A 2-Judge Bench of the Supreme Court summarised the principles related to s.92 of the Code of Civil Procedure, 1908 (“CPC”) and explained the circumstances when a registered society can be construed as a ‘constructive trust’ so as to maintain a suit under s.92 against it. The Bench was tasked with determining whether a constructive trust could be created in a circumstance wherein a society vests its property in its governing body through the deeming fiction employed under s.5 of the Societies Registration Act, 1860.

The Bench held – “A suit under Section 92 of the CPC is a representative suit of a special nature since the action is instituted on behalf of the public beneficiaries and in public interest”.

The Bench reiterated the conditions or essential pre-requisites to be fulfilled for the applicability of s.92 CPC – “(a) the trust in question must be created for public purposes of a charitable or religious nature; (b) there must exist a breach of trust or a direction of the court must be necessary for the administration of the trust; and (c) the relief claimed must be one or other of the reliefs as enumerated under Section 92(1) of the CPC”.

The Bench held that the method of devolution of the property to the institution or its acquisition, the intention behind the grant of property i.e. for the benefit of the organization or for the personal benefit of any particular individual/family i.e. the historical setting and circumstances of the grant are to be considered while concluding whether a trust of a public charitable or religious nature exists.

The Bench further held that the institution of the suit must be made by two or more persons “having an interest in the trust” i.e. the interest must denote a present and substantial interest and not a sentimental, remote, fictitious or purely illusory interest. It must be clear and direct.

The list of reliefs in s.92(1) relate to removing a trustee, appointing a new trustee, vesting any property in a trustee, directing accounts and inquiries, declaring what proportion of the trust property or of the interest therein shall be allocated to any particular object of the trust, authorising the whole or any part of the trust property to be let, sold, mortgaged, or exchanged, settling a scheme, or granting such further or other reliefs as the nature of the case may require.

The detailed judgment can be read at 47882_2024_8_1502_63019_Judgement_05-Aug-2025.pdf.