Bombay High Court

Rev. Bathuel Ramchandra Tiwade vs Rev.Dn. Albert Dattoba Londhe & ... on 28 November, 2011

Bench: G. S. Godbole

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                IN THE HIGH COURT OF JUDICATURE AT BOMBAY




                                                                              
                            CIVIL APPELLATE JURISDICTION




                                                      
                         WRIT PETITION NO. 4431 OF 2011


      Rev. Bathuel Ramchandra Tiwade                              ...    Petitioner.




                                                     
                     V/s.

      1 Rev.Dn. Albert Dattoba Londhe & Ors.                      ...   Respondents.




                                          
                                           ---
      Mr. M.L.Patil for the Petitioner.
                              
      Mr. C. G. Patil for the Respondent Nos.1 to 4.
      Mr. Suresh Kamble for Respondent No.6.
      Mr. Amit Shete for the Respondent Nos. 7 to 10.
                             
                                           ---

                                          CORAM : G.S. GODBOLE, J.

DATED : 28th NOVEMBER, 2011.

P.C. :

1 Heard Mr. M.L. Patil, Advocate for the Petitioner, Mr. Chetan Patil

for the Respondent Nos. 1 to 4, Mr. Kamble for the Respondent No.6 and

Mr. Shete for the Respondent Nos. 7 to 10.

2 By order dated 12.07.2011 notice for final disposal at the stage of

admission had been issued. Hence, Rule. Rule made returnable forthwith

by consent of the Advocates.

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3 Petitioner is one of the Trustees of the Trust known as "Commission

on Ecumenical Mission and Relations of the United Presbyterian Church

in U.S.A.), Kolhapur". Respondent No. 6 is "Kolhapur Church

Council" (K.C.C.). There is third Trust known as "Kolhapur Diocesan

Council" (KDC). The Petitioner is the Trustee of the Trust namely,

C.O.E.M.A.R. Trust and there is no dispute about their status.

It is the case of the Petitioner that from the available Trust Funds,

the Petitioner was constructing commercial complex and after the complex

is constructed the same was to be used for generating funds.

5 The Respondent Nos. 1 to 5 have filed Application No.10 of 2008

before the Joint Charity Commissioner, Kolhapur, Region Kolhapur under

section 41E of the Bombay Public Trust Act, 1950 (BPT Act) and an

injunction was sought against the construction of the Petitioner. In this

proceeding the Opponent No.3 therein filed the Reply which states that

COEMAR Trust is owner of the property. Some portion has been given to

K.C.C. under the lease deed. KDC is running an Industrial Training

Centre known as "Sangli Industrial School" and for the purpose of running

funds to support the project work of Sangli Industrial School, the Trust

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has submitted an Application to the Sangli, Miraj & Kukpwad Municipal

Corporation for granting requisite Building permission.

6 A separate Reply was filed by the KCC in which it was stated that

though the building permission has been granted on mentioning the entire

land including the land leased out to the KCC, no construction was being

carried out on the land leased to KCC. The learned Joint Charity

Commissioner, Kolhapur framed three points for consideration. The Joint

C.C., Pune I/c. of the office of the Joint C.C. Kolhapur decided the

Application No. 10/2008 by impugned Judgment and Order dated 30th July,

2010. The first reason given against the Opponent was that since portion

of the land had been leased to K.C.C. applying for permission to construct

a structure on the entire land does not stand to reason. Thereafter, the

said Authority has observed in paragraphs 10 and 11 thus :

"10 Assuming for the sake of discussion that COEMAR Trust is razing construction over the disputed property, which is not let out to KCC, necessary permission ought to have been taken from the competent authority under related

provisions of The Bombay Public Trusts Act, 1950. No such permission has been secured by the COEMAR Trust. Without there being permission of this authority, COEMAR Trust is not entitled to utilize funds or raise funds for constructing commercial structure over the disputed property and thereby change its nature. To sum up, it has to be held that, the Opponent Nos. 1 to 4 and Opponent No.5 are raising construction over the disputed property in

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collusion with each other unlawfully and illegally without any authority. In short, the construction of proposed

commercial structure over the disputed property is unauthorized. I, therefore, record my finding on Point No.1

in the affirmative as above.

11 POINTS NOS. 2 AND 3: As stated earlier by virtue of proposed construction over the disputed property, its

nature would be changed. It is not allowed in law. Since the open site of COEMAR Trust is being altered to a commercial site and its benefits are being released in favour of KDC Trust for upgrading Sangli Industrial School, it has

to be informed that, the disputed property is in danger of being wasted and damaged or improperly alienated by

Opponents Nos. 1 to 4, who are the Trustees of COEMAR Trust. Under such a situation, the property is required to be protected by this Authority as contemplated by the

provisions of Section 41-E of the Bombay Public Trusts Act, 1950. I, therefore record my findings on Points Nos. 2 and 3 in the affirmative as above."

