Sahruvan Nachair and Another Vs. V.S. Mohammed HussaIn Maracair and 3 Others - Court Judgment

Excerpt:
foreign exchange regulation act, 1973 - section 31--father of the plaintiff, late sheikh ismail maracaiar executed a registered settlement deed on 16.12.1931. providing that the income from the properties have to be utilised for the charities mentioned therein and the remaining have to be equally divided among the heirs.;trust deed--the settlement deed executed on 16.12.1931 contemplates the male heirs have to administer the properties; that charities to be performed personally and the trustee has to maintain and render accounts to other heirs. plaintiff being the resident of u.k. could not perform the duties of the trustee as stipulated in the deed. the second defendent is the only next male hair who is entitled to be trustee and can maintain the properties in the deed. - - a4.....order1. these two appeals arise out of a common judgment passed by the subordinate judge, nagapattinam in o.s.nos.36 of 1986 and 112 of 1986 dated 11.11.1987. 2. the suit in o.s.no.36 of 1986 was filed for declaration that the suit property is a muslim charitable property and the plaintiff is the sole trustee of the same and for recovery of possession of the suit property from the defendants. the suit in o.s.no. 112 of 1986 was filed for removing the first defendant as trustee of the suit property, declaring the second and third defendants as unfit to hold the post of trustee, declaring the plaintiff as the proper trustee of the suit property and for recovery of possession of a schedule property from the first defendant. 3. the trial court, by a common judgment, decreed the suit in.....

Judgment:
ORDER

1. These two appeals arise out of a common judgment passed by the Subordinate Judge, Nagapattinam in O.S.Nos.36 of 1986 and 112 of 1986 dated 11.11.1987.

2. The suit in O.S.No.36 of 1986 was filed for declaration that the suit property is a Muslim Charitable Property and the plaintiff is the sole trustee of the same and for recovery of possession of the suit property from the defendants. The suit in O.S.No. 112 of 1986 was filed for removing the first defendant as trustee of the suit property, declaring the second and third defendants as unfit to hold the post of trustee, declaring the plaintiff as the proper trustee of the suit property and for recovery of possession of A schedule property from the first defendant.

3. The trial Court, by a common judgment, decreed the suit in O.S.No.36 of 1986 as prayed for with costs and dismissed the suit in O.S.No.112 of 1986 with costs. Aggrieved by the same, the defendants in O.S.No.36 of 1986 preferred an appeal in A.S.No.45 of 1988 and the plaintiff in O.S.No.112 of 1986 preferred an appeal in A.S.No.191 of 1988 before this Court.

4. The plaintiff in O.S.No.36 of 1986 has stated as follows:-

The plaintiff is the son of Fathima Beevi, the fourth wife of late V. Sheik Ismail Maracaiar. The first defendant is the wife of late Mohamed Yousuf Maracaiar. The second defendant is the son of the first defendant. Late Mohamed Yousuf Maracaiar was the brother of the plaintiff. He passed away in 1971. The brothers and sisters of the plaintiff viz., Mohamed Thambi Maracaiar Mohamed Yousuf Maracaiar, Rabiyath Nachiar, Habeeth Kani Nachiar died in 19/0. 1979, 1949 respectively. Mohamed Haneef Maracaiar was the fifth son of late Sheik Ismail Maracaiar and he passed away in 1978. The plaintiff is the fourth son of late Sheik Ismail Maracaiar and is the only male legal heir who is alive. Late Sheik Ismail Maracaiar executed a registered Settlement Deed on 16-2-1931. The properties mentioned in the settlement deed are the suit properties and other properties and as per the recitals therein, the income from the properties have to be utilised for the charities mentioned therein and the remaining have to be equally divided among the heirs. As per the recitals in the deed, after the death of Sheik Ismail Maracaiar, the male heirs have to administer the properties. The plaintiff, being the only living son of Late Sheik Ismail Maracaiar, is managing the suit properties and other properties as trustee and the defendants have no right in the suit properties. The defendants vacated the house in which they were living and requested the plaintiff in the month of May, 1978 to permit them to reside in the suit property for some time, and they promised to vacate the house in a short time. The defendants were permitted to occupy the suit property in T.S.No.756 and they did not keep their promise and on the other hand they quarrelled with the plaintiff. Hence the plaintiff has filed the suit.

