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PETITIONER: KRISHNA VEER SINGH BACHANSINGH CHAUHAN

       Vs.

RESPONDENT: WASUDEO MOTIRAM KALMEGH AND ANR.

DATE OF JUDGMENT30/08/1995

BENCH: JEEVAN REDDY, B.P. (J) BENCH: JEEVAN REDDY, B.P. (J) MUKHERJEE M.K. (J)

CITATION:  JT 1995 (6)   324        1995 SCALE  (5)49

ACT:

HEADNOTE:

JUDGMENT:                         O R D E R      On August  6, 1990, this Court made the following order :      Having regard  to the circumstances that      the body  that is  brought into being is      an  adhoc   managing  committee  pending      final  decision  by  the  Joint  Charity      Commissioner it  appears to us that ends      of justice would be met by directing the      said  adhoc  managing  committee,  which      includes  the   said   Vasudeo   Motiram      Kalmegh and  Suresh Moolchand Agarwal to      furnish accounts of the rents or licence      fee collected  from the  licencees  (who      were not-applicants  4 to  7 respondents      before the Charity Commissioner) for the      period from April, 1987 to 31st of July,      1990.  If   upon  such   furnishment  of      accounts and  funds are  found to  be in      the  hands   of   the   adhoc   managing      committee  or   with   Vasudeo   Motiram      Kalmegh and  Suresh Moolchand Agarwal or      any of  them, as  the case  may be, such      balance shall also be deposited with the      Charity Commissioner  within two  months      from today. The adhoc managing committee      shall, with  effect from the 1st August,      1990 collect  the said  licence fee  and      deposit  the   same  with   the  Charity      Commissioner every month regularly.           This  arrangement   shall  continue      till the matter before the Joint Charity      Commissioner is  finally disposed  of as      envisaged  by  the  order  of  the  High      Court.           Whatever we have said in this order

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    or whatever  may be  implicit in  it, it      may not  be taken  into account  in  the      final disposal  of the  proceedings  now      pending or  to be  taken  in  future  in      respect of this Samiti, as this order is      intended  to   operate  as   an  interim      arrangement."      Complaining that  the respondents  have failed to carry out the  said order,  the petitioner, Sir Krishna Veer Singh Chauhan (K.S.Chauhan  ) moved  the present  application  for contempt.      Vidharbha Rashtrabhasha Prachar Samiti, Nagpur (Samiti) is a body registered under the Bombay Trust Act, 1950 having its office  at Nagpur.  In February  1982,  the  petitioner, Chauhan, was  appointed as  the Secretary  of the Samiti. He says that  in April  1982, the  respondents, Sri Kalmegh and Sri Suresh  Agarwal, forcibly  took away  the  keys  of  the office of  the Samiti and took control of the affairs of the Samiti. The  petitioner says  that he  applied to  the Joint Charity  Commissioner   to  direct  the  respondents  (S/Sri Kalmegh and  Agarwal) to hand over the charge of the affairs of the  trust to  him. Orders  were made  by the authorities against  both   the  respondents   as  prayed   for  by  the petitioner.  The   respondents  were  also  restrained  from dealing with  or alienating  or otherwise  transferring  the Samiti properties.      On November  3, 1987,  the Joint  Charity  Commissioner passed the following order :           "Non-applicant  No.1   Prof.   W.M.      Kalmegh and  NA No.  3.  Shri  Jagannath      Jadia  are   proved  to  have  committed      misfeasance  and   misappropriation   in      respect of  property of  Rs.35,000/- and      125 cement  bags of  the trust  Vidarbha      Rashtrabhasha  Prachar  Samiti,  Nagpur,      PTR   No. F-639 (Nagpur) and, therefore,      they  are   hereby  dismissed  from  the      Trusteeship of  the aforesaid Trust, PTR      No. F-639 (Nagpur)."      It is  stated that  the respondents challenged the said order by  way of  a writ  petition in the Bombay High Court, Nagpur Bench.      In  the  year  1988,  the  Joint  Charity  Commissioner initiated suo  motu proceedings  under Section  50-A of  the Bombay Public  Trust Act  to enquire into the affairs of the trust.      On April  21, 1989, the High Court disposed of the writ petition filed  by  the  respondents  directing  the  Deputy Charity Commissioner,  Nagpur "to draw a list of the persons who belong  to category  Nos. 1  to 3  of clause  -7 of  the Constitution and  cause a body of five persons to be elected by them  by treating  category Nos.  1 to  3 as an electoral college, within  two months from the date of this order. The petitioners and  the respondent  No.1 shall  thereupon  hand over the  charge of  the adhoc Managing Committee which will manage the  affairs of  the Vidarbha  Rashtra Bhasha Prachar Samiti, Nagpur,  until the  matter is finally decided in suo moto   proceedings    initiated   by   the   Joint   Charity Commissioner, Nagpur,  under  section  50-A  of  the  Bombay Public Trusts Act."      Against the  said order, the petitioner approached this Court by  way of Special Leave Petition (C) No. 2545 of 1990 in September 1989. After notice to the respondents and after hearing them,  this Court made the aforesaid order on August 6, 1990.

