
that the meaning of the expression used in Sec. 34 of the Trusts Act
F having been directly at issue in the said judgments, the interpretation
placed in the said judgments, on this expression was not only
appropriate and correct at the time of the passing of the said judgments
but still continue to be the only interpretation that may possibly be
given. In AIR 1945 Sind 81 (supra) it has been laid down as follows:

G "The words "opinion, advice or direction" in Sec. 34 Trusts Act,
must be read together as meaning nothing more than guidance.
Under S. 34 the Court exercised what may be called its
consultative jurisdiction, giving guidance to a trustee who
presumably asks for it, because he wants it and intends to follow

H
ASHOK KUMAR KAPUR v. ASHOK KHANNA fS.B. SINHA . .I.] 979

it, Section 34 is intended to enable a trustee to obtain the Court's A
guidance in suitable matters for his protection. The advice,
opinion or direction given under Sec. 34 is not an order binding
on parties and disobedience to it does not involve committal for
contempt.. .. "

38. Strong reliance has been place on Smt. Nilima Ghosh and Anr .v. B
Prakriti Bhusan Mitter, AIR ( 1982) Cal. 14, wherein it was categorically held
that when an application was filed under Section 90 of the Code of Civil
Procedure, the court would be justified in refusing to answer the question
as the matter should have been referred to court specified in Section 34 of
the Act, stating the said decision was rendered, inter alia, on the premise that C
the court of principal Civil Court is a court of superior jurisdiction to that of
a Subordinate Judge. We need not pronounce on the correctness or otherwise
of the said decision; but we may notice that such observations were made
having regard to the development and preservation of the trust property in
question and not for any other purpose.
D
39. Whereas a direction to sell a portion of the trust property may be
issued for the benefit of the trust as also the beneficiary thereof and not for
preservation of the property, in our opinion, the same test cannot be applied
for the purpose of obtaining in truth and substance an order of extinction of
the trust. The two reliefs are absolutely different.
E
40. We, therefore, are of the opinion that no case has been made out
for our interference with the impugned judgment. We need not make our
comments with regard to the maintainability of the Letters Patent appeal, as
Mr. Dwivedi conceded that such an appeal would be maintainable.

41. It is well-settled that if the jurisdiction of a court in relation to the F
subject-matter thereof is limited, any decision rendered by it would be a
nullity. In such an event, even the principle of res judicata will have no
application See Official Trustee of West Bengal v. Stephen Court Ltd. (2006]
14 SCALE 285, and Harshad Chiman Lal Modi v. DLF Univesal Ltd and
Another., (2005] 7 sec 791. G
~ 42. It is interesting to note that in Sachindra Nath Chatterjee (supra),
Hegde, J. was clearly of the opinion that where the relief cannot be granted
keeping in view the limited jurisdiction of the court, in relation thereto the
court will have no jurisdiction. But it is of some significance that the
jurisdiction of the court must be determined in a case of this nature having H
980 SUPREME COURT REPORTS (2007] 3 S.C.R.

A to the purport and object for which such jurisdiction is conferred. A wider ). .
jurisdiction thereunder is not contemplated.

43. It is also well-settled that when a court refuses to exercise its
discretionary jurisdiction, normally an appellate court shall not interfere
therewith. [See Manjunath Anandappa Ur/Shivappa Hanasi v. Tammanasa
B and Ors., [2003] 10 SCC 390.

44. Article 142 of the Constitution of India in a case of this nature may
not be invoked, particularly when this Court is exercising its appellate
jurisdiction. If the High Court had no jurisdiction to entertain the application
C and in any event having regard to the fact that both the learned Single Judge
as also the Division Bench of the High Court had not exercised their
discretionary jurisdiction, in my opinion, it is not a case where jurisdiction
under Article 142 of the Constitution of India should be invoked particularly
in view of the fact that the appellant is not remediless. It can file a suit. It
can take recourse to other remedies which are available in law.
D
45. The appeal, therefore, being devoid of any merit is dismissed. In
the facts and circumstances, however, there shall be no order as to costs.

