Gujarat High Court
Rajendrakumar Vinodray Kamdar vs Rajesh Nanubhai Zaveri on 7 April, 2022
Author: Vaibhavi D. Nanavati
Bench: Vaibhavi D. Nanavati
C/SCA/2572/2022 JUDGMENT DATED: 07/04/2022
IN THE HIGH COURT OF GUJARAT AT AHMEDABAD
R/SPECIAL CIVIL APPLICATION NO. 2572 of 2022
FOR APPROVAL AND SIGNATURE:
HONOURABLE MS. JUSTICE VAIBHAVI D. NANAVATI
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1 Whether Reporters of Local Papers may be allowed
to see the judgment ?
2 To be referred to the Reporter or not ?
3 Whether their Lordships wish to see the fair copy
of the judgment ?
4 Whether this case involves a substantial question
of law as to the interpretation of the Constitution
of India or any order made thereunder ?
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RAJENDRAKUMAR VINODRAY KAMDAR
Versus
RAJESH NANUBHAI ZAVERI
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Appearance:
MR RS SANJANWALA, SENIOR ADVOCATE with MR AMIT V
THAKKAR(3073) for the Petitioner(s) No. 1,2
DS AFF.NOT FILED (N) for the Respondent(s) No. 2,3,4,5,6,7
MR ISHAN JOSHI, AGP for the Respondent(s) No. 8
MR MONAAL J DAVAWALA(6514) for the Respondent(s) No. 1
MR SN SOPARKAR, SENIOR ADVOCATE with MR VISHAL T. PATEL(6518)
for the Respondent(s) No. 1
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CORAM:HONOURABLE MS. JUSTICE VAIBHAVI D. NANAVATI
Date : 07/04/2022
ORAL JUDGMENT
1. The present writ-application is filed under Article 226 of the Constitution of India by the writ-applicants seeking the Page 1 of 44 Downloaded on : Thu Apr 07 21:33:55 IST 2022 C/SCA/2572/2022 JUDGMENT DATED: 07/04/2022 following reliefs :-
"[A] THIS HONOURABLE COURT may be pleased to issue a writ of certiorari or a writ in the nature of certiorari and/ or any other appropriate writ, order or direction and may be pleased to quash and set aside the impugned order dated 18.1.2022 (Annexure-A) passed by the learned Joint Charity Commissioner in Scheme Application No.3 of 2021 and may be pleased to direct the learned Joint Charity Commissioner, Bhavnagar, to give proper opportunity of hearing to the present petitioners to represent their case and may be further pleased to direct the learned Joint Charity Commissioner to decide the issue as to whether it is expedient and necessary in the interest of the Trust to modify and/or to alter the scheme first; before proceeding further with scheme application no 3/2021 and may also decided the preliminary objections raised.
10AA. THIS HONOURABLE COURT may be pleased to issue a writ of certiorari or a writ in the nature of certiorari and/or any other appropriate writ, order or direction and may be pleased to quash and set aside the order vide Exh. 56 dated 22.02.2022 (Annexure-Q) passed by Learned Joint Charity Commissioner, Bhavnagar in Scheme Application No. 3 of 2021 And may be pleased to direct the Learned Joint Charity Commissioner to decide the applications Exh-15, Exh-16 and Exh19 preferred by the petitioners first, before proceeding further in the matter to decide the scheme application no. 3 Page 2 of 44 Downloaded on : Thu Apr 07 21:33:55 IST 2022 C/SCA/2572/2022 JUDGMENT DATED: 07/04/2022 of 2021.
10BB. Pending admission, hearing and final disposal of this petition, this Hon'ble Court may be pleased to stay the implementation and execution of the order vide Exh. 56 dated 22.02.2022 (Annexure-Q ) passed by Ld. Joint Charity Commissioner in Scheme Application No. 3 of 2021.
[B] Pending admission, hearing and final disposal of this petition, this Hon'ble Court may be pleased to stay the further proceeding of Scheme Application No.3 of 2021 pending before the learned Joint Charity Commissioner, Bhavnagar;
[C] ANY other and further relief or reliefs to which this Hon'ble Court deemed fit in the interest of justice, may kindly be granted."
2. The facts as stated by the writ-applicants are produced thus :-
2.1 It is stated that Shri Digambar Jain Swadhyaya Mandir Trust (for short 'the Trust') is a registered Public Charitable Trust which is registered vide Registration No.A/902 with the office of the Assistant Charity Commissioner Bhavnagar and the writ-applicants are trustees of the said Trust.
2.2 The said Trust was established on 25.12.1939 at Songadh, Dist. Bhavnagar. The object of the Trust is to spread religious Page 3 of 44 Downloaded on : Thu Apr 07 21:33:55 IST 2022 C/SCA/2572/2022 JUDGMENT DATED: 07/04/2022 education in the sampradaya. Shri Kanji Swami was the religious head and preacher of the said sect. The Trust was established for the purpose of religious education and to arrange various 'Shibir' for the said purpose and to arrange different 'Seminar/lecture/group discussion for the purpose of spreading the religious awareness in the sect. The Trust also holds various activities and Mahotsava.
2.3 The Joint Charity Commissioner (for short 'JCC') framed the Scheme in respect of the said Trust in Scheme Application No.7/1981 on 27.8.1982 (page-30). On 8.9.2021, Scheme Modification Application No.3/2021 came to be filed by the respondents No.1 to 3 before the learned JCC, Bhavnagar (page-183). On 17/18.1.2022, the writ-applicants through their advocate also sent preliminary objection by RPAD. On 19.1.2022, public notice came to be issued inviting objections/suggestions. On the even date the writ-applicants preferred application below Ex.15 raising preliminary issue with regard to the maintainability of the Scheme Modification Application No.3/2021. The writ-applicant No.1 preferred application Ex.15 (page-366). The writ-applicant No.2 preferred application Ex.16 praying to dismissed the main application on the ground of maintainability and to hear the application of maintainability first (page-368). On 3.2.2022, the writ-applicant preferred an application Ex.19 raising preliminary issue with the prayer that the said two issues raised therein be decided Page 4 of 44 Downloaded on : Thu Apr 07 21:33:55 IST 2022 C/SCA/2572/2022 JUDGMENT DATED: 07/04/2022 first as preliminary issue before proceeding further with Scheme Application (page-376). Hence the writ-applicants approached this Court by filing the present writ-application.
2.4 On 8.2.2022, Shri Rajendra Vasantlal Shah preferred application below Ex.17 and 18 raising preliminary objections to be decided prior to deciding the main modification application. On 19.1/8.2.2022, written objections came to be filed in the Scheme Application No.3/2021 (page-382). On 22.2.2022, the learned Joint Charity Commissioner passed common order below Ex.56 below applications Ex.15 to 20 passing an order that the said application will be decided at the time of deciding the main Scheme Amendment Application (page-412).
2.5 It is stated by the writ-applicant that the writ-applicant and other respondents are trustees of the said Trust whose appointment have been duly notified in the PTR of the Trust.
3. The writ-applicant filed application raising objections with regard to the maintainability of the Scheme seeking modification which was settled in Scheme Application No.7/1981. The said application below Ex.19 dated 3.2.2022 was filed raising preliminary issues and objections before the Charity Commissioner which reads thus :-
(a) Whether it is expedient and necessary in the interest of Page 5 of 44 Downloaded on : Thu Apr 07 21:33:55 IST 2022 C/SCA/2572/2022 JUDGMENT DATED: 07/04/2022 Trust to modify the Scheme of the Trust?
