Bombay High Court
Vitthal Rukmini Devasthan Trust, ... vs The Learned Joint Charity ... on 7 July, 2022
Bench: Manish Pitale
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IN THE HIGH COURT OF JUDICATURE AT BOMBAY
NAGPUR BENCH AT NAGPUR
WRIT PETITION NO. 2825 OF 2020
M/s. Sai Builder and Developer
through its Partner,
Shri Deepak Gangadhar Mandaokar,
Aged about 43 years,
Occupation : Business,
.. Petitioner
R/o. Pasahan Chowk, Hawaldar Pura,
Wardha, Tah. And Dist. Wardha.
Versus
1. Joint Charity Commissioner,
Nagpur, Tah.and Dist. : Nagpur
2. Vitthal Rukhmai Deosthan Trust, .. Respondents
Registration No. A441
At Pipri, Taq. Wardha, Dist. Wardha,
Through its Trustee, Shri Vinayak
Sadashivrao Meghe
AND
WRIT PETITION NO. 2516 OF 2020
Vitthal Rukhmai Deosthan Trust,
Registration No. A-441(W),
At Pipri (Meghe), Taq. & Dist. Wardha,
Through it's President Shri Vinayak
Sadashivrao Meghe, aged about 64 years,
.. Petitioner
Occ.: Retired, R/o. Borgaon (Meghe),
Tq. and Dist. Wardha.
Versus
1. The Learned Joint Charity Commissioner,
Behind General Post Office, Civil Lines,
Nagpur
2. M/s. Sai Builders and Developer
through its Partner, .. Respondents
Shri Deepak Gangadharrao Mandavkar,
Aged about 43 years,
Occupation : Business,
R/o. Pashan Chowk, Hawaldar Pura,
Wardha, Tah. And Dist. Wardha.
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Mr. A.D. Mohgaonkar, Advocate for petitioner in WP No.2825/2020 and
respondent No.2 in WP No.2516/2020.
Ms. T.H. Khan, A.G.P. for respondent No.1 in both petitions.
Mr. A.P. Thakre, Advocate for respondent No.2 in WP No.2825/2020 and
petitioner in WP No.2516/2020.
CORAM : MANISH PITALE, J.
RESERVED ON : 05/07/2022
PRONOUNCED ON : 07/07/2022
JUDGMENT
Rule. Rule made returnable forthwith. Heard finally with
the consent of the learned counsel appearing for the rival parties.
(2) A Trust and a highest bidder in a project for renovation
of a temple managed by the Trust, are before this Court challenging order
dated 06.03.2020 passed by the Joint Charity Commissioner, Nagpur,
whereby an application filed by the Trust under Section 36(1)(a) of the
Maharashtra Public Trusts Act, 1950 (hereinafter referred to as 'the said Act')
was dismissed.
(3) The petitioner in Writ Petition No.2516/2020 is the Trust
called 'Vitthal Rukhmai Deosthan Trust', Pipri (Meghe), Tah. & District
Wardha, which manages a temple about 56 years old. Since, the temple is in
dilapidated condition, the said Trust decided to renovate the same. On
11.07.2014, the Executive Committee of the Trust held a meeting and passed
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a resolution for undertaking renovation of the temple and for obtaining
estimate for the renovation/reconstruction plan. Thereupon, on 04.08.2014,
the Executive Committee of the Trust unanimously resolved to sell property
of the Trust located in Gat No.289/01, admeasuring 3.706 acres at Mouza
Pipri (Meghe), Tah. & Dist. Wardha, in order to raise funds for undertaking
the project of renovation of the temple. Pursuant thereto, on 18.09.2014,
tenders were published in two newspapers i.e. "Jana Madhyam" and
"Shramik Sangharsh", circulated in Wardha.
(4) There were four bidders who came forward in response
to the said tender notices and in a meeting held on 27.09.2014, the Trust
decided to accept the highest bid offered by M/s.Sai Builders and Developers
i.e. the petitioner in Writ Petition No.2825/2020. As per the highest bid of
the said petitioner-developer at Rs. 54,00,000/- per acre, the total
consideration came to Rs. 2,00,15,000/-, out of which Rs.30,11,000/- was
paid by the said petitioner to the Trust as earnest money and the transaction
was made subject to permission to be granted by the respondent - Joint
Charity Commissioner under Section 36(1)(a) of the said Act.
