Supreme Court Upholds Change Reports Despite Delay in Maharashtra Public Trust Case (25 April 2024)

Introduction

Date of the Judgment: 25 April 2024
Citation: 2024 INSC 339
Judges: A.S. Bopanna, J. and Sanjay Kumar, J.

Can a delay in reporting changes to a Public Trust’s administration invalidate the new appointments? The Supreme Court of India recently addressed this question in a case concerning Shri Mallikarjun Devasthan, Shelgi, a Public Trust in Maharashtra. The core issue was whether the High Court was correct in setting aside the acceptance of Change Reports due to a significant delay in their filing. The Supreme Court, in this judgment, clarified that a delay in submitting a Change Report does not automatically invalidate the appointment of a Vahiwatdar (Administrator) and Trustees of a Public Trust. The judgment was delivered by a two-judge bench comprising Justice A.S. Bopanna and Justice Sanjay Kumar, with the majority opinion authored by Justice Sanjay Kumar.

Case Background

The Shri Mallikarjun Devasthan, Shelgi, was registered as a Public Trust on 26 May 1952, under the Bombay Public Trusts Act, 1950 (now the Maharashtra Public Trusts Act, 1950). The initial Vahiwatdar (Administrator) was Mallikarjun Mahalingappa Patil, with the eldest male member of his family designated as his successor. Upon Mallikarjun Mahalingappa Patil’s death in 1992, his eldest son, Ashok Mallikarjun Patil, took over. After Ashok’s death on 16 February 1997, his brother, Jagdishchandra Mallikarjun Patil, became the Vahiwatdar, although he was not the eldest male member. Jagdishchandra filed a Change Report on 21 October 2015, to officially record this change, along with a delay condonation application, stating his lack of awareness of the requirement to file a Change Report.

Subsequently, Jagdishchandra co-opted four additional Trustees on 28 March 2017. This led to objections from some devotees of the Temple, who challenged the legality of Jagdishchandra’s appointment and the co-option of the new Trustees. These devotees claimed that Jagdishchandra had unlawfully taken over and that the Deputy Charity Commissioner had not conducted a proper inquiry. They also raised concerns about the management of the Temple. The High Court of Judicature at Bombay, however, set aside the acceptance of the Change Reports, citing the delay in filing the first Change Report by Jagdishchandra. The Supreme Court was then approached to resolve the matter.

Timeline:

Course of Proceedings

Initially, the Deputy Charity Commissioner, Solapur, accepted Jagdishchandra’s Change Report (No. 899 of 2015) on 15 March 2016, noting that no objections were raised. Subsequently, the Assistant Charity Commissioner, Solapur, accepted the Change Report (No. 1177 of 2017) regarding the co-option of four Trustees on 18 April 2018, subject to the decision in the revision against Change Report No. 899 of 2015.

The Joint Charity Commissioner, Pune, dismissed the revision application (No. 61 of 2017) against the acceptance of Change Report No. 899 of 2015 and also dismissed the appeal against Change Report No. 1177 of 2017, both on 9 July 2019. The High Court of Judicature at Bombay, however, allowed the writ petitions filed by the devotees, setting aside the acceptance of both Change Reports on 27 August 2019, primarily due to the lack of a separate order condoning the 17-year delay in filing the first Change Report. The Supreme Court then heard the matter in appeal.

Legal Framework

The case revolves around the Maharashtra Public Trusts Act, 1950. Key provisions include:

