2021 Supreme(Bom) 1043

IN THE HIGH COURT OF JUDICATURE OF BOMBAY BENCH AT NAGPUR
A.S. Chandurkar, Pushpa V Ganediwala, JJ.
Chandrakant - Appellant
Versus
Alka Sahani - Respondent
First Appeal No. 600 of 2016
Decided On : 27-04-2021

The exercise of jurisdiction under Section 47 of the Maharashtra Public Trusts Act, 1950, by the Charity Commissioner is subject to specific conditions precedent, including the absence of a validly constituted Administrative Body and the need to ensure proper functioning of the trust in accordance with its Articles of Association. The Charity Commissioner must conduct a proper enquiry, consider the eligibility criteria for membership as per the bye-laws of the trust, and record sufficient reasons for the appointment of each member of the Administrative Body.

Headnote:

Bombay Public Trust Act, 1950 - Section 47 - Appointment of Trustees - Scope and Applicability - Joint Charity Commissioner's jurisdiction to appoint Trustees - Conditions precedent - Procedure to be followed - Consideration of relevant factors - Recording of reasons - Constitution of Administrative Body - Compliance with Articles of Association and bye-laws of the Trust - Verification of credentials - Public notice - Enquiry - Appealability of order.

Fact of the Case:

Vishwa Punarnirman Sangha, Nagpur, a Trust registered under the Societies Registration Act, 1860 and the Bombay Public Trusts Act (now Maharashtra Public Trusts Act) (MPT Act), runs a school with around 2500 students and 150 staff members. The Sangha is governed by its Memorandum of Association and Articles of Association. The administration of the Sangha is carried out by the Administrative Body constituted in accordance with the Articles of Association, consisting of Trustee-Administrators and Co-opted Administrators, ordinarily totaling 19 persons. Due to various disputes and rejections of Change Reports, the strength of the legal Trustees came down below the minimum number of Trustees as laid down in the Constitution. The Joint Charity Commissioner, Mumbai, invoked jurisdiction under Section 47 of the MPT Act and appointed 10 Trustees/Administrators and 9 Co-opted Administrators.

Finding of the Court:

1. The Joint Charity Commissioner was justified in invoking jurisdiction under Section 47 of the MPT Act in the given circumstances, considering the absence of a validly constituted Administrative Body and the need to ensure proper functioning of the Sangha in accordance with its Articles of Association. 2. However, the manner in which the Administrative Body was constituted by the Joint Charity Commissioner was not in accordance with the Articles of Association and the provisions of Section 47 of the MPT Act. 3. The Joint Charity Commissioner failed to conduct a proper enquiry, consider the eligibility criteria for membership as per the bye-laws of the Sangha, and record sufficient reasons for the appointment of each member of the Administrative Body.

Issues: 1. Whether the Joint Charity Commissioner was justified in invoking jurisdiction under Section 47 of the MPT Act to appoint Trustees and Co-opted Administrators for the Sangha. 2. Whether the Administrative Body constituted by the Joint Charity Commissioner was in accordance with the Articles of Association and the provisions of Section 47 of the MPT Act.

Ratio Decidendi: 1. Section 47 of the MPT Act is a complete code in itself, providing for the filing of applications, hearing of parties, conducting enquiries, passing of orders, appeals against orders, and the period of limitation for filing appeals. An order under Section 47 is elevated to the status of a decree. 2. The power under Section 47 can be exercised only in specific circumstances, such as when there is no trustee for a trust or the trust cannot be administered until a vacancy is filled, or for the suspension, removal, or discharge of a trustee for specified reasons. 3. While exercising jurisdiction under Section 47, the Charity Commissioner must conduct an enquiry, extend proper opportunity of hearing to the parties, and, where disputed questions of facts are involved, allow the parties to lead evidence if they so desire. 4. The Charity Commissioner must consider the factors mentioned in Section 47(3) of the MPT Act, including the wishes of the author of the trust, the wishes of persons empowered to appoint a new trustee, the impact of the appointment on the execution of the trust, the interest of the public, and the custom and usage of the trust. 5. The Charity Commissioner must record sufficient reasons for the appointment of each member of the Administrative Body, demonstrating compliance with the provisions of Section 47(2) and (3) of the MPT Act.

Final Decision: The First Appeal was partly allowed. The judgment of the Joint Charity Commissioner was quashed and set aside to the extent it constituted the Administrative Body and issued further directions. The proceedings were remanded for re-constitution of the Administrative Body in accordance with the Articles of Association of the Sangha, by calling fresh applications from the public, conducting a fresh enquiry, and considering the relevant factors under Section 47 of the MPT Act. The interim arrangement in terms of previous orders was to continue until the disposal of the remanded proceedings.