(5) In this backdrop, on 21.10.2014, the Trust moved the
said application. The Joint Charity Commissioner asked for a valuation
report. Accordingly, the Trust submitted the valuation report dated
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17.10.2017, issued by the Joint Sub-Registrar, Wardha, and as per the Ready
Reckoner the value was shown as Rs.1,19,37,500/-. On 09.11.2017, the Joint
Charity Commissioner passed an order directing the Trust to submit
documents demonstrating that it was a Class-I occupant of the property in
question and thereafter to issue fresh advertisements in two newspapers
stating that it was a Class-I occupant of the said property. This was on the
basis that when the tender notices were published by way of advertisement
by the Trust, it was a Class - II occupant.
(6) At this stage, the petitioner - developer in Writ Petition
No.2825/2020, filed application for intervention before the Joint Charity
Commissioner as it was an interested party in the said proceedings. The said
application was allowed and thereafter, the petitioner - developer filed an
application before the Joint Charity Commissioner, for recalling the order
dated 09.11.2017. The said application was dismissed by an order dated
12.09.2018. Being aggrieved by the orders dated 09.11.2017 and
12.09.2018, passed by the Joint Charity Commissioner, the petitioner -
developer filed Writ Petition No.2384/2019, before this Court. By order
dated 11.12.2019, the said petition was allowed and the impugned order was
quashed and set aside. The Joint Charity Commissioner was directed to
proceed to decide the application filed under Section 36(1)(a) of the said Act,
within a period of three months from the date of the order.
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(7) Pursuant thereto, the Joint Charity Commissioner heard
the petitioner - Trust as well as the petitioner - developer and by the
impugned judgment and order dated 06.03.2020, dismissed the application
under the aforesaid provision. Aggrieved by the same, the petitioners have
filed the present writ petitions wherein notices were issued and the petitions
were taken up for hearing.
(8) Mr. Mohgaonkar, learned counsel appearing for the
petitioner - developer in Writ Petition No.2825/2020 submitted that the Joint
Charity Commissioner erred in dismissing the application and the reasons
stated in the impugned order were all unsustainable. It was emphasized that
the bid offered by the petitioner was not only the highest bid, but it was much
more than the valuation placed on record by the petitioner - Trust and also
the valuation given by a Government approved valuer at Rs.1,66,50,000/-.
Despite the aforesaid facts placed on record, according to the learned counsel
for the petitioner - developer, the Joint Charity Commissioner, dismissed the
application on frivolous grounds, as a consequence of which, the project of
renovation of dilapidated temple has been unnecessarily delayed.
(9) Reliance was placed on judgment of the Division Bench
of this Court in the case of Suburban Education Society, Mumbai and anr.
Vs. Charity Commissioner of Maharashtra State, Mumbai and Ors. 2004
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(2) Mh.L.J. 792, wherein it was held that the Charity Commissioner has to
enquire into the genuine need of the Trust and whether the property in
question is being sold in the interest of the Trust and its beneficiaries.
(10) Mr. A.P. Thakre, learned counsel appearing for the
petitioner - Trust in Writ Petition No.2516/2020, supported the contentions
raised on behalf of the petitioner - developer and additionally submitted that
all the requirements to demonstrate that the ingredients of Section 36(1)(a) of
the said Act were satisfied, were placed on record before the Joint Charity
Commissioner. It was submitted that merely because the tender notices were
published in two Marathi newspapers instead of one Marathi and one English
newspaper, it could not be said that there had been any major deviation from
the norms. As regards audit reports of the relevant years, it was submitted
that the same were placed by a separate application before the Joint Charity
Commissioner, which was ignored. It was submitted that the highest bid
offered by the petitioner - developer ought to have been permitted to be
accepted, so that the renovation of the temple could be undertaken at the
earliest.
(11) On the other hand, Ms. T.H. Khan, learned Assistant
Government Pleader appearing for respondent - Joint Charity Commissioner,
submitted that cogent reasons were stated in the impugned judgment and
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order, while dismissing the application filed by the petitioner - Trust. It was
submitted that the Charity Commissioner being the custodian of the
properties of the Trust, was enjoined to ensure that all the requirements of the
Act were satisfied before such permissions could be granted for disposing of
Trust properties. It was further submitted that there was a fundamental defect
in the procedure adopted by the petitioner - Trust in the present case,
inasmuch as application under Section 36(1)(a) of the said Act was moved
after the process of inviting bids was undertaken and the petitioner -
developer was selected as the highest bidder. It was submitted that the
petitioner - Trust ought to have first sought permission from the Joint Charity
Commissioner and then the process should have been initiated. For the said
proposition, the learned AGP relied upon the judgment and order of this
Court in the case of Central Hindu Military Social Education Society Vs. the
Joint Charity Commissioner, Nashik and Ors., and connected petitions
(judgment and order dated 22.10.2018 passed in Writ Petition
No.6743/2007).
