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8. A Writ Petition being Writ Petition No. 11618 of 2012 was filed by the Khasgi Trust and its Trustee Shri S.C. Malhotra in the Madhya Pradesh High Court for challenging the aforesaid order dated 5th November 2012 passed by the Collector and praying for restraining the Collector from interfering with affairs of the Trust. The learned Single Judge disposed of the petition by the judgment and order dated 28th November 2013 by issuing diverse directions for the administration of the Khasgi Trust. The learned Single Judge directed that the Board of Trustees shall be reconstituted by including Smt. Sumitra Mahajan and two the persons as trustees. The State Government was directed to make a provision for payment of Rs.1 crore every year to the Khasgi Trust. Another writ petition (W.P. No. 5372 of 2010) filed by the Khasgi Trust was disposed of by the order dated 3rd December 2013 by the learned Single Judge directing the authorities to correct the revenue record in terms of the aforesaid order dated 28th November 2013. As stated earlier, both the said orders of the learned Single Judge were challenged by the State Government by filing two writ appeals. The Public Interest Litigation which was decided along with the writ appeals contained a prayer for directing inquiry through CBI regarding the affairs of the trust and in particular, regarding the alienations made by the Trustees.

25. Thus, the Government of India held that the Khasgi properties and the income from Khasgi should be treated as lapsed for all time to the Madhya Bharat Government. This shows that the claim made by the Maharaja in respect of the Khasgi properties was not accepted and that a decision was taken that the said properties shall vest in the State Government. In lieu thereof, certain guarantees were given by the Government of India, which included that an autonomous Trust would be created for the said charities (the Khasgi properties and the charities of Maharani Ahilyadevi Holkar). The Trust was to be headed by the Ruler of Indore as its President. Out of five other Trustees, two were to be the nominees of the Ruler, two were to be the nominees of the State Government, and one was to be the nominee of the Government of India. The government nominees were to be appointed after consultation with the Ruler. The powers and functions of the Trust were made subject to the State or Central legislation, which may be enacted in future. However, it was clarified that the legislation shall not change the manner of formation of the autonomous Trust and the composition of the Trust.

30. On 23rd June 1969, an application was made by the Trustees of Khasgi properties to the Registrar seeking a declaration regarding exemption under clause (a) of sub-Section (1) of Section 36 of the Public Trusts Act. In paragraph 6 of the said application, the Trustees stated that the charities and religious endowments were initially under the management of the erstwhile Holkar State.

They further stated that after the merger of Holkar State with the State of Madhya Bharat, the management and possession of the charities and religious endowments remained with the State Government and its successors till 16th July 1962, when the same was handed over to the Trustees. The stand consistently taken by the Trustees of the Khasgi Trust clearly shows that it is an accepted position that the properties described in Part ‘B’ of the Schedule to the Trust Deed vested in the State Government after the adjudication was made in accordance with Clause (3) of the Article XII. It must be noted here that the Maharaja or none of his family members challenged the said adjudication made on the issue of ownership of the Khasgi properties and none of them disputed or challenged the act of the State Government of taking over the Khasgi properties/charities. In fact, the Maharaja acted upon it by nominating two trustees. The Khasgi Trust has been created on the basis of the said adjudication. Hence, the Trustees are bound by the adjudication.

38. The order of the Registrar proceeds on the footing that even if Clause (a) of Sub-Section (1) of Section 36 is applicable, Section 14 of the Public Trusts Act will apply. Obviously, if Clause (a) is attracted, nothing contained in the Public Trusts Act shall apply to such a Trust, which will include Section 14 as well. The powers of the Registrar under the Public Trusts Act are found in Chapter V. None of the provisions of the Public Trusts Act confer any power on the Registrar to decide the question whether an exemption under Clause (a) of Sub-Section (1) of Section 36 is applicable to a particular public Trust. Therefore, we have independently examined whether Clause (a) of sub-Section (1) of Section 36 will have application. It is not the case that the Khasgi Trust is being administered by any local authority as such. The question is whether it is being administered by any agency acting under the control of the State Government. There are six Trustees of the Khasgi Trust, out of which, one is the Ruler, who is the ex-officio President. Two Trustees are the nominees of the Ruler. The remaining three are the nominees of the State Government and Central Government. Neither in the order of the Government of India dated 6th May 1949 nor in the Trust Deed, there is anything to indicate that the Khasgi Trust is administered by any agency acting under the control of the State Government. Even the power to nominate two Trustees vested in the State Government and similar power vested in the Central Government to nominate one Trustee has to be exercised in consultation with the Ruler. The three Trustees nominated by the Government do not have a majority in decision making. The State Government has no effective control over the functioning of the Khasgi Trust. In one sense, it is an autonomous public Trust. Therefore, on the face of it, Clause