TaxTMI 
TaxTMI 
1997 (3) TMI 631
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..../92 11/90 8. 1688/96 168/92 2/89 9. 1689/96 204/92 12/91 10. 1691/96 164/92 11/90 2A. The facts, which are necessary for the disposal of these appeals are as follows:- Earlier there was a Trust by name Nasik Diocosan Trust Association Ltd., which was registered as a Company under the Companies Act in 1943. Subsequently the said Trust came to be registered as a Public Trust under Bombay Public Trust Act, 1950 on 13-7-1954 (herein after referred to as the Act). Then the Assistant Charity Commissioner prepared a scheme for the said Trust in 1967. Under this scheme Bishop is an ex-officio Chairman of the board of trustees. It appears some of the trustees and some of the beneficiaries and members of the Trusts were not satisfied with the working of the Trust. Some of them filed three scheme applications being 2/89, 11/90 and 12/91 under section 50-A(3) of the Act before the Assistant Charity Commissioner, making allegations against the Bishop and the board of trustees. It was alleged that the trustees are not acting in the interests of the trust. Allegation of mismanagement and diversion of funds were alleged against the Bishop and the trustees and it was further alleged tha....
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....s are not maintainable and are liable to be dismissed. He fully supported the finding of the learned District Judge that the Bishop should be ex-officio Chairman of the Trust. 4. In the light of the arguments addressed before me, the points that fall for determination in these appeals are:- (i) Whether the present appeals should be treated as second appeals within the meaning of section 100 C.P.C. and secondly the Court cannot go into the merits of the dispute between the parties unless there substantial question of law arises for consideration? (ii) Whether the amendments made by the learned District Judge to the scheme of the Trust are sustainable or not? (iii) What order? 5. Mr. P.N. Joshi, the learned Counsel for the Bishop contended that the Assistant Charity Commissioner passed the original order as a trial Court. Then the parties filed application before the learned District Judge under section 72(1) of the Act. Though it is styled as an application, it virtually is an appeal to the District Judge. Therefore it was argued that what the District Judge has decided under section 72(1) of the Act is a First Appeal. Even the learned Counsel for the appellants have no quarrel....
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....larger Bench because of these conflicting views. Then it was argued that the later decision should prevail over the earlier decision. I have heard lengthy arguments on the merits of the case spread over for 8 days. The litigation pertaining to this Trust has been going on for the last 7-8 years. There are allegations of mismanagement against the trustees. It is also admitted fact that elections have not been held in the Trust from the beginning. Even the learned Counsel for the Bishop who raised a question of maintainability of appeal alternatively submitted that if the Court does not agree with his contention that the present appeal lies only on a question of law, then, this Court may consider the appeals on both facts and law. I, therefore feel that it is not necessary to refer the question to a larger-Bench and the matter can be disposed of by me by adopting one of the two conflicting views which is in consonance with the provisions of the Act. Further, I also find that the point is concluded by decision of the Supreme Court, where similar question had arisen under a different Act. In my view the appeal under section 72(4) of the Act though it may be a second appeal under the A....
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....e Act is concerned, it would be a first appeal. There is only one order of the Charity Commissioner against which the appeal is provided to the High Court. As far as the orders under section 41-E(6), 41-D(6) and section 72(1) of the Act are concerned, there is a first appeal to the District Judge, and then against the order of the District Judge appeal lies to the High Court. Therefore, appeals under those three sections are in the nature of second appeals to the High Court. But still the wordings used in respect of those second appeals and in respect of first appeal under section 47(5) of the Act are concerned, the language used is the same. In section 47(5) of the Act, the words used are the order of the Charity Commissioner shall be deemed to be a decree of the Court and an appeal shall lie to the High Court. Similarly, in section 41-D(6), it is provided appeal lies to the High Court as if the decision of the District Court was a decree, from which appeal ordinarily lies to the High Court. Similar words are mentioned in 41-E(6) and section 72(4) of the Act. That means the Act has used similar or identical words both in respect of first appeal provided in section 47(5) of the ....