(b) Whether there is any legal and permissible ground for seeking modification and/or alteration of the Scheme?
3.1 It is further stated that the said issues be decided first in view of the provisions envisaged under Section 50A of the Trust Act. The applicant prayed for the following reliefs in the said application :-
"Your Honour first to decide the aforesaid two issues as preliminary issue before proceeding further with the Scheme Application pursuant to the public notice dated 19th January, 2022.
Your Honour first to pass appropriate order after hearing us on the aforesaid two issues in the present application.
Your Honour to first decide the aforesaid two issues as preliminary issue in the present application before proceeding further with the Scheme Application."
4. The Charity Commissioner by the impugned order dated 22.2.2022 held that the preliminary objections which are raised by the applicants would be heard alongwith the Scheme Application No.1.
5. The writ-applicant being aggrieved by the impugned Page 6 of 44 Downloaded on : Thu Apr 07 21:33:55 IST 2022 C/SCA/2572/2022 JUDGMENT DATED: 07/04/2022 order dated 22.2.2022 has approached this Court by filing a draft amendment and by way of amendment sought for the following modified prayers :-
10AA. THIS HONOURABLE COURT may be pleased to issue a writ of certiorari or a writ in the nature of certiorari and/or any other appropriate writ, order or direction and may be pleased to quash and set aside the order vide Exh. 56 dated 22.02.2022 (Annexure-Q) passed by Learned Joint Charity Commissioner, Bhavnagar in Scheme Application No. 3 of 2021 And may be pleased to direct the Learned Joint Charity Commissioner to decide the applications Exh-15, Exh-16 and Exh19 preferred by the petitioners first, before proceeding further in the matter to decide the scheme application no. 3 of 2021.
10BB. Pending admission, hearing and final disposal of this petition, this Hon'ble Court may be pleased to stay the implementation and execution of the order vide Exh. 56 dated 22.02.2022 (Annexure-Q ) passed by Ld. Joint Charity Commissioner in Scheme Application No. 3 of 2021."
6. Mr. Sanjanwala, the learned Senior Advocate relied on the provisions of Section 50A of the Gujarat Public Trust Act (for short 'Trust Act') and law in regard that the writ- applicants preferred an application for deciding the preliminary issues raised by the writ-applicants. He vehemently submitted that in light of the provisions of Section 50A of the Trust Act Page 7 of 44 Downloaded on : Thu Apr 07 21:33:55 IST 2022 C/SCA/2572/2022 JUDGMENT DATED: 07/04/2022 it was duty of the learned Joint Charity Commissioner to first ascertain and record subjective satisfaction and findings that for proper administration and management of the Trust it is expedient and necessary to frame or to modify the Scheme and/or for that purpose, opportunity of hearing is required to be given to all the trustees and after hearing the trustees the same has to be decided.
6.1 Mr. Sanjanwala, the learned Senior Advocate further submitted that such a procedure was not carried out and without recording subjective satisfaction the Charity Commissioner proceeded to issue public notice inviting objections and as the Charity Commissioner proceeded further in the main Scheme Application the writ-applicants were constrained to prefer the present writ-application seeking appropriate reliefs including the direction to the learned Joint Charity Commissioner to decide the preliminary issues as raised by the writ-applicants which reads thus :-
(1) Whether it is expedient and necessary in the interest of Trust to modify the Scheme of the Trust ?
(2) Whether there is any legal and permissible ground for seeking modification and/or alteration of the Scheme before the proceeding in the Scheme Application No.3 of 2020.
6.2 Mr. Sanjanwala, the learned Senior Advocate further Page 8 of 44 Downloaded on : Thu Apr 07 21:33:55 IST 2022 C/SCA/2572/2022 JUDGMENT DATED: 07/04/2022 submitted that instead of deciding the preliminary objections and preliminary issues as raised by the writ-applicants herein the Joint Charity Commissioner erred in passing the order to decide the preliminary objections and the issues alongwith the main Scheme Application.
6.3 Mr. Sanjanwala, the learned Senior Advocate submitted that the impugned order dated 22.2.2022 vide Ex.56 is contrary to the Section 50A of the Trust Act and the same is contrary to the law as laid down by this Court, more particularly in the case of Chhotubhai L. Patel vs. State of Gujarat, reported in 2007 (2) GLR 1716.
6.4 Mr. Sanjanwala, the learned Senior Advocate submitted that the Charity Commissioner was required to first ascertain and record subjective satisfaction and findings as to whether for better and proper administration and management of the Trust it is expedient and necessary to modify the Scheme of the Trust. The preliminary issue as raised by the writ-applicant is with regard to the maintainability of the modification application preferred by the respondent herein and the Charity Commissioner was required to decide the said issue before proceeding further with the main matter.
6.5 Mr. Sanjanwala, the learned Senior Advocate relied on the following case law to substantiate the submissions as Page 9 of 44 Downloaded on : Thu Apr 07 21:33:55 IST 2022 C/SCA/2572/2022 JUDGMENT DATED: 07/04/2022 made:-
(1) 2007 (2) GLR 1716 (2) 2002 (5) Maharashtra law Journal 73 (Para 13 and 13A) (3) 2017 (3) Maharashtra law Journal (Paras 2, 3, 5, 7, 9, 10, 25 to 28) 6.6 Relying on the above referred case law Mr. Sanjanwala,
the learned Senior Advocate vehemently submitted that the provisions of Section 50A(1) of the Trust Act requires the Charity Commissioner to record subjective satisfaction while considering the modification of Scheme under Section 50A sub- section (3).
6.7 Mr. Sanjanwala, the learned Senior Advocate vehemently submitted that it was incumbent for the Charity Commissioner to record subjective satisfaction before proceeding further with the hearing of the application with regard to the modification of the Scheme.
7. Per contra, Mr. S. N. Soparkar, the learned Senior Advocate assisted by Mr. Vishal T. Patel, the learned advocate appearing for the respondent No.1 submitted that present writ- application was originally filed seeking opportunity for hearing to the writ-applicants. The said prayer does not survive. As far as amended writ-application is concerned, the writ-applicants have challenged the order dated 22.2.2022, wherein the writ-
Page 10 of 44 Downloaded on : Thu Apr 07 21:33:55 IST 2022C/SCA/2572/2022 JUDGMENT DATED: 07/04/2022 applicants have made an attempt to misdirect and mislead this Court.
7.1 Mr. S. N. Soparkar, the learned Senior Advocate submitted that the respondent herein is a trustee and office bearer in the Trust and one of the applicant of the scheme modification No.3/2021.
7.2 Mr. S. N. Soparkar, the learned Senior Advocate submitted the procedure and principle under Section 50A(1) of the Act is not applicable to the proceedings under Section 50A(3) of the Act.
7.3 Mr. S. N. Soparkar, the learned Senior Advocate submitted even if the first contention is negatived then if the application is filed as preliminary issue it is still open for the Charity Commissioner to decide such an issue alongwith the main application for modification.