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    In this contempt petition, the following order was made by this Court on August 23, 1993 :           "We have  heard  Sri  G.L.  Sanghi,      learned   senior    counsel   for    the      petitioner and  Sri  S.B.  Wad,  learned      senior counsel for the ad hoc trustees.           We are afraid the compliance of the      order dated  6th August,  1990 by the ad      hoc  trustees   is  only   partial   and      incomplete.  The  ad  hoc  trustees  are      directed to furnish to this Court within      four weeks  from today  an affidavit  of      the year-wise  break-down of  the income      and expenditure  of the  Trust  for  the      years 1982-83  to  1990-91.  They  shall      indicate in  respect of  each year,  now      many  tenants   or  licensees   were  in      occupation of the property of the Trust;      the specification of the area and extent      of such  occupation; what was the amount      of rent  or licence  fee realisable from      them;   what   amounts   were   actually      realised  and   what  amounts   remained      unrealised. They  shall also indicate in      an year-wise  break-up what  action  was      taken by  the ad hoc trustees to recover      the amounts in arrears.           That  apart,   in  respect  of  the      period 6th  August, 1990  to 5th August,      1993, a  similar statement  with similar      break-down of  the figures shall also be      furnished. It would appear that for none      of these  years the  accounts  were  got      audited by  the trustees.  The  trustees      are   admittedly    governed   by    the      provisions are  the Bombay  Public Trust      Act, 1950.  Provisions of Section 32 and      33 statutorily  require the  trustees to      have the  accounts audited.  We  do  not      know how  the authorities  under the Act      permitted or ignored this lapse.           Likewise,  the   petitioners  shall      also file  their affidavits  giving  the      necessary   particulars   as   to   how,      according to  them, the income of Rs. 10      lacs per year.           Sri Wad submitted that the trustees      have  produced  the  books  of  accounts      before the Charity Commissioner and that      they  need  permission  to  inspect  the      books of  accounts.  The  trustees  have      such permission.           It  would   be  appropriate   if  a      certificate of  Chartered Accountant  is      also produced as regards the accounts.           This would  go  in  favour  of  the      trustees while  examining the  rectitude      of  their  conduct  in  respect  of  the      management of  the affairs  and funds of      the Trust.           We would  also like  to comment  on      the undue protraction of the proceedings      under the  Bombay Public Trust Act, 1950      which were  commenced suo  motu  by  the      authorities.  It   is  appropriate  that

