SUNITA A GANDHI Vs. LEENA GANDHI TEWARI

JUDGEMENT

(1.) THE above suit is filed by the beneficiary, inter alia, for cancellation of the Agreement dated 18th December 1992 being Exhibit C to the plaint entered into by defendants 1, 2 and 3 (Trustees) on the one hand and defendant No. 5 - US Vitamins (India) Limited being the subsidiary of the holding Company by the name American Products Company Limited (defendant No. 4 herein ). The suit is also for an order and direction against defendant No. 5-Company to hand over vacant and peaceful possession of the premises admeasuring 10755 sq. ft. situate at Poonam Chambers, North Wing, 4th floor, Dr. Annie Beasant Road, Worli, Bombay. The suit is also for a declaration that 4600 shares in defendant No. 4 Company subscribed by defendant No. 1 (Trustee) is held by her for the benefit of the Trust and to transfer the said shares in defendant No. 4 Company to the plaintiff alongwith dividends and all other benefits accrued thereon.

(2.) THE claim in the suit is made by the plaintiff as a beneficiary alleging that defendant No. 1 is making use of the Trust properties consisting of the above premises and 4,600 shares for her own personal profit/ gain and thereby defendant No. 1 is guilty of breach of trust. The claim made by the plaintiff beneficiary with regard to the premises is based on allegations of breach of trust against defendant No. 1 on the ground that the said Agreement dated 18th December 1992 has been entered into between the Trustees on the one hand an defendant No. 5 on the other hand in breach of the Indian Trust Act and, therefore, it is prayed that the said Agreement be declared as null and void. The facts giving rise to the above dispute briefly are as follows :

(3.) ASHOK Ganpat Keni (defendant No. 3 herein) as a Settlor created a Trust by way of indenture dated 5th January 1979 (Exhibit A to the plaint ). Under the said settlement, plaintiff is a beneficiary of the Trust known as Susheeleena Trust alongwith her sister Mrs. Sheela Rao (not a party to the suit), defendant No. 1 herein (sister of the plaintiff), Dr. Pramila Gandhi i. e. defendant No. 2 herein (mother of the plaintiff, defendant No. 1 and defendant No. 2 ). In all, there are four beneficiaries under the said trust. The settlor, as stated hereinabove, is Ashok Ganpat Keni defendant No. 3 (Trustee ). Defendant No. 3 is the nephew of defendant No. 2. The object of the said Trust is to distribute the income earned by the Trust among the above mentioned four beneficiaries for 15 years from 5th January 1979 upto 5th January 1994 and to distribute the corpus thereafter. Initially, in 1979 the corpus consisted only of Rs. 5,000/ -. In 1979, the trustees were Arvind Gandhi (husband of defendant No. 2), defendant No. 2 and defendant No. 3. Arvind died on 15th January 1986. At that time, plaintiff was a minor. On the demise of Arvind, defendant No. 1 was inducted as a Trustee. She was the eldest of all. This induction took place on 11th February 1986. Since 1986, defendant No. 1 is a trustee alongwith defendant No. 2 and defendant No. 3. Defendant No. 1 is also a majority share holder in defendant No. 4 Company which is a holding Company of defendant No. 5. Defendant No. 4 holds 98% shares in defendant No. 5 Company. Defendant No. 1, in turn, holds 55. 40% of the equity shares of the holding company and consequently, she controls defendant No. 5. According to the plaintiffs, her nominees are on the Board of Directors of defendant No. 5- Company. Defendant No. 1 is also a Director in both the above Companies.