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PETITIONER: RATILAL PANACHAND GANDHI

       Vs.

RESPONDENT: THE STATE OF BOMBAY AND OTHERS.(and connected appeal)

DATE OF JUDGMENT: 18/03/1954

BENCH: MUKHERJEA, B.K. BENCH: MUKHERJEA, B.K. HASAN, GHULAM MAHAJAN, MEHAR CHAND (CJ) DAS, SUDHI RANJAN BOSE, VIVIAN

CITATION:  1954 AIR  388            1954 SCR 1035  CITATOR INFO :  R          1958 SC 731  (13)  D          1959 SC 942  (14)  R          1961 SC 459  (11,14)  D          1963 SC1638  (62,75)  R          1965 SC1107  (48,50)  R          1965 SC1611  (5,7)  RF         1971 SC 344  (6)  R          1971 SC1182  (6)  R          1975 SC 706  (4,25,29)  R          1975 SC 846  (14)  F          1977 SC 908  (20)  F          1978 SC1181  (5)  R          1980 SC1008  (11)  RF         1981 SC1863  (24)  MV         1983 SC   1  (15)  R          1984 SC  51  (11)  R          1987 SC 748  (19)

ACT: Constitution  of India, arts. 25 and  26-Bombay  Public Trust  Act, 1950 (Act XXIX of 1950), ss. 44, 47(3)  (4)  (6) (6), 55(c) and 56(1) -Whether ultra vires the  Constitution- Section  68  of  the  Act--Whether  ultra  vires  the  State Legislature.

HEADNOTE:    Held,  that the provision of a. 44 of the  Bombay  Public Trust Act, 1950, relating to the appointment of -the Charity Commissioner  as a trustee of any public trust by the  court without any reservation in regard to religious  institutions like temples and Maths is unconstitutional and must be  held to be void.    The  provisions of el. (3) to (6) of a. 47 of the Act  to the  extent  that  they relate to  the  appointment  of  the Charity Commissioner as a trustee of a religious trust  like temple and Math are unconstitutional and must be held to  be void.    A religious sect or denomination has. the undoubted right guaranteed by the Constitution to manage its own affairs  in

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matters of religion and this includes the right to spend the trust property or its income for religion and for  religious purposes  and objects indicated by the founder of the  trust or established by ussage 137 1056 obtaining in a particular institution.  To divert the  trust property   or   funds  for  purposes   which   the   Charity commissioner  or  the court considers expedient  or  proper, although  the original objectes of the founder can still  be carried out, is an unwarrantable encroachment on the freedom of  religious  institutions in regard to the  management  of their religious affairs.    Therefore cl. (3) of s. 55, which contains the  offending provision  and the corresponding provision relating  to  the powers  of  the  court occurring in the latter  part  of  s. 56(1), must be held to be void.    Section  58  of the Act is not ultra vires of  the  State Legislature  because  the  contribution  imposed  under  the section  is  not  a tax but a fee  which  comes  within  the purview  of  entry  47 of List III in Schedule  VII  of  the Constitution.      Commissioner, Hindu Religious Endowments, Madras v. Sri Lakshmindra Thirtha Swamiar, ( [1954] S.C.R. 1005) Davis  v. Beason (133 U.S. 333), Adelaide Company v. The  Commonwealth (67  C.L.R.  116,  124) and Tamshed Ji  v.  Soonabai  [1919] (I.L.R 33 Bom. 122) referred to.

JUDGMENT:   CIVIL      APPELLATE JURISDICTION: Civil Appeal No.  1  of 1954, and Civil Appeal No. 7 of 1954.    Appeals under article 132(1) of the Constitution of India from the Judgment and Order dated the 12th September,  1952, of  the  High  Court  of  Judicature  at  Bombay  in   Civil Application  No. 880 of 1952 and  Miscellaneous  Application No. 212 of 1952 respectively.     N.C.  Chatterjee and U. M. Trivedi (H.  H. Dalal and  I. N. Shroff -with them) for the appellants in Appeal No., I of 1954.     Rajinder Narain for the appellants in Civil Appeal.  No. 7 of 1954.    M.     C.  Setalvad and C.K. Daphtary (G.  N.  Joshi  and Porus  A. Mehta, with them) for the respondents in both  the appeals.  1954.  Mach 18.  The Judgment of the Court was delivered by MUKHERJEA  J.-These  two  connected  appeals  are   directed against a common judgment of a division  Bench of the Bombay High Court, dated the 12th of September, 1952, by which  the learned Judges dismissed two petitions under article 226  of the Constitution presented respectively by the appellants in the two appeals. 1057 The  petitioners  in  both the cases  assailed  the  consti- tutional  validity  of the Act, known as the  Bombay  Public Trusts Act, 1950 (Act XXIX of 1950), which was passed by the Bombay  Legislature with a view to regulate and make  better provisions   for  the  administration  of  the  public   and religious trusts in the State of Bombay.  By a notification, dated  the 30th of January, 1951, the Act was  brought  into force on and from the 1st of March, 1951, and its provisions were made applicable to temples, maths and all other trusts, express  or constructive, for either a public, religious  or charitable purpose or both.  The State of Bombay figures  as

