Official Trustee, West Bengal &
Ors Vs. Sachindra Nath Chatterjee & ANR  INSC 315 (13 December 1968)
13/12/1968 HEGDE, K.S.
CITATION: 1969 AIR 823 1969 SCR (3) 92
Trust-Settlor as trustee reserving power to
alter terms by will-If, trustee could alter by deed inter vivos-Indian Trusts
Act (2 of 1882), s. 34, Official Trustees Act (2 of 1913), s. 10(1) and
Trustees and Mortgagees Powers Act (28 of 1866), s. 43-Scope of-Judge of High
Court on Original Side of Calcutta High Court-Powers under Chap. 13 of the
Original Side Rules-Inherent powers-Scope Official TrusteeLiability for
The father of the first respondent executed a
trust deed in 1930, in respect of properties owned by him. The deed provided
inter alia, that the settlor would be trustee during his life time, that from
and after his death, his wife should be paid Rs. 50 per mensem from the profits
of the trust estate, that the balance of the income was to be paid in equal shares
to the sons of the settlor, and that after the wife's death, the whole estate
was to be made over to the settlor's sons in equal shares. The settlor reserved
to himself the power to vary the quantum of interest, given to each of the
beneficiaries after his death by will alone and in no other way. After
administering the trust for some time he wanted to make some changes in the
trust deed, and for this purpose took out an originating summons on the
original side of the Calcutta High Court, under Ch. 13 of the Original Side
Rules and prayed for two reliefs, namely, (i) to have the Official Trustee
appointed as the trustee in his place, and (ii) to empower the settlor to alter
the clause relating to variation of the 'quantum of interest by a deed inter vivos.
The first respondent did not appear in those proceedings though notice was
served on him. The High Court, in specific terms, granted the prayers. The
settlor then executed another trust deed in 1938 under which the first
respondent was deprived of all his interest in the corpus of the trust
properties and was given a meagre allowance of Rs. 20 per mensem. The Official
Trustee carried out the order of the High Court and disbursed the income to the
various beneficiaries. In 1950, after the death of the settlor, the first
respondent filed a suit and prayed : (i) that the power reserved to the settlor
in the original trust deed for altering the quantum of interest by will alone,
was irrevocable; (ii) that the order on the originating summons was null and void
as having been made without jurisdiction; (iii) that the plaintiff was entitled
to the benefits provided by the original deed; and (iv) that the Official.
Trustee should render accounts since the time of the death of the settlor.
The trial court decreed the suit but the
first appellate court reversed the decree. In second appeal, the High Court
restored the decree of the trial court.
In appeal to this Court, on the questions :
(1) Whether the settlor was entitled to execute the second trust deed; (2) Whether
its validity was not open to challenge in view of the order on the originating
summons, because, the Judge had jurisdiction to pass the order either under s.
34 of the Indian Trusts Act, 1882, or s. 10(1) of the Official Trustees Act,
1913, or s. 41 of the Trustees and Mortgagees Powers Act, 1866, or in 93
exercise of his inherent powers; and (3) Whether the Official trustee was
liable to render accounts and if so for what period.
HELD : (1) The stipulation in the trust deed
that the variation can only be made by will and not otherwise is a binding
condition. Being a material condition the settlor had no power to vary it and
therefore had no power to execute the second trust deed., [98 F] Re : Anstis
 31 Ch. D. 596; Reid V. Shergold (1805) 10 Ves. 370 and Molineux v.
Evered, (1910) 2 Ch. 147, applied.
Halsbury 3rd Edn. Vol. 30 p. 272, para. 518
and Hannbury Modern Equity (7 Edn. p. 56), referred to.
(2) Before a court can be held to have
jurisdiction to decide a particular matter it must not only have jurisdiction
to try it but must also have the authority to decide the questions at issue and
pass appropriate orders.