7.4 Mr. S. N. Soparkar, the learned Senior Advocate submitted that the notices with respect to the Scheme modification were issued to the trustees on 22.11.2021. The writ-applicant appeared before the competent authority from time to time and had preferred an application for adjournment in which time came to be granted by the competent authority.
7.5 Mr. S. N. Soparkar, the learned Senior Advocate Page 11 of 44 Downloaded on : Thu Apr 07 21:33:55 IST 2022 C/SCA/2572/2022 JUDGMENT DATED: 07/04/2022 submitted that the order dated 22.2.2022 states that the application of the writ-applicants and other persons raising such purported preliminary issue shall be decided finally after hearing all the parties. He submitted that in the entire writ- application, the writ-applicants have failed to point out as to how the writ-applicants are prejudiced by the order dated 22.2.2022 and as to how there is legal injury caused to the writ-applicants. It is not even the case of the writ-applicants that sufficient opportunity was not given before passing of the impugned order dated 22.2.2022. Mr. Soparkar, the learned Senior Advocate submitted that the provision of Section 50A(1) is with regard to a fresh Scheme. Lastly Mr. Soparkar, the learned Senior Advocate submitted that this Court may not entertain the present writ-application and it is required to be rejected.
8. Heard Mr. R. S. Sanjanwala, the learned Senior Advocate assisted by Mr. Amit V. Thakkar, the learned advocate appearing for the writ-applicants and Mr. S. N. Soparkar, the learned Senior Advocate assisted by Mr. Vishal T. Patel, the learned advocate appearing for the respondent No.1.
Analysis :-
9. The writ-applicants and the respondents are trustees of Page 12 of 44 Downloaded on : Thu Apr 07 21:33:55 IST 2022 C/SCA/2572/2022 JUDGMENT DATED: 07/04/2022 Shri Digambar Jain Swadhyaya Mandir Trust. The said Trust came to be registered vide Registration No.A/902 at Songadh, Dist. Bhavnagar on 25.12.1939. The Joint Charity Commissioner framed the Scheme No.7/1981 with respect to the said Trust on 27.8.1982.
10. The Joint Charity Commissioner framed Scheme No.7/1981 in respect of the said Trust. According to the PTR of the Trust, the respondents No.2.1 to 2.9 are trustees, respondents No.2.3 to 2.7 are deceased and respondent No.2.6 resigned. In all total six trustees were part of the said Trust. In October, 2020 agenda notice came to be issued by the said Trust for the appointment of new trustees. Two new trustees came to be appointed, one - writ-applicant and second, Harshad Kamdar. The said appointments were objected by the respondent No.2.9. In response to the said respondent No.2.9 filed an application before the Joint Charity Commissioner challenging the appointment of writ-applicant and Harshad Kamdar. On 26.6.2021, the Joint Charity Commissioner allowed the application filed by the respondent No.2.9 with respect to the appointment of the writ-applicant. The said order is subject of challenge by way of Special Civil Application No.12856 of 2021.
11. One Nimesh Shah, trustee in Shree Kund Kaham Paramarthik Trust filed a Scheme Application No.3 of 2021 alongwith the trustees before the Joint Charity Commissioner Page 13 of 44 Downloaded on : Thu Apr 07 21:33:55 IST 2022 C/SCA/2572/2022 JUDGMENT DATED: 07/04/2022 seeking modification of the scheme of the Trust. On 9.11.2021, a public notice was issued in the local newspaper inviting objections/suggestions. The writ-applicant No.1 preferred application below Ex.15 raising preliminary issue of maintainability of the Scheme Application No.3 of 2021. The writ-applicant No.2 preferred application below Ex.16 praying to dismiss the main application on the ground of maintainability and to hear the application of maintainability first. The writ-applicants preferred application below Ex.19 raising preliminary issue with a prayer that the said two issues raised be decided first as preliminary issue before proceeding further with the Scheme Application. The writ-applicants approached this Court by filing the present writ-application on 7.2.2022. On 8.2.2022, Rajendra Vasantlal Shah preferred applications Ex.17 and 18 raising preliminary objections and to decide it prior to deciding the main application. The operative paragraph of the said order dated 22.2.2022 reads thus :-
"In the aforementioned Scheme Amendment Application submitted to this office, in addition to the representations made under the provision of Section-50(a)(3) of the Bombay Public Trust Act, 1950, now the Gujarat Public Trust Act that, The charity commissioner may, at any time, after hearing the trustees, modify the scheme framed by him under sub-section (1) or sub-section(2) and the representations mainly made for the opponent trustees and the applicant trustees of the Scheme Amendment Application, thousands of representations, Page 14 of 44 Downloaded on : Thu Apr 07 21:33:55 IST 2022 C/SCA/2572/2022 JUDGMENT DATED: 07/04/2022 opinions, suggestions, objections in writing have been received from the beneficiaries, interested parties of the said trust with respect to the Public Notice issued in the present case. I believe it appropriate and necessary to consider the representations received from the perspective of the section-
provisions, in the interest of the trust. It appears from the circumstances of the case that, if the representations are not considered, it shall not be appropriate. Therefore, it appears appropriate to decide the preliminary objections and issues raised in the applications submitted by the opponents, at the time of deciding the original application and passing an order in the case of the Scheme Amendment Application, along with considering comprehensively the representations received, the representations that the parties and the beneficiaries, in person, intend to make with respect to the present Scheme Amendment Application. It shall be in the interest of the trust if decision is taken considering all the aspects. Considering the present situation of the case, it appears that an interest of the trust, the paramount interest shall be maintained and protected only if all the issues pertaining to the Scheme Amendment Application are decided. In this way also, I believe that, it is necessary, inevitable and appropriate to take into account the fact that the purpose and intent of the legal provisions made for the trust be served. It is not an application for individual rights, interests and entitlements or for the suit. I believe that, the main issue is as to what is in the interest of the public trust and there is a reason to believe in the light of the provisions of the Act that, the same Page 15 of 44 Downloaded on : Thu Apr 07 21:33:55 IST 2022 C/SCA/2572/2022 JUDGMENT DATED: 07/04/2022 is an important issue. It is in the interest of the public trust to take into consideration the representations regarding the issues raised in the scheme amendment application along with taking into account that decision making is done for all matters and it appears that, there is no reasonable ground for not considering it accordingly. Therefore, it appears that, there is reasonable and appropriate situation in the procedure of the present case to also take the decision regarding these preliminary objection, issues at the time of the decision of Exhibit-1 keeping in the center as to what is in the interest of the public trust. Therefore, it does not appear appropriate to accept the submissions to reject the applications made in regard with these preliminary objections issues submitted by the applicants. Because, in the interest of the Trust, the decision regarding the preliminary objections will also be taken simultaneously at the time of the decision of Scheme Amendment of Exhibit-1 while considering the issues, objections raised vide these applications.
It is hereby ordered to commence the hearing in the matter of original scheme amendment application so that the present party / advocate and beneficiary / claimant can make their submission, if any. Signature of the present Advocate / Beneficiary / Claimant be obtained after reading over same to them for information and action.
Date : 22/02/2022 Sd/-Illegible
(R.V. Vyas)
Place : Bhavnagar
Joint Charity Commissioner
Page 16 of 44
Downloaded on : Thu Apr 07 21:33:55 IST 2022
C/SCA/2572/2022 JUDGMENT DATED: 07/04/2022
Bhavnagar Division,
Bhavnagar
It is hereby certified that this
is a certified copy.