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.... on the powers of the High Court in a second appeal provided under the Act. 9. As far as applicability of the Code of Civil Procedure to the authorities under the Act are concerned, there are two sections, which are section 73 and section 76. Section 73 provides that the provisions of Civil Procedure Code are applicable to officers conducting inquiries under the Act, only to the extent of proof of facts by affidavit, summoning witnesses, discovery and inspection and issuing of Commission. Only few provisions of the C.P.C. are made applicable to inquiries conducted by the officers under the Act. 10. Section 76 reads as follows:- "Save in so far as they may be inconsistent with anything contained in this Act the provisions of the Code of Civil Procedure, 1908, shall apply to all proceedings before the Court under this Act." Here C.P.C. is made applicable only to all the proceedings before the "Court" under the Act. The Court is defined in section 2(4) of the Act meaning either the City Civil Court at Bombay or District Court outside Bombay City. Therefore C.P.C. is made applicable only to the proceedings before the City Civil Court or the District Court. It c....
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....cond appeal under section 100 C.P.C. In this connection I may also refer to judgment of a learned Single Judge of the Gujarat High Court reported in XVIII G.L.R. 488 Miya Mohamed Abdulkarim Jariwala and anr. v. Collector of Surat and others, (By His Lordship Justice A.M. Ahmadi, as he then was, presently the Chief Justice of India). He also took the view that there is nothing to limit the powers of the High Court in section 72(4) of the Act, unlike the limitation provided in second appeal under section 100 C.P.C. It was pointed out that the limitation provided in section 100 C.P.C. cannot be read into section 72(4) of the Act. I may also make reference to the latest book of Mulla on the Code of Civil Procedure, 1995 Edition, Vol. I, page 711, where it is stated as follows:- "In a recent decision the High Court of Punjab and Haryana has held that this section does not affect the provisions as to second appeals contained in special or local laws, e.g., Punjab Courts Act or any other law for the time being in force on the subject of second appeals." In A.I.R. 1978 Punjab & Haryana, 137 Ganpat v. Smt. Ram Devi and others, it has been held that a second appeal under sectio....
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....r, uncontrolled and unlimited than the powers of second appeal under section 100 C.P.C. Hence, in view of the authoritative pronouncement of the Apex Court, I have no hesitation to hold that the power under section 72(4) of the Act is not limited in any way by invoking section 100 C.P.C. Since, we are concerned with a special statute, with special provisions of appeal and special forum, we need not be guided by the limitations of a second appeal under section 100 C.P.C. Hence, there is no necessity to refer the point to a Division Bench in view of the decision of the Apex Court on the point and also in view of the guideline given by the Full Bench decision of this Court referred to above. 14. For the above reasons my finding is that the second appeal under section 72(4) of the Act lies both on facts and law and not limited to substantial question of law like the second appeal under section 100 C.P.C. Point No. 1 answered accordingly. 15. The appellants are challenging some of the amendments made by the learned District Judge in the impugned order. I will consider only those amendments made by the District Judge, which were questioned before me at the time of arguments. Some of th....
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....confined to Districts mentioned by the learned District Judge. On behalf of the respondents, it was argued that the order of the learned District Judge on this point does not suffer from any infirmity and hence, it should not be interfered with. 17. In my view the question of area of operation should be left to the trustees and members of the General Body of the Trust. No evidence has been let in before the Court to show as to what should be the area of operation and whether the area should be increased? In the absence of such evidence the area of operation as mentioned in the 1967 scheme should be maintained. The area mentioned in the 1967 scheme coincides with the area of Nasik Diocese District. If the area of operation is made whole of India, then we will be enlarging this scope of becoming members and it may be difficult to hold elections. I therefore feel that for the present the Nasik Diocesan District should be the operational area as mentioned in 1967 scheme and as confirmed by the learned District Judge giving liberty to the members of the general body of the Trust and Board of trustees to express their opinion on this aspect and then they can move the Charity Commissione....
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.... Judge on this point. However even on this point, it is open to the general body to express its opinion and seek amendment of the membership clause in the scheme of the Trust and then it is open to the Charity Commissioner to decide that question one way or other after knowing the opinion of the general body. 20. The next objection to the order of the learned District Judge is about the qualification for becoming a member of the Trust. According to the learned Asst. Charity Commissioner any person "belonging to Christian community having origin of Anglican" can become a member of the Trust. The learned District Judge amended this clause as any person "who is the communicant member of the Church." Now the dispute between the parties is whether we should retain the definition given by the Assistant Charity Commissioner or the definition given by the District Judge or whether there should be any other change. Though the learned Asst. Charity Commissioner has used the word Anglican Church, it is now admitted before me that the said word has now become obsolete, since the Indian Churches are not governed by Anglican Church meaning there by the Church of England.....