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the  first  respondent in both the appeals  and  the  second respondent  is  the Charity Commissioner, appointed  by  the first  respondent  under section 3 of the  impugned  Act  to carry out the provisions of the Act throughout the State  of Bombay.   In  one of the appeals, namely, Appeal  No.  1  of 1954,  the Assistant Charity Commissioner for the region  of Baroda has been impleaded as the third respondent.    The  appellant  in Appeal No. I of 1954  is  a  Swetamber Murtipujak  Jain and a resident of Vejalpar in the  district of  Punchmahals  within  the  State  of  Bombay.   He  is  a Vahivatdar  or  manager of a Jain public temple  or  Derasar situated  in  the same village and  the  endowed  properties appertaining  to the temple are said to be of the  value  of Rs. 5 lakhs.  The petition, out of which this appeal arises, was filed by the appellant on the 29th of May, 1952,  before the High Court of Bombay, in its Appellate Side, against the three respondents mentioned above, praying for the issue  of a  writ in the nature of mandamus or direction ordering  and directing  the  respondents  to forbear  from  enforcing  or taking  any steps for the enforcement of the  Bombay  Public Trusts  Act,  1950,,or of any of its provisions  and  parti- cularly  the provisions relating to registration  of  public and religious trusts managed by the appellant and payment of contributions levied in respect the same.  The grounds urged in support of the petition were that a number of  provisions of  the  Act convicted with the fundamental  rights  of  the petitioner  guaranteed  under  articles 25  and  26  of  the Constitution and that the 1058 contribution  levied  on the trust was a tax  which  it  was beyond the competence of the State Legislature to impose.   A  similar  application under article 226 of  the  Consti- tution and Praying for almost the identical relief was filed by the appellants, in the other appeal, namely, Appeal No. 7 of  1954 before the High Court in its Original Side  on  the 4th  of August, 1952.  The petitioners in this case  purport to be the present trustees of the Parsi Punchayet Funds  and Properties  in  Bombay  registered under  the  Parsi  Public Trusts   Registration   Act  of  1936.    These   properties constitute  one consolidated fund and they are  administered by  the  trustees  for  the  benefit  of  the  entire  Parsi community  and the income is spent for  specified  religious and  charitable purposes of a public character as  indicated by  the  various donors.  The  petitioners,  challenged  the validity   of   the   Bombay  Public   Trusts   Act,   1950, substantially  on the grounds that they interfered with  the freedom  of  conscience of the petitioners  and  with  their right freely to profess, practise and propagate religion and also with their right to manage their own affairs in matters of  religion  and  thereby  contravened  the  provisions  of articles  25  and  26  of the  Constitution.   The  levy  of contribution under section 58 of the Act was also alleged in substance  and effect to be a tax on public,  religious  and charitable  trusts, a legislation upon which it  was  beyond the competency of the State Legislature to enact.    As  practically the same questions were involved in  both the petitions, the learned Chief Justice of Bombay  directed the transfer of the later petition from the Original Side to the  Appellate Side of the High Court and both of them  were heard  together by a Division Bench consisting of the  Chief Justice himself and Shah J. Both the petitions were disposed of  by  one and the same judgment delivered on the  12th  of September,  1952,  and the learned Judges rejected  all  the contentions   put  forward  on  behalf  of  the   respective applicants and dismissed the petitions.  The petitioners  in

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both  the  cases have now come before us in  appeal  on  the strength of certificates granted 1059 by the High Court under article 132(1) of the Constitution.     To appreciate the points that have been canvassed before us by the parties to these appeals, it may be convenient  to refer  briefly  to the scheme and salient  features  of  the impugned Act.     The object of the Act, as stated in the preamble, is  to regulate  and make better provisions for the  administration of public, religious and charitable trusts within the  State of Bombay.  It includes, within its scope, all public trusts created  not merely for religious but for purely  charitable purposes  as well and extends to  people of all classes  and denominations  in the State.  The power  of  superintendence and  administration  of public trusts is vested,  under  the Act, in the Charity Commissioner, who is to be appointed  by the State Government in the manner laid down in Chapter  II. The State Government may also appoint such number of  Deputy and  Assistant Charity Commissioners as. it thinks  fit  and these  officers  would  be placed in  charge  of  particular regions or particular trusts or classes of trusts as may  be considered necessary.  Section 9, with which Chapter III  of the Act beigins, defines what ’charitable purposes’ are, and sections 10 and 11 lay down that a public trust shall not be void on the ground of uncertainty, nor shall it fail so  far as a religious and charitable purpose is concerned, even  if a non-charitable or non-religious purpose,- which is includ- ed  in it,. cannot be given effect to.  Chapter IV  provides for  registration  of public trusts.  Section  18  makes  it obligatory  upon the trustee of every public trust to  which the Act applies, to make an application for the registration of  the  trust,  of which he is the  trustee.   In  case  of omission  on  the  part of a trustee  to  comply  with  this provision,  he is debarred under section 31 of the Act  from instituting  a suit to enforce any right on behalf  of  such trust in a court of law.  Chapter V deals with accounts  and audit.   Section 32 imposes a duty upon every trustee  of  a public  trust, which has been registered under the  Act,  to keep regular accounts.  Under section 33, these accounts are to be audited annually, in such manner as may be prescribed. 1060     Section  34 proscribes it to be the duty of the  auditor to  prepare balance-sheets and to report all  irregularities in  the accounts.  Section 35 lays down how trust money  has to  be  invested,  and section 36  prohibits  alienation  of immovable  trust  property  except  by  way  of  leases  for specified  periods,  Without the previous  sanction  of  the Charity  Commissioner.   Section 37 authorises  the  Charity Commissioner  and his subordinate officers to enter  on  and  inspect  or  cause  to  be entered  on  and  inspected  any property belonging to a public trust.  A proviso is added to the  section  laying  down that in entering  upon  any  such property,   the  officers  making  the  entry   shall   give reasonable  notice to the trustee and shall have due  regard to  the religious practices and usages of the trust.   Among other  powers  and functions of  the  Charity  Commissioner, which  are  detailed in Chapter VII, section  44  enables  a Charity Commissioner to be appointed to act as a trustee  of a  public trust by a court of competent jurisdiction  or  by the  author of the trust.  Section 47 deals with the  powers of  the court to appoint new trustee or trustees  and  under clause (3) of this section, the court, after making enquiry, may appoint the Charity Commissioner or any other person  as a  trustee to fill up the vacancy.  Section 48 provides  for