It is not sufficient that it has some
jurisdiction in relation to the subject-matter under the various provisions of
law or under its inherent power. If the High Court had the power under those
provisions of law or in its inherent jurisdiction the fact that they were not
invoked by the petitioner in the originating summons would not invalidate the
order even if it was wrong. But the order on the originating summons in the
present case was outside the jurisdiction of the Judge. It was not merely a
wrong order, or an illegal order; it was an order which he had no competence to
make and was therefore a void order. [101 B-D;
106 C-D] Ittavira Mathai v. Varkey Varkey,
 1 S.C.R. 495, referred to.
Hirday Nath Roy v. Ramchandra Barna Sarma,
I.L.R. LXVIII Cal. 138, approved.
(a) The facts stated and the nature of relief
asked for in the originating summons, show that the matter did not come within
the scope of s. 34 of the Trusts Act. The jurisdiction of the Court under the
section is a limited jurisdiction. The statute has prescribed what the Court
can do and inferentially what it cannot do. Under the provision, the Court
could only give 'opinion, advice or direction on any presented question
respecting the management or administration of the trust property' and not on
any other matter arising under the trust deed. The relief prayed for by the
settlor did not relate to the management or administration of the trust
Property. [101 G;
102 A-D] (b) Section 10(1) of the Official
Trustees Act, 1913, might have empowered the High Court to appoint the Official
Trustee in the place of the settlor, as the settlor was not willing to continue
as trustee. But it could not have granted the other reliefs asked; for. [102 G]
(c) Section 43 of the Trustees and Mortgagees Powers Act, 1866, is similar to
s. 34 of the Trusts Act. Under that provision, a Judge of a High Court could have
only given opinion, advice or direction on any question respecting the
management or administration of the trust property and therefore, the order on
the originating summons could not be justified on the basis of the section.
[103 D] (d) There is no rule in Ch. 13 of the Original Side Rules of the
Calcutta High Court, under which the order on the originating summons could
have been made. It is not as if the Judge, in passing his order on the
originating summons, was merely interpreting the original 'trust deed in which
case it might not have mattered whether his interpretation wag 'correct or not.
[104 A-C] 94 It may be that a Judge sitting on the original side of the High
Court has all the powers of a Chancery Judge in England, but the inherent
powers of a Chancery Judge only relate to management and administration of
trust property which powers are similar to those codified in s. 34 of the
Trusts Act and s. 43 of the Trustees and Mortgagees Powers Act, and is
therefore of a limited character. [105 G-H; 106 A] Chapman v. Chapman, 
A.C. 429 and Chapman's case,  Ch. 218, referred to.
(3) But for the order on the originating
summons the settlor would have certainly altered by will the quantum of
interest given to the first respondent. The first respondent did not challenge
the second trust deed during the father's life-time and there was no knowing
that he would have challenged it till he filed the suit. Since the Official
Trustee merely carried out the order of the Court, he is not a trustee de-son-tort
and his liability should not be greater than that of a trustee. Therefore,
there is no Justification for directing him to account from the date he took
charge of the trust estate, and the ends of justice would be met, if accounting
was ordered as from the date of suit. [106 D-H]
CIVIL APPELLATE JURISDICTION : Civil Appeal
No. 168 of 1966.
Appeal from the judgment -and decree dated
December 22, 1960 of the Calcutta High Court in Appeal from Appellate Decree
No. 701 of 1956.
B. Sen, P. K. Chatterjee and P. K.
Chakravarti, for the appellants.
N. C. Chatterjee and D. N. Mukherjee, for
respondent No. 1.
The Judgment of the Court was delivered by
Hegde J. Two important questions of law arise for decisionin this appeal, by
certificate. It will be convenient to formulate those questions after we set
out the material facts.
One Aswini Kumar Chatterjee (since deceased)
executed the Trust deed Exh. 1 on December 6, 1930 in respect of some of the
properties owned by him. It is provided therein (a) that the settlor would be
the trustee of the Trust Estate and would enjoy the income and profits of the
trust properties during his lifetime, (b) after his death his wife Sm.
Santimoyee Devee and/or his sons as soon as they or any of them attain the age
of majority should be the sole Trustee or Joint Trustees and (c) from and after
his death the said Trust Estate should be held to the use and for the benefit
of the said Sm. Santimoyee Devee and the said sons.