Sd/-Illegible
Superintendent
Office of Joint Charity
Commissioner, Bhavnagar
12. Section 50A of the Gujarat Public Trust Act - Power of Charity Commissioner for frame, amalgamate, modify the Scheme reads thus :-
"50A.(1) Notwithstanding anything contained in section 50, where the Charity Commissioner has reason to believe that, in the interest of the proper management or administration of a public trust, a scheme should be settled for it, or where two or more persons having interest in a public trust make an application to him in writing in the prescribed manner that, in the interest of the proper management or administration of a public trust, a scheme should be settled for it, the Charity Commissioner may if after giving the trustees of such trust due opportunity to be heard, he is satisfied that it is necessary or expedient so to do, frame a scheme for the management or administration of such public trust (2) Where the Charity Commissioner is of opinion that in the interest of the proper management or administration, two or more public trusts may be amalgamated by framing a common scheme for the same, he may, afterPower of Charity Page 17 of 44 Downloaded on : Thu Apr 07 21:33:55 IST 2022 C/SCA/2572/2022 JUDGMENT DATED: 07/04/2022 Commissioner to frame, amalgamate or modify schemes. 1950:
Bom. XXIX] Bombay Public Trusts Act, 1950 27 of 53
(a) publishing a notice in the Official Gazette and also in at least two newspapers (one in English, and the other in the language of the region) with a wide circulation in the region in which the trust is registered, and
(b) giving the trustees of such trusts and all other interested persons due opportunity to be heard, frame a common scheme for the same.
[(2A) A scheme under this section may provide for the number of trustees, the mode of appointment of trustees including the appointment of the first trustees, vesting of the trust property in the trustees so appointed, mode of filling any vacancy of a trustee the remuneration of a trustee or manager of the public trust and where necessary, a clarification of the objects of the public trust.].
(3) The Charity Commissioner may, at any time, after hearing the trustees, modify the scheme framed by him under sub- section (1) or sub-section (2).
(4) The scheme framed under sub-section (1) or sub-section (2) or modified under sub-section (3) shall, subject to the decision of the competent court under section 72, have effect as a scheme settled or altered, as the case may be, under a decree of a Court under section 50."
13. In the case of Chhotubhai L.Patel Versus State Of Page 18 of 44 Downloaded on : Thu Apr 07 21:33:55 IST 2022 C/SCA/2572/2022 JUDGMENT DATED: 07/04/2022 Gujarat, reported in 2007 (2) GLR 1716.
Heard Note :-
"Bombay Public Trusts Act, 1950 - S. 50A - framing of scheme for Public Trust by Charity Commissioner under S. 50A - application filed by respondent no. 3 to 5 - in said proceedings petitioner filed an application raising preliminary issue regarding expediency and necessity in interest of the Trust for framing of Scheme for said trust - application was rejected - validity of - held, first and foremost requirement of S. 50a is recording of a satisfaction by the Charity Commissioner that it is necessary/expedient to frame a scheme
- in interest of proper management or administration of a public trust regardless of the allegations in application filed under S. 50A by any person or regardless of whether proceedings have been initiated suo motu - in present case, application of petitioner raising preliminary issue was rejected without recording any satisfaction or any reasons for rejecting the same - impugned order also proceeds on an entirely erroneous premises - impugned order set aside as issue raised by petitioner has not been decided as required in law - application of petitioner restored for fresh consideration by respondent no. 2-authority - petition allowed accordingly."
Paragraphs 7 to 11 reads thus :-
(7.) Sec. 50A(1) of the Act reads as under:-
"50A. Power of Charity Commissioner to frame, amalgamate or modify schemes.Page 19 of 44 Downloaded on : Thu Apr 07 21:33:55 IST 2022
C/SCA/2572/2022 JUDGMENT DATED: 07/04/2022 Notwithstanding anything contained in sec. 50, where the Charity Commissioner has reason to believe that, in the interest of the proper management or administration of a public trust, a scheme should be settled of it, or where two or more persons having interest in a public trust make an application to him in writing in the prescribed manner that, in the interest of the proper management or administration of a public trust, a scheme should be settled for it, the Charity Commissioner may if after giving the trustees of such trust due opportunity to be heard, he is satisfied that it is necessary or expedient so to do, frame a scheme for the management or administration of such public trust."
(8.) On a plain reading the provision requires that regardless of what is stated in Sec. 50 of the Act, it would be open to the Charity Commissioner where the Charity Commissioner has reason to believe that, in the interest of the proper management or administration of a public trust, a scheme should be settled of the trust; another contingency is, where two or more persons having interest in a public trust make an application to the Charity Commissioner in the prescribed manner, and such application in writing states that in the interest of the proper management or administration of a public trust, a scheme should be settled for the trust; in either of the contingencies the Charity Commissioner, may, after giving the trustees of such trust due opportunity to be heard, if he is satisfied that it is necessary or expedient so to do, frame a scheme for the management or administration of such public trust. Meaning thereby, the Charity Commissioner has to record a satisfaction, after hearing the trustees of the existing trust, that it is necessary or expedient, in the interest of the proper management or administration of a public trust, Page 20 of 44 Downloaded on : Thu Apr 07 21:33:55 IST 2022 C/SCA/2572/2022 JUDGMENT DATED: 07/04/2022 to frame a scheme. Therefore, regardless of what the allegations are in the application moved by any person, or regardless of whether the proceedings have been initiated suo motu on the basis of a reason to believe, the first and foremost requirement of the provision is recording of a satisfaction by the Charity Commissioner that it is necessary or expedient to frame a scheme in the interest of proper management or administration of a public trust.
(9.) The section, therefore, envisages a specific finding in the form of satisfaction that there is material and evidence on record to show that a scheme is required to be framed in the interest of proper management or administration of a public trust. In other words, the existing trust, or the scheme, under which the existing trust functions, is not conducive for proper management or administration or such a public trust. This satisfaction, as envisaged by the provision, has to be only of the Charity Commissioner and such a satisfaction has to be recorded by the Charity Commissioner before the Charity Commissioner proceeds any further in the direction of framing a scheme. The section requires that the satisfaction is the prerequisite condition which is required to be satisfied before the Charity Commissioner can proceed further to frame a scheme or even proceed further in that direction. The authority is entitled to record, in the first instance, a finding as to the satisfaction envisaged by the provision before adverting to other issues. Though the order may be a consolidated order, a specific, categorical finding as to the satisfaction has to be recorded first in unambiguous terms on Page 21 of 44 Downloaded on : Thu Apr 07 21:33:55 IST 2022 C/SCA/2572/2022 JUDGMENT DATED: 07/04/2022 the basis of cogent and relevant evidence, uncluttered by any other issues or considerations.