5. The defendants filed written statement stating that the plaintiffs father died in the year 1971 and after his death, the first defendant's husband Yousuf Maracaiar administered the trust in a proper way till his life time. The plaintiff is not entitled to trusteeship since he is the permanent citizen of United Kingdom. He is not an Indian citizen and he is not entitled to manage the trust as a trustee or to file the suit as a trustee claiming reliefs in respect of the trust properties. Even before 1971, the plaintiff was a resident of London and he used to come to India once in three years' for short stay. Taking advantage of the fact that the first defendant was a widow and the second defendant was a young man, the plaintiff has manouvered to transfer the registry of the property in his name. The plaintiff has not distributed the income after 1971 even though he was collecting the rent from the property. The said house has been in the possession of the defendants' family for a quite long time. The first defendant's husband was born in the suit house and he got married and lived with the first defendant in the same house. The second defendant has been living in the suit property eversince his birth. The averment that the defendants moved into the suit house only in May, 1978 with the permission of the plaintiff is incorrect. The plaintiff does not have legal right to demand possession of the house. The defendants are in occupation of the house in their own right and the plaintiff is not entitled to recover possession from them.

6. The defendants in their additional written statement has further stated that all the grandsons of Late Sheik Ismail Maracaiar are entitled for trusteeship and therefore they are necessary parties in the suit.

7. The plaintiff in O.S. No. 112 of 1986 has stated as follows : -

The plaintiff is the grandson of Late Sheik Ismail Maracaiar through his son. Sheik Ismail Maracaiar was a native of Nagoor and he had five sons viz., Mameed Maracaiar, Mohamed Thambi Maracaiar, Yousuf Maracaiar, Mohamed Hussain Maracaiar and Shaneef Maracaiar. Out of them, except Mohamed Hussain Maracaiar all the other four sons had expired. The said Mohamed Hussain Maracaiar is the first defendant in the suit. The second defendant Kader Maracaiar is the only son of Late Hameed Maracaiar. Mohamed Thambi Maracaiar had no male heirs. The plaintiff and the third defendant-Sheik Ismail Maracaiar are the sons of late Mohamed Yousuf Maracaiar. Shaneef Maracaiar had three sons viz.. Mohamed Iqbal, George Hussain and Ashraf All. The eldest son Mohamed Iqbal is the fourth defendant in the suit. Late Sheik Ismail Maracaiar executed a registered settlement deed dated 16.2.1931 and the income from the properties mentioned in the deed have to be utilised for the charities mentioned therein. Sheik Ismail Maracaiar appointed his eldest son Hameed Maracaiar as trustee for managing the properties and after him, the other sons in the order of succession have to manage the properties as trustee and as per the deed after utilising the income for the charities mentioned therein, the remaining have to be equally divided among the heirs, The trustee was permitted to take one extra share and he has to render accounts to the other heirs. After the execution of the settlement deed, Mohamed Hussain Maracaiar and Shaneef Maracaiar were born to late Sheik Ismail Maracaiar. After the death of Sheik Ismail Maracaiar, his eldest son Hameed Maracaiar was functioning as trustee and after his life time, the father of the plaintiff and third defendant, Mohamed Yousuf Maracaiar was functioning as trustee and he passed away in 1971. The first defendant Mohamed Hussain Maracaiar when he was youth, left for England and joined Royal Air Force and then he worked in Ford Motor Company and he became a permanent resident of England. The trust did not function after the life time of Mohamed Yousuf Maracaiar. The first defendant used to come to native place once in three years and after staying for few days he would return to England. The lease amount is collected by the wife of the first defendant and no amount was ever paid to the other heirs as stipulated in the deed. The first defendant relinquished his Indian citizenship and became a citizen of England. The first defendant is acting against the interest of the trust and he is unfit to be trustee and he has to be removed from the trusteeship. The second and third defendants are residents of Singapore and once in three years they used to come and stay for few days and return back. They have no interest in trusteeship as they are citizens of Singapore and they cannot be appointed as trustees and it has to be declared so. In the order of succession after the defendants one to three, the plaintiff is the eldest male heir as contemplated in the deed. The plaintiff is residing in Nagoor and is working as Accountant in the Dhurga and is willing to be trustee to administer the properties and to do the charities. The fourth defendant is younger to the plaintiff and he is working in Saudi Arabia and he cannot be considered for trustee. Hence the plaintiff has filed this suit.

