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TMI Blog1979 (7) TMI 259X X X X Extracts X X X X X X X X Extracts X X X X ..... of that trust which was styled as Dadabhai Trust- under Section 18 of the Bombay Public Trusts Act, 1950. On 31st January 1967, it was registered under S. 19 of the Bombay public Trusts Act. Respondents 1 and 2 appealed to the Charity Commissioner against the order of registration of Dadabhai Trust. It was appeal No. 56 of 1957. The appeal was dismissed. Thereafter an application under Section 72 of the Bombay Public Trusts Act was made by respondents 1 and 2 to the District Judge at Surat calling in question the appellate order of the Charity Commissioner. The District Court dismissed it by its order dated 18th October 1967. That order was challenged in this High Court in First Appeal No. 247 of 1968, That appeal, in the first instance, came up for hearing before Mr. Justice T.' U. Mehta who held that the transaction evidenced by the deed of settlement dated 31st December, 1956, was a gift. Therefore, under Section 85A read with Section 70(O) of the Tenancy Act, he referred to the Mamlatdar. Karnrej, the following issue: Whether the transaction evidenced by the vesting of the disputed property in Dadabhai Trust under document dated 31-12-1956, is valid or not in view of the p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... es not require the previous permission of the Collector in cases where the property is settled in trust. (iv) Reference made to the Mamlatdar, Kamrej, by Mr. Justice T. U. Mehta by his interlocutory order is bad and without jurisdiction. (v) The jurisdiction of the Charity Commissioner to decide whether particular properties are public trust proper-a ties or not is not excluded by Section 85 of the Tenancy Act and, therefore, he decided the question correctly and with jurisdiction. 5. The first two contentions raised by Mrs, Mehta can be conveniently dealt with together. Section 122 of the Transfer for Property Act, defines Gift in the following terms: Gift is the transfer of certain existing- moveable or Immovable property made voluntarily and without consideration, by one person, called the donor, to another, called the donee, and accepted by or on behalf of the donee . The rest of the provision of Section 122 is not material for the purpose of the present case. The deed of settlement executed by the appellant on 31st December 1956, shows that he created t1ilder that transaction a trust in respect of the lands in question and appointed himself as the sole trustee. He has also pro ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ne's own favour, an exchange in one's own favour and a gift in one's own favour do not bring about any change in the character or ownership of the property and therefore they are not transfers. Therefore, there is no transfer at all in the properties so dealt with and all rights therein remain where they are and do not undergo any transfer or transformation whatsoever even after a transaction of sale,' mortgage, lease, gift or exchange has been executed by the owner in favour of himself. It is, therefore, clear that, in order that a transaction may amount to a gift, there must be a donor under the deed and there must be a donee. One person cannot be the donor and the donee. He cannot in his capacity as the donor gift an Immovable property to himself and accepts it as the donee. We say so because there is no transfer whatsoever in this case. We are mindful of the definition of transfer given in Section 5 of the Transfer of Property Act. We are dealing with it shortly. We are, however, clear in our minds that in order that a transaction may amount to a gift, there must be a transfer from one legal person to another legal person of an Immovable property and that there ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... re other living persons. He could not transfer it to himself. It was by the Amending Act 20 of 1929 that transfer of an Immovable property to oneself was provided by Section 5. What is this transfer to oneself and how does it reflect upon Section 122? When a person owns an Immovable property, he is both its legal owner as well as its beneficial owner. When he sells it to another person, he transfers both the ownerships to the vendee. When he mortgages an Immovable property to another person, he transfers all his rights of legal ownership and beneficial ownership therein to the mortgagee except the equity of redemption, which he retains. When a person leases out his Immovable property to another person, he transfers all his rights - legal and beneficial - to the lessee, except the right to recover rent and the right of re-entry, which he ' reserves for himself. It is difficult to imagine a person exchanging in his own favour one property of his for another property of his. Such a situation in the very nature of things is inconceivable. When a person gifts a property to another - not by way of trust - he transfers both - the legal and the beneficial ownership therein -to the done ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ction a trust is created when the author of the trust indicates with reasonable certainty by any words or acts (a) an intention on his part to create thereby a trust, (b) the purpose of the trust, (c) the beneficiary, and (d) the trust-property, and (unless the trust is declared by will or the author of the trust is himself to be the trustee) transfers the trust-property to the trustee . Section 6 of the Trusts Act, in terms, contemplates the 'transfer' of 'the trust property' except where--the author of the trust or the settlor is himself the trustee. Therefore, within the meaning of Sec., 6 of the Trusts Act, 1882, when the settlor or the author of the trust appoints himself as the sole trustee, there is no transfer. If the transaction amounts to a gift, there must be a 'transfer'. But, every transfer of a property to himself does not create a 'gift'. Creation of a trust and transfer to it of the properties by a person is one more mode of transferring the property, independently of and dehors the 'gift'. We say so because the gift requires the donor and the donee and acceptance by and on behalf of the donee. In addition, the donee must be a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the ownership of the property is to be transferred. In the case of Immovable property only a declaration is necessary. Therefore, in the view of the Calcutta High Court, transfer contemplated by Section 6 of the Trusts Act not only includes a sale, mortgage, lease, exchange and gift but also includes a vesting declaration. Therefore, what a person does by creating a trust mi respect of his Immovable properties and appointing himself as the sole trustee of the trust is to make a vesting declaration and not to make a gift of the property. It is this vesting declaration, which invests him with the legal ownership of the property, divests him of the beneficial ownership and transfers the latter to the beneficiaries of the trust. 17. Therefore, when the appellant created Dadabhai Trust and appointed himself' as the sole trustee, what he did was to make a vesting declaration and not to make a gift. Since he appointed himself as the sole trustee, he did not bring about the transfer of the property as contemplated by Section 122 of the Transfer of Property Act but produced a situation contemplated by Section 6 of the Trusts Act. If we take a different view and hold- that such a transf ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in the instant case was to make a vesting declaration without bringing about the transfer of his Immovable property within the meaning of Section 122 of the Transfer of Property Act. Therefore, no question arose under the-provisions of the Tenancy Act, which was required to be settled, decided or dealt with by the Marnlatdar or the Tribunal. Therefore, no reference could have been made by Mr. Justice T. U. Mehta under Section 85A of the Tenancy Act of the issue to the Mamlatdar, Kamrej. In our opinion, therefore, the reference of the issue, which he made, was without jurisdiction. The order of reference made by him is, therefore, set aside. This is the answer to the third and the fourth contention, which Mrs. Mehta has raised before us. 19. The last contention which she has raised is that the jurisdiction of the Charity Commissioner to find out whether the properties in question were the public trust properties or not, was not excluded by Section 85 of the Tenancy Act and that, therefore, also, the reference made by Mr. Justice T. U. Mehta to the Mamlatdar was bad in law. In view of the findings, which we have recorded on the first contention, it is not necessary for us to express ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n the case on behalf of the respondents would like us to take a step further and hold that that is the necessary corollary of the decision of the Supreme Court. We are unable to uphold the argument raised in that behalf because to take the view which has been canvassed on behalf: of the respondents is to nullify a part of the provision, of Section 6 of the Trusts Act while unduly enlarging the scope of Section 122 of the Transfer of Property Act. 22. The next decision to which we may refer is in Chhatra Kumari Devi v. Mohan Bikram Shah . It was a case in which the Privy Council was concerned with the application of Section 5 of the Transfer of Property Act as it was before it was amended. It has been observed in that decision that the Indian law does not recognize legal and equitable estates and that therefore there can be but one owner and where the property is vested in a trustee the owner must be the trustee. It has been further observed that the trustee is the owner of the trust property, the right of the beneficiary -being mi a proper case to call upon the trustee to convey to him. These observations made by the Privy Council cannot be applied to the facts of the instant case ..... X X X X Extracts X X X X X X X X Extracts X X X X
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