Santimoyee Devee to be paid from the income
and the profits of the said estate Rs. 50 monthly and the balance of the income
and profits of the Trust Estate to be held for the use and benefit of each of
the sons in equal shares and after the death 'of the said Santimoyee Devee to
make over the whole of the Trust Estate to each of the sons in equal shares. He
reserved to 95 himself the Power to vary the terms and conditions of the Trust
so far as they relate to the quantum of interest given to each of the
beneficiaries after the death of the settlor "by his instrument by will
alone and in no other way or act".
The settlor administered the trust property
for some time and thereafter thought of effecting by deed inter vivos certain
changes in the trust. To enable him to do so he took out an originating summons
on the original side of the Calcutta High Court under Chapter XIII of the
Original Side Rules of that Court seeking primarily two reliefs viz., (1) to
have the Official Trustee, Bengal appointed as the Trustee in his place and (2)
to empower him to alter the clause relating to variation of the quantum of
interest given to each of the beneficiaries by a deed inter vivos. From the
averments made in the application, it is clear that relief was sought under the
provisions of the Indian Trusts Act (Central Act 2 of 1882) and the Official
Trustees Act (Central Act 2 of 1913). In the body of the petition the settlor
definitely prayed for permission to revoke the clause in the trust deed
relating to his power to vary the quantum of interest of the beneficiaries by
will alone and in, its place authorise him to make that variation "by deed
inter vivos and not by will alone". The relevant reliefs asked for in the
petition read as follows (1) "that the provisions contained in the Deed of
settlement dated the 6th December 1930 whereby the persons therein named were
appointed Trustees of the said Trust Estate and whereby power was reserved to
petitioner to alter the said quantum of interest by will alone and in no other
way be revoked and . . . .
(2) that the petitioner be empowered to alter
the said quantum of interest in such manner as he may think proper, by deed
inter vivos and not by will alone." The aforementioned originating summons
was taken out on August 20, 1937. The matter came up for hearing before Ramfry
J. evidently after service of notices on the respondents on August 25, 1937. On
that date the learned Judge passed the following order :
"It is ordered that the provisions
contained in the said Deed of Trust whereby the persons therein named were
appointed Trustees of the said Trust Estate and whereby power was reserved to
the said applicant to alter the quantum of interest of the beneficiaries by
,will and in no other way be and they are hereby 96 revoked and it is further
ordered that the said applicant as such settlor as aforesaid be at liberty to
alter the said quantum of interest in such manner as he may think proper by
deed inter vivos and not by will and it is further ordered that the said
applicant the present sole trustee under the said Deed of Trust be and is
hereby discharged from further acting as such Trustee and the Official Trustee
of Bengal be and is hereby appointed the sole trustee of the said Deed of
And it is further ordered that the stocks and
shares and securities (both movable and immovable) now comprised in the Trust
Estate... do vest in the said Official Trustee of Bengal as such Trustee as
aforesaid." At this stage it is necessary to emphasize that what the
settlor asked for was the court's permission to revoke the clause in the Trust
deed empowering him to alter the quantum of interest given to each of the
beneficiaries "by will alone" and in its place to confer upon him
power to make the said alteration by deed inter vivos. The court in specific
terms ordered the revocation and granted the authority sought for. Acting under
the power purported to have been given by the order of Ramfry J., the settlor
executed a second Trust deed on March 22, 1938. Under that deed, in theplace of
the Trustees nominated under the original deed, the Official Trustee was
constituted as the sole trustee. Sachindra, (the first respondent herein) one
of the sons of the settlor was deprived of all his interest as a beneficiary in
the corpus of the trust properties. He was given a meagre allowance of Rs. 20 per
month during his life-time. The settlor died in 1946.