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the  levy  of  administrative charges  in  cases  where  the Charity  Commissioner  is appointed a trustee.   Section  50 appears  to  be  a substitute for section 92  of  the  Civil Procedure  Code and contains provisions of almost  the  same character in respect to suits regarding public trusts.   One of  the  reliefs  that can be claimed in such a  suit  is  a declaration  as to what proportion of the trust property  or interest therein shall be allocated to any particular object of  the trust.  Section 55 purports to lay down the rule  of cy  pres in relation to the administration of religious  and charitable trusts; but it extends that doctrine much further than  is  warranted  by  the principles  laid  down  by  the Chancery  Courts  in  England  or  recognised  by   judicial pronouncements  in this country.  Section 56 deals with  the powers of the courts in relation to the application of  -the cy pres doctrine.  Section 57 provides for the establishment of a fund to be called "The 1061 Public  Trusts Administration Fund  which shall vest in  the Charity  Commissioner  and clause (2) lays  down  what  sums shall  be  credited  to  this fund.   Section  58  makes  it obligatory  on  every  public trust to pay to  this  fund  a contribution  at  such  time and in such manner  as  may  be Prescribed.   Under the, rules prescribed by the  Government on this subject, the contribution has been fixed at the rate of  2  per cent. per annum upon the gross annual  income  of every public trust.  Failure .to pay this contribution  will make  the  trustee liable to the penalties provided  for  in section 66 of the Act.  Section 60 provides that the  Public Trusts Administration Fund shall, subject to the  provisions of the Act and subject to the general and special orders  of the  State  Government,  be applicable to  the.  payment  of charges for expenses incidental to the regulation of  public trusts and generally for carrying out the provisions of  the Act.   Sections 62 to 66, which are comprised in Chapter  IX of the Act, deal with the appointment and qualifications  of assessors.   The function of the assessors is to assist  and advise the Charity Commissioner or his subordinate  officers in  the  matter of making enquiries which may  be  necessary under  the provisions of the Act.  Chapter X prescribes  the penalties  that  will be inflicted on trustees  in  case  of their violating any of the pro visions of the Act.   Chapter XI   deals  with  procedural  matters  in  connection   with jurisdiction of courts and rights of appeal, and the twelfth or  the  last  chapter  deals  with  certain   miscellaneous matters.   These,  in brief, are the provisions of  the  Act which are material for our present purpose.    The  contentions  that have been raised  by  the  learned counsel,  who  appeared in support of the  appeals,  may  be considered under two heads.  In the first place, a number of provisions of the Act have been challenged as invalid on the ground  that they conflict with freedom of religion and  the right  of the religious denominations or sects,  represented by the appellants in each case, to manage their own, affairs in matter of religion guaranteed under articles 25 and 26 of the Constitution.  The sections of the Act, the validity  of which has been challenged on this ground are sections 18, 31 to 37, 44, 1062 47,  48 50, clauses (e) and (g), 55, 58 and 66.  The  second head  of  the  appellants argument relates to  the  levy  of contribution  as laid down in sections 57 and 58 of the  Act and the argument is that this being in substance the levy of a tax, it was beyond the competence of the State Legislature to enact-such a provision.

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    As  regards the first branch of the contention, a  good deal of argument has been advanced before us relating to the measure  and  extent of the  fundamental  rights  guaranteed under  articles 25 and 26 of the Constitution.  It  will  be necessary  to  address  ourselves to this  question  at  the outset,  because without a clear appreciation of  the  scope and  am  bit of the fundamental rights embodied in  the  two articles  of the Constitution, it would not -be possible  to decide  whether  there  has been a  transgression  of  these rights by any of the provisions of the Act.  This  identical question  came  up for consideration before  this  court  in Civil  Appeal  No.  38  of  1953  (The  commissioner,  Hindu Religious  Endowments,  Madras  v.  Sri  Lakshmindra  Tirtha Swamiar(1)   and  it  was discussed at some  length  in  our judgment  in  that  case.  It will  be  sufficient  for  our present  purpose to refer succinctly to the main  principles that this court enunciated in that judgment.     Article  25  of  the Constitution  guarantees  to  every person  and not merely to the citizens of India the  freedom of conscience and the right freely to profess  practise  and propagate  religion.   This is subject, in  every  case,  to public  order, health and morality.  Further exceptions  are engrafted  upon  this right by clause (2)  of  the  article. Sub-clause (a) of clause (2) saves the power of the State to make   laws   regulating   or   restricting   any   economic financial, political or other secular activity which may  be associated  with  religious  practice;  and  sub-clause  (b) reserves the State’s power to make laws providing for social reform  and social welfare even though they might  interfere with-religious practices.  Thus, subject to the restrictions which  this article imposes, every person has a  fundamental right  under our Constitution not merely to  entertain  such religious  belief as may be approved of by his  judgment  or conscience but to exhibit his belief and ideas in such (1)  [1954] S.C.R. 1005. 1063 overt acts as are enjoined or sanctioned by his religion and further to propagate his religious views for the edification of others.  It is immaterial also whether the propagation is made by a person in his individual capacity or on behalf  of any church or institution.  The free exercise of religion by which is meant the performance of outward acts in  pursuance of  religious belief, is, as stated above, subject to  State regulation imposed to secure order, public health and morals of the people.  What sub-clause (a) of clause (2) of article 25  contemplates  is not State regulation of  the  religious practices  as  such  which are  protected  unless  they  run counter to public health or morality but of activities which are really of an economic, commercial or political character though they are associated with religious practices.       So  far  as article 26 is concerned, it deals  with  a particular  aspect  of  the subject  of  religious  freedom. Under this article, any religious denomination or a  section of  it  has the guaranteed right to establish  and  maintain institutions  for religious and charitable purposes  and  to manage  in its own way all affairs in matters of  religion. Rights  are also given to such denomination or a section  of it  to acquire and own movable and immovable properties  and to  administer such properties in accordance with law.   The language of the two clauses (b) and (d) of article 26  would at once bring out the difference between the two.  In regard to  affairs in matters of religion, the right of  management given to a religious body is a guaranteed fundamental  right which  no legislation can take away.  On the other hand,  as regards   administration  of  property  which  a   religious

