1973 (12) TMI 96 - SC - Indian Laws

Court affirms conditional donation creates trust, orders return of funds

STATE OF UTTAR, PRADESH Versus BANSI DHAR AND OTHERS

The Supreme Court upheld the lower courts' findings that the donation was conditional, with unmet conditions resulting in a trust in favor of the donor. ... - Issues Involved:1. Delay in Justice2. Breach of Conditions by Government3. Nature and Efficacy of the Donation4. Application of the Cypres Doctrine5. Conditional Gift and Resulting Trust6. Estoppel and Agreement to Withdraw the ClaimDetailed Analysis:1. Delay in Justice:The litigation, initiated by the sons of a philanthropist, took over 22 years to reach the Supreme Court. This case highlights the 'injustice of delayed justice' and the damage caused by the administration's 'dilatory indifference.' The initial promise made by the Collector in 1945 to construct a women's hospital using a Rs. 30,000 donation from the philanthropist was not fulfilled promptly, leading to prolonged legal battles.2. Breach of Conditions by Government:The philanthropist, Dubey, donated Rs. 30,000 with the understanding that the government would provide a matching contribution and that he would oversee the construction. The government failed to meet these conditions, as evidenced by the actions of subsequent officials who did not follow through on the initial commitments. The breach of these conditions led to the donor's sons seeking legal recourse.3. Nature and Efficacy of the Donation:The courts found that the donation was made with specific conditions: the hospital was to be constructed on an approved site, according to an approved plan, and through Dubey's agency. The government failed to meet these conditions, leading to the conclusion that the donation was not a simple gift but was conditional.4. Application of the Cypres Doctrine:The cypres doctrine, which allows courts to modify charitable trusts to fulfill the donor's general charitable intent when the original objective is impracticable, was considered. However, the courts determined that Dubey's gift was for a specific charitable purpose, not a general one, thus limiting the application of the cypres doctrine.5. Conditional Gift and Resulting Trust:The courts concluded that Dubey's donation was conditional upon the government's matching contribution and the construction of the hospital by Dubey. Since these conditions were not met, the gift did not take effect. The legal consequence was a resulting trust in favor of the donor, meaning the government had to return the Rs. 30,000.6. Estoppel and Agreement to Withdraw the Claim:The government argued that the plaintiffs had agreed to withdraw the claim if the hospital was constructed. However, the courts found no final accepted contract between the parties and no evidence that the government incurred expenses based on the plaintiffs' assurance. Thus, the plea of estoppel was rejected.Conclusion:The Supreme Court upheld the findings of the lower courts, concluding that the donation was conditional and the conditions were not met, resulting in a trust in favor of the donor. The appeal was dismissed, and the government was ordered to return the Rs. 30,000 with costs. The judgment emphasizes the importance of fulfilling conditions attached to charitable donations and the consequences of failing to do so.