On December 18, 1950, the first respondent
filed the suit out of which this appeal has arisen praying for following
(a) that the power reserved by the settlor in
the original Trust deed for altering the quantum of interest of the beneficiaries
'by will alone and by no other means was irrevocable; (b) that the order passed
by Ramfry, J. on August 25, 1937 was null and void as having been made without
jurisdiction; and (c) the original Trust deed stood unaffected by the second
Trust deed and therefore he was entitled to the benefits provided under the
said deed. He also asked for a decree directing the Official Trustee to pay him
1/4th of the income of the Trust Estate, so long as Santimoyee Devee was alive
and on her death to make over one-fourth of the corpus of the Trust Estate to
him and further render accounts to him of the profits of the Trust Estate since
the time of the death of the settlor. The Official 97 Trustee as well as some
of the other defendants resisted the suit. They contended that the settlor was
entitled to execute the second Trust deed in exercise of the power reserved by
him under the original Trust deed and in any event he could do so, because of
the order of Ramfry, J.
The trial court decreed the suit as prayed
for but the first Appellate Court reversed the decree of the trial court and
dismissed the suit upholding the contentions advanced on behalf of the
contesting defendants. In second appeal the High Court reversed the decree of
the first Appellate Court and restored the decree of the trial court.
Two questions that -arise for decision in the
appeal are (1) whether the settlor was entitled to execute the second Trust
deed in pursuance of the power reserved by him under the original Trust deed
and (2) whether in any event the validity of the second Trust deed is not open
to challenge in view of the order made by Ramfry, J. on August 25, 1937.
Mr. B. Sen, learned Counsel for the appellant
contended that on a proper reading of the Trust deed it would be seen that the
settlor had reserved to himself the power to vary the terms of the Trust, in so
far as they relate to the quantum, of interest given to each of the
beneficiaries after the death of the settlor. According to him the recital in
the deed that such a variation can be done only by an instrument of will and
not otherwise is not a " matter of substance but only a form. Therefore we
must hold that the settlor had the power to make the variation in question. He
did not dispute the proposition that a settlor is incompetent to vary any of
the terms of a Trust settled by him unless he had reserved for himself the
power to make the variation in question. The real question for decision is
whether the stipulation in the Trust deed that the variation in question can
only be made by will and not otherwise is binding condition. If it is held to
be a material condition then the settlor must be held to have had no power to
vary the same.
The law on the point is stated by Halsbury
(1) thus Defects not of the essence. Equity relieves only against defects which
are not of the essence of the power; relief will not be granted so as to defeat
anything material to the intention of the donor of the power. Thus mere defects
in the mode of execution will be aided, and so will an appointment by will
made, under a power to appoint only by deed.
But no aid will be given to an appointment by
irrevocable deed made under a power to appoint only by will or to an 3rd Edn.
Vol. 30 p. 272 Paragraph, 518.
98 appointment which would result in -a fraud
on the power or aid a breach of trust. Moreover, no aid will be given to the
exercise by will of a power of revocation by deed if it is clear that a deed is
of the essence, as where the original power of appointment was by will or deed
and on its exercise a power to revoke by deed only was reserved. Nor will the
court aid a lease containing unusual covenants granted under a power to lease
with usual covenants, or a lease granted without consent under a power to lease
with consent, or a sale of land reserving timber made under a power not
authorising such a reservation, or a sale of land reserving the minerals under
a power not authorising such a reservation." IV Similar are the views
expressed in Hanbury's book on Modern Equity (7th Edn. p. 56). Referring to the
decision in Tollet v.Tollet(1) the learned author observes "The case
brings out another important point.
The power was exercised by will, whereas it
should have been exercised by deed. Now a Will is revocable at any time during
the testator's life time, and so the defect is treated as one of ,form only,
and relief will be granted. But the defect constituted by the converse process,
the attempted exer cise by irrevocable deed of a power which should have been
exercised by will is treated as a matter of substance, and, in Reid v.
Shergold(2) as fatal to the objects of the power." The law is similarly
stated in Molineux v.
From the above discussion it also follows
that the settlor had no power to appoint new trustees during his life time nor
designate persons other than those already designated in the original Trust
deed to act as trustees after his life time.
Considerable arguments were advanced before
us as to the effect of the order made by Ramfry, J. on August 25, 1937.