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denomination  is  entitled  to  own  and  acquire,  it   has undoubtedly  the right to administer such property but  only in  accordance  with  law.  This means that  the  State  can regulate the administration of trust properties by means  of laws validly enacted but here again it should be  remembered that under article 26 (d), it is the religious  denomination itself which has been given the right to administer its pro- perty in accordance with any law which the State may validly impose.  A law, which takes away the right of 138 1064 administration  altogether from the  religious  denomination and vests it in any other or secular authority, would amount to violation of the right which is guaranteed by article  26 (d) of the Constitution.   The  moot point for consideration, therefore, is where  is the  line to be drawn between what are matters  of  religion and  what  are not ? Our Constitution-makers  have  made  no attempt to define what ’religion’ is and it is certainly not possible  to  frame  an exhaustive definition  of  the  word ’religion’  which  would  be applicable to  all  classes  of persons.  As has been indicated in the Madras case  referred to above, the definition of religion  given by Fields J.  in the American case of Davis v. Beason(1), does not seem to us adequate  or precise.  "The term ’religion"’, thus  observed the  learned Judge in the case mentioned above, "has  refer- ence  to one’s views of his relations to his Creator and  to the  obligations they impose of reverence for His Being  and character  and  of  obedience  to His  Will.   It  is  often confounded  with cultus or form of worship of  a  particular sect,  but  is distinguishable from the latter". it  may  be noted  that  ’religion’ is not necessarily theistic  and  in fact  there are well known religions in India like  Buddhism and Jainism which do nor believe in the existence of God  or of any Intelligent First Cause.  A religion undoubtedly  has its  basis in a system of beliefs -and doctrines  which  are regarded by those who profess that religion to be  conducive to  their spiritual well being, but it would not be  correct to  say,  as  seems to have been suggested  by  one  of  the learned  Judges  of the Bombay High Court, that  matters  of religion  are  nothing but matters of  religious  faith  and religious  belief.   A religion is not  merely  an  opinion, doctrine  or belief.  It has its outward expression in  acts as  well.  We may quote in this connection the  observations of  Latham C. J. of the High Court of Australia in the  case of Adelaide Company v. The Commonwealth(2), where the extent of  protection given to religious freedom by section 116  of the Australian Constitution came up for consideration. (1)133   U.S. 33 (2)  67 C.L.R, 116, 124. 1065    "It is sometimes suggested in discussions on the  subject of  freedom of religion. that, though the  civil  Government should   not   interfere  with   religious   opinions,    it nevertheless may deal as it pleases with any acts which  are done in pursuance of religious belief without infringing the principle of freedom of religion.  It appears to me   to  be difficult  to maintain this distinction as relevant  to  the interpretation  of  section  116.   The  section  refers  in express terms to the exercise of religion, and therefore  it is   intended   to  protect  from  the  operation   of   any Commonwealth  laws  acts which are done in the  exercise  of religion.   Thus  the  section goes  far  beyond  protecting liberty of opinion.  It protects also acts done in pursuance of religious belief as part of religion.,