7 Aggrieved by this order, Misc. Civil Application No. 205 of 2010

was filed under Section 41-E (5) of the BPT Act in the District Court,

Sangli and by the impugned Judgment and Order dated 02.04.2011, the

learned District Judge -3, Sangli has dismissed the said Application. It

has been interalia observed by the learned District Judge in paragraph 11

of the Judgment thus :

"11 Section 36 of the Bombay Public Trust Act speaks about alienation of immovable property of public trust. Sub clause

(b) says that no lease for period exceeding three years in case of non-agricultural land shall be valid without previous sanction of Charity Commissioner. It further speaks that sanction may be accorded subject to such conditions as

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Charity Commissioner may thinks fit to impose regard being had to the interest, benefit or protection of the trust.

Meaning thereby Section 36 bars leasing out immovable property of trust without previous sanction of charity

commissioner. If trustees satisfy the charity commissioner for any type of transaction in respect of trust property, the charity commissioner is competent enough to grant sanction. Admittedly, no where it is the case of the

opponents that they have applied for such type of sanction from charity commissioner. On the contrary, it is the case of the opponents that proposed construction is being made on disputed property for benefit of trust and if lease period is

exceeded for more than three years, the question of sanction will come in picture. There is no positive evidence from the

side of opponents about period of lease and by considering any future event as submitted on behalf of the opponents, no lease period can be considered in favour of the opponents

for not applying the provisions of Section 36 of the Bombay Public Trust Act. Joint Charity Commissioner who is competent authority while dealing with such matter in impugned order has specifically observed that opponent

Nos. 1 to 4 and 5 are raising construction over disputed property of the trust in collusion with each other and

therefore, trust property is in danger of being wasted and damaged at the hands of the opponents. Such observations of learned Joint Charity Commissioner also fortify with contentions of opponents that they are constructing

commercial complex to generate its own funds for upgradation of K.D.C. Second contention of opponents that for the purpose of earning funds and to support financial status of Sangli Industrial School affiliate to K.D.C. proposed construction is being raised on disputed

property also demonstrate that proposed construction is not as per provision applicable to trust property and its alienation."

8 An Affidavit-in-Reply has been filed by Respondent No.1- Rev. Dn.

Albert Dattoba Londhe in which it is contended that the building

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permission has been obtained for the entire land. It is further contended

that the K.D.C. is entirely different and distinct Trust having no concern

with the COEMAR Trust and hence very purpose for which the

construction was being carried out, namely, for supporting the Sangli

Industrial School run by K.D.C. will make it clear that the amount spent

in the construction of the building was being mis-utilized and hence,

waste of Trust's funds had been duly proved.

9 Mr. M.L. Patil, learned counsel for the Petitioner pointed out that

there is nothing on record to show that any funds were being borrowed.

He pointed out that all the lands were mentioned in the Application. The

new construction was proposed to be raised only on that land which was

not subject a matter of lease in favour of the K.C.C.. He submitted that as

and when premises in the new construction are to be alienated or given

on rent or sold, encumbered in any manner whatsoever permission of the

Charity Commissioner under section 36 would be obtained. He submitted

that the Joint Charity Commissioner and the learned District Judge has

completely mis-construed the provisions of Section 36 of the BPT Act,

1950. He further submitted that there is no requirement of law that for

construction of a building of the Trust from the funds available with the

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Trust, sanction of the Charity Commissioner is required.

10 Mr. Kamble, learned Advocate appearing for the Respondent No.6-

K.C.C. supported Mr. M.L.Patil, learned Advocate for the Petitioner. Mr.

Chetan Patil, learned counsel appearing for the Respondent Nos. 1 to 4,

however, strenuously argued that all the requirements of Section 41-E were

fulfilled in this case. Pointing to the Reply filed before the Joint C.C., he

submitted that the Reply expressly stated that the new construction was

being raised to raise funds for supporting K.D.C. which was completely a

different Trust and hence, it is clear that the funds of COEMAR Trust

were being wasted. He submitted that considering entire scheme of

Sections 35, 36 and 36-A construction in question required prior sanction

of the Charity Commissioner and since prior sanction had not been taken,

the entire construction was illegal and a case for interference under section

41-E had been made out.

11 I have carefully considered the rival contentions. It is no doubt true

that in the Reply filed before the Joint Charity Commissioner, it is clearly

stated that the construction was being raised so as to utilize the commercial

potential of the land/ property of the Trust and to use the said funds to

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support the Sangli Industrial School conducted by K.D.C. However, only

on that count it was improper to jump to the conclusion that the property

of the Trust is being wasted or alienated so as to damage the property or

interest of the Trust. It is difficult to accept the contentions of Mr.