On behalf of the appellant it was urged that
Ramfry, J. had jurisdiction over the parties to the application in question as
well as on the subject matter. Hence the validity of the order made by him
cannot 'be challenged even if it is held that that order is -not in accordance
with law. To put it differently it was urged -that what could be complained of
is not the lack of jurisdiction on the part of the court to make the order in
question but an illegal exercise of that jurisdiction; but such an attack
cannot -be made against that order in a collateral proceedings. On the ,other
hand it was urged by Mr. N. C. Chatterjee, learned (1) (1728) 24 E. R. 828. (2)
 10, Ves. 370.
(3)  2 Ch. 147.
99 Counsel for the respondents that Ramfry,
J. had no jurisdiction to pass the order in question. His grievance was not
that Ramfry, J. exercised his undoubted jurisdiction illegally but that he had
no jurisdiction at all to make the order in question.
It is plain that if the learned judge had no
jurisdiction to pass the order in question then the order is null and void.
It is equally plain that if he had
jurisdiction to pronounce on the plea put forward before him the fact that he
made an incorrect order or even an illegal order cannot affect its validity.
Therefore all that we have to see is whether Ramfry, J. had jurisdiction to
entertain the application made by the settlor.
What is meant by jurisdiction? This question
is answered by Mukherjee, Acting C. J. speaking for the Full Bench of the
Calcutta High Court in Hirday Nath Roy v. Ramachandra Barna Sarma.(1) At page
146 of the report the learned judge explained what exactly is meant by
jurisdiction. We can do no better than to quote his words :
A " In the order of Reference to a Full
Bench in the case of Sukhlal v. Tara Chand(2) it was stated that jurisdiction
may be defined to be the power of a Court to hear and determine a cause, to
adjudicate and exercise any judicial power in relation to it : in other words,
by jurisdiction is meant the authority which a Court has to decide matters that
are litigated before it or to take cognizance of matters presented in a formal
way for its decision. An examination of the cases in the books discloses
numerous attempts to define the term 'jurisdiction', which has been stated to
be 'the power to hear and determine issues of law and fact', 'the authority by
which the judicial officer take cognizance of and 'decide causes'; 'the
authority to hear and decide a legal controversy', 'the power to hear and
determine the subject matter in controversy between parties to a suit and to
adjudicate or exercise any judicial power over them;' 'the power to hear,
determine and pronounce judgment on the issues before the Court'; 'the power or
authority which is conferred upon a Court by the Legislature to hear and
determine causes between parties and to carry the judgments into effect'; 'the
power to enquire into the facts, to apply the law, to pronounce the judgment
and to carry it into execution'.
(1) I.L.R. LXVIII Cal. 138.
(2)  I.L.R. 33 Cal. 68.
100 Proceeding further the learned judge
observed "This jurisdiction of the Court may be qualified or restricted by
-a variety of circumstances. Thus, the jurisdiction may have to be considered
with reference to place, value and nature of the subject matter. The power of a
tribunal may be exercised within defined territorial limits. Its cognizance may
be restricted to subject-matters of prescribed value. It may be competent to
deal with controversies of a specified character, for instance, testamentary or
matrimonial causes, acquisition of lands for public purposes, record of rights
as between landlords and tenants. This jurisdiction and jurisdiction of the
subject matter is obviously of a fundamental character. Given such
jurisdiction, we must be careful to distinguish exercise of jurisdiction from
existence of jurisdiction : for fundamentally different are the consequences of
failure to comply with statutory requirements in the assumption and in the
exercise of jurisdiction. The authority to decide a cause at all and not the
decision rendered therein is what makes up jurisdiction; and when there is
jurisdiction of the person and subject matter, the decision of all other questions
arising in the case is but an exercise of that,jurisdiction. The extent to
which the conditions essential for creating and raising the jurisdiction of a
Court or the restraints attaching to the mode of exercise of that jurisdiction,
should be included in the conception of jurisdiction itself, is sometimes a
question of great nicety, as is illustrated by the decisions reviewed in the
order of reference in Sukhlal v. Tara Chand(1) and Khosh Mahomed v. Nazir
Mahomed(2) see also the observation of Lord Parkar in Raghunath, v. Sundar
Das(3) ... We must not thus overlook the cardinal position that in order that
jurisdiction may be exercised, there must be a case legally before the Court
and a hearing as well as a determination. A judgment pronounced by a court
without jurisdiction is void, subject to the well-known reservation that, when
the jurisdiction of a Court is challenged, the Court is competent to determine
the question of jurisdiction, though the result of the enquiry may be that it
has no jurisdiction to deal with the matter brought before it : Rashmoni v.