(10.) Testing the impugned order dated 12.01.2007 wherein application Exh.77 has been rejected at the anvil of the aforesaid requirement of Sec. 50A(1) of the Act it is apparent that not only is the order silent as to recording of any satisfaction, in fact there are no reasons forthcoming for rejecting the application Exh.77. It is not a question as to whether such an application could or could not have rejected. The question is :- whether the impugned order satisfies the legislative requirement ? Not only does the order does not assign any reason for rejecting application Exh.77 but proceeds on an entirely erroneous premise. Respondent No.2 authority refers to provision of sub-sec. (2A) of Sec. 50A of the Act and states that the question is not only whether the scheme should be framed but also whether trustees should be appointed or not. Sub-sec. (2A) of Sec. 50A of the Act is an enabling provision. The said sub-section provides for a situation where the scheme, as and when framed, provides for the number of trustees, the mode of appointment of trustees including the appointment of first trustees, vesting of the trust property in the trustees so appointed, etc. which is a stage very much later in the legislative scheme of Sec. 50A of the Act. In fact, these are factors which are required to be taken into consideration at the point of time when the scheme is being framed. They cannot be factors relevant for the purposes of testing whether or not it is necessary or expedient to frame a scheme. The position in law is well settled. Once the authority Page 22 of 44 Downloaded on : Thu Apr 07 21:33:55 IST 2022 C/SCA/2572/2022 JUDGMENT DATED: 07/04/2022 in exercise of quasi-judicial powers while arriving at a decision takes into consideration an irrelevant factor, it is not possible to state to what extent the decision making process is vitiated while arriving at such a decision on the basis of consideration of such an irrelevant factor. In such circumstances, the entire order falls to the ground and cannot be sustained.
(11.) In light of what is stated hereinbefore, it is apparent that the impugned order dated 12.01.2007, to the extent it rejects application Exh.77, cannot be sustained and is required to be quashed and set aside. The petitioner has raised a preliminary issue and that issue has in fact not been decided as required in law. The order made by respondent No.2 authority on 12.01.2007 to the extent it rejects application Exh.77 is hereby quashed and set aside. Application Exh.77 stands restored to file for taking a decision afresh in accordance with law. Respondent No.2 authority is directed to decide the said preliminary issue as a separate issue, even if the respondent authority comes to the conclusion that it would be in the interest of all concerned to decide all the issues together.
In paragraphs 9 to 11 the Coordinate Bench of this Court held that the learned Charity Commissioner was required to raise a preliminary issue as regard his satisfaction that it is necessary or expedient to proceed further to frame a Scheme or even proceed further in that direction. The decision pertains to interpretation of Section 50A(1) of the Act which is with regard to framing of a fresh Scheme and not Section 50A(3) Page 23 of 44 Downloaded on : Thu Apr 07 21:33:55 IST 2022 C/SCA/2572/2022 JUDGMENT DATED: 07/04/2022 which is with regard to the modification of the existing Scheme.
13.1 In the case of President, Purohit Sangh vs. Prabhakar Ramchandra Gokhale, reported in 2003 (5) MhLJ 73. Paragraph para 13 and 13A reads thus :-
"[13] Reverting to the first question formulated above, I have no manner of doubt that the factors and parameters which are required to be kept in mind while formulating a scheme as spelt out by the Division Bench of this Court in Fakir Mohamad Abdul Razak v. The Charity Commissioner, Bombay and others, 1976 AIR(Bom) 304 will apply with full force even at the time of modification of the scheme in exercise of powers under section 50-A(3) of the Act. It will be useful to advert to some of the extracts of this decision. In paragraph 35 the Court has observed thus:
"It is well-settled that in suits like the suits for setting the scheme, the Court has a duty once it is found that it is a trust for public purposes, to consider what is best in the interests of public. Settling a scheme is one of the most important reliefs relating to the administration of public trust. The primary duty of the Court is to consider the interest of the public for whose benefit the trust has been created. It has large powers to frame suitable schemes in cases where trust property has been diverted from it proper purposes, and the objects of the trusts are not being carried out and the persons in management are not properly accounting for the realisation from the trust property or otherwise misconducting themselves. Further in Page 24 of 44 Downloaded on : Thu Apr 07 21:33:55 IST 2022 C/SCA/2572/2022 JUDGMENT DATED: 07/04/2022 settling a scheme for the administration of a charitable trust involving the appointment of trustees or managers, the Court is bound to secure persons whom it regards as suitable. A Court cannot abandon its duties lightly relying on mere statements of Advocates without placing any material on record to show who is who and what is what as was done by the learned District Judge in the present case".
Again in paragraph 36 it is observed thus:
".....Appointing trustees is not like appointing sub-committee in association dealing generally with public affairs. The Court is called upon to appoint such trustees men who can apply their mind to the management of the trust and to find out whether those persons have got necessary physical and intellectual capacity and social standing which would justify their appointment as trustees of the public trust......."
In paragraph 37 it is observed thus:
"The Court has further to consider in settling the scheme the past history of the institution and the way in which the management of the trust has been carried on till the settlement of the scheme and the appointment of the trustee. The Court has also to find out whether the persons who are interested, and particularly the devotees of the religious institutions like a Dargah, are satisfied with the new scheme of management which the Court purposes."Page 25 of 44 Downloaded on : Thu Apr 07 21:33:55 IST 2022
C/SCA/2572/2022 JUDGMENT DATED: 07/04/2022 In paragraph 40 while adverting to the other precedents, the Court observed thus:
"In Mahomed Ismail Arief v. Ahmed Moolla Dawood, 1916 AIR(PC) 132 the Privy Council laid down the principle that the Court has complete discretion in settling a scheme of management, it may defer to the wishes of the founder so far as they are conformable to changed conditions and circumstances, but its primary duty is to consider the interests of the general body of the public for whose benefit the trust was created. It may vary any rule of management which it finds either not practicable or not in the best interest of the institution. Mr. Ameer Ali, J., who delivered the judgment observed at page 136 as follows:-
"The present case, however, in their Lordships' opinion illustrates the mischief of leaving the power of appointing or electing trustees in the hands of an indeterminate and necessarily fluctuating body of people, whether they call themselves Panchayat or Jamat. In order to avoid so far as possible a recurrence of the trouble that has brought about this long-drawn litigation, their Lordships think it desirable, in the interest of the institution which form the primary matter for consideration, that the appointment of future trustees should be entrusted to a Committee of the worshippers the composition of which should be in the discretion of the Judge, with due regard to local conditions and needs, subject to the Page 26 of 44 Downloaded on : Thu Apr 07 21:33:55 IST 2022 C/SCA/2572/2022 JUDGMENT DATED: 07/04/2022 provisions that, so long as circumstances do not vary, a majority of such committee should be Randherias, and that in settling the scheme the Judge should lay down rules for their guidance in the discharge of any supervisitorial functions that may appear necessary to confide to them and for filling up vacancies on their body subject to his control."
"These principles were followed by the Privy Council in Ram Dularey v. Ram Lal, 1946 AIR(PC) 34"
13A Undeniably, the factors or parameters which would apply for framing or settling of the scheme would apply with full force even for the purpose of modification of the scheme. The parties in this case have accepted the position that modification of the earlier scheme was imperative."
In the above referred judgment the Hon'ble Bombay High Court was dealing with the provisions of Section 47 of the Bombay Public Trust Act. Section 47 deals with appointment of trustees by the Charity Commissioner. The formation of opinion can never be a question of framing preliminary issue. Section 47 is applicable to Maharashtra that the Charity Commissioner can appoint new trustees and the circumstances under which he can appoint such persons are indicated. It is not a precedent as to whether under Section 50A(3), the Charity Commissioner is required to initially form an opinion/satisfaction and thereafter modify the Scheme. The modification of the Scheme would depend upon several factors Page 27 of 44 Downloaded on : Thu Apr 07 21:33:55 IST 2022 C/SCA/2572/2022 JUDGMENT DATED: 07/04/2022 that may justify modification having regard to necessity and expediency and also need of the time. There is no need for frame a preliminary issue under the provisions of Section 50A(3) of the Act.
