P K GOPI Vs. STATE OF KERALA

JUDGEMENT

(1.) The petitioner who is a toddy tapper by profession and is a member of the Kerala Toddy Workers' Welfare Fund established under the Kerala Toddy Workers' Welfare Fund Act, 1969 has come up with this writ petition challenging the validity of the notification Ext. P1 whereby the State Government has effected an amendment in Para.70 of the Toddy Workers' Welfare Fund Scheme, 1969 by adding a proviso to the said paragraph. The effect of that proviso is to enable the Toddy Workers' Welfare Fund Board to grant loans or invest money in institutions which have been approved or sponsored by the Government subject to the condition that such action should be taken only after obtaining the prior approval of the Government. It is contended on behalf of the writ petitioner that the said proviso is opposed to the provision contained in S.20 of the Indian Trusts Act, 1882. According to the petitioner the effect of the Kerala Toddy Workers' Welfare Fund Act is to constitute a trust in respect of the Welfare Fund and hence investments can be made by the Board only in conformity with the provisions of S.20 of the Trusts Act. In as much as the proviso introduced in Para.70 of the Scheme by the impugned notification Ext. P1 purports to empower the Board to invest the monies otherwise than in the modes specified in S.20 of the Trusts Act the petitioner contends that the said proviso is invalid on the ground of inconsistency with the mandatory provision contained in S.20.

(2.) On behalf of the respondents, namely the State Government and the Chief Welfare Fund Inspector, Kerala Toddy Workers' Welfare Fund, it is argued that the Trusts Act does not apply at all to the present case since no trust coming within the scope of the said Act has been created by the Kerala Workers' Welfare Fund Act or by the Scheme. Alternatively it is submitted on behalf of the respondents that the scheme which has been framed in exercise of the power conferred by S.3 and 5 of the Act is the instrument of trust in case the fund is to be regarded as a trust and the restriction imposed by S.20 of the Trusts Act is expressly made subject to any direction contained in the instrument of trust. It is therefore urged that there is no merit in the petitioner's contention that a provision contained in the Scheme cannot authorise the investment of the monies belonging to the Welfare Fund otherwise than in any of the modes specified in S.20 of the Trusts Act. Yet another argument advanced on behalf of the respondents was that the State Legislature was fully competent to enact a provision empowering the framing of a Scheme for the administration of a Welfare Fund incorporating also provisions as to how the monies belonging to the said fund shall be invested and that such provision will prevail notwithstanding any inconsistency with S.20 of the Trusts Act since "trust and trustees" is a subject in the concurrent list (item 10 of list 3, of the seventh schedule of the Constitution) and the Act was brought into force only after obtaining the President's assent. It is contended on this basis that the provision contained in the Scheme is immune from challenge on the ground of inconsistency with S.20 of the Trusts Act.

(3.) I find there is force in the last two contentions put forward on the side of the respondents and hence it is unnecessary for me to examine the soundness or otherwise of the other points raised by them. Even if it is to be assumed that the Welfare Fund is a trust to which the provisions of S.20 of the Trusts Act apply, the provisions of that Section are expressly stated to be applicable only subject to any directions that are contained in the instrument of trust. In other words, the Section contemplates that the instrument of trust may validly make provision for investment of monies belonging to the trusts in modes other than those specified in clauses (a) to (f) thereof. The instrument of trust, in the present case, is the Scheme framed under S.3 and 5 of the Act. It was undoubtedly competent for the State Government to effect an amendment to any of the provisions that were originally contained in the Scheme. Under the proviso introduced as per Ext. P1 what the Government has done is to specify in the instrument of trust certain additional modes of investment that may be taken recourse to by the Board subject to the condition regarding the obtainment of the Government's prior approval for such a course. There is nothing in S.20 which stands in the way of such an amendment being made in the instrument of trust if the Welfare Fund is to be regarded as a statutory trust created under the Act and the Scheme. The further contention urged on behalf of the respondents based on Art.254 of the Constitution is also, in my opinion, correct and sound. The topic "trust and trustees" being included in the concurrent list it was within the power of the State Legislature and its delegate, namely the State Government, which was empowered to promulgate the Scheme, to lay down the modes in which monies belonging to the Welfare Fund are to be invested and in as much as assent of the President has been obtained for the Act neither the Act nor the provision made in the Scheme on the basis of the power conferred by S.3(3) read with entry 4 in the schedule to the Act can be called in question on the ground of inconsistency with S.20 of the Trusts Act.