Ganada.(4)" (emphasis supplied).
(1)  I.L.R.33 Cal.68. (2) (1905)
(3)  I.L.R.42 Cal.72. (4)  20
101 Finally the learned judge quoted with
approval the decision of Srinivas Aiyangar, J. in Tuljaram v. Gopala(1) wherein
Aiyangar, J. laid down that "if a Court has jurisdiction to try a suit and
has authority to pass orders of a particular kin#, the (,act that it has passed
an order which it should not have made in the circumstances of the litigation,,
does not indicate total want or loss of jurisdiction so as to render the order
a nullity" (emphasis supplied).
From the above discussion it is clear that
before a Court can be held to have jurisdiction to decide -a particular matter
it must not only have jurisdiction to try the suit brought but must also have
the authority to pass, the orders sought for. It is not sufficient that it has
some jurisdiction in relation to the subject matter of the suit.
Its jurisdiction must include the power to
hear and decide the questions at issue, the authority to hear and decide the
particular controversy that has arisen between the parties.
Therefore the fact that Ramfry, J. had
jurisdiction to pass certain orders either under the Indian Trust Act, 1882 or
under the Official Trustees Act, 1913 or under the Trustees and Mortgages
Powers Act, 1866 or under his inherent power is not conclusive of the matter.
What is relevant is whether he had the power to grant the relief asked for in
the application made by the settlor. That we think is the essence of the
matter. It cannot be disputed that if it is held that the learned judge had
competence to pronounce on the issue presented for his decision then the fact
that he decided that issue illegally or incorrectly is wholly beside the point.
See Ittavira Mathai v. Varkey Varkey and A nr.
(2). Therefore we have now to see whether the
learned judge had jurisdiction to decide the issue presented for his
determination. The relief prayed for, as seen earlier, was to Permit the
settlor to revoke particular clauses in the Trust deed and to authorise him to
alter the quantum of interest given to each of the beneficiaries by a deed
inter vivos. Had the learned judge jurisdiction to entertain those pleas ?
Reliance was placed on s. 34 of the Indian Trusts Act, 1882 as conferring power
on the judge to make the order in question. That section reads "Any
trustee may, without instituting a suit, apply by petition to a principal Civil
Court of original jurisdiction for its opinion, advice or direction on any
present questions respecting the management or administration of the trust
property other than questions of detail, difficulty or importance, not proper
in the opinion of the Court for summary disposal." (2)  1 S.C.R.
102 Under this provision the court could have
only given "opinion, advice or direction on any presented question
respecting the management or administration of the trust property" and not
on any other matters. The relief prayed for by the settlor did not relate to
the management or administration of the trust Property but on the other hand it
asked for authority to alter the quantum of interest given to each of the
beneficiaries by a deed inter vivos.
The jurisdiction confrere on the court under
s. 34 is a limited jurisdiction. Under that provision, the court has not been
conferred with overall jurisdiction in matters arising under a Trust deed. The
statute has prescribed what the court can do and inferentially what it cannot
do. From the fact that the court has been conferred power to grant only certain
reliefs it follows as a matter of law that the court has been prohibited from
granting any other relief.
The jurisdiction of the court is
circumscribed by the provisions of s. 34 of the Trusts Act. The court had no
jurisdiction to pronounce on the pleas put forward by the settlor. From the
facts stated in the petition and from the relief asked for, it was obvious that
the case did not come within the scope of s. 34 of the Trust Act. Therefore
when the learned judge granted the relief asked for, he did something which he
was not competent to do under s. 34 of the Trusts Act.