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  In  our  opinion, as we have already said in  the  Madras case,  these  observations  apply  fully  to  the  provision regarding   religious  freedom  that  is  embodied  in   our Constitution.      Religious   practices  or  performances  of  acts,   in pursuance of religious belief are as much apart of  religion as  faith  or belief in particular doctrines.  Thus  if  the tenets  of  the  Jain or the Parsi religion  lay  down  that certain rites and ceremonies are to be performed at  certain times  and  in a particular manner, it cannot be  said  that these  are  secular activities partaking  of  commercial  or economic character simply because the involve expenditure of money  or  employment of priests or the  use  of  marketable commodities.  No outside authority has any right to say that these  are  not essential parts of religion and it.  is  not open  to the secular authority of the State to  restrict  or prohibit  them  in any manner they like under the  guise  of administering  the  trust estate.  Of course, the  scale  of expenses to, be incurred in connection with these  religious observances  may  be and is a matter  of  administration  of property  belonging  to religious institutions; and  if  the expenses  on these heads are likely to deplete  the  endowed properties  or  affect the stability  of  the  institution,, proper control can certainly be exercised by State  agencies as the law provides.  We may refer in this connection to the observation of 1066 Davar  J.  in  the case of  Jamshedji  v.  Soonabai(1),  and although  they  were made in a case where the  question  was whether the bequest of property by a Parsi testator for  the purpose  of perpetual celebration of ceremonies like  Muktad baj,   Vyezashni,   etc.,  which  are  sanctioned   by   the Zoroastrian  religion  were  valid  charitable  gifts,   the observations,  we  think,  are  quite  appropriate  for  our present  purpose.  "If this is the belief of the  community" thus   observed  the  learned  Judge,  "and  it  is   proved undoubtedly to be the belief of the Zoroastrian community,-a secular  Judge is bound to accept that belief-it is not  for him  to sit in judument on that belief, he has no  right  to interfere with the conscience of a donor who makes a gift in favour  of  what he believes to be the  advancement  of  his religion  and  the ,Welfare of his  community  or  mankind". These observations do, in our opinion, afford an  indication of the measure of protection that is given by article  26(b) of our Constitution.    The distinction between matters of religion and those  of secular  administration  of  religious  properties  may,  at times,  appear to be a thin one.  But in cases of doubt,  as Chief Justice Latham pointed out in the case(2) referred  to above,  the  court should take a common sense  view  and  be actuated by considerations of practical necessity.  It is in the  light  of  these principles that  we  will  proceed  to examine the different provisions of the Bombay Public Trusts Act, the validity of which has been challenged on behalf  of the appellants.      We  will first turn to the provisions of the Act  which relate  to registration of trusts.  Under section 18, it  is incumbent  on  the  trustee of every  public,  religious  or charitable trust to get the same registered.  Section 66  of the Act makes it an offence for a trustee not to comply with this  provision and prescribes punishment for such  offence. Section  31 provides for further compulsion by  laying  down that  no  suit  shall lie on behalf of  a  public  trust  to enforce  its right in any court of law unless the  trust  is registered.  A compulsory payment

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(1)  33 Bom. I22. (2)  Vide  Adelaide Company v. The commonwealth,  67  C.L.R. 116, i29. 1067 of  a  fee of Rs. 25 has also been prescribed by  the  rules framed  by the Government for registration of a trust.   The provisions of registration undoubtedly have been made with a view  to ensure-due supervision of the trust properties  and the exercise of proper control over them.  These are matters relating to administration of trust property as contemplated by  article  26(d) of the Constitution and  cannot,  by  any stretch  of  imagination  be  held  to  be  an  attempt   at interference  with the rights of religious  institutions  to manage  their  religious affairs.  The fees  leviable  under section  18 are credited to the Public Trust  Administration Fund  constituted under section 57 and are to be  spent  for meeting  the  charges incurred in the regulation  of  public trusts  and for carrying into effect the provisions  of  the Act.    The  penalties  provided  are   mere   consequential provisions  and  involve no infraction  of  any  fundamental right.   It has been argued by the learned counsel  for  the appellants that according to the tenets of the Jain religion the  property  of the temple and its income  exist  for  one purpose  only, viz., the religious purpose, and a  direction to  spend  money  for purposes other than  those  which  are considered  sacred in the Jain scriptures  would  constitute interference with the freedom of religion.  This  contention does  not  appear  to us to be sound.   These  expenses  are incidental  to proper management and administration  of  the trust  estate  like payment of municipal  rates  and  taxes, etc.,  and cannot amount to diversion of trust property  for purposes  other  than  those which  are  prescribed  by  any religion.      The  next  group of sections to which  objections  have been taken comprises sections 32 to 37.  Section 32  compels a trustee of a public trust to keep accounts in such form as may  be prescribed by the Charity Commissioner.  Section  33 provides  for the auditing of such accounts and  section  34 makes  it the duty of the auditor to prepare  balance-sheets and to report irregularities, if any, that are found in  the accounts.   These are certainly not matters of religion  and the  objection raised with regard to the validity  of  these provisions seem to be altogether baseless Section 35 relates to investment of money belonging to trusts.  It is a well 1068 settled  principle of law that trustees in charge  of  trust properties  should not keep cash money in their hands  which are  not  necessary for immediate expenses; and  a  list  of approved securities upon which trust money could be invested is invariably laid down in every legislation on the  subject of trust.  There is nothing wrong in section 36 of the  Act. Immovable  trust  properties are inalienable by  their  very nature  and  a provision that they could be  alienated  only with the previous sanction of the Charity Commissioner seems to us to be a perfectly salutary provision.     Section  37 has been objected to on the ground  that  an unrestricted right of entry in any religious premises  might offend the sentiments of the followers of that religion; but the section has expressly provided that the officers  making the  entry  shall give reasonable notice of  their  intended entry  to  the  trustees and shall have due  regard  to  the religious  practice and usages of the trust.  Objection  has next  been taken to sections 44 and 47 of the Act.   Section 44 lays down that the Charity Commissioner can be  appointed to act as trustee of a public trust by a court of  competent