(12) Heard the learned counsel for the rival parties and
perused the material on record. Before dealing with the contentions raised by
the rival parties on the specific reasons stated in the impugned order while
dismissing the application of the petitioner - Trust, it would be appropriate to
consider the contentions raised by the learned AGP that there was the
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aforesaid fundamental defect in the procedure adopted by the petitioner -
Trust while seeking to dispose of Trust property, in order to raise funds for
renovation of the temple.
(13) Section 36(1)(a) of the said Act specifically provides that
there can be no sale of any immovable property belonging to a Trust, unless
the Charity Commissioner is satisfied that such immovable property is being
disposed of in the interest of the public Trust by imposing such conditions as
necessary to protect the interest or benefit of the Trust. The learned AGP
placed much emphasis on the words "previous sanction" of the Charity
Commissioner to contend that in the present case, before initiating the
process of issuance of advertisements inviting bids and selecting the highest
bidder, the petitioner - Trust ought to have applied under the said provision
before the Joint Charity Commissioner. Having applied after completing the
process of inviting bids and selecting the highest bidder, according to the
learned AGP, the petitioner - Trust had undertaken a flawed procedure,
which vitiated the entire proceedings. Reliance was placed on the aforesaid
judgment of this Court in the case of the Central Hindu Military Social
Education Society Vs. The Joint Charity Commissioner and anr. (supra).
(14) A perusal of the aforesaid judgment would show that this
Court, after referring to Section 36(1)(a) of the said Act, emphasized upon
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the necessity for a transparent process to be undertaken while disposing of
Trust property. In the facts of the said case, it was found that the Trust
therein had neither invited tenders nor held public auction, but a private party
was straightaway chosen to negotiate and the transaction was completed.
After having undertaken such a transaction, the Trust had applied before the
Joint Charity Commissioner for sanction. The Joint Charity Commissioner
in the said case refused to grant post facto sanction, primarily on the ground
that no tenders were invited by the Trust and that the entire procedure
adopted in the said case was found to be unsustainable. It is in the context of
the such facts, that this Court in the aforesaid judgment emphasized upon the
necessity for transparency in the process of disposing of Trust property and in
that regard, it was held that post facto sanction could not have been granted
and that the Joint Charity Commissioner in the said case was justified in
rejecting the application. While considering earlier judgments of this Court,
it was emphasized that the words "previous sanction" clearly contemplate
obtaining sanction from the Charity Commissioner before completing the
transaction.
(15) This Court is of the opinion that the said judgment would
not assist the learned AGP in contending that there was a fundamental flaw in
the manner in which the petitioner - Trust had approached the Joint Charity
Commissioner under Section 36(1)(a) of the said Act. In the present case, the
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petitioner - Trust did not complete the transaction when it approached the
Joint Charity Commissioner under the said provision. The entire transaction
with the petitioner - developer was specifically subject to sanction to be
granted by the Joint Charity Commissioner under Section 36(1)(a) of the said
Act. This does not mean that the petitioner - Trust could not have initiated
the process of inviting bids for choosing the highest bidder, as long as the
process could be demonstrated to be transparent and in the interest of the
Trust. Therefore, it cannot be said that the procedure adopted by the
petitioner - Trust was defective. Even otherwise, the said judgment of this
Court in the case of Central Hindu Military Social Education Society (supra)
was delivered on 22.10.2008 and thereafter, by amendment brought into
effect with effect from 10.02.2017, Sub-Section (5) has been added to
Section 36 of the said Act, which provides for ex-post facto sanction to
transfer of Trust property by the Charity Commissioner. The factors
indicated in the said provision include satisfaction of the Charity
Commissioner that the property was transferred for consideration not less
than prevalent market value of the property. Therefore, there is no substance
in the said contention raised by the learned AGP.