• Section 17: Mandates the maintenance of registers containing particulars of Public Trusts.
• Section 18: Provides for the registration of Public Trusts.
• Section 21: Requires the Deputy or Assistant Charity Commissioner to make necessary entries in the register maintained under Section 17. It states that the entries so made shall, subject to the provisions of the Act of 1950 and subject to any change recorded as per the provisions thereof, be final and conclusive.
• Section 22(1): Requires Trustees to report changes in the register within 90 days. The proviso added in 2017 allows the Deputy or Assistant Charity Commissioner to extend the period of 90 days for reporting the change, on being satisfied that there was a sufficient cause for not reporting the change within the stipulated period, subject to payment of costs by the reporting Trustee to the Public Trust Administration Fund.
• Section 22(2): Empowers the Deputy or Assistant Charity Commissioner to inquire into the correctness of entries or changes. It also allows for provisional acceptance of changes with a notice for objections.
• Section 22(3): Specifies the procedure for recording findings after an inquiry, including the possibility of removing the Trust from the register.
• Section 41D: Provides for the suspension, removal, or dismissal of Trustees by the Charity Commissioner.
• Section 70: Provides for appeals to the Charity Commissioner against the findings or orders of the Deputy or Assistant Charity Commissioner.
• Section 70A(1): Empowers the Charity Commissioner to call for and examine records of cases before Deputy or Assistant Charity Commissioners.
• Section 66: Provides for a penalty of ₹10,000 for failure to report a change under Section 22.

The Act of 1950 was amended in 2017 to include a proviso in Section 22(1), allowing for the condonation of delay in filing Change Reports if sufficient cause is shown. This amendment was not in place when Jagdishchandra filed his initial Change Report.

Arguments

Arguments of the Devotees (Respondents):

• The devotees contended that Jagdishchandra’s appointment as Vahiwatdar was illegal because he was not the eldest male member of the family.
• They argued that Jagdishchandra had obtained approval for Change Report No. 899 of 2015 by misleading the villagers and the court.
• They asserted that the Deputy Charity Commissioner did not conduct a proper inquiry into the Change Report.
• They claimed that there was a delay of over 17 years in filing the Change Report after the death of Ashok Mallikarjun Patil and that this delay was not properly condoned.
• They contended that the Trust was not taking proper care of the Temple.

Arguments of the Trust (Appellant):

• The Trust argued that Jagdishchandra was the son of the founder of the Trust and that his elder brother had no interest in taking over as Vahiwatdar.
• They pointed out that other sons of Mallikarjun Mahalingappa Patil had consented to Jagdishchandra’s appointment as Trustee.
• The Trust submitted that the delay in filing the Change Report was due to a lack of awareness and that a delay condonation application was filed.
• They contended that the Joint Charity Commissioner had already accepted that the delay was condoned and that this order had not been challenged.
• They stated that the devotees’ challenge to the change reports was motivated by their grievance with the very registration of the Trust, which had already been dismissed.
• They argued that failure to file a Change Report does not automatically invalidate the assumption of office by a Vahiwatdar.
• They contended that a delay in filing a Change Report is a curable defect and does not nullify the changes in the Trust.

Innovativeness of the argument: The Trust’s argument that a delay in filing a Change Report is a curable defect and does not automatically invalidate the changes in the Trust is a significant point of contention and innovativeness.

Issues Framed by the Supreme Court

The Supreme Court considered the following issues:

1. Whether the High Court was correct in setting aside the acceptance of the Change Reports on the ground that there was no separate order passed by the Deputy Charity Commissioner, Solapur, condoning the delay of over 17 years in the filing of the first Change Report.
2. Whether a delay in submitting a Change Report under the Maharashtra Public Trusts Act, 1950, automatically invalidates the appointment of a Vahiwatdar (Administrator) and Trustees of a Public Trust.

Treatment of the Issue by the Court

The following table demonstrates as to how the Court decided the issues:

Authorities

The Supreme Court considered the following authorities:

Judgment

How each submission made by the Parties was treated by the Court?

How each authority was viewed by the Court?

The Court used the authorities to support its reasoning:

• Bhagmal and others vs. Kunwar Lal and others, (2010) 12 SCC 159* and Sesh Nath Singh and another vs. Baidyabati Sheoraphuli Co-operative Bank Ltd. and another, (2021) 7 SCC 313*: Used to support the view that a written application for condonation of delay is not mandatory.
• Esha Bhattacharjee vs. Managing Committee of Raghunathpur Nafar Academy and others, (2013) 12 SCC 649*: Used to emphasize the need for a liberal approach in dealing with delay condonation applications.
• Section 17, 18, 21, 22, 41D, 66, 70 and 70A of the Maharashtra Public Trusts Act, 1950: Used to interpret the statutory scheme and to show that the Act does not contemplate automatic invalidation of appointment due to delay in filing Change Reports.
• Section 29(2) and 5 of the Limitation Act, 1963: Used to show that the Limitation Act can be invoked for condonation of delay.

