Criminal
Appeal No 150 of 1966
Appeal from the judgment and order dated June 21 1965 of the Gujarat High Court in Criminal Appeal No 906 of 1963
HR Khanna and RN Sachthey for the appellants
M Nanavati B Datta and OC Mathur for the respondent
457 The Judgment of the Court was delivered by Grover J
This is an appeal by certificate against the judgment of the High Court of Gujarat setting aside an order of a Magistrate by which the respondent was convicted of an offence under section 67 read with section 37 of the Bombay Public Trusts Act 1950 as adapted and applied to the State of Gujarat hereinafter referred to as the Act and sentenced to pay a fine of Rs 300 in default of payment of which he was to suffer rigorous imprisonment for two months
The respondent is one of the trustees of a trust known as Shri Swami Narayan Mandir at Ahmedabad which is registered as a public trust in the office of the Charity Commissioner
The trust is managed under a scheme prepared by the High Court of Bombay
It appears that the Charity Commissioner learnt about certain constructions having been made by the respondent trustee without permission from him
On March 22 1962 a letter Ext
3 was addressed from his office to the respondent the material part of which may be reproduced An information is received of the Charity Commissioner that opposite the temple near the New Narnarayan building the blocks are being constructed in which shops are constructed on the ground floor of that building
For what purpose it is constructed  2
From when its construction work is started  3
What amount is spent till today in construction of the same  4
What amount is to be spent still  5
How much income will accrue from it  6
By which No and on what date the permission of the Charity Commissioner is taken for constructing the same
To which contractors are given the contracts for constructing the same  His name address amount of the contract and other details and a copy of the contract
If the committee has passed a resolution for constructing the same its true copy
If a contract is given to any contractor then whether that contractor is related or acquainted to any member of the committee
All these necessary information may please be sent before 15th April 1962
Queries on similar lines were made regarding the constructions near the respondent s bungalow in Girdharnagar
458 As no reply was received from the respondent reminders were sent to him on April 20 1962 and May 10 1962 followed by a telegram dispatched on May 23 1962
A reply was sent by the respondent giving the particulars of the buildings which had been constructed
Reference was made to the resolutions of the Committee relating to these constructions together with the amount spent on them
The Inspector appointed under the Act made a report dated May 4 1963 giving the result of the enquiry made by him relating to the aforesaid constructions
According to him 8 shops had been constructed adjoining the Narnarayan building opposite the Swammarayan temple the estimated cost of which was more than Rs 2 lacs
On plot No 98A shops were being built in four blocks
Construction was also being made on another plot No 98A 2 opposite the railway crossing
On May 30 1962 the Charity Commissioner instituted a complaint in the court of the City Magistrate at Ahmedabad giving most of these facts and stating inter alia that under the provisions of the Act a trustee who desired to invest trust funds in construction of buildings was bound to obtain permission of the Charity Commissioner which had not been done in the present case
According to him the respondent had deliberately committee a breach of the relevant provisions of the Act and had omitted to comply with the notice dated May 22 1962
The gravamen of the charge was contained in paragraph 7 according to which the respondent had without reasonable cause failed to comply with the order and the directions issued to him under the provisions of section 37 of the Act
The respondent filed an application Ext 6 before the Magistrate submitting that the investment of the trust funds made in the construction of the building adjacent to the Narnarayan Bhavan was legal and had been done in good faith
It was for the benefit of the institution
The scheme committee had given its consent by passing resolutions
By an order dated June 10 1963 the City Magistrate held that the respondent had not shown the purpose of the new constructions nor had he furnished the date of commencement of the work as also the details amount already spent and to be spent on the said constructions
He was accordingly convicted under section 37 read with section 67 of the Act
The respondent moved the High Court on the revisional side
It was quite clear that the respondent was not being prosecuted for failure to obtain permission from the Charity Commissioner in the matter of investment of funds but the case for the prosecution as urged by the Assistant Government Pleader before the High Court was that in the letter dated March 22 1962 Charity Commissioner had called for a statement  or report regarding certain construction work which was being carried on 459 by the respondent in his capacity as a trustee and since the same had not been complied with the respondent had been rightly convicted
The High Court was of the view that the words used in el
c of section 371 namely return statement account or report have to be interpreted or construed with reference to the other provisions of the Act and the Rules framed thereunder where those words had been employed or used
As regards the word statement reference was made to Rules 17 22 and 23
Similarly the word report was mentioned in sections 34 37 and 38