S.K.S. Appeal dismissed.

E MARKANDEY KATJU, J. I. I have perused the judgment of my learned
brother S.B. Sinha, J. in this case and am in respectful disagreement with the
same. Hence, I am preparing my own judgment.

2. Leave granted.

F 3. This appeal is directed against the judgment and order dated 6.2.2006
of the High Court of Calcutta in APOT No. 584 of 2005 in APO No. 508 of
2005.

4. The facts of the case are mentioned in the judgment of my learned
brother Sinha, J. and hence I am not repeating the same except where necessary.
G
5. Admittedly, the object of the Trust in question was to pay pension
and annuities to the members of the Trust or dependents, including their
widows and children (upto the age of 21 years), in accordance with the rules
of the Trust.

H 6. The entire funds of the Trust were admittedly provided by the
ASHOK KUMAR KAPUR v. AS HOK KHANNA [MAR KAN DEY KAT JU, l ] 98 J
Dunlop India Limited (hereinafter referred to as the 'Company'), It is further A
admitted that all the beneficiaries under the Trust have been paid off and
hence the purpose has been completely fulfilled and executed without
exhaustion of the funds of the Trust, except to the extent of Rs. 3,88,55,682.00,
which amount after one time payment has been transferred to the Life Insurance
Corporation of India (hereinafter referred to as 'LIC'). Consequently, the Trust
has now no further liability/responsibility towards any of its beneficiaries. B
The balance sum remaining with the Trust fund being Rs. 20,83,95,690.00 has,
> in my opinion, therefore, to be returned to the Company in view of Section
83 of the Indian Trust Act (hereinafter referred to as the 'Act'). After all, the
entire money donated to the Trust fund was donated by the Company and
hence it has to be returned to the Company. C
7. Section 34 of the Act may not be strictly applicable in the present
case because that provision enables the principal Civil Court of original
jurisdiction to give an opinion, advice or direction on any present questions
respecting the management or administration of the trust property. The words
'management or administration of the trust property' would not apply when D
the object of the Trust itself has been fulfilled and now the only question
remains is as to what has to be done about the remaining fund with the Trust.
In such a case, in my opinion, a direction should be issued under Article 142
of the Constitution of India to refund the balance money lying with the Trust
to the Company which had donated the funds to the Trust. In my opinion, E
such a direction should be given in view of Section 83 of the Act, and also
because the money can now only go back to the Company sin1=e all the
beneficiaries have been paid off. Any other view would, in my opinion, be
unreasonable because the balance amount lying with the Trust cannot
obviously remain idle. To direct the Company to file a suit for this purpose
would only cause further delay and multiplicity of proceedings. F
8. The Settler (the Company) is admittedly facing severe financial crisis
having become sick and proceedings are pending for its revival before the
appellate authority for financial reconstruction. Hence, it would be appropriate
ifthe funds are returned to the Company as it may help revive the Company.
G
./ 9. I am, therefore, of the opinion that the learned Division Bench as well
as the Single Bench which passed the impugned judgment erred in holding
that the purpose of the Trust still exists and remains valid. Consent letters
have been given by 140 employees of the Company and the others concerned
have also been paid off. The only one remaining is Shri M.D. Shukla, who H
982 SUPREME COURT REPORTS [2007] 3 S.C.R.

A was the Managing Director for 38 months and who claims pensionary benefits ) -
of over Rs. 45 lakhs after having changed the Trust rules just before his
retirement in order to become a beneficiary. His claim is disputed by the
company. In my opinion, even if there is a genuine dispute about the claim
of Shri M.D. Shukla of about Rs. 45 lakhs, this amount could have been set
B aside for adjudication in a suit and the balance amount of the Trust fund
should have been ordered to be returned to the Company.

