Rajasthan Sewa Samiti vs The Charity Commissioner
2021 Latest Caselaw 15143 Guj

     C/SCA/12155/2021                              ORDER DATED: 27/09/2021



            IN THE HIGH COURT OF GUJARAT AT AHMEDABAD

            R/SPECIAL CIVIL APPLICATION NO. 12155 of 2021
                                 With
        CIVIL APPLICATION (FOR JOINING PARTY) NO. 1 of 2021
           In R/SPECIAL CIVIL APPLICATION NO. 12155 of 2021
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                    RAJASTHAN SEWA SAMITI & 2 other(s)
                                Versus
                  THE CHARITY COMMISSIONER & 2 other(s)
==========================================================
Appearance:
MR VISHAL T. PATEL(6518) for the Petitioner(s) No. 1,2,3
for the Respondent(s) No. 1
MR MI MERCHANT(479) for the Respondent(s) No. 2,3
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 CORAM:HONOURABLE MS. JUSTICE SANGEETA K. VISHEN
                  Date : 27/09/2021
                   ORAL ORDER

1. Mr.Saurabh Soparkar, learned senior advocate appearing with Mr.Vishal T. Patel, learned advocate for the petitioners, at the outset, submitted that the petitioners are aggrieved by the order dated 07.08.2021 passed by the learned Charity Commissioner in Judicial Miscellaneous Application No. 46 of 2021, it being unjust, illegal and without jurisdiction. It is submitted that the respondent Nos.2 and 3, had filed an application Exhibit-1 before the learned Charity Commissioner, inter alia, praying for direction to declare that the petitioners (Care Taker Managing Committee) have no authority to implement/execute the amendments purported to have been passed in Extraordinary General Body Meetings dated 22.02.2018 as well as 18.06.2018 as reported in change report no.1782 of 2018. It is submitted that the said application, has been filed after a gross delay of two and half years from the date of the amendment of the Constitution. It is also submitted that it is not that the respondents, were not aware about the passing of the Resolution in the year 2018. In fact, respondent Nos.2 and 3 had consented to the amendment as is evident from the forms submitted by the respondents, duly signed by them which were

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issued by the Trust to its registered members as a part of the procedure for amending the earlier Constitution to meet with the exigencies.

2. It is submitted that as is clear from the prayers in the application, the respondents have sought for declaration; however, the learned Charity Commissioner under the provisions of section 41A of the Gujarat Public trust Act 1950 (hereinafter referred to as the "Trust Act"), has no jurisdiction to decide such application, and is wholly not maintainable inasmuch as, it would not be within the purview of the learned Charity Commissioner to issue any declaration, declaring meeting as invalid. It is also submitted that the interim relief, as granted vide order dated 07.08.2021, could not have been granted inasmuch as, the issue as regards taking of the policy decision touching the administration of the trust was not before it and the only issue which was before the learned Charity Commissioner was not to give effect to the resolutions passed by the petitioners in the year 2018.

3. It is submitted that the trust, owing to certain circumstances, thought it fit to amend the Constitution and various meetings were convened for the same. Taking recourse to clause 49 titled "change", the amendment came to be passed in the Extraordinary General Body Meetings held on 22.02.2018 and 18.06 2018, and the respondent Nos. 2 and 3, had consented for the amendment, as is evident from the forms duly signed by them. The respondents filed an application being Judicial Miscellaneous Application No. 46 of 2021 seeking direction to the petitioners declaring that the petitioners (Care Taker Managing Committee) have no authority to implement/execute the amendment passed in Extraordinary General Body Meetings. It is submitted that the trust started implementing the amendment from the date of resolutions and at present, it is

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being managed and governed as per the amended constitution. It is further submitted that the amendments made, were duly reported by filing the change report before the office of the learned Deputy Charity Commissioner, being change report number 1782 of 2018 on 26.11.2018.

4. In the proceedings before the learned Charity Commissioner, after hearing all the parties, the learned Charity Commissioner has passed the order dated 07.08.2021, inter alia, directing the petitioners not to take any policy decision touching the smooth administration of the trust till the election is conducted. It has also been directed that as soon as the elections for the petitioner trust, is conducted, a detailed material controversies involved would be heard. It is submitted that the directions issued by the learned Charity Commissioner to the effect that the petitioners (Care Taker Managing Committee) to not take any policy decision, it was not the issue before him and hence, the learned Charity Commissioner, could not have granted such interim direction.