Next we were told the learned judge had
jurisdiction to pass the order in question under s. 10(1) of the Official Trustees
Act, 1913 which reads :
"If any property is subject to trust
other than a trust which the Official Trustee is prohibited from accepting
under the provisions of this Act, and there is no trustee within the local
limits of the ordinary or extraordinary original civil jurisdiction of the High
Court willing or capable to act in the trust, the High Court may on application
make an order for the appointment of the Official Trustee by that name with his
consent to be the trustee of such property." This provision has no
relevance as regards the controversy with which we are dealing. That provision
might have empowered the court to appoint the Official Trustee in the place of
the settlor as the settlor was not willing to continue as the trustee. But it
could not have granted the other reliefs asked for.
Reliance was next placed on s. 43 of the
Trustees and Mortgagees Powers Act, 1866. There is no reference to this Act in
the application made by the settlor. Obviously he did not rely on any of the
provisions in that Act. But then if the court could 103 have acted on the basis
of any of the provisions in that Act, the fact that it did not purport to act
under that provision is, immaterial. Therefore we have to see whether the court
could have acted on the basis of any of the provisions in the said Act. The
only provision of that Act on which reliance was placed on behalf of the
appellants is s. 43(1). The portion of that section relevant for our present
purpose reads :
.lm15 " Any trustee, executor or
administrator shall be at liberty, without the institution of a suit, to apply
by petition to any Judge of the High Court for the opinion, advice or direction
of such Judge on any question respecting the management or administration of
the trust property or the assets of any testator or intestate.. . " This
provision is more or less similar to s. 34 of the Trust Act. Under that
provision a judge of a High Court could have only given opinion, advice or
direction on any question respecting the management or administration of the
trust property. Therefore the order made by Ramfry, J. cannot be justified on
the basis of s. 43 of the Trustees and Mortgagees Powers Act.1866.
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 at
Calcutta has all the powers of a Chancery Judge in England as that power has
been conferred on him by the Letters Patent granted to that High Court. We
shall assume it to be so. We may note that the settlor did not invoke the
inherent jurisdiction of the Court nor did the judge purport to exercise that
But, still, that cannot invalidate 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 1 of that Chapter empowers the judge to entertain an application in
respect of matters enumerated in clauses (a) to (g) of that rule. Admittedly
cls. (a) (b), (f) and (g) are not relevant for our present purpose. Under cl.
(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
cl. (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 104 Ch. XIII are made in
chambers. As mentioned earlier the proceedings under, that Chapter are summary.
No rule in that Chapter was brought to our
notice under which the ,order in question could have been made.
Different questions might have arisen for
consideration if an ,application under rule 9 of Chapter XIII had been made
requesting the High Court to interpret the original Trust deed in ,a particular
manner, Such a plea was not taken in the application filed by the settlor
before Ramfry, J.
Further it was not the ,case of the appellant
either in the High Court or in the courts below or even in this Court that
Ramfry, J. merely purported to interpret the original Trust deed whether his
interpretation is ,correct or not.
Let us now proceed to the question whether
the Chancery Court in, England had jurisdiction to pass an order similar to
that made by Ramfry, J. This question was elaborately considered by the House
of Lords in Chapman and Ors. v. Chapman and Ors.(1). The leading judgment in
that case was delivered by Lord Morton of Henryton. In his speech he
elaborately considered the -various decisions rendered by the English courts.
The broad question that he posed for decision was -whether the court could
permit the settlor to alter the terms of a trust and if so in what respect. It
was urged before him on behalf of the appellants in that case that the court
had jurisdiction to permit the alteration of any of the terms of a trust.
