27 Apr 2121

Power conferred under Section 47 of the Maharashtra Public Trusts Act, 1950 can be exercised by the Charity Commissioner only in specific cases - Bombay High Court

Case : Jagjeet Singh Gurusharan Singh and Ors. v. Alka Sahani and Ors. First Appeal No. 600 of 2016

Court : Bombay High Court

Bench : Justice Pushpa V. Ganediwala and Justice A. S. Chandurkar

Decided on : 27 Apr 2121

Relevant Statues

Sections 41-A, 47 of the Maharashtra Public Trusts Act, 1950

Brief Facts & Procedure History

1. The relevant seminal facts are that the Vishwa Punarnirman Sangha is a Trust registered under the provisions of the Societies Registration Act, 1860 and the Maharashtra Public Trusts Act, 1950 vide Registration Number E-1344(N). The administration of the Sangha is governed by its Articles of Association.  

2. The cause of action arises when all the change reports filed by the Applicants before the Assistant Charity Commissioner was rejected and the Trust was subjected to interference by the outsiders without having any locus. In order to protect the properties of the Trust and to streamline its administration, Trustees are to be appointed in accordance with its bye-laws. The Applicants showed their inclination under Section 41-A of the Maharashtra Public Trusts Act, 1950 to be appointed as Trustees. The learned Joint Charity Commissioner appointed 10 Trustees or Administrators and 9 Co-opted Administrators of the Trust.

3. The present appeal is directed against the judgment and order dated 19/05/2016 passed by the Joint Charity Commission in Application Number 74/2015 which was filed under Section 47 and Section 41-A of the Maharashtra Public Trusts Act, 1950

The Issues of the Case

Whether the Joint Charity Commissioner is justified in passing the order under Section 47 of the Maharashtra Public Trusts Act, 1950?

Whether the administrative body constituted by the Joint Charity Commissioner is in accordance with the law and the bye-laws of the Trust?

The Observations of the Court

With respect to Issue 1, the following were the observations of the Honourable Bombay High Court:

1. The Honourable Bombay High Court critically analyzed Section 47 of the Maharashtra Public Trusts Act, 1950 and by referring to the case of Gyandeo Tukaram Devre & Ors. Vs. Ganpat Nathu Devre and Ors., 1995(1) Mh.L.J. 99, observed that the power conferred under said section can be exercised by the Charity Commissioner only in specific circumstances.

2. The Honourable Bombay High Court observed that the election conducted for the post of the President of the Sangha is contrary to the provisions of the bye-laws. Hence, the selection of Mr. Marwah as the President is considered to be illegal. Furthermore, the appointments of the Co-opted Administrators are also considered to be bad in law.

3. The Honourable Bombay High Court further analyzed the Articles of Association of the Sangha and explained the necessity of a validly constituted Administrative Body for properly administering the Trust. The Administrative Body exercises full administrative control over the Trust and properties of the Trust vest with them.

4. The Honourable Bombay  High Court took cognizance of the fact that there are only three Trustee-Administrators whereas a quorum of nine members of the Administrative Body is required for its meetings.

5. By referring to the case of Vanmala Manoharrao Kamdi v. Deputy Charity Commissioner, 2012 SCC OnLine Bom 688 : (2012) 3 Mah LJ 59, the Honourable Bombay High Court observed that the function of the Charity Commissioner while acting under the provisions of the Act is administrative, judicial as well as quasi-judicial.

6. Based on the above considerations, the Honourable Bombay High Court was satisfied that in the absence of a validly constituted Administrative Body as contemplated by the Articles of Association, the exercise of jurisdiction under Section 47(1) and (2) of the Maharashtra Public Trusts Act, 1950 by the learned Joint Charity Commissioner was justified.

With respect to Issue 2, the following were the observations of the Honourable Bombay High Court:

7. The Honourable Bombay High Court observed that the learned Joint Charity Commissioner did not consider the factors mentioned in Section 47(3) of the Maharashtra Public Trusts Act, 1950. Further, he did not consider the eligibility criteria as per the bye-laws and verify the credentials of the proposed members of the Administrative Body.

8. The Honourable Bombay High Court further contemplated that the learned Authority did not consider the objections brought out by the Appellants from time to time during the proceedings and adopted a shortcut method to postpone the decision on the said applications.

9. Therefore, based on the above considerations, this part of the order of the learned Joint Charity Commissioner was set aside by the Honourable Bombay High Court.

The Decision Held by the Court

1. The Honourable Bombay High Court partly allowed the First Appeal upholding the judgment dated 19/05/2016 in Application Number 74/2015 passed by the learned Joint Charity Commissioner to the extent of the jurisdiction under Section 47 of the Maharashtra Public Trusts Act, 1950 while setting aside the judgment to the extent of the Administrative Body that has been constituted and issuance of further directions on that aspect.

2. The Honourable Bombay High Court opined the remand of the proceedings for the reconstitution of the Administrative Body in accordance with the Articles of Association of the Sangha and the interim arrangement in terms of the orders dated 20/06/2016 and 05/12/2019 passed in the First Appeal continue to operate.

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