13.2 In the case of Shivajirao Bhavanrao Patil & Anr. vs. Shikshan Prasarak Mandal, Malshiras & Ors., reported in 2017 (3) MhLJ. Paragraphs 2, 3, 5, 7, 9, 10, 25 to 28 reads thus:-
"2] By order dated 29 May 2009, the Assistant Charity Commissioner (ACC) purporting to exercise powers under section 50A framed new scheme for the management and administration of the Trust, in substitution of the existing scheme. The new scheme, amongst other matters, involves the curtailment of the tenure of existing trustees and the reduction in the strength of the governing body from 17 to 7 trustees. The appellants, the then existing trustees, appealed ACC's order dated 29 May 2009 to the District Judge, Malshiras invoking provisions of section 72(2). This appeal was dismissed by order dated 17 July 2010. Section 72(4) provides that an appeal shall lie to the High Court, against the decision of the District Court under section 72(2), as if such decision was a decree from which an appeal ordinarily lies. The explanation clarifies that the expression 'decision' shall include a scheme framed or modified under section 50A. Hence, the present appeal against orders dated 29 May 2009 and 17 July 2010.Page 28 of 44 Downloaded on : Thu Apr 07 21:33:55 IST 2022
C/SCA/2572/2022 JUDGMENT DATED: 07/04/2022 3] On 4 November 2008, Santosh Shinde (R5) and Ramdas Kale (R3), members of the Trust, applied to the ACC for frame of new scheme of management and administration of the Trust, in substitution of the existing scheme invoking the provisions of section 50A. On 22 December 2008 Shivaji Abaji Mote [Mote -R6] and another, sought for their substitution in application dated 4 November 2008. On 18 March 2009, Mote filed 'address pursis' before the ACC, stating that addresses of the existing trustees, who stood to be removed under the new scheme, have changed and the new address is 'Post Bhamburdi (Mote Vasti), Taluka Malshiras, Zilla Solapur'. ACC, without verification, addressed notices to the existing trustees at the new address indicated by Mote in the address pursis. Santosh Shinde (R5) by reference to certain registered acknowledgement due cards, purporting to bear signatures of the existing trustees, filed affidavit dated 25 May 2009 claiming that service was complete. The ACC, relying upon such affidavit, on 29 May 2009 made an order framing the new scheme in substitution of the existing scheme.
5] Mr. Bansode, learned counsel for the appellants has basically stressed uopn the following main grounds in support of the appeal :-
(A) In terms of section 50A, no order framing or modifying an existing scheme for management and administration of the trust can be made without opportunity of hearing to the existing trustees. In the present case, there was no service of Page 29 of 44 Downloaded on : Thu Apr 07 21:33:55 IST 2022 C/SCA/2572/2022 JUDGMENT DATED: 07/04/2022 notice upon the existing trustees, most of whom except Mote (R6) stood to be removed under the new scheme. A fraud was played by Mote (R6) in order to create an impression that all the existing trustees have been duly served in the matter and on the said basis the ACC made the order dated 29 May 2009. ig Such order is in breach of the express provisions of section 50A; principles of natural justice and fair play; and can be said to have been procured by fraud and therefore, constitutes a nullity. The material on record clearly bears out the modus operandi with which such fraud was practiced by Mote (R6). On such grounds the order dated 29 May 2009 and the order of the District Judge dated 17 July 2010, confirming the same, are liable to be recalled and status quo ante is liable to be restored;
(B) In any case, the ACC in making the order dated 29 May 2009 and approving the substitution of the old scheme with the new scheme, has completely ignored the parameters of Section 50A and exercised powers without application of mind and in a casual or cavalier manner. The approach of the ACC is in violation of the law laid down by this Court in the case of Mallikarjun Basvanappa Masute & Anr. vs. Dattatraya Krushnath Wadane & Ors.1 and Paraskumar s/o. Bhalchand Thole & Anr. vs. Sureshkumar Hukumchandji Kasliwal & Ors.2, dealing with the scope of 1 2005 (2) Mh.L.J. 266 and Paraskumar s/o Bhalchand Thole and anr. vs. Sureshkumar Hukumchandji Kasliwal and ors., 2009(2) Mh.L.J 543 dealing with the scope of exercise of powers under Section 50-A of the said Act.Page 30 of 44 Downloaded on : Thu Apr 07 21:33:55 IST 2022
C/SCA/2572/2022 JUDGMENT DATED: 07/04/2022 7] Based upon the rival contentions, the points for determination which arise in this appeal are basically twofold:-
(A) Whether, there was proper notice and consequently afford of proper opportunity of hearing to the existing trustees before the ACC made his order dated 29 May 2009 or whether, the material on record establishes fraud on the part of Mote (R6), in the matter of service of notice upon the existing trustees?
(B) Assuming valid service upon the existing trustees, whether, ACC's order dated 29 May 2009 is vitiated by non application of mind to the parameters of section 50A?
9] Since, much turns in this appeal upon the provisions of section 50A, such provisions are transcribed below for convenience of reference :-
"50A. (1) Notwithstanding anything contained in section 50, where the Charity Commissioner has reason to believe that, in the interest of the proper management or administration of public trust, a scheme should be settled for it, or where two or more persons having interest in a public trust make an application to him in writing in the prescribed manner that, in the interest of the proper management or administration of a public trust, a scheme should be settled for it, the Charity Commissioner may, if, after giving the trustees of such trust Page 31 of 44 Downloaded on : Thu Apr 07 21:33:55 IST 2022 C/SCA/2572/2022 JUDGMENT DATED: 07/04/2022 due opportunity to be heard, he is satisfied that it is necessary or expedient so to do, frame a scheme for the management or administration of such public trust. (2) Where the Charity Commissioner is of opinion that in the interest of the proper management or administration, two or more public trusts may be amalgamated by framing a common scheme for the same, he may, after -
(a) publishing a notice in the Official Gazette [and also if necessary in any newspaper which in the opinion of the Charity Commissioner is best calculated to bring to the notice of persons likely to be interested in the trust] with a wide circulation in the region in which the trust is registered, and
(b) giving the trustees of such trusts and all other interested persons due opportunity to be heard, frame a common scheme for the same.
(3) The Charity Commissioner may, at any time, after hearing the trustees, modify the scheme framed by him under sub-
section (1) or sub-section (2). (4) The scheme framed under sub-section (1) or sub- section (2) or modified under sub- section (3) shall, subject to the decision of the competent court under section 72, have effect as a scheme settled or altered, as the case may be, under a decree of a Court under section 50]."