8. The first defendant in the written statement has stated as follows:-

The plaintiff has filed this suit as counterblast to the suit filed by this defendant against him. The suit properties belonged to late Sheik Ismail Maracaiar and he executed registered settlement deed dated 16.2.1931 and as per the recitals the first defendant is in possession of the properties from the year 1971. The first defendant is doing the charities and he has distributed the income among the heirs till 1975 and even thereafter and he had obtained receipts for the same. The first defendant did not go to England in his youth as alleged. He went to England in 1975 and he used to visit his native place once a year and reside with his wife and children in Nagoor. The first defendant is an Indian by birth and he follows only Indian tradition and custom. Hence the averment that the first defendant cannot function as trustee is not correct. The plaintiff cannot be granted the reliefs he has sought for in the plaint. The first defendant is functioning as trustee as per the settlement deed and the suit is liable to be dismissed.

9. The trial Court by a common judgment has decreed the suit in O.S. No. 36 of 1986 as prayed for and dismissed the suit in O.S.No.112 of 1986 and the present appeals arise out of it.

10. In this judgment the parties are mentioned as found in the cause title in O.S.No.36 of 1986, as done by the trial Court in its common judgment. The points for determination in both the appeals are:-

1. Whether the plaintiff in O.S.No.36 of 1986 is entitled to be trustee and whether he can administer the properties mentioned in the settlement deed.

2. Whether the plaintiff in O.S.No.36 of 1986 ask for recovery of possession from the defendants.

3. Whether the second defendant in O.S.No.36 of 1986 is fit to be trustee and maintain the properties.

11. Point 1: The properties mentioned in both the suits are the properties owned by late Sheik Ismail Maracaiar and he executed a registered settlement deed dated 16.2.1931 and as per the deed, the income from the properties have to be utilised for the charities mentioned therein and the remaining have to be equally divided among the heirs. As per the recitals, after the death of the executant, the male heirs in the order of succession have to administer the properties as trustees till their life time. There is no dispute regarding the above among the parties. The plaintiff is the only living son of late Sheik Ismail Maracaiar and he is managing the suit properties as trustee from 1971. The defendants contend that the plaintiff cannot continue as trustee for two reasons. Firstly, the plaintiff has ceased to be an Indian citizen and secondly, the plaintiff being a resident of London is not doing the charities personally and he is not distributing the income to other heirs as stipulated in the settlement deed which is marked as Ex.A4. The learned counsel for the defendants contend that the plaintiff left for England in his youth and he has ceased to be an Indian citizen and he cannot hold any immovable property situate in India without the permission of Reserve Bank of India as per Section 31 of the Foreign Exchange Regulation Act, 1973. PW.1 is the plaintiff. In his examination in chief, he has stated that he is residing in London from 1975 and his wife and children are residing in Nagoor and he used to come to native place and stay for some time. In his cross-examination, he has stated that he joined the Royal Air Force in 1955 and his work was only in foreign countries and he went to London in 1975 and Joined the Ford Company. He has further stated that ' ' So, the plaintiff has categorically admitted that he is a British citizen and his Indian citizenship is annulled. The question is whether the plaintiff as a British citizen can hold the suit properties as trustee and maintain them.

Section 31 of the Foreign Exchange Regulation Act, 1973 reads as follows :-

'Restriction on acquisition, holding, etc. of immovable property in India -31, (1) No person who is not a citizen of India and no company (other than a banking company) which is not incorporated under any law in force in India shall, except with the previous general or special permission of the Reserve Bank, acquire or hold or transfer or dispose of by sale, mortgage, lease, gift, settlement or otherwise any immovable property situate in India:

Provided that nothing in this sub-section shall apply to the acquisition or transfer of any such immovable property by way of lease for a period not exceeding five years.

(2) Any person or company referred to in sub-section (1) and requiring a special permission under that sub-section for acquiring, or holding, or transferring, or disposing of, by sale, mortgage, lease, gift, settlement or otherwise any immovable property situate in India may make an application to the Reserve Bank in such form and containing such particulars as may be specified by the Reserve Bank.