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    these proceedings  are expedited and the      Charity  Commissioner   or  the   Deputy      Charity Commissioner,  as the  case  may      be,    concludes    these    proceedings      expeditiously and,  in  any  event,  not      later  than   within  four  months  from      today. Let  a copy  of this  order go to      the Charity Commissioner for compliance.           Call on 4th October, 1993. Personal      presence   of    the    contemners    is      discharged."      Meanwhile, the Joint Charity Commissioner concluded the suo motu  proceedings initiated by him under Section 50-A of the Act  and passed  orders on  December 31,  1993 framing a scheme for the trust and appointing trustees thereunder. The petitioner was  appointed as the secretary of the trust. The said Board  was directed  to take  over charge from the then existing body,  whosoever it  may  be,  and  to  manage  the affairs of  the trust in accordance with its objects and the law.  Pursuant   to  the   orders  of   the  Joint   Charity Commissioner, the petitioner says, he obtained possession of the trust  properties on  August 22,  1994 with  the help of police.      Pursuant to  the order  of this  Court dated August 23, 1993, the  respondents filed  certain audited  accounts, the correctness whereof  was questioned  by the petitioner. When the matter  came up  before this Court again on November 10, 1994, the following further order was made :           "In this  contempt case, this Court      made an  order  on  23rd  August,  1993.      According to  the said order, the ad hoc      Trustees, who  were respondents  herein,      were  directed   to   submit   year-wise      breakdown of  the income and expenditure      of the  Trust for  the years 1982-83 and      1990-91. Indeed,  even subsequent to the      year  1990-91,  they  were  directed  to      continue to deposit the amounts and file      accounts so  long as  they  remained  in      management of  the Trust property. It is      stated now  that the  respondent-ad  hoc      Trustees were in management of the Trust      property till  August,  1994.  Mr.  S.B.      Wad,  learned  senior  counsel  for  the      respondents says that in compliance with      the aforesaid  order as  well as earlier      order  dated   6th  August,   1990,  the      respondents  have   filed  the   audited      accounts for  the years 1982-83 to 1990-      91. He  further submits that the audited      accounts for  the subsequent  years have      been  submitted   before   the   Charity      Commissioner. Learned  counsel says that      in accordance  with the  said  accounts,      the deposits  have also been made by the      respondents     with     the     Charity      Commissioner. Learned  counsel  for  the      petitioner,   however,    disputes   the      correctness  of   the  audited  accounts      filed by the respondents.           Inasmuch as  the  audited  accounts      are quite voluminous and also because it      is not  possible or  feasible  for  this      Court to  go  into  the  correctness  or      otherwise  of   the  said  accounts,  we

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    direct the Charity Commissioner, Bombay,      to look  into the  matter.  The  Charity      Commissioner,  Bombay,   or  such  other      officer as  the Charity Commissioner may      designate,   will    look    into    the      correctness  of   the   accounts,   make      necessary enquiries and verifications as      may be  called for  in the circumstances      of  the   case,  after   notice  to  the      petitioner and  the respondents  herein,      and submit  a Report to this Court about      the   correctness of  the said  accounts      and deposits which may have been made by      the respondents.  It is obvious that the      Charity Commissioner  or the  officer as      may  be   designated  by   the   Charity      Commissioner  shall   be  empowered   to      receive such evidence as may be produced      before him or as may be gathered by them      for the aforesaid purpose.           The   Report    of   the    Charity      Commissioner shall  be submitted  within      four months from today.           Copies of  the order dated 6-8-1990      and 23-8-1993  shall be  enclosed to the      copy of  this order  communicated to the      Charity Commissioner."      Pursuant  to   the  said   order,  the  Deputy  Charity Commissioner,  Nagpur   (who  was   entrusted  the   job  of submitting  the  report)  has  submitted  his  report  dated February  7,  1995.  In  this  report,  the  Deputy  Charity Commissioner  has   mentioned  the   total  amount  of  rent deposited by the respondents during the period April 1, 1982 to June  30, 1994 and the dates on which the various amounts were deposited.  according to this statement, a total amount of Rs.  92,487.92 p.  has been deposited for the said period of over  twelve years.  The Deputy  Charity Commissioner has reported that  it has not been possible for him to check the correctness of  the accounts  submitted by  the  respondents inasuch as  the relevant  registers and  books of the Samiti have not  been made  available to  him. He has reported that while  the   respondents  complain   that  inasmuch  as  the possession of  the office  and properties  of the Samiti was taken by  the petitioner  by force and with police help, and because they do not have access to the office of the Samiti, they are  not in  a position  to produce  the  accounts  and registers to  enable  the  Deputy  Charity  Commissioner  to verify the  accounts submitted  by them.  On the other hand, the report says, the petitioner complained that when he took possession of  the office  and properties of the Samiti with the police help there were no records, registers and account books of  the Samiti  in the  office and  that  only  a  few properties  not  belonging  to  Samiti  were  found  in  its premises. He  stated that  all the  account books  must have been taken  away by thew respondents to cover up and conceal their   acts    of   misfeasance,    misappropriation    and mismanagement. The  petitioner has  also submitted  that the income of the Samiti is more than Rs. 1-1/2 lakhs every year and that  depositing a measly amount of Rs.92,497.92p. for a period of  twelve years  is not only a non-compliance of the orders of  this Court  but also  a positive  proof of  their misappropriation  and   mismanagement.  He  prays  that  the respondents should  be directed  to deposit the true amounts realised by them from the Samiti properties.      Before we  deal  with  the  contentions  urged  by  the