It was finally held that the Charity Commissioner had not called for any statement or report but for particulars and detailed information regarding the various items set out in his letter which he was not empowered to do
The Act was enacted to regulate and
to make better provisions for the administration of public religious and charitable trusts in the State of Bombay
Section 213 defines
public trust
Section 218 defines the word trustee as a person in whom either alone or in association with other persons the trust property is vested and includes a manager
Section 220 says that words and expressions used but not defined in the shall have the meanings assigned to them in that Act
Chapter ii of the Act provides for the appointment of the Charity Commissioner Joint Deputy and Assistant Charity Commissioners as also the subordinate officers and assessors
Chapter HI gives charitable purposes and validity of certain trusts
Chapter IV relates to registration of public trusts
Under section 17 a duty has been cast on the Deputy or Assistant Charity Commissioner in charge of the public trust registration office to keep and maintain such books indices and other registers as may be prescribed which have to contain the prescribed particulars
Under section 22 where any change occurs in any of the entries in the register kept under section 17 the trustee shall within 90 days from the date of the occurrence of such change report the same in the prescribed form to the Deputy or Assistant Charity Commissioner in charge of the public trust registration office
Chapter V deals with accounts and audit
Section 32 makes it the duty of every trustee to keep regular accounts in the approved form containing the prescribed particulars
Under section 34 it is the duty of every Auditor to prepare balance sheet and to report irregularities etc
Section 35 relates to investment of public trust money and provides inter alia that the Charity Commissioner may permit a trustee to invest money in any manner other than that provided in that section
Section 3 6 prohibits alienation of immovable property of a public trust without the previous sanction of the Charity Commissioner
Chapter Vwhich contains sections 37 to 41 is headed control
Section 37 gives powers of inspection and supervision to the Charity Commissioner etc
These officers have been given under subs
 1  the power 460 a to enter on and inspect or cause to be entered on and inspected any property belonging to a public trust b to call for or inspect any extract from any proceedings of the trustees of any public trust and any rocks of account or documents in the possession or under the control of the trustees or any person on behalf of the trustees
c to call for any return statement account or report which he may think fit from the trustees or any person connected with a public trust
 Sub section 2 says that it shall be the duty of every trustee to afford all reasonable facilities to any officer exercising any of the powers under sub section
1  and to comply with any order or direction made by him
Sections 38 and 39 provide for calling of an explanation from the trustee or any other person concerned on the report of the Auditor and the making of a report by the Deputy or the Assistant Charity Commissioner to the Charity Commissioner about the gross negligence breach of trust etc
 of the trustee
Under section 40 the Charity Commissioner after considering the report submitted under section 39 and giving an opportunity to the person concerned and holding such enquiry as he thinks fit can determine the various matters set out in that section and under section 41 if he decides that any person is liable to pay to the public trust any amount for the loss caused to the trust he may direct that amount shah be surcharged on that person
Section 54 provides for what is called Dharmada and an account is to be submitted in the prescribed form
Section 56N2h includes among the general duties of a Committee in which the management of certain endowments vests under section 56D to supply such returns statistics accounts and other information with respect to such endowments as the State Government may from time to time require
It is unnecessary to notice the otherr sections with the exception of sections 67 and 69
Section 67 provides for contravention inter alia of any order or direction made under the Act by the Charity Commissioner
Section 69 relates to the duties functions and powers of the Charity Commissioner
Under cl
h he can enter on and inspect any trust property and call for and inspect any proceedings of a trust
He can further call for any return statement books of account document or report from trustees or any person connected with a public trust under section 37
The relevant rules in the Bombay Public Trust Gujarat Rules 1961 may next be examined
Rule 17 is to the effect that every trustee shall keep regular accounts of all receipts and of movable and immovable property and of
all encumbrances created on the trust property and of all payments alienations etc
made on behalf 4 61 of the trust
The accounts have to contain all such particulars as in the opinion of the Charity Commissioner will facilitate preparation of the balance sheet and income and expenditure account in the Form of Schedules VIIand IX and the preparation of a Statement of income chargeable to contributions in the Form of Schedule IXC
According to the proviso to r 17 where the trustees of a public trust are entitled to file statements in the Form of Schedules IXA and IXB by virtue of any exemption granted under section 334 b the accounts may contain particulars which shall facilitate the preparation of statements in the aforesaid Form of Schedules IXA and IXB