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jurisdiction  or by the author of the trust.  If the  author of  the trust chooses to appoint the Charity Commissioner  a trustee, no objection can possibly be taken to such  action; but if the court is authorised to make such appointment, the provisions of this section in the general form as it  stands appear  to us to be open to serious objection.  If  we  take for example the case of a religious institution like a  Math at  the head of which stands the Mathadhipati  or  spiritual superior.   The Mathadhipati is a trustee according  to  the provisions  of  the.Act  and if the court  is  competent  to appoint  the Charity Commissioner as a superior of a  Math,. the  result  would be disastrous and it would  amount  to  a flagrant  violation  of the constitutional  guarantee  which religions  institutions  have  under  the@  Constitution  in regard to the management of its religious affairs.  This  is not  a secular affair at all relating to the  administration of  the  trust property.  The very object of a  Math  is  to maintain   a  competent  line  of  religious  teachers   for propagating and strengthening the religious 1069 doctrines  of a particular order or sect and as there  could be no Math without a Mathadhipati as its spiritual head, the substitution  of the Charity Commissioner for  the  superior would mean a destruction of the institution altogether.  The evil is further aggravated by the provision of clause (4) of the  section which says that the Charity Commissioner  shall be  the sole trustee and it shall not be lawful  to  appoint him  as a truste along with other persons.  In our  opinion, the  provision of section 44 relating to the appointment  of the Charity Commissioner as a trustee of any public trust by the  court  without any reservation in regard  to  religious institutions like temples and Maths is unconstitutional  and must  be  held to be void.  The very  same  objections  will apply to the provisions of clauses (3) to (6) of section 47. The court can certainly be empowered to appoint a trustee to fill up a vacancy caused by any of the reasons mentioned  in section 47(1), and it is quite a -salutary principle that in making  the  appointment  the court should  have  regard  to matters  specified  in clause (4) of section 47  ;  but  the provision of clause (3) to the extent that it authorises the court  to appoint .the Charity Commissioner as the  trustee- and  who according to the provisions of clause (5) is to  be the  sole trustee-cannot be regarded as valid in  regard  to religious  institutions of the type we have just  indicated. To allow the Charity Commissioner to function as the Shebait of a temple or the superior of a Math would certainly amount to   interference  with  the  religious  affairs   of   this institution.   We  hold accordingly that the  provisions  of clauses  (3)  to (6) of section 47 to the extent  that  they relate  to the appointment of the Charity Commissioner as  a trustee  of  a  religious trust like temple  and  Math,  are invalid.  If these provisions of section 47 are  eliminated, no objection can be taken to the provision of section 48  as it stands.  This section will in that event be confined only to cases where the Charity Commissioner has been appointed a trustee  by  the  author  of  the  trust  himself  and   the administrative   charges  provided  by  this   section   can certainly be levied on the trust. 1070     We  now come to section 50 and exception has been  taken to clauses (e) and (g) of that section.  It is difficult  to see how these provisions can at all be objected to.  Section 50,  as  has  been said above, is really  a  substitute  for section 92 of the Civil Procedure Code and relates to  suits in  connection with public trusts  Clause (e) of section  50

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is an exact reproduction of clause (e) of section 92 of  the Civil   Procedure  Code  and  clause  (g)  also   reproduces substantially  the provision of clause (g) of section 92  of the   Civil  Procedure  Code.   There  is  no  question   of infraction  of  any  fundamental right by  reason  of  these provisions.     A  more serious objection has been taken by the  learned counsel for the appellants to the provisions of sections  55 and  56  of the impugned Act and it appears to us  that  the objections  are  to  a great  extent  well  founded.   These sections purport to lay down how the doctrine of cy pres  is to  be  applied in regard to the  administration  of  public trust of a religious or charitable character.  The  doctrine of cy pres as developed by the Equity Courts in England, has been  adopted by out Indian courts since a long -time  past. The provisions of sections 55 and 56, however, have extended the  doctrine  much beyond its recognised  limits  and  have further ,introduced certain principles which run counter  to well  established rules of law regarding the  administration of charitable trusts.  When the particular purpose for which a charitable trust is created fails or by reason of  certain circumstances the trust cannot be carried into effect either in whole or in part, or where there is a surplus left  after exhausting the purposes specified by the settlor, the  court would  not,  when there is a  general  charitable  intention expressed by the settlor, allow the trust to fail but  would execute it cy pres, that is to say, in some way as nearly as possible to that which the author of the trust intended.  In such cases, it cannot be disputed that the court can frame a scheme  and give suitable directions regarding  the  objects upon  which  the  trust money can be spent.   It  is  we  11 established, however, that where the donors intention can be given effect to, the court has no authority to sanction  any deviation from the intentions expressed 1071 by  the settlor on the grounds of expediency and  the  court cannot exercise the power of applying the trust property  or its  income  to other purposes simply because  it  considers them  to be more expedient or more beneficial than what  the settlor had directed(1).  But this is exactly what has  been done by the provision of section 55(c) read with section  56 of the Act.  These provisions allow a diversion of  property belonging to a public trust or the income thereof to objects other  than  those  intended by the donors  if  the  Charity Commissioner  is  of  opinion, and the  court  confirms  its opinion  and decides, that carrying out wholly or  partially the  original intentions of the author of the trust  or  the object  for  which the trust was created is  not  wholly  or partially  expedient, practicable, desirable  or  necessary; and  that the property or income of the public trust or  any portion thereof should be applied to any other charitable or religious   object.   Whether  a  provision  like  this   is reasonable or not is not pertinent to our enquiry and we may assume that the legislature, which is competent to legislate on  the  subject of charitable and religious  trust,  is  at liberty to make any provision which may not be in consonance with  the  existing  law; but the  question  before  us  is, whether   such  provision  invades  any  fundamental   right guaranteed by our Constitution, and we have no hesitation in holding that it does so in the case of religious trusts.   A religious  sect  or  denomination has  the  undoubted  right guaranteed by the Constitution to manage its own affairs  in matters of religion and this includes the right to spend the trust property or its income for the religious purposes  and objects indicated by the founder of the trust or established