[Emphasis supplied] 10] The provisions of section 50A are quite clear in that they mandate the afford of opportunity of hearing to the existing Page 32 of 44 Downloaded on : Thu Apr 07 21:33:55 IST 2022 C/SCA/2572/2022 JUDGMENT DATED: 07/04/2022 trustees before framing or modification of existing scheme for management and administration of the trust. The furnish of such opportunity is mandatory even upon plain reading of the provisions in section 50A. The new scheme or the modified scheme may, as in the present case, involved removal of existing trustees or several other vital matters concerning the management and administration of the trust. The principles of natural justice and fair play, will also require that such a decision is preceded by afford of opportunity of hearing to the existing trustees. In order that such opportunity is afforded to the existing trustees, it is necessary that the ACC issues and is thereafter satisfied that there is valid service of notices upon the existing trustees. The records and the material in the present case will bear out that there was no valid service of notice upon the existing trustees. In fact, valid service, was scuttled by Mote (R6), who stood to maximum gain under the new scheme and therefore, was interested in ensuring minimum opposition to the new scheme.
25] Before the ACC exercises power and jurisdiction under section 50A in the matter of framing of or modification of any existing scheme for the management and administration of a public trust, the ACC must have 'reason to believe' that it is in the interest of proper management or administration of the public trust that such a proposal must be considered. Thereafter, the ACC is required to afford the trustees 'due opportunity to be heard'. The ACC after due Page 33 of 44 Downloaded on : Thu Apr 07 21:33:55 IST 2022 C/SCA/2572/2022 JUDGMENT DATED: 07/04/2022 application of mind to the predicates of the scheme or the modified scheme and upon due consideration of the submissions, if any, which the trustees may make, is then required to record his satisfaction that it is 'necessary or expedient' to frame a scheme or to modify any existing scheme for the management or administration of such public trust. The perusal of the order dated 29 May 2009, at once indicate that the ACC has been oblivious to the jurisdictional parameters of section 50A. The learned District Judge has also not adverted to the provisions of section 50A and upheld the new scheme on grounds, which are not very different from the grounds stated by the ACC in his order dated 29 May 2009.
26] Taher vs. Quizar (supra) was a case of suo moto exercise of powers by the Charity Commissioner under section 50A(2) in the matter of amalgamation of two or more public trusts by the frame of a common scheme for the same. The learned Single Judge of this Court took cognizance of the circumstance that expressions like 'reason to believe' or 'is satisfied that it is necessary or expedient to do so' as obtain in ig section 50A(1) find no place in section 50A(2). Even then, it was held that such expressions will have to be read in section 50A(2) by way of necessary implication. Therefore, even where the Charity Commissioner exercises powers under section 50A(2), he is required to record his reasons, at least briefly as to why he had reasons to believe that the framing of a common scheme was necessary for the interests of the two trusts or either of them or for their better Page 34 of 44 Downloaded on : Thu Apr 07 21:33:55 IST 2022 C/SCA/2572/2022 JUDGMENT DATED: 07/04/2022 management and administration. In the present case, there is nothing to indicate that the ACC had any 'reason to believe' that the new scheme was in the interest of proper management or administration of the trust. In the impugned order, there is nothing to indicate that the ACC was indeed satisfied that it was 'necessary and expedient' to frame the new scheme in substitution of the existing scheme for the management and administration of the trust.
27] In Paraskumar vs. Sureshkumar (supra), another learned Single Judge of this court has considered and explained the scope of section 50A by emphasizing that a Charity Commissioner cannot frame a scheme at his whim or caprice. The existence of necessity or expediency to frame a scheme in the interest of proper management or administration of the public trust is a sine qua non for the exercise of powers under section 50A. The scheme so framed, was set aside for want of such a sine qua non. In paragraph 10, the learned Single Judge has made the following observations, which are quite apposite :
"10. Section 50-A of the B.P.T. Act provides that where the Charity Commissioner has a reason to believe that in the interest of proper management, or administration of public trust, a scheme should be settled for it, or where two or more persons having interest in public trust make an application to him in writing in prescribed manner that in the interest of proper management, or administration of the public trust a scheme should be settled for it, the Charity Page 35 of 44 Downloaded on : Thu Apr 07 21:33:55 IST 2022 C/SCA/2572/2022 JUDGMENT DATED: 07/04/2022 Commissioner may, after giving the trustees of such trust opportunity to be heard, after he is satisfied that it is necessary or expedient so to do, permit a scheme for the management or administration of such trust. The power of the Charity Commissioner to frame a scheme is not un-briddled. It can be exercised only The Charity Commissioner must have a reason to believe so. That reason to believe must be based on objective assessment of facts. He cannot frame a scheme at the whim or caprice. The existence of a necessity to frame a scheme in the interest of the proper management or administration of a public trust is a sina-qua-non for framing of a scheme under section 50-A of the B.P.T. Act. Whether the trust is ancient and it's origin is not known, the trust has no written constitution or a proper set of rules for the management and administration of trust and there exist circumstances from which it can be reasonably inferred that a trust is not well managed or mismanaged and that mismanagement can reasonably be attributed to absence of a trust deed or a written constitution or set of rules of governance or management the Charity Commissioner may readily believe that it is necessary to frame a scheme for the proper management or administration of the trust. But where a trust is created by a trust deed which contains the basic objects of the trust and the set of rules for the proper management or administration of the trust, the Charity Commissioner's must have due regard to the wishes of the settlor and cannot on his whim say that the trust could be better managed if it is governed by another set of rules or Page 36 of 44 Downloaded on : Thu Apr 07 21:33:55 IST 2022 C/SCA/2572/2022 JUDGMENT DATED: 07/04/2022 another constitution settled by a scheme framed under section 50-A of the B.P.T. Act. In the present case the trust was created by written deed of indenture dated 28.4.1961, a copy of which is annexed to the appeal memo. It does contain the rules for the administration and management of the trust. The order of the Charity Commissioner does not disclose how these rules are in-sufficient for the proper management and administration of the trust. In the circumstances the finding recorded in the negative by the learned District Judge that the Assistant Charity Commissioner could not in law had a reason to believe that in the interest of the proper management or administration of the Trust a scheme should be settled for it was in any way erroneous, much less perverse".
[Emphasis supplied] 28] Mallikarjun vs. Dattatraya (supra) was a case involving frame of a new scheme in substitution of a existing scheme for management and administration of the trust. In this context, the learned Single Judge of this court has held that power and jurisdiction under section 50A cannot be ordinarily exercised to frame an entirely new scheme in substitution of the existing one.