(16) Insofar as the reasons recorded in the impugned order
passed by the Joint Charity Commissioner, while dismissing the application
filed by the petitioner - Trust are concerned, it is found that all three reasons
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are not sustainable. The first reason recorded in the impugned order was that
the petitioner - Trust did not submit a sanctioned map of the proposed
construction of the temple. The material on record shows that the petitioner -
Trust had indeed engaged the services of an Architect Engineer who prepared
a map of the proposed construction with a construction plan and estimate
towards total costs. The question of placing sanctioned map on record would
not arise for the reason that the stage for obtaining sanction for such a map
would arrive only after due permission was obtained from the Charity
Commissioner, whereby funds would be generated from the transaction for
further steps to be taken towards sanctioning of the map and undertaking
construction of the temple. Therefore, there is no substance in the said reason
recorded by the Joint Charity Commissioner.
(17) The second reason recorded in the impugned order was
that the petitioner - Trust failed to publish tender notice inviting bids in one
English and one Marathi newspaper having wide circulation in Wardha and
its adjoining districts. The record shows that the petitioner - Trust had issued
advertisements in two Marathi newspaper having circulation in District
Wardha on 18.09.2014 and 19.09.2014. There were four bids received in
response to such notices and the highest bidder i.e. the petitioner - developer
was finally selected. There was no material to record to demonstrate that
absence of publication of such notice in English newspaper had resulted in
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lack of competitive bidding. There is no specific rule requiring publication of
such notices in an English newspaper also. Even otherwise, the proposed
reconstruction/renovation of the temple is in a place called Mouza Pipri
(Meghe) Tah. & Dist. Wardha and so long as the notices were duly published
in Marathi newspapers having circulation in the vicinity, including District-
Wardha, no fault could be found on that ground in the procedure adopted by
the petitioner - Trust. Therefore, this reason is also found to be
unsustainable.
(18) The third reason recorded in the impugned order was the
absence of audit reports for specific years before filing of the application
under Section 36(1)(a) of the said Act. The petitioner - Trust has brought to
the notice of this Court that the said audit reports were placed on record by
way of a separate application before the Joint Charity Commissioner.
Therefore, even this reason is found to be without any substance. Even
otherwise, the learned counsel for the petitioner - Trust produced latest audit
reports of the petitioner - Trust to show to this Court that all the requirements
of law were being regularly complied with by the Trust and that the Trust was
bonafide seeking to dispose of the said property in the interest of the Trust for
reconstruction/renovation of the dilapidated temple.
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(19) The learned counsel appearing for the petitioner -
developer is justified in relying upon Division Bench judgment of this Court
in the case of Suburban Education Society, Mumbai and anr.(supra) wherein
it has been held as follows:
"16........In our view the said observation made by the Charity Commissioner
is absolutely unfounded inasmuch as the scope of authority which is exercised
by the Charity Commissioner under Section 36(1)(a) is very limited. The
Charity Commissioner in the first place is required to consider whether the
Trust has a genuine need for the purpose of selling its immovable property
and secondly whether the said property is being sold in the interest of the
Trust and its beneficiaries. The Charity Commissioner is not supposed to
substitute his own ideas and views vis-a-vis the functioning of the Trust".
(20) Thus, it becomes clear that the Charity Commissioner is
supposed to verify as to whether the need projected by the Trust for selling its
immovable property is genuine or not and that the Trust property is being
sold in the interest of the Trust and its beneficiaries. Applying the said
standards, to the application filed by the petitioner - Trust under Section
36(1)(a) of the said Act in the present case, this Court is satisfied that the
Joint Charity Commissioner erred in dismissing the application filed by the
petitioner - Trust.
(21) This is particularly in the backdrop of the fact that the
highest bid submitted by the petitioner - developer was much higher than the
valuation report for the said property submitted by the Joint Sub-Registrar of
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Wardha as the Ready Reckoner showed the value of Rs.1,19,37,500/- while
the government approved valuer stated it to be Rs.1,66,50,000/- and the bid
of the petitioner - developer was Rs.2,00,15,000/-. Hence, this Court is
satisfied that in the present case, the application submitted by the petitioner -
Trust ought to have been allowed. Accordingly, the writ petitions are allowed.
The impugned judgment and order dated 06.03.2020, passed by the Joint
Charity Commissioner, is quashed and set aside. The application filed by the
petitioner - Trust under Section 36(1)(a) of the aforesaid Act stands allowed.
(22) Rule made absolute in the above terms.
(23) Pending applications, if any, stand disposed of.
[ MANISH PITALE J.]
Prity
Signed By:PRITY S GABHANE
Reason:
Location:
Signing Date:07.07.2022 18:12
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