10. Admittedly the Company had a total number of 186 Executives and/
or Management staff, who were members and/or beneficiaries of the said 1.
Fund.
c 11. Under the Rules of the Fund, the aforesaid 186 members and/or
beneficiaries would be entitled to receive a sum of Rs. 3,88,55,682.00, as
calculated by the LIC, applying the mode of 'Actuarial Valuation', and the
same is also undisputed by any of the beneficiaries.

12. In accordance with the valuation carried out by the LIC, the appellants,
D
out of the funds lying in the Special Deposit Account No. 3/1976 with the
United Bank of India, Park Street Branch, Kolkata, transferred a sum of Rs.
3,88,55,682.00 to the LIC and took out policies in favour of the present
members and/or beneficiaries of the Fund w.e.f. 01.4.2001. As a result, full
provision has been made for the payment required to be made under the Rules
E of the Fund to its present members and /or beneficiaries, upcin superannuation,
and it is again undisputed that as and when the respective members become
eligible for the pension, the same will be paid by the LIC to the members/
pensioner directly and the Fund/Trust in no way will be responsible or
accountable for the same.
F 13. After transfer of the said sum of Rs. 3,88,55,692.00, which completely
protects the beneficiaries, a further sum of Rs. 22,83,95,690.00 with accrued
interest as on 12.9.2001, remained in the Special Deposit Account No. 3/1976
to the credit of the Fund/Trust.

G 14. In view of the aforesaid, the purpose of the Fund/Trust stood
completely fulfilled and executed, without exhaustion of the Fund/Trust
property, except to the extent of Rs. 3,88,55,682.00 refen-ed to above, which
amount, being a one-time payment, has been transferred to the LIC, pursuant
whereafter the Trust has got no further liability/responsibility towards any of
its beneficiaries. There are no existing beneficiaries of the said Fund nor is
H
ASHOK KUMAR KAPUR v. ASHOK KHANNA [MARKANDEY KAT JU, J.] 983
there any possibility of any further beneficiaries being created out of the A
instant Fund/Trust. The sum of Rs. 20,83,95,690.00 with accrued interest is,
therefore, being held by the Fund under Section 83 of the Act for the benefit
of the Company being the Settler of the Trust/Fund.

15. It is again a matter of record that out of 186 beneficiaries/members, B
140 members have given their express consent and the remaining 46 members
have raised no objection to the same which, inter alia, means that there is
deemed consent on their behalf.

-\ 16. It is again an admitted position that in the event of appropriate
directions not being given, surplus money will lie redundant and cannot be C
put to use under any circumstances, which needless to say, does no justice
or equity to any of the parties.

17. Section 83 of the Indian Trust Act states:

"Trust incapable of execution or executed without exhausting trust D
property. - Where a trust is incapable of being executed, or where
the trust is completely executed without exhausting the trust property,
the trustee, in the absence of a direction to the contrary, must hold
the trust property, or so much thereof as is unexhausted, for the
benefit of the author of the trust or his legal representative." E
Hence, in view of Section 83, the money lying with the Trust fund
should be returned to the Company.

18. Three persons who filed Suit No. 551/200 I retired between 1994-97
and as on date are getting their pension from the LIC. Thus, the interest of F
every beneficiary under the Trust has been taken care of and annuities have
,. j been purchased by the Trust in the names of the beneficiaries as per the
valuation carried out by the LIC and in terms of the pensionery benefits to
be received by the concerned beneficiary. Therefore, there is no employee/
beneficiary left who is entitled to get any pension out of the Trust in issue, G
which material fact has been ignored by the courts below.

19. In view of the above, in my opinion, the appeal deserves to be
~ allowed and the money lying with the Trust fund should be directed to be
returned to the Company forthwith. The impugned judgments of the courts H
984 SUPREME COURT REPORTS [2007] 3 S. C.R.

A below are set aside. There shall be no order as to costs.
I .

S.K.S. Appeal allowed.

ORDER

B In view of the difference of opinion the matter may be placed before a
larger bench. Accordingly, it may be placed before Hon'ble the Chief Justice
of India for necessary orders.