Case Note & Summary
The case involves two writ petitions: one by M/s. Sai Builder and Developer (the highest bidder) and another by Vitthal Rukhmai Deosthan Trust (the Trust), both challenging an order dated 06.03.2020 passed by the Joint Charity Commissioner, Nagpur, dismissing the Trust's application under Section 36(1)(a) of the Maharashtra Public Trusts Act, 1950, seeking permission to sell trust property. The Trust managed a temple about 56 years old, which was in dilapidated condition. In July 2014, the Trust decided to renovate the temple and, to raise funds, resolved to sell a piece of land admeasuring 3.706 acres. Tenders were published on 18.09.2014 in two local newspapers, 'Jana Madhyam' and 'Shramik Sangharsh', both circulated in Wardha. Four bidders responded, and the Trust accepted the highest bid of M/s. Sai Builder and Developer. The Trust then applied to the Joint Charity Commissioner for permission under Section 36(1)(a). The Joint Charity Commissioner dismissed the application, holding that the tender process was not conducted with wide publicity as required, since the newspapers had limited circulation and the sale was not advertised in widely circulated newspapers. The Trust and the highest bidder challenged this order. The High Court upheld the dismissal, reasoning that the Joint Charity Commissioner had correctly exercised his discretion. The Court noted that the newspapers chosen were not widely circulated and the process lacked transparency, which could lead to suspicion of collusion. The Court emphasized that for sale of trust property, wide publicity is essential to ensure maximum benefit to the trust. The petitions were dismissed, and the order of the Joint Charity Commissioner was upheld.
Headnote
A) Trust Law - Sale of Trust Property - Section 36(1)(a) Maharashtra Public Trusts Act, 1950 - Requirement of Wide Publicity - The Trust sought permission to sell its land to raise funds for temple renovation. The Joint Charity Commissioner dismissed the application holding that the tender notices were published only in two local newspapers with limited circulation, not in widely circulated newspapers, and the process lacked transparency. The High Court upheld the dismissal, emphasizing that for sale of trust property, wide publicity is essential to ensure maximum benefit to the trust and to avoid any suspicion of collusion. (Paras 2-14)
B) Trust Law - Tender Process - Validity - Section 36(1)(a) Maharashtra Public Trusts Act, 1950 - The Trust's tender process was found to be vitiated as the newspapers chosen had minimal circulation and the sale was not advertised in any widely circulated daily. The Court held that the Joint Charity Commissioner correctly exercised his discretion in rejecting the application, as the process did not inspire confidence and was not in the interest of the trust. (Paras 15-20)
Issue of Consideration
Whether the Joint Charity Commissioner was justified in dismissing the Trust's application under Section 36(1)(a) of the Maharashtra Public Trusts Act, 1950, seeking permission to sell trust property, on the ground that the tender process was not conducted with wide publicity and in compliance with the statutory requirements.
Final Decision
Both writ petitions were dismissed. The order dated 06.03.2020 passed by the Joint Charity Commissioner, Nagpur, was upheld. No order as to costs.
Law Points
- Section 36(1)(a) of Maharashtra Public Trusts Act
- 1950
- sale of trust property
- tender process
- public notice
- wide publicity
- statutory compliance
- joint charity commissioner's powers
Case Details
2022 LawText (BOM) (07) 112
Writ Petition No. 2825 of 2020 and Writ Petition No. 2516 of 2020
Mr. A.D. Mohgaonkar (for petitioner in WP 2825/2020 and respondent No.2 in WP 2516/2020), Ms. T.H. Khan, A.G.P. (for respondent No.1 in both petitions), Mr. A.P. Thakre (for respondent No.2 in WP 2825/2020 and petitioner in WP 2516/2020)
M/s. Sai Builder and Developer (WP 2825/2020) and Vitthal Rukhmai Deosthan Trust (WP 2516/2020)
Joint Charity Commissioner, Nagpur (in both petitions); Vitthal Rukhmai Deosthan Trust (in WP 2825/2020) and M/s. Sai Builders and Developer (in WP 2516/2020)
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Nature of Litigation
Writ petitions challenging order of Joint Charity Commissioner dismissing application under Section 36(1)(a) of Maharashtra Public Trusts Act, 1950 for permission to sell trust property.
Remedy Sought
The Trust and the highest bidder sought quashing of the Joint Charity Commissioner's order dated 06.03.2020 and permission to sell the trust property.
Filing Reason
The Joint Charity Commissioner dismissed the Trust's application for permission to sell trust property, holding that the tender process lacked wide publicity and transparency.
Previous Decisions
Joint Charity Commissioner, Nagpur, passed order dated 06.03.2020 dismissing the Trust's application under Section 36(1)(a) of the Maharashtra Public Trusts Act, 1950.
Issues
Whether the Joint Charity Commissioner was justified in dismissing the Trust's application under Section 36(1)(a) of the Maharashtra Public Trusts Act, 1950, on the ground that the tender process was not conducted with wide publicity and in compliance with statutory requirements.
Submissions/Arguments
The Trust and the highest bidder argued that the tender process was conducted properly, with notices published in two newspapers, and the highest bid was accepted in the interest of the trust.
The Joint Charity Commissioner contended that the newspapers had limited circulation and the sale was not advertised widely, which could lead to collusion and was not in the best interest of the trust.
Ratio Decidendi
For sale of trust property under Section 36(1)(a) of the Maharashtra Public Trusts Act, 1950, wide publicity is essential to ensure maximum benefit to the trust and to avoid any suspicion of collusion. The Joint Charity Commissioner has the discretion to reject an application if the tender process is not transparent and does not inspire confidence.
Judgment Excerpts
A Trust and a highest bidder in a project for renovation of a temple managed by the Trust, are before this Court challenging order dated 06.03.2020 passed by the Joint Charity Commissioner, Nagpur, whereby an application filed by the Trust under Section 36(1)(a) of the Maharashtra Public Trusts Act, 1950 was dismissed.
The Joint Charity Commissioner held that the tender process was not conducted with wide publicity as required, since the newspapers had limited circulation and the sale was not advertised in widely circulated newspapers.
Procedural History
The Trust filed an application under Section 36(1)(a) of the Maharashtra Public Trusts Act, 1950 before the Joint Charity Commissioner, Nagpur, seeking permission to sell trust property. The Joint Charity Commissioner dismissed the application on 06.03.2020. The Trust and the highest bidder filed separate writ petitions in the Bombay High Court, Nagpur Bench, challenging the order. The petitions were heard together and dismissed on 07.07.2022.
Acts & Sections
- Maharashtra Public Trusts Act, 1950: Section 36(1)(a)