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....When once we have provided that the trustees should be elected, then as natural corollary the Chairman also be elected from among the trustees. It may be that in olden days under 1943 provisions or even earlier there was provision for the Bishop being an ex-officio Chairman. We must bear in mind that India has adopted a democratic way of living under the Constitution and elected Government or elected body is basis of the democratic principle. Then idea of an ex-officio Chairman is an outdated idea. In the modern concept particularly in view of our Country having adopted a democratic form of Government, it is essential that the same principle should apply to all public institutions. We are concerned with a public trust and not a private Trust. In the case of Public Trust, particularly under the Bombay Act, many powers are given to the Charity Commissioner and other Officers to supervise and control the activities of the Trust. Since, it is a public Trust, it is desirable that the Trust should be managed by an elected body of trustees including the elected Chairman. 24. The Trust has three objects, of which religious aspect is one and the other are running educational institutions, ....
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....mmittee has been constituted to deal with all finances, all property matters, all legal matters etc. It is therefore seen that the present Bishop himself has put it in writing in black and white that it is very difficult for him to manage the day to day affairs of the Trust since, he has to attend to the other works as Bishop etc. He has, therefore, appointed Advisory Committee to assist him and also to attend to certain works. This clearly shows that the Bishop cannot be expected to attend to the day to day affairs of the Trust. He being the religious head of the diocese, will have lot of work and he cannot be burdened with numerous duties as a Chairman of the Trust. 25. We may also notice that Bishop is a transferable person. One Bishop may take interest in the Trust matters, in addition to his religious duties as a Bishop. Another Bishop may be only interested in the religious work as a Bishop and may not be interested in the work of the Trust. Another Bishop may have no experience in administrative matters, in finance matters etc. to look after the trustees work. Another Bishop may not be interested to do any non-religious work at all. He may be interested only in religious ma....
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.... will be entitled to stand for election for the post of the chairman, to be elected from among the trustees. If he can muster support of the trustees, then the Bishop can be elected as Chairman of the trustees. As already stated some Bishops may not be interested in becoming Chairman, in which case the trustees can elect a willing person as a Chairman. Therefore, the amendment made by the learned District Judge making Bishop as ex-officio Chairman of the Trust is hereby set aside. However, the Bishop of Nasik Diocese shall be an ex-officio member of the Board of trustees with a right to stand for election of the Chairman. However, the Chairman of the Trust shall be elected from among the board of trustees including an ex-officio trustee, who is the Bishop of the diocese. 26. I have already omitted the word "communicant" in the qualification of person to become member of the Trust. There should be consequent amendment in the qualification for person standing for election as trustee. Hence, Clause 13(c) be amended as "a person being a member of any of the Churches in the Nasik Diocese. Subject to these amendments specifically interfered with by me, the other amendment....
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....es as members by paying necessary subscription as per scheme. The acting Chairman and ad-hoc trustees are entitled to look after the day to day administration of the Trust and for holding elections and handing over charge to the newly elected body. This ad-hoc committee will have no powers of taking any policy decisions or about alienating the property of the Trust. 29. In the result all the 10 appeals are allowed partly as follows:- (i) In Clause (5) of the scheme, the basic qualification for becoming a member of the Trust is that he should a person "belonging to Christian community and the member of any of the Churches in the Diocese of Nasik District". Clause (5) be amended accordingly. (ii) In Clause 11 the amendment made by the learned District Judge making the Bishop of Nasik as an ex-officio Chairman of the Trust is set aside. However, Clause 11 be amended as follows :- The Bishop of Nasik shall be an ex-officio Trustee. All other trustees are to be elected from the members of the Trust. The Chairman shall be elected from the trustees, including an ex-officio trustee. The Bishop who is an ex-officio trustee is also entitled to stand for election for the post o....