(3) On receipt of an application under sub-section (2) the Reserve Bank may, after making such inquiry as it deems fit, either grant or refuse to grant the permission applied for:

Provided that no permission shall be refused unless the applicant has been given a reasonable opportunity for making a representation in the matter:

Provided further that it before the expiry of a period of ninety days from the date on which the application was received by the Reserve Bank, the Reserve Bank does not communicate to the applicant that the permission applied for has been refused, it shall be presumed that the Reserve Bank has granted such permission.

Explanation: In computing the period of ninety days for the purposes of the second proviso, the period, if any, taken by the Reserve Bank for giving an opportunity to the applicant for making a representation under the first proviso shall be excluded.

(4) Every person and company referred to in sub-section (I) holding at the commencement of this Act any immovable property situate in India shall, before the expiry of a period of ninety days from such commencement or such further period as the Reserve Bank may allow in this behalf, make a declaration in such form as may be specified by the Reserve Bank regarding the immovable property or properties held by such person or company.'

12. The learned counsel for the defendants contended that the Bombay High Court dealt with Section 31 of the Act in its decision in Joaquim Mascaremhas Fluza v. Smt. Jaime Rebello and another, 1989 (66) Com. Cases 349.

In the above decision, the Bombay High Court has held as follows:-

' The principle laid down in the said section is, inter alia, that a foreigner shall not hold any immovable property situate in India unless with the previous general or special permission of the Reserve Bank or after making a declaration of the holding as required in sub-section (4). The dictionary meaning of the word 'hold' as given in The Shorter Oxford English Dictionary is 'to have or keep as one's own; to own as property; to be in possession or enjoyment of. In other words, the word 'hold' embraces both the title and possession. This was otherwise the view taken by the Supreme Court in Handique's case, : [1966]60ITR216(SC) . In fact, It was observed in the said case that the expression 'holds' appearing in the Assam Agricultural Income-tax Act includes a two-fold idea of the actual possession of a thing and also of being invested with a legal title. Though this observation was made in connection with the said Act, the fact remains that the view taken is harmonious with the dictionary meaning of the said word. The wording of sub-sections (1) and (4) of the Act does not justify or warrant the giving of a different meaning to the word 'hold' or 'holding-occurring therein and, as such, the said word is to be construed as meaning having title to or possession of any immovable property.

Sub-section (1) of Section 31, as already stated, inter alia, provides that no person who is not a citizen of India shall, except with the previous general or special permission of the Reserve Bank acquire or hold or transfer or dispose of by sale, mortgage, lease, gift, settlement or otherwise any immovable property situate in India. Therefore, it becomes clear from the said provision of law that a foreign national cannot hold any immovable property situate in India whatever is the means by which the said property comes to him.'

13. The Bombay High Court has held that the word 'hold' is to be construed as meaning having title to or in possession of any immovable property. I agree with the view expressed in the above decision. It becomes clear that a foreigner shall not hold any immovable property situate in India unless with the previous permission of the Reserve Bank of India. The plaintiff, as trustee, is in possession of suit properties and is maintaining them. The plaintiff has not stated that he has obtained permission from Reserve Bank of India to hold immovable property as contemplated under Section 31. The recitals in Ex.A4 settlement deed contemplate actual possession of the properties by the trustee and maintaining there by keeping accounts. The plaintiff, as British citizen, cannot hold any immovable property as trustee in India.

14. The other ground of attack by the defendants is that Ex.A4 settlement deed stipulates that charities to be performed by the trustee personally and the trustee has to maintain and render accounts to other heirs and the trustee has been given one extra share for his services and the plaintiff has never done his duties as trustee as per the deed. Ex.A4 settlement deed stipulates charities of distributing the poridge to poor on certain occasions and, reciting and preaching of Fathia on certain days and other connected religious acts. PW.1, the plaintiff has stated that after 1975, since he was in London, his sister's son Nural Amin was attending to trustee's work and was performing the charities. PW.2 is Nural Amin and he has stated that the was demanding the lease amounts from the tenants regarding the trust properties. So, it is clear that the plaintiff, as trustee, did not perform the charities personally. The defendants further alleged that the plaintiff did not distribute the income of the properties to the heirs as per Ex.A4 regularly. PW.1 has stated that he had collected the lease amount in the year 1973, 1974 from the tenants of the trust lands and distributed it to the heirs and obtained the receipts for it and from 1975 to 1987, he could not collect the lease amount from the tenants and he did not give any amount to the heirs. Ex.A10 is the lease deed executed by one Packirisamy for Fasli 1383. Ex.A11 series and EX.A13 series are the receipts given by heirs for having received their share of income from the plaintiff in the year 1972 and 1974. The above receipts show that the plaintiff had distributed the income only in 1972 and 1974. After 1974, the plaintiff did not collect the lease amount and he did not take any step for the collection of it and he has also not maintained the accounts of the Trust. As already seen, Ex.A4 settlement deed contemplates actual participation of the trustee in the charities of the trust and in maintaining the properties by rendering accounts and the trustee is given one extra share for doing the work. The plaintiff, being the resident of London, could not perform the duties of the trustee by actual participation. For the above reasons, the plaintiff in O.S.No.36 of 1986 is not entitled to be trustee and he cannot administer the properties mentioned in Ex.A4 settlement-deed and it is decided accordingly.