Chetan Patil, learned Advocate for Respondent Nos. 1 to 4 that even for

construction of a new building, permission of the Charity Commissioner

under Sections 36A and 35 is required. Section 35 merely deals with the

investment of public trust money. In fact sub-section (1) of Section 35

clearly stipulates that where the trust property consists of money and

cannot be applied immediately or at any early date to the purposes of the

public trust, the trustees shall be bound to deposit the money in any

Schedule Bank etc.. It is thus clear that if the Trust Fund/ money can be

applied immediately or at any early date to the purposes of the Public

Trust, there is no mandate or statutory requirement, requiring the Trustees

to invest the money. Section 35 merely deals with the instrument or

security in which the excess funds of the Trust can be deposited will have

no application to the facts of the present case.

12 So far as Section 36 is concerned, it deals with the alienation of the

immovable property of the Public Trust. In this case what is being

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constructed is a commercial complex. As and when the construction is

completed and the Trust decides to alienate the tenaments in such

complex, the Trustees are bound to submit an application to the Charity

Commissioner and only after being satisfied that the sale/alienation is

beneficial to the Trust, the Charity Commissioner is empowered to grant

sanction for such alienation. That stage is yet to be reached and such stage

will be reached only after the construction is complete. In my opinion,

the Joint Charity Commissioner and the learned District Judge have

clearly mis-read and mis-construed the provisions of Section 36 of the Act

and have read something in the Statute which is impermissible.

13 The submission of Mr. Chetan Patil that Section 36 A will apply

also does not find favour with me. Section 36-A does not contemplate

taking any prior permission of the Charity Commissioner if the funds of the

trust are being used for the object of the Trust. It is not the case of the

Respondent Nos. 1 to 4 that either the Charity Commissioner or the District

Judge have recorded a finding that the Trustees have borrowed funds for

the purpose of construction. In the absence of any such finding, it is

difficult to accept the submission of Mr. Chetan Patil that Section 36-A is

attracted.

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14 One more aspect appears to have been completely overlooked by the

learned Joint Charity Commissioner and the learned District Judge. Perusal

of the photographs available on the record shows that the RCC work of the

ground plus one floor is complete and the RCC work of the second floor

is also partly complete. Granting an injunction which is not restricted to

a particular date or not restricted to happening of a particular event would

result in a situation where a half constructed building will be left to rot

without any utility. Viewed thus, the balance of convenience was

certainly in favour of the Trustees of COEMAR and against the

Respondent Nos.1 to 4. For overlooking this aspect also, the impugned

Judgments and orders are not sustainable.

15 It is, however, necessary to consider one submission of Mr. Chetan

Patil. According to him some unknown builder is involved in the

construction of a new building and with a view to favour that unknown

builder the Trustees are acting against the interest of the Trust. At this

stage, there is nothing on record to support this contention save and

except the submission of Mr. Chetan Patil that the audit report do not

indicate spending of Trust funds for the construction in question. As

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stated above it is difficult to hold that Section 36 is attracted in so far as

construction of a new building over the Trust property is concerned.

However, if the trustees intend to use constructed tenaments for the

purpose of augmenting or enhancing income for the Trust, then three

important conditions will have to be imposed namely, (1) that absolutely

no alienation of the newly constructed tenaments even for a period less

than three years as contemplated by section 36, shall be done by the

Trustees without obtaining sanction of the Charity Commissioner and, (2)

if the Trustees apply for obtaining sanction for alienation of the building

to the Charity Commissioner, for aforesaid alienations, the Charity

Commissioner shall issue notice of such Application to the Respondent

Nos. 1 to 4 herein and they will be entitled to participate in the proceedings

so as to ensure that the interest of the Trust is not jeopardized and, (3)

Funds of the Trust shall be used only for the stated objects of the Trust.

Needless to state that if supporting the K.D.C. is not one of the objects of

the Trust then funds generated from the alienation cannot be used for

supporting the K.D.C..

16 While allowing this Writ Petition, it is necessary to clarify that the

Petition is being allowed subject to the aforesaid conditions.





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    17    Hence, I pass following order :




                                                  
         i.         The impugned Judgment and Order        dated 30th July, 2010

         passed     by the learned Joint Charity Commissioner, Pune I/c. Jt.

Charity Commissioner Kolhapur Region,Kolhapur in Application No.

10 of 2008, Exh. 'F' pages 40 to 47 and the impugned Judgment and

Order dated 02.04.2011 passed by the learned District Judge-3 Sangli

in Misc. Civil Application No.205 /2010 Exh. G, pages 48 to 64 are

hereby quashed and set aside and the Application No. 10 of 2008 is

dismissed. However, this will be subject to the following

conditions :

(a) that absolutely no alienation of the newly

constructed tenaments even for a period less than three years

as contemplated by section 36, shall be done by the Trustees

without obtaining sanction of the Charity Commissioner;

b) if the Trustees apply for obtaining sanction for