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by  usage obtaining in a particular institution.  To  divert the  trust property or funds for purposes which the  Charity Commissioner  or  the court considers expedient  or  proper, although  the original objects of the founder can  still  be carried  out, is to our minds an unwarrantable  encroachment on  the freedom of religious institutions in regard  to  the management  of  their religious affairs.   It  is  perfectly true, as has been stated (1) Vide Halsbury, 2nd Edn., VOl. IV, P. 228, 139 1072 by  the  learned counsel for the appellants, that it  is  an established  maxim  of the Jain religion that  Divadraya  or religious property cannot be diverted to purposes other than those  which are considered sacred in the  Jain  scriptures. But apart from the tenets of the Jain religion, we  consider it  to be a violation of the freedom of religion and of  the right   which  a  religious  denomination  has   under   our Constitution  to  manage  its  own  affairs  in  matters  of religion,  to  allow any secular authority-  to  divert  the trust  money  for purposes other than those  for  which  the trust  was  created.  The State can step in  only  when  the trust  fails or is incapable of being carried out either  in whole  or in part.  We hold, therefore, that clause  (3)  of section  55, which contains the offending provision and  the corresponding provision relating to the powers of the  court occurring in the latter part of section 56(1), must be, held to be void.     The only other section of the Act to which objection has been  taken  is  section 58 and it deals with  the  levy  of contribution upon each public trust, at certain rates to  be fixed by the rules, in proportion to the gross annual income of such trust.  This together with the other sums  specified in  clause  (2)  of section 57 makes up  the  Public  Trusts Administration  Fund, which is to be applied for payment  of charges  incidental to the regulation of public  trusts  and for  carrying  into effect the provisions of this  Act.   As this  contribution  is  levied purely for  purposes  of  due administration  of the trust property and for defraying  the expenses incurred in connection with the same, no  objection could be taken to the provision of the section on the ground of its infringing any fundamental rights of the  appellants. The  substantial, contention that has been raised in  regard to the validity of this provision comes, however, under  the second  head of the appellants’ arguments  indicated  above. The  contention  is  that the  contribution  which  is  made payable  under  this section is in substance a tax  and  the Bombay  State  Legislature was not competent to  enact  such provision within the limits of the authority exercisable  by it  under  the Constitution.  This raises a  point  of  some importance which requires to be examined carefully. 1073     It  is not disputed before us that if  the  contribution that  is  levied under section 58 is a  tax,  a  legislation regarding  it  would be beyond the competence of  the  State Legislature.  Entries 46 to 62 of List II in Schedule VII of the  Constitution specify the different kinds of  taxes  and duties in regard to which the State Legislature is empowered to  legislate and a tax of the particular type that we  have here  is not covered by any one of them.  It does  not  come also under any specific entry in List III or even of List I. The  position, therefore, is that if the imposition is  held to be a tax, it could come either under entry 97 of List  I, which  includes taxes not mentioned in Lists II and  III  or under article 248 (1) of the Constitution and in either case

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it is Parliament alone that has the competency to  legislate upon  the  subject.  If, on the other hand,  the  imposition could  be regarded as "fees", it can be brought under  entry 47   of  the  Concurrent  List,  the  Act  itself  being   a legislation under entries 10 and 28 of that List.  The whole controversy  thus  centers round a point as to  whether  the contribution  leviable under section 50 is a fee or tax  and what  in fact are the indicia and characteristics of  a  fee which  distinguish it from a tax.  This  identical  question came up for consideration before this court in Civil  Appeal No.  38 of 1953 referred to above, in, connection  with  the provision  of  section  76  of  the  Madras  Religious   and Charitable Endowments Act, and the view which we have  taken in that case regarding the proper criterion for  determining whether  an  imposition is a fee or tax  is  in  substantial agreement  with the view taken by the Bombay High  Court  in the present case.. As the matter has been discussed at  some length  in  the  Madras case, it will not  be  necessary  to repeat the same discussions ’over again.  It will be  enough if  we indicate the salient principles that were  enunciated by  this court in its judgment in the Madras case  mentioned above.      We  may  start  by saying that  although  there  is  no generic difference between a tax and a fee and in fact  they are  only  different forms in which the taxing  power  of  a State manifests itself, our Constitution has, in fact,  made a distinction between a tax and a fee for, 1074 legislative  purposes.  While there are various  entries  in the three legislative lists with regard to various forms  of taxation, there is an entry  at the end of each one of these lists  as regards fees’ which could be levied in respect  of every  one  of the matters that are included  therein  .This distinction  is further evidenced by the provisions  of  the Constitution  relating to Money Bills which  areembodied  in articles  110 and 199.  Both these articles provide  that  a bill should not be deemed to be a Money Bill by reason  only that  it  provides for the imposition of fines  or  for  the demand or payment of fees for licences or fees for  services rendered,  whereas a bill relating to imposition,  abolition or regulation of a tax would always be recckoned as a  Money Bill.  There is no doubt  that a fee resembles a tax in many respects and the question which presents difficulty is, what is  the proper test by which the one could be  distinguished from  the  other?  A tax is undoubtedly in the nature  of  a compulsory  exaction  of  money by a  public  authority  for public  purposes, the payment of which is enforced  by  law. But the other and equally important characteristic of a  tax is,  that the imposition is made for public purpose to  meet the  general expenses of the State without reference to  any special  advantage  to be conferred upon the payers  of  the tax.   It  follows, therefore, that although a  tax  may  be levied  upon  particular classes of  persons  or  particular kinds  of property, it is imposed not to confer any  special benefit upon individual -persons and the collections are all merged in the general revenue of the State to be applied for general  public  purposes.  Tax is a common burden  and  the only return which the taxpayer gets is participation in  the common benefits of the State.  Feees on the other hand,  are payments  primarily  in the public interest,  but  for  some special  service rendered or some special work done for  the benefit of those from whom the payments are demanded.   Thus in fees there is always an element of quid pro quo which  is absent  in a tax.  It may not be possible to prove in  every case  that  the fees that are collected  by  the  Government