15. Point 2: Plaintiff seeks to recover the house property of the trust from the defendants. According to the plaintiff, the defendants vacated the house in which they were living and requested the plaintiff in May, 1978 to permit them to reside in the suit house for some time and promised to vacate in short time and after occupation, they are not vacating it as promised. The defendants contend that they are residing in the suit house for a long time and the first defendant's husband was born in the suit house and the plaintiff has no legal right to demand possession. Ex.A7 series and Ex.A24 series are the letters written by defendants to plaintiff to the London address. Ex.A8 is the Birth Certificate of the second defendant and Ex.A9 is the Death Certificate of the father of the second defendant and in those certificates, the address of the defendants was mentioned as 12, Mohaideen School Street, Nagoor. Exs.A15 and A16 are the voters' list of Nagapattinam Municipality for the years 1977 and 1978 respectively. Ex.A17 is the voters list of Nagapattinam Legislative Assembly Constituency. In the above documents, the defendants' residence is mentioned as 12, Mohaideen School Street. Ex.A18 is the marriage invitation of the sister of the second defendant and Ex.A20 is the marriage invitation of the second defendant and in those the residence of the defendants is shown as Mohaideen School Street. Ex.A21 settlement deed and Ex.A22 mortgage deed contain the address of the defendants as 12, Mohaideen Street. All the above show that the defendants were residing in 12, Mohaideen School Street and in 1978, they had come to the suit house.

16. The learned counsel for the defendants further contend that the defendants as heirs are beneficiaries under Ex,A4 settlement deed and as such, they are entitled to reside in the suit house. The settlement deed properties are meant to generate income for carrying out the charities and the income has to be divided by all the heirs. It is already determined that the plaintiff is not entitled to be trustee and he cannot administer the properties mentioned in Ex.A4 settlement deed. Hence the plaintiff cannot seek for recovery of house property from the defendants and it is determined accordingly.

17. Point 3: The only other question to be decided is whether the second defendant is fit to be trustee and maintain the properties mentioned in Ex.A4 settlement deed. DW.1 is the second defendant. According to him, his father performed the charities as trustee till his life time and afterwards the plaintiff did not perform them and he also did not render account on demand. He has further stated that second and third defendants in O.S.No.112 of 1986 are citizens of Singapore and fourth defendant is younger to him in age and is residing in Saudi Arabia and the second defendant alone is fit and qualified to be trustee among the male heirs. PW.1, the plaintiff has admitted that among the male heirs, the second defendant alone is residing in India permanently and he has the opportunity to become trustee. As already decided, the plaintiff is not entitled to be a trustee. In the order of succession among the male heirs, the second and third defendants in O.S.No.112 of 1986 are the citizens of Singapore and therefore they are not entitled to be trustee. They did not also appear and were set ex parte. The next male heir is only the second defendant and he is a resident of Nagoor, working as Accountant in Dhurga. He is entitled to be trustee and he can maintain the properties mentioned in Ex.A4 settlement deed and he can also recover the A schedule property from the plaintiff. It is decided accordingly.

18. For the reasons stated above, the appeal in A.S.No.45 of 1988 is allowed and the judgment and decree in O.S.No.36 of 1986 are set aside and the suit in O.S.No.36 of 1986 is dismissed. The appeal in A.S.No.191 of 1988 is allowed and the Judgment and decree passed in O.S.No.112 of 1986 are set aside and the suit in O.S.No.112 of 1986 is decreed as prayed for. To avoid further bitterness among the family members, there shall be no order as to costs in the appeals.