5. It is further submitted that the order passed by the learned Charity Commissioner, is without jurisdiction, inasmuch as it has no jurisdiction under Section 41A of the Trust Act to maintain the application which was filed by the respondents. It is therefore submitted that when the issue of jurisdiction was raised before the learned Charity Commissioner, it ought not to have passed the order dated 07.08.2021 directing the petitioners (Care Taker Managing Committee) to not take any policy decision. It is therefore urged that the order dated 07.08.2021 so also the proceedings before the learned Charity Commissioner, being without jurisdiction, deserves to be interfered with by this Court, at this stage.

6. As against this, Mr.S. N. Shelat, learned senior advocate appearing with Mr.M.I. Merchant, learned advocate for the

C/SCA/12155/2021 ORDER DATED: 27/09/2021

respondent Nos.2 and 3, has submitted that the main prayer prayed for in the writ petition so also the interim relief, are identical and therefore, as per the well settled proposition of law, if the interim relief tantamounts to grant of final relief, the same should not be acceded to. Therefore, the petitioners do not deserve any interim protection at this stage, i.e. stay of the operation and implementation of the order dated 07.08.2021, which is also main prayer in the writ petition. It is also submitted that this Court, in exercise of the powers under Article 226 of the Constitution of India, would not hear the petitioners inasmuch as, the petitioners are the trustees who wants to mismanage the affairs of the trust.

7. It is also submitted that the term of the managing committee, has come to an end in the month of January 2020 and further extension as provided in Constitution of three months has also expired in the month of April 2020 and therefore, the Managing Committee being a Care Taker Committee, it would be impermissible to it to take any such policy decision. It is submitted that the "Caretaker" means someone put in charge of a place. Hence, the Care Taker Committee having been placed in charge, it has no right to take any policy decision.

8. It is also submitted that the two Resolutions dated 22.02.2018 and 18.06.2018, which were passed in the Extraordinary General Body Meetings, are pending consideration before the learned Deputy Charity Commissioner and various objections, have been filed contesting the change reports by many members of the trust and till, the change report is approved, it would not be permissible to the Managing Committee i.e. a Care Taker Committee to take any decision. It is also submitted that the matter is pending before the learned Charity Commissioner, and is yet to go for the trial and therefore, the balance of convenience is also not in favour of the

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petitioners. Hence, the petitioners be relegated to the learned Charity Commissioner, without entertaining the petition at this stage.

9. Mr Shalin Mehta, learned senior advocate appearing with Mr Arjun Sheth in Civil Application No. 1 of 2021, has submitted that the applicant has filed the civil application, being a permanent member and also the board member of the Rajasthan Seva Samiti which is a public charitable trust. While inviting the attention to page 24/A of the Civil Application, it is submitted that the Extraordinary General Body Meeting was held on 22.02.2018 and the relevant forms were circulated to all the members, that is, 1430 members. In all, there were 1128 forms received out of which, 17 forms were held to be invalid, and out of remaining 1111 forms, eight members have expressed their dissent while 1103 members have agreed to the resolution. While inviting the attention of this court to page 61 of the Civil Application, it is submitted that the form, carries the details of member i.e. Shri Nandlal Ramgopal and Shri Nandalal Danmal with his signature on the form. It is submitted that there have been mischief committed by the petitioner inasmuch as Shri Nandalal Danmal who has been shown as the representative, had passed away in the year 1972 and therefore, the form could not have been signed by the dead person. Clearly, there is mischief committed by the petitioners while passing the resolutions. It is also submitted that there are many such instances which can be placed on record to substantiate that the resolutions which were passed in the year 2018, were not bona fide and genuine.

