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Ravi holds a shop for Sunita under a contract between them. Ravi wants to buy the shop himself, and he has not approached any court. Under the Indian Trusts Act, 1882, what is the position?

Ravi may buy the shop, or take it on lease or mortgage, without the Court's permission. The Act allows this where the obligor holds the property by virtue of a contract with the person for whose benefit he holds it.

  1. AHe cannot buy it in any circumstances because he is treated as a trustee.
  2. BHe may buy it only after paying double the market value into court.
  3. CHe may buy it, or become lessee or mortgagee of it, without the Court's permission, because he holds it by virtue of a contract with the person for whom he holds it.Correct
  4. DHe may buy it only if Sunita is a minor.

Explanation

The proviso to Section 95 lets an obligor who holds the property by virtue of a contract with the person for whose benefit he holds it buy, or become lessee or mortgagee of, the property or any part without the Court's permission. Ravi therefore needs no court permission. The other options add conditions not in the text.

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