Schedule IXC is headed statement of income liable to contributions and has reference to sub r 3 of r 32 which provides for contributions to the Public Trust Administration Fund by every public trust other than a trust exclusively for the purpose of advancement and propagation of secular education or exclusively for the purpose of medical relief or veterinary treatment of animals certain deductions specified therein shall be allowed in calculating the gross annual income of a public trust or where the public trust is a Dharmada its gross annual collection by receipts for the purpose of assessing the contribution
SchedulesXA and IXB are headed statements of income and expenditure respectively and have as stated before reference to section 334b which provides that the Government may by general or special order exempt any public trust or class of public trusts from the provisions of sub section
2 of section 33 according to which the accounts shall be audited annually in such manner as may be prescribed and by a person who is a Chartered  Accountant or by such persons as may be authorised by the State Government
Rule 18 which relates to the powers in respect of audit empowers the Deputy or the Assistant Charity Commissioner inter alia to require the production before the auditor of any book deed account etc
by the trustee or to give such information as may be necessary regarding the same
Rule 22 and 23 provide for inspection and grant of entries in the public trust register and other documents
Thus inspection and grant of copies can be obtained of any entry or portion thereof in the register of public trust or any statement notice intimation account audit report or any other document filed under the Act
In other similar legislation on public trusts the expressions
which have been used may be noticed
In the English Charitable Trusts Act 1853 it was provided by section 10 that the Board consisting of the Charity Commissioners may require all trustees or persons acting or having any concern in the management or administration of any charity or the estate funds or property thereof to render to the said Board accounts and statements in writing in relation to such charity or the funds estate property income or monies thereof or may also require such trustee to return answers in writing to any questions or enquiries sup
C I68 15 463 or statement but in addition answers have to be returned to any questions or enquiries and the refusal to do so is punishable with contempt of court
In the Act itself the legislature was fully aware of the true import of the word information as is clear from section 56H2h and r 18
It is difficult therefore to equate the word statement as used in section 37 1  c with the word information or answering of enquiries etc
which would have a much wider sweep than the word statement when considered from the point of view of statutory provisions and the rules in which it appears
In view of the above discussion it is difficult to hold that any of the items mentioned in the letter dated March 22 1962 fall within the meaning of the words report or statement
The enquiries which have been made can only involve the calling of information on various matters mentioned in the letter which could hardly be said to fall within the aforesaid expressions used in section 371c
The view of the High Court therefore must be upheld with the result that the appeal fails and is dismissed
YP Appeal dismissed


Summary:
Section 67 of the Bombay Public Trusts Act 1950 provides that the contravention of an order or direction made under the Act by the Charity Commissioner is an offence
Section 69 relates to the duties functions and powers of the Charity Commissioner
Under section 69H the Charity Commissioner can under section 37 call for a statement or report from a trustee of a public trust
The respondent was one of the trustees of a public trust
In respect of certain constructions made with the funds of the public trust without the Charity Commissioner s permission the Charity Commissioner wrote to the respondent asking him to furnish information regarding g the purpose of the constructions and when they were stated the amount spent and to be spent the income expected and details and particulars regarding the contracts
For failure to comply with the notice the respondent was prosecuted
He was convicted by the Magistrate under sections 37 and 67 of the Act
In revision
he was acquitted by the High Court
In appeal to this Court HELD The items mentioned by the Charity Commissioner only involve calling of information on various matters and did not fall within the meaning of the words report or statement used in section 371c and the Charity Commissioner is not empowered to call for such information
463 C From the context in which the word report has been used in section 371c the word can have reference only to a formal report which a trustee may be required to make under the provisions of the Act or the rules if any framed under section 841b
Similarly the word Statement has been employed in rr 17 22 and 23 of the rules and this word appearing in section 371c has to be construed with reference to them
So construed it cannot be equated with the word information which would have a much wider sweep than the word statement
The distinction between the words statement and information is recognised by the Legislature itself by the use of the words other information in section 56N 2 h of the Act and r 18 of the Rules made thereunder which take in the answering of all inquiries and giving all kinds of information
462 E G