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2006 Supreme(Bom) 431
IN THE HIGH COURT OF BOMBAY
Maha Pragya Vidya Nidhi Foundation
Versus
State of Maharashtra
Decided on,MARCH 21, 2006
GOKHALE, J.
Headnote:Bombay Public Trusts Act, 1950 - Sections 41-A and 69 Grant of membership of the charitable trust Applicants wanted to be considered for membership of the trust They were ready to make their contributions Order passed by the Charity Commissioner finalising the list of valid members for elections to trust whereby some 32 new members became eligible to become members and vote The trust had, in fact, agreed that on the applicants bringing in the necessary money, their applications will be considered, though of course, in accordance with the Rules and Regulations The trust is expected to give some reasons why the membership was being opposed The trust having failed to give any reasons, the Charity Commissioner was bound to allow these respondents to be enrolled as members while finalising the membership. AIR 1971 SC 966; AIR 1991 Bom 30; AIR 1916 Oudh 94; JT 2000 (B) SCC 68; 1988 (2) SCC 602: (1984) 2 SCC 183 Referred.
Bombay Public Trusts Act, 1950 - Section 69 Trust Addition of new members to Allowed by Charity Commissioner Challenged Application rejected by Managing Committee in view of clause 5-E of Trust Deed Committee not came out with any reasons to support their decision Charity Commissioner bound to allow their applications Decision not erroneous No interference narrated with. There cannot be any dispute about the proposition laid down by the Apex Court in Damyanti ’s case (supra). In a voluntary association, no member can be imposed, except with the consent of its existing members. So are the propositions laid down in other cases, though the judgment in Sejal Rikeen Dalal ’s case is s lightly different in the sense, suitability is an aspect which is permitted to be gone into. In the present case, it was specifically canvassed by respondent Nos. 5 to 36 in the earlier writ petition that they wanted to bring in money so that there is no domination of one person over the trust. That was also with a view to seeing that the ground floor of the school building is retained for the school. The trust did not as such express any disagreement with their suggestion, as can be seen from para 24 of the earlier order quoted above. Respondent Nos. 5 to 36 have thereafter brought in Rs. 2.50 crores and applied for membership. The order of this Court has been confirmed by the Apex Court in the peculiar facts and circumstances of the case while holding that the trust may scrutinise the applications but reject them for valid reasons. Obviously, the trust is expected to give some reasons why the membership of respondents Nos. 5 to 36 was being opposed. The trust having failed to give any reasons, the Charity Commissioner was bound to allow these respondents to be enrolled as members while finalising the membership. Court do not think that there is anything erroneous in this decision.
( 2 ) THE petitioners seek to challenge the order dated 8. 2. 2006 passed by the Charity Commissioner, Maharashtra, mumbai, finalising the list of valid members for elections to petitioner no. 1-trust whereby some 32 new members (i. e. respondent Nos. 5 to 36 herein) have become eligible to become members and vote. The petition also seeks to challenge the notice dated 10. 2. 2006 fixing the election programme and the Charity Commissioners order dated 14. 2. 2006 declining to postpone the elections.
( 3 ) THE brief facts leading to the present petition are as follows:- petitioner no. 1 herein is a charitable trust governed under the Bombay Public Trusts Act, 1950. Amongst others, one of the objectives of this trust is to establish and to take over and maintain schools and educational institutions. One Seth Gokuldas Tejpal charities, another public trust, has been running a school at Dadyseth Agiary Lane, Kalbadevi Road, Mumbai. The said G. T. trust wanted to sell the property as it was not in a position to carry on the educational activities. The petitioner-trust agreed to purchase that property for a consideration of Rs. 5. 50 crores and one mr. Gauti was authorised on behalf of the first petitioner trust to negotiate and finalise that deal. He was given all the powers of the Managing Committee and the regulations of the trust were altered for that purpose and a change report was filed before the Charity commissioner and it came to be accepted in January 2000. Petitioner no. 1-trust needed to raise a loan to make the payment and, hence, negotiations were held with Union bank of India which sanctioned a term loan of Rs. 4. 40 crores. The loan was sanctioned on condition that the trustees will give personal guarantees. Petitioner no. 1 trust had already paid Rs. 1. 10 crore to the said G. T. trust and the balance was paid after sanction of this loan. Thereafter, it was decided on 5. 4. 2004 to let out a part of the premises on the ground floor admeasuring 4,000 sq. ft. to Union Bank of India for 20 years. Some of the members of the trust led by one Mithalal N. Sisodia objected their decisions. Amongst other grievances, they contended that necessary notice was not given to them and other members. Yet a resolution of approval came to be passed thereafter.
( 4 ) THE above three decisions, viz. , (i) the change report; (ii) the permission to raise a loan of Rs. 4. 40 crores; and (iii) grant of lease in favour of Union Bank of India for 20 years, came to be challenged by filing writ Petition No. 265 of 2005 by Mithalal Sisodia and another member. When the matter came up before this court, it was pointed out that a personal guarantee of rs. 2. 20 crores had been given by the above referred Mr. Gauti (respondent No. 8 in that petition ). By order dated 9. 3. 2005, this Court recorded that respondent Nos. 5 to 36 herein were ready to make their contributions. They wanted to be considered for membership of the trust and contended that only one person i. e. respondent No. 8 to that petition could not be permitted to take control of the properties of the trust. Granting membership to such additional persons was opposed on behalf of Mr. Gauti and others by relying upon the judgement in the case of damyanti v. Union of India (AIR 1971 S. C. 966) concerning the Hindi Sahitya Sammelan Act, 1962 and the decision of a single Judge of this Court in Sejal Rikeen dalal v. Stock Exchange Bombay (AIR 1991 Bom. 30) and abhoy Pado Bose v. Queens Anglo-Sanskrit School (AIR 1916 Oudh 94 ).
( 5 ) AFTER hearing the counsel for all the parties, this court was of the view that the Asstt. Charity commissioner had erred in passing the orders and the charity Commissioner had further erred in not exercising the jurisdiction vested in him when revisions were filed. It was also noted tha
