Madhya Pradesh High Court
Shri Brahmeshwar Mahadev Seva Nyas ... vs The State Of Madhya Pradesh on 7 April, 2025
Author: Milind Ramesh Phadke
Bench: Milind Ramesh Phadke
NEUTRAL CITATION NO. 2025:MPHC-GWL:8190
1 WP-4678-2025
IN THE HIGH COURT OF MADHYA PRADESH
AT GWALIOR
BEFORE
HON'BLE SHRI JUSTICE MILIND RAMESH PHADKE
ON THE 7 th OF APRIL, 2025
WRIT PETITION No. 4678 of 2025
SHRI BRAHMESHWAR MAHADEV SEVA NYAS THROUGH
MANAGING TRUTEE SATYANARAYN SHARMA
Versus
THE STATE OF MADHYA PRADESH AND OTHERS
Appearance:
Shri Upendra Yadav - Advocate for the petitioner.
Shri B M Patel - G.A. for the respondent/State.
ORDER
The present petition under Article 226 of the Constitution of India is preferred against the order dated 31.12.2024 as well as order dated 07.01.2025 passed by the Collector, District Bhind whereby invoking the provisions under Section 16(4) of M.P. Public Trusts Act, 1951, directions were issued for conducting special audit of the accounts of the petitioner/Trust as well as notices were directed to be issued to lease-
holder/tenants of the present petitioner since without obtaining permission of Registrar, 18 shops were given on lease on a meager sum of Rs.200/- per month.
Learned counsel for the petitioner has argued before this Court that though prior to passing of the order dated 31.12.2024, in the month of October, 2024, audit report of the auditor was already furnished to the Collector/Registrar even then directions were issued for special audit of the Signature Not Verified Signed by: YOGENDRA OJHA Signing time: 4/17/2025 10:54:03 AM NEUTRAL CITATION NO. 2025:MPHC-GWL:8190 2 WP-4678-2025 accounts of petitioner/Trust which was wholly unwarranted and even otherwise, the Collector has gone beyond its jurisdiction to exercise power under Section 16 of M.P. Public Trusts Act, 1951 and the procedure as provided under Section 23 of the M.P. Public Trusts Act, 1951 was required to be followed and notices were required to be issued to the working trustees of the petitioner/Trust to submit an explanation thereon. Thus, the very order directing special audit of the accounts of the petitioner/Trust is per se illegal, therefore, deserves to be quashed.
It was further argued that the Trust with the permission of Registrar had constructed the shops and later on, had rented out the same. The accounts were audited by an auditor and there were no objections as to the said audit, but without any rhyme and reason, notices were directed to be issued to the tenants alleging that no permission had been sought for giving the premises on rent from the Registrar, which is dehors the records, therefore, the said direction deserves to be quashed. On the basis of the aforesaid arguments, it was submitted that present petition be allowed and the impugned orders be set-aside.
On the contrary, learned counsel for the respondent/State had argued that there is no bar under the provisions of M.P. Public Trusts Act for directing special audit alongwith the regular audit as sub-section 4 of section 16 starts with non obstante clause "Notwithstanding anything contained in sub-sections (1) and (2) to the contrary", thus, the very contention of the petitioner that since the audit report has already been submitted to it then recourse of provisions of Section 23 was required to be taken, has no force.
Signature Not Verified Signed by: YOGENDRA OJHA Signing time: 4/17/2025 10:54:03 AMNEUTRAL CITATION NO. 2025:MPHC-GWL:8190 3 WP-4678-2025 It was further submitted that the reason has been assigned by the Collector in the order dated 31.12.2024 for conducting special audit since he had arrived at a subjective satisfaction that defalcation of the income of the trust was being done, therefore, the order cannot be said to be perverse or illegal.
It was further argued that without permission, the shops were constructed by the Trust and given on rent at a meager sum of Rs.200/- per month, therefore, the said leasing out was not legal and accordingly, notices were directed to be issued to the lease-holders also. In such circumstances, the orders passed by the Collector cannot be said to be perverse or illegal. Thus, it was prayed that present petition being devoid of merits, deserves to be dismissed.
Heard counsel for the parties and perused the record. Section 16 of M.P. Public Trusts Act, 1951 deals with balancing and auditing of the accounts of the Trusts. For reference, Section 16 of M.P. Public Trusts Act, 1951 is quoted herein-below:-
16. Balancing and auditing of accounts.
(1)The accounts kept under Section 15 shall be balanced each year on the 31st day of March or such other day, as may be fixed by the Registrar.
(2)The accounts shall be audited annually in such manner as may be prescribed and by a person who is a holder of a certificate granted under Section 144 of the Indian Companies Act, 1913 (VII of 1913), or is a member of an institution or association, the members of which have been declared under that section to be entitled to act as auditors of companies or by such persons as may be authorised in this behalf by the State Government or in the case of a public trust, the gross annual income of which does not exceed one thousand rupees, by a person approved by the Registrar by a general or special order.
(3)Every auditor acting under sub-section (2) shall have access to the accounts and to all books, vouchers, other documents and Signature Not Verified Signed by: YOGENDRA OJHA Signing time: 4/17/2025 10:54:03 AM NEUTRAL CITATION NO. 2025:MPHC-GWL:8190
4 WP-4678-2025 records in the possession of, or under the control of the working trustee or the manager.
(4) Notwithstanding anything contained in sub-sections (1) and (2) to the contrary, the Registrar may direct a special audit of the accounts of any public trust whenever in his opinion such special audit is necessary.
The provisions of sub-sections (2) and (3) shall, so far as may be applicable, apply to such special audit. The Registrar may direct the payment of such fee as may be prescribed for such special audit and the working trustee or the manager shall be liable to pay the same from the trust property.
Sub-Section (4) of Section 16 provides that whenever the Registrar is of the opinion that special audit is necessary to be conducted of the accounts of any public trust, he may direct special audit of the accounts of the trust and the said power can be used by Registrar in conjugation to the regular audit conducted of the accounts of the trust. Thus, it cannot be said that the power exercised by the Registrar of the trust under Section 16(4) of M.P. Public Trusts Act, 1951 was not proper and once the regular audit report has been submitted then the provision of Section 23 of M.P. Public Trusts Act, 1951 would be applicable. To this extent, the petition has no force.
With regard to issuing of notices to the lease-holder, since it has been observed by the Collector in the order dated 07.1.2025 that no permission was sought from the Registrar, therefore, transfer of the lease was illegal. Though this fact has been controverted by counsel for the petitioner and has submitted that due permission was taken for inducting the tenants/leasing out the said shops, but the aforesaid permission had not been placed before this Court, thus, this Court finds that no illegality has been committed by the Collector in directing issuance of notices to the tenants/lease-holders. If proper permission has been sought from the Registrar as has been contended by counsel for the petitioner, the same can be submitted alongwith the reply Signature Not Verified Signed by: YOGENDRA OJHA Signing time: 4/17/2025 10:54:03 AM NEUTRAL CITATION NO. 2025:MPHC-GWL:8190 5 WP-4678-2025 to the notices and the matter could be resolved and would come to an end then and there.
Accordingly, the present petition being devoid of any merits, is hereby dismissed.
(MILIND RAMESH PHADKE) JUDGE ojha Signature Not Verified Signed by: YOGENDRA OJHA Signing time: 4/17/2025 10:54:03 AM