Negativing that contention his Lordship observed at p. 456 "Striking
instances of cases which negative the existence of the alleged, unlimited
jurisdiction are In re Crawshay,(2) In re Morrison(3) (Buckley, J.) and In re
Montagu(4) '(Court of Appeal). In the first of these cases North, J. said: 'I
should not be administering the trusts created by 'the testator if I consented
to this scheme. I should be altering his trusts and substituting something
quite outside the will. On the assumption that the scheme would be beneficial
to the estate, I cannot decide that I have jurisdiction to authorise it' "
In the last mentioned case the Court of Appeal held that it had no jurisdiction
to allow the trustees of a settlement to raise money by mortgage of the settled
estate and to apply it in pulling down and rebuilding some of the houses on the
property. Lindley, L. J. said 'We none of us see our (3) 1 Ch. 701. (4)
105 way to hold that there is jurisdiction to
make an order in this case. It is very desirable that the court should have
jurisdiction to deal with such a case; but Parliament has never gone so far as
to give it that jurisdiction. No doubt it would be a judicious thing to do what
is wanted in this case, and if the persons interested were all ascertained and
of age, they would probably concur, and then it might be done; but they are not
all ascertained nor of full age; and unless the court can authorize the
trustees to do it, it cannot be done.' Lopes, L.J. said: 'I have no doubt that
what is proposed is beneficial and would increase both the income and the
capital value of the property. The question is whether the court has
jurisdiction to sanction it. There is no provision in the settlement which
would authorize the works in question, nor do they fall within any of the
improvements sanctioned by the Settled Lands Act." From the above
observations it is clear that the learned judge proceeded on the basis that the
court has no jurisdiction to permit the alteration of any of the terms in a
trust deed excepting as regards the following matters (a) Changes in the nature
of an infant's property e.g. by directing investment of his personality in the
purchase of freeholds;
(b) Allowing the trustees of settled property
to enter into some business transaction which was not authorized by the
(c) Allowing maintenance out of income which
the settlor or testator directed to be -accumulated; and (d) Approving a
compromise on behalf of infants and possible after-born beneficiaries.
It will be noticed that the power given under
those four heads are those relating to management and -administration of trust
property. That power is similar to the power conferred on courts by S. 34 of
the Trusts Act and 43 of the Trustees and Mortgagees Powers Act, 1866. In fact
in this country we have codified the very powers that were exercised by the
Chancery Courts in England under their equitable jurisdiction. The Court of
Appeal in Chapman's case(1) Evershed, M.R. and Romer, L.JJ., Denning, L.J.
dissenting stated the law on the point thus :
(1)  Ch. 1 218.
L 7 Sup. CI/69-8 106 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 does not extend to, sanctioning
generally the modification or remoulding of the beneficial trusts of a
Hence we are not persuaded that the Chancery
Court in England had jurisdiction to pass orders similar to that passed by
From whatever angle we may examine the
validity of the order 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 not have passed but it is an
order that he could not have passed and therefore a void order.
The circumstances of the case call for
certain modifications in the decree of the High Court. On the facts of this
case we see no justification for treating the Official Trustee as a trustee
de-son-tort and to require him to account as such.
In the proceedings before Ramfry, J. the
plaintiff did not choose to appear and contest. It is not his case that he was
not served in that proceeding. But for the order of Ramfry, J. the settlor
would have certainly altered the quantum of interest given to the plaintiff
under the original Trust deed by means of a will,. As it now turned out the
plaintiff has benefited by the wrong step taken by the settlor. The Official
Trustee has merely carried out the order of the court. It was not open to him
to go behind that order. That being so we see no _justification to treat him as
a trustee. deson-tort. Equity requires that he should be made to account as if
he was 'a trustee. In other words his liability should not be greater than that
of a trustee. It is also proper to permit him to reimburse himself all the
costs incurred by him in all the courts from out of the trust funds in his
We see no justification for allowing
accounting in this case from the date the official Trustee took charge of the
trust estate. Till the institution of the present suit from which this appeal
has arisen there was no knowing that the plaintiff would challenge the second
Trust deed executed by his father. He did not challenge it during his father's
life time. On the faith of the order of the High Court, the Official Trustee
must have been disbursing the trust income to the various beneficiaries. It
will be inequitable to, reopen all those transactions. We think the end,,;
1 07 of justice will be met if accounting is
ordered as from the date of the institution of the present suit. The plaintiff respondent
is entitled to his costs in all the courts. But he shall get the same from out
of the Trust Estate.
Subject to the modifications directed above
in the decree of the High Court this appeal is dismissed.
V.P.S. Appeal dismissed and decree modified.