10. It is submitted that the contention raised by the learned advocate for the petitioners that the applicants are estopped is misplaced inasmuch as it is a clear case of forgery and therefore,

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estoppel does not come in the way of the applicants. It is submitted that in past, the Judicial Miscellaneous Application Nos.27 of 2020 and 28 of 2020, Exhibit-18 were filed before the learned Joint Charity Commissioner and after hearing all the parties, has passed the order dated 06.07.2020 whereby, it has been directed that till there is a new Managing Committee, the present Managing Committee, that is, Care Taker Committee, would not take any policy decision. It is also submitted that the contention raised that the Charity Commissioner has no jurisdiction and could not issue direction is also misplaced inasmuch as, Section 41A of the Trust Act clearly provides that subject to the provisions of the Act, the learned Charity Commissioner, may from time to time issue directions to any trustee of a public trust or any person connected therewith, to ensure that such trust is properly administered. It is therefore submitted that the direction contained in the order dated 07.08.2021, fulfills the mandate of Section 41A of the Trust Act; whether wrong, right or otherwise that is to be adjudicated at the time of hearing of the appeal and therefore, no case has been made out to contend that the learned Charity Commissioner, has no jurisdiction. Further, the action on the part of the petitioners, is in clear violation of the order dated 06.07.2020 passed by the learned Joint Charity Commissioner because, the learned Joint Charity Commissioner has directed that till the new Managing Committee is elected, no policy decision shall be taken. It is also submitted that if the amendments are implemented, it will have a devastating effect because the amendment is capable of inducting the new members. It is submitted that the learned Charity Commissioner, has not committed any error in passing the order dated 07.08.2021 and hence does not deserve any interference at this stage.

11. Mr.Soparkar, learned senior counsel, in the rejoinder has submitted that the respondent Nos.2 and 3 have agreed for passing

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of the resolutions. Once having agreed, now, it would not be open for them to turn around and challenge the same. So far as grant of final relief is concerned, if the power is exercised without jurisdiction, it can very well be granted even at the interim stage. It is further submitted that the application has been filed, not on the ground that there is a mismanagement, for, neither is there any pleadings nor any whisper as regards mismanagement. The only ground which has been raised in the application, is not to implement the resolutions which have been passed by the Managing Committee in the Extraordinary General Body Meetings. It is submitted that it is incorrect to contend that the Care Take Committee cannot take any decision inasmuch as, there is no decision by the committee. In fact the General Body had already taken a decision in the year 2018 which the current body is implementing. It is also submitted that the contention as regards the balance of convenience, is misplaced inasmuch as, the respondents themselves have supported the resolutions in the year 2018. Therefore, the order dated 07.08.2021 passed by the learned Charity Commissioner, being without jurisdiction requires to be stayed at this stage.

12. Mr.Mihir Thakor, learned senior counsel appearing with Mr.Vishal T. Patel, learned advocate has supplemented the arguments by citing the judgment in the case of Chembur Trombay Education Society v. D K. Marathe, reported in 2001 LawSuit (Bom)

760. It is submitted that the contention raised before the Bombay High Court that the amendment of the Constitution being still pending consideration, no steps can be taken on the basis of the amended constitution, was rejected observing that alteration or amendment, brought about in accordance with law would come into effect from the date of the resolution of the trust to bring about such a change. It is submitted that since the resolutions were

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passed in the year 2018, it would take effect from the year 2018. Further, the responsibility on the part of the petitioners was to report the change, which has been duly done by filing the same with the learned Deputy Charity Commissioner being the change report No.1782 of 2018 on 26.11.2018. It is therefore submitted that once the resolution has been passed by the petitioners, it would take effect from the date it has been passed.

13. Heard the learned advocates appearing for the respective parties.

14. Issue notice, returnable on 12.10.2021. Mr.M.I.Merchant waives service of notice on behalf of respondent Nos.2 and 3. Mr.Krutik Parikh, learned Assistant Government Pleader waives service of notice on behalf of respondent No.1.

15. So far as prayer 9C is concerned, this Court, is of the opinion that the same does not deserve to be granted for the reasons discussed hereinbelow.

16. As is discernible from the record, in Extraordinary General Body Meetings dated 22.02.2018 as well as 18.06.2018, the resolutions were passed; which, have been reported vide change report no.1782 of 2018. The change report, is pending consideration before the learned Deputy Charity Commissioner.

17. Further, the term of the Managing Committee of the petitioner trust, has come to an end in the month of January 2020 and was due for election. As per the provisions of the Constitution, extension of three months, had also come to an end in the month of April 2020. The elections, were due; however, owing to the pandemic-induced pause, the elections of the Trust could not be held.