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approximate  to  the  expenses that are incurred  by  it  in rendering any particular kind of services or in 1075 performing  any particular work for the benefit  of  certain individuals.  But in order that the collections made by  the Government  can  rank  as fees, there  must  be  co-relation between  the levy imposed and the expenses incurred  by  the State for the purpose of rendering such services.  This  can be  proved  by showing that on the face of  the  legislative provision  itself,  the collections are not  merged  in  the general  revenue  but  are set apart  and  appropriated  for rendering  these services.  Thus two elements are  essential in  order that a payment may be regarded as a fee.   In  the first  place, it must be levied in consideration of  certain services which the individuals accepted either willingly  or unwillingly  and in the second place, the  amount  collected must  be ear-marked to meet the expenses of rendering  these services and must not go to the general revenue of the State to  be  spent  for general public  purposes.   As  has  been pointed  out  in the Madras case mentioned above,  too  much stress should not be laid on the presence or absence of what has been called the Coercive element.  It is not correct  to say that as distinguished from taxation which is  compuslory payment, the payment of fees is always voluntary, it being a matter  of  choice  with individuals either  to  accept  the service  or not for which fees are to be paid.  We may  cite for  example the case of a licence fee for a motor car.   It is  argued that this would be a fee and not a tax, as it  is optional with a person either to own a motor car or not  and in case be does not choose to have a motor car, he need  not pay  any fees at all.  But the same argument can be  applied in  the  case of a house tax or land tax.   Such  taxes  are levied  only on those people who own lands or houses and  it could  be said with equal propriety that a man need not  own any  house  or  land and in that event he  could  avoid  the payment  of these taxes.  In the second place, even  if  the payment  of a motor licence fee is a voluntary  payment,  it can still be regarded as a tax if the fees that are realised on motor licences have no relation to the expenses that  the Government  incurs  in keeping an office or bureau  for  the granting   of   licences  and  the   collections   are   not appropriated for that purpose but 1076 go to the general revenue.  Judging by this test, it appears to  us  that the High Court was perfectly right  in  holding that  the  contributions  imposed under section  58  of  the Bombay Public Trusts Act are really feEs and not taxes.   In the  first  place, the contributions,  which  are  collected under  section 58, are to be credited to the  Public  Trusts Administration  Fund as constituted under section 57.   This is  a  special fund which is to be applied  exclusively  for payment of charges for expenses incidental to the regulation of public trusts and for carrying into effect the provisions of  the Act.  It vests in the Charity Commissioner  and  the custody  and investments of the moneY belonging to the  funD and  the  disbursement  and  pAyment  therefrom  are  to  be effected  not  in the manner in which general  revenues  are disbursed, but in the way prescribed by the rules made under the Act.  The collections, therefore, are not merged in  the general  revenue, but they axe earmarked and set  apart  for this particular purpose. it is true that under section 6A of the  Act, the officers and servants appointed under the  Act are  to draw their pay and allowances from the  Consolidated Fund  of the State but we agree with what has been  said  by Mr.  Justice  Shah  of  the  Bombay  High  Court  that  this

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provision  is made only for the purpose of facilitating  the administration  and not with a view to mix up the fund  with the  general  revenue, collected  for  Government  purposes. This  would be clear from the provision of section 6B  which provides that out of. the Public Trusts Administration  Fund all  the costs, which the State Government may determine  on account of pay, pension, leave and other allowances of  all. the officers appointed under this Act, shall ’ be paid.   It is  the Public Trusts Administration Fund, therefore,  which meets  all  the  expenses of  the  administration  of  trust property within the scheme of the Act, and it is to meet the expenses  of this administration that these collections  are levied.  As has been said by the learned Judges of the  High Court,  according  to the concept of a modern State,  it  is -not necessary that services should be rendered only at  the request of particular people, it is enough that payments are demanded for 1077 rendering  services which the State considers beneficial  in the  public  interests and which the people have  to  accept whether they are willing or not.  Our conclusion, therefore, is  that  section  58  is  not  ultra  vires  of  the  State Legislature by reason of the fact that it is not a tax but a fee  which comes within the purview of entry 47 of List  III in Schedule VII of the Constitution.    The result, therefore, is that in our opinion the appeals are  allowed only in part and a mandamus will issue in  each of  these  cases restraining the State  Government  and  the Charity  Commissioner from enforcing against the  appellants the following provisions of the Act to  wit :-    (i)    Section  44  of  the Act to  the  extent  that  it relates to the appointment of the Charity Commissioner as  a trustee of religious public trust by the court,      (ii) the  provisions of clauses (3) to (6)  of  section 47, and     (iii) clause  (c) of section 55 and the part  of  clause (1) of section 56 corresponding thereto.       The  other prayers of the appellants stand  dismissed. Each party will bear hi own costs in both the appeals.