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parties, we  feel constrained  to reiterate the observations made by  this Court  in its order dated August 23, 1993 with respect to  "undue protraction  of the proceedings under the Bombay Public  Trust Act, 1950 which were commenced suo motu by the  authorities". The  authorities in-charge of ensuring proper management  of public  trusts should be more vigilant and prompt  in discharge  of their  duties. Delays  on their part only help the unscrupulous persons in wasting the trust properties and  in other  acts of  misfeasance. The facts of this case  show how  the validly appointed persons have been thwarted by  the respondents  from coming into possession of the properties  and office  of the  trust. It  would not  be unreasonable to  assume in  the circumstances  of this  case that the  respondents who  somehow came  into possession and management  of  the  trust  properties  were  interested  in protracting their control and management by one or the other means, obviously  with a  view to enrich themselves unjustly at the  cost of  the trust  and its  properties.  The  table contained in  the report  of the Deputy Charity Commissioner discloses that  the first deposit by the respondents is in a grand sum  of Rs.  124.92p.  on  October  4,  1990.  Several amounts have  been deposited  thereafter from  time to time. Prima facie  it is  not explicable  how it  is that  for the period April  1, 1982  to July  31, 1990  only a  sum of Rs. 124.92p. was  be available  and why was it deposited after a lapse of eight years. For subsequent period, various amounts have been  deposited but neither there is any consistency in the amounts  deposited nor  is there  any regularity  in the timing of  the deposits.  In the  circumstances, this  is  a proper case  where a reasonable ascertainment should be made of the  income  derived  and  expenditure  incurred  by  the respondents for the period April 1, 1982 to August 22, 1994, the period during which they where in management and control of the  affairs and  the properties  of the trust. No doubt, they have filed certain audited accounts but the correctness of the  said accounts  is disputed  by the  petitioner.  The Deputy Charity  Commissioner has  also not reported that the said audited accounts are acceptable. There is a controversy with respect  to the  custody and possession of the relevant account books  and registers.  In this  contempt case, it is not possible  to go into the truth or otherwise of the rival contentions with  respect to  the custody  and possession of the books  and accounts.  At the same time the matter cannot be left  as it  is, more  particularly, in  view of the fact that not  a single  paise was deposited for the period April 1, 1982  to July 31, 1990 except a petty sum of Rs. 124.92p. on October 4, 1990. The respondents cannot be allowed to get away trust  funds just  because the  relevant account  books have been made scarce. The income and expenditure can yet be ascertained  by  other  means.  In  the  circumstances,  the following   direction    is   made:   the   Deputy   Charity Commissioner, Nagpur  shall make a best-judgment estimate of income of  the trust properties for the period April 1, 1982 to August  22, 1994  after making such appropriate enquiries as he  may find  necessary. He can, of course, look into and consider the  audited accounts  filed by  the respondents in this connection.  He shall  also make  an  estimate  of  the expenditure which  was reasonably  required for  running and managing the  trust and trust properties. This exercise will disclose the  amount that  should have been deposited by the respondents for  the said period. After giving credit to the amount already deposited, we can then direct recovery of the balance from the person and properties of the respondents by taking appropriate proceedings according to law.      All the  immovable properties  of the  respondents  are

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attached herewith. The attachment shall continue until final orders  are   passed  in   this  case.  The  Deputy  Charity Commissioner shall  give effect  to  this  order  by  making appropriate directions.      The matter is adjourned by four months. List after four months. The  Deputy Charity Commissioner shall send a report of the  proceedings taken  and orders  passed by  him in the said period of four months pursuant to thia order.