18.     The     respondent   Nos.2   and        3   have   preferred        Judicial






       C/SCA/12155/2021                                     ORDER DATED: 27/09/2021

Miscellaneous Application Nos.27 of 2020 and 28 of 2020 before the learned Joint Charity Commissioner, Ahmedabad - Exhibit 18. The learned Joint Charity Commissioner has passed the order dated 06.07.2020. The grievance, raised before the learned Joint Charity Commissioner was that the term of the Executive Committee, was of three years which has come to an end and the elections, are not held. The stand taken by the petitioners before the learned Joint Charity Commissioner was that owing to the present pandemic situation, it was difficult for the trust to conduct the election; however, all the endeavors were put by the petitioners trust to conduct the election, but it could not do so. Various permissions, were also sought for; however, since permissions were not granted by various authorities, the elections were decided to be postponed.

19. The learned Joint Charity Commissioner, after hearing the parties, was of the opinion that the term of the trust has come to an end and as per the provisions of the Constitution, without availing the three months extension, the elections could have been held in the month of January 2020; however, it has not conducted the election. Since the learned Joint Charity Commissioner was of the opinion that the elections were due, issued directions for conduct of the election. The learned Joint Charity Commissioner was also of the opinion that the committee, being a Care Taker Committee, would not be permissible for it to take any policy decision. Accordingly, the learned Joint Charity Commissioner issued directions to the petitioners for holding the elections so also direction that till the new Managing Committee, is appointed, the petitioner trust would not take any policy decision.

20. As is discernible from the record, the said order has not been challenged by the petitioners. On the contrary, steps have been taken seeking permission from various authorities in furtherance of

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implementing the order dated 06.07.2020; however, certain permissions were not granted at the relevant point of time. Even thereafter, during the month of February 2021, the petitioners trust has addressed various communications to the various authorities namely, Municipal Commissioner and others requesting to provide permission to conduct elections. The petitioners, have taken steps for implementing the order dated 06.07.2020, being not challenged before the appropriate authority.

21. The respondent Nos.2 and 3, had preferred an application Exhibit-1, before the learned Charity Commissioner seeking following directions:

"i. YOUR HONOUR MAY BE PLEASED TO issue directions declaring that the opponents (care taker Managing committee) have no authority implement/execute the amendments purported to have been passed in extra ordinary General Body meetings dated 22.02.2018 as well as 18.06.2018 as reported in change report no.1782 of 2018.

ii. YOUR HONOUR MAY BE PLEASED TO initiate actions against the opponents for breach of directions of orders in JMA no.27 and 28 of 2020."

Clearly, the prayers are twofold, (i) to direct that the Managing Committee has no authority to implement and execute the amendments passed in Extraordinary General Body Meetings dated 22.2.2018 as well as 18.6.2018 as reported in the change report number 1782 of 2018 and (ii) to initiate actions against the petitioners for breach of directions of orders in Judicial Miscellaneous Application Nos.27 and 28 of 2020. So far as the main prayer is concerned, the learned Charity Commissioner is yet to take any decision and the issue is pending consideration and the tentative date of hearing is 28.09.2021. In the absence of any exercise of powers by the Charity Commissioner on the application

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under section 41A of the Trust Act, the contention raised by the petitioner that the learned Joint Charity Commissioner has no jurisdiction, cannot be accepted, it being premature.

22. While adverting to the order of the learned Joint Charity Commissioner dated 06.07.2020, it is required to be noted that in Judicial Miscellaneous Application Nos. 27 and 28 of 2020, the learned Joint Charity Commissioner has issued directions for holding elections so also a direction to the managing committee not to take any policy decision. As is clear from the operative portion of the order dated 07.08.2021, direction that the petitioners are restrained from taking any decision on the policy matter touching the smooth administration of the trust till the election is concluded, was very much part of the order dated 06.07.2020. The learned Charity Commissioner, simply has reiterated the directions issued by the learned Joint Charity Commissioner.

23. In view of the aforementioned discussion, the contention that the learned Charity Commissioner has no jurisdiction, cannot be accepted at this stage inasmuch as, the learned Charity Commissioner is yet to take a decision. Besides, the main prayer in the writ petition, is seeking quashing and setting aside of the order dated 07.08.2021 and the interim relief, is seeking stay of the operation and implementation of the order dated 07.08.2021. Allowing the stay of the operation and implementation of the order dated 07.08.2021, would virtually amount to allowing the writ petition at this stage. Hence, this Court, is of the opinion that the order dated 07.08.2021 does not deserve to be stayed at this stage.

(SANGEETA K. VISHEN, J) RAVI P. PATEL