What weighed in the mind of the Court?

The Supreme Court’s decision was primarily influenced by the following factors:

• Curable Defect: The Court emphasized that the delay in filing the Change Report was a curable defect and did not automatically invalidate the appointment of the Vahiwatdar.
• No Automatic Invalidation: The Court clarified that the Maharashtra Public Trusts Act, 1950, does not provide for automatic invalidation of the assumption of office due to a delay in filing the Change Report.
• Purpose of Change Report: The Court noted that the purpose of the Change Report is to update records, not to invalidate appointments.
• Liberal Approach: The Court stressed the need for a liberal, pragmatic, and justice-oriented approach in dealing with delay condonation applications.
• Finality of Order: The Court noted that the Joint Charity Commissioner had already proceeded on the understanding that the delay was condoned and that this order had not been challenged.

The Court’s reasoning was heavily influenced by the need to avoid a hypertechnical approach and to ensure that justice is not defeated by procedural lapses.

Sentiment Analysis Ranking of Reasons:

Fact:Law Ratio Analysis:

Logical Reasoning:

The Court considered alternative interpretations of the Maharashtra Public Trusts Act, 1950, but rejected them. The Court reasoned that the Act does not contemplate automatic invalidation of appointments due to a delay in filing the Change Report. The Court also considered the 2017 amendment to Section 22(1), which allows for condonation of delay, as further support for its view. The Court concluded that the High Court’s approach was hypertechnical and that the delay in filing the Change Report did not automatically invalidate the assumption of office by the Vahiwatdar.

The Supreme Court’s decision was that the High Court’s judgment was not sustainable and set it aside. The Supreme Court confirmed the acceptance of Change Report Nos. 899 of 2015 and 1177 of 2017. The key reasons for the decision were:

• The delay in submitting the Change Report was a curable defect.
• The Maharashtra Public Trusts Act, 1950, does not provide for automatic invalidation of appointments due to a delay in filing the Change Report.
• The Joint Charity Commissioner had already proceeded on the understanding that the delay was condoned.
• A liberal approach should be adopted in dealing with delay condonation applications.

The Court stated, “The very fact that a proviso was added in Section 22(1) of the Act of 1950, by way of amendment in 2017, empowering the Deputy or Assistant Charity Commissioner to condone the delay in reporting the change, if sufficient cause is shown, would indicate that the failure to report the change within the stipulated period was not fatal to the change itself.”

Conclusion

The Supreme Court’s judgment in the Shri Mallikarjun Devasthan case clarifies that a delay in submitting a Change Report under the Maharashtra Public Trusts Act, 1950, does not automatically invalidate the appointment of a Vahiwatdar or Trustees. The Court emphasized that the purpose of the Change Report is to update records and that the Act provides for penal consequences for failure to file, but not automatic invalidation of appointments. This decision provides much-needed clarity on the interpretation of the Act and ensures that procedural lapses do not undermine the administration of Public Trusts. The Court’s liberal approach to condonation of delay is also a welcome step, ensuring that justice is not defeated by technicalities. This judgment sets a precedent for future cases involving similar issues under the Maharashtra Public Trusts Act, 1950.

Key Takeaways:

• A delay in submitting a Change Report under the Maharashtra Public Trusts Act, 1950 is a curable defect and does not automatically invalidate the appointment of a Vahiwatdar or Trustees.
• The purpose of the Change Report is to update records, not to invalidate appointments.
• The Maharashtra Public Trusts Act, 1950, provides for penal consequences for failure to file a Change Report, but not automatic invalidation of appointments.
• A liberal, pragmatic, and justice-oriented approach should be adopted while dealing with applications for condonation of delay.
• A separate written order for condonation of delay is not mandatory.