Such power or jurisdiction can be exercised in very very exceptional circumstances upon arriving at a conclusion that the existing scheme is proved to be inadequate to safeguard the interests of the public trust and such interest cannot be Page 37 of 44 Downloaded on : Thu Apr 07 21:33:55 IST 2022 C/SCA/2572/2022 JUDGMENT DATED: 07/04/2022 safeguarded even by making variations, alterations or amendments to the existing scheme. Further, frame of an entirely new scheme without a finding as to necessity or expediency would be illogical and therefore unsustainable. By reference to the decision in the case of Dr. R. P. Kapoor & Ors. vs. Charity Commissioner, Maharashtra 11, the learned Single Judge of this Court has made the following observations which are quite apposite in the facts of the present case:
"What is necessary or expedient is borrowed in para 15 of the judgment in the matter of Dr. R. P. Kapoor from commentary on The Bombay Public Trusts Act, 1950, which reads as follows :
" 'Necessary' and 'Expedient' -meaning : This is a power conferred under the Act in a special contingency, when it is necessary or expedient to frame a scheme in the interest of a public trust. Recently the Gujarat High Court explained the words 'necessary' and 'expedient'. The term 'necessary' means what is indispensable, needful and essential. The terms has a precise meaning and a connotation and there is nothing vague or nebulous about it. The term 'expedient' has no doubt a wider ambit and gives much scope to the exercise of power. But this expression has also a recognized connotation in the eye of law. The dictionary meaning of the term 'expedient' that what in the context it is used and which is most fitting is 'useful for effecting a desired result, fit or suitable for the purpose."Page 38 of 44 Downloaded on : Thu Apr 07 21:33:55 IST 2022
C/SCA/2572/2022 JUDGMENT DATED: 07/04/2022 Even taking into consideration the wider meaning of the term 'expedient', the Court ought to come to a conclusion that it is desirable for achieving the necessary result i.e. safeguarding the charity, to settle a new scheme and. therefore, unless the learned Charity Commissioner can arrive at a conclusion that existing scheme is insufficient for the purpose, or that even after amendment to the existing scheme the purpose of the trust would not be served, the Charity Commissioner would not be in a position to record a finding that it is expedient in the interest of trust to settle a new scheme".
[Emphasis supplied] In the above referred judgment the observation in para 10 is mainly for providing grant of hearing before modification of the Scheme. The decision cannot be read to have held that while exercising power for modification under Section 50A(3), formation of opinion/satisfaction as required under sub-section (1) of Section 50A of the Act is necessary before invoking the jurisdiction for modification of the existing scheme.
In para 25 the Bombay High Court observed that before framing of the scheme or modification of existing scheme of the Trust, due opportunity is required to be provided to the trustees and that, modification is in the interest of the proper management and administration of the Trust. The emphasis is on hearing which is required to be provided to the trustees.
Page 39 of 44 Downloaded on : Thu Apr 07 21:33:55 IST 2022C/SCA/2572/2022 JUDGMENT DATED: 07/04/2022
14. Section 50(A) begins with the non-obstante clause which has have an overriding effect on the provision of Section 50. The Charity Commissioner can frame a scheme under this section without filing suit under Section 50 of the Act.
14.1 The Charity Commissioner can move under Section 50A(1) if;
a) He has "reason to believe" that a scheme should be settled for a trust, however the reason for such a belief should be in the interest of proper management or administration of the trust.
(b) or, if two or more persons having interest in the Trust apply to the Charity Commissioner in the prescribed manner, but such application should show that the settlement of a scheme is in the interest of proper management or administration of the Trust.
In either of the cases, the Charity Commissioner is required to give to the trustees of the Trust an opportunity to be heard as to why such Scheme should not be framed.
Thereafter, Charity Commissioner should be satisfied that it is either necessary or expedient to frame a scheme for the management or administration of the Trust.
Page 40 of 44 Downloaded on : Thu Apr 07 21:33:55 IST 2022C/SCA/2572/2022 JUDGMENT DATED: 07/04/2022 14.2 Under sub section (2) of section 50A, the Charity Commissioner has been empowered to amalgamate two or more public trusts by framing a common scheme if he is of the opinion that the same is in interest of proper management and/or administration of the Trust.
The above action can be taken only after publishing a notice for this purpose in official gazette and also in the two newspapers, one in English and the other in the language of the region in which the trust is registered.
Having framed the scheme under Section 50A(1), the Charity Commissioner under sub-section 3 is also conferred power to modify the scheme framed by the Charity Commissioner under sub section 1 and sub-section 2.
The action under Section 50A(1) can be initiated only if the Charity Commissioner has reason to believe that the action is in the interest of proper management or administration of the public trust and after initiating the action, and hearing the trustees, the Charity Commissioner should be satisfied that it is necessary or expedient to frame the scheme.
Similarly, so far as the action for amalgamation is concerned, Charity Commissioner is required to form an opinion that such amalgamation is in the interest of proper Page 41 of 44 Downloaded on : Thu Apr 07 21:33:55 IST 2022 C/SCA/2572/2022 JUDGMENT DATED: 07/04/2022 management or administration of the Trust.
Sub section 3 of section 50(A) enables the Charity Commissioner at any time after hearing the trustees to modify the scheme.
While, framing of the Scheme and amalgamation of the Trust, the Charity Commissioner is required to form a reasonable belief that there is interest of proper management or administration of the Trust and the Charity Commissioner can initiate action.
Section 50A(3) enables the Charity Commissioner to modify the scheme. However, the language and wording of sub section 3 is different from sub section 1 and 2 of section 50A.
Sub section 3 enables the Charity Commissioner to modify the scheme. The grounds for the modification may be the same as "in the interest of proper management or administration of public trust" but it is not necessary for Charity Commissioner to provide preliminary hearing and/or record satisfaction/opinion before embarking upon the consideration of need for modification as required under sub section 1 of Section 50A of the Act.
15. In view of above, in the facts of the present case, if the Page 42 of 44 Downloaded on : Thu Apr 07 21:33:55 IST 2022 C/SCA/2572/2022 JUDGMENT DATED: 07/04/2022 Joint Charity Commissioner on evidence comes to the conclusion that modification is necessary for proper management of the Trust, it is open for the Joint Charity Commissioner to do so and no fault can be found if the Joint Charity Commissioner comes to the conclusion that all the objections of the trustees about formation of opinion on reasonable belief would be taken into consideration while considering the objections against the application for modification of the Scheme being Application No.3/2021 in Original Scheme No.7/1981.
The present writ-application cannot be entertained at this stage as Section 50A(3) does not provide for the same requirement as contemplated under Section 50A(1) and Section 50A(2) of the Act.
Section 50A(3) stands alone wherein learned Charity Commissioner after hearing the trustees can modify the scheme under Section 50A(1). The applicants are required to make out a case that said modification in the Scheme is necessary for proper management of the Trust. The test for modification would be stricter than that contemplated under sub section 1 of Section 50A.
In the facts of the present case, it is open to the Joint Charity Commissioner to consider the entire application for modification after hearing the trustees and hearing all the Page 43 of 44 Downloaded on : Thu Apr 07 21:33:55 IST 2022 C/SCA/2572/2022 JUDGMENT DATED: 07/04/2022 necessary parties and come to a conclusion as to whether modification is necessary or not. The contention that the Joint Charity Commissioner must first come to the conclusion about formation of opinion/satisfaction as sub section 1 of Section 50A is not warranted. It is open for the Joint Charity Commissioner to decide application for modification of Scheme after considering the objections taken by the trustees and all necessary parties but the reasons for modification of the said Scheme must be germane to what is provided under sub section 1 of Section 50A.
16. In view of above, no error of law or jurisdiction could be said to have been committed by the learned Joint Charity Commissioner. This Court is not inclined to exercise extraordinary jurisdiction under Article 226/227 of the Constitution of India as no case for interference is called for in the order passed by the Joint Charity Commissioner, Bhavnagar dated 22.2.2022 below Ex.56 in Scheme Application No.3 of 2021.
17. In terms of the observations made above, the present writ-application fails and the same is rejected. Notice stands discharged.
(VAIBHAVI D. NANAVATI,J) K.K. SAIYED Page 44 of 44 Downloaded on : Thu Apr 07 21:33:55 IST 2022