1 19.wp.916.10.sxw IN THE HIGH COURT OF JUDICATURE AT BOMBAY CIVIL APPELLATE JURISDICTION skt WRIT PETITION NO. 916 OF 2010 The Bombay Diocesan Trust Association Pvt. Ltd. & Anr. ... Petitioners Vs. Juliet James & Ors. ... Respondents ...... Mr.V.A.Thorat, Senior Counsel with Ms.Gauri K. Jadhav for the petitioners. Mr.Satya M. Shettigar for respondents no. 1 & 2. Mr.P.M.Jadhav & Mr.V.P.Sawant i/by Mr.Akash P. Sharma for respondents no. 5, 8, 10. ...... CORAM : R.V. MORE, J. DATE : AUGUST 26TH, 2010. P.C. 1 Heard Mr.Thorat, Senior Counsel for the petitioners and Mr.Shettigar learned counsel for respondents no.1 & 2. 2 Rule. By consent, Rule is made returnable forthwith. Since short point is involved, petition is taken up for hearing. 3 The brief facts giving rise to the present writ petition are as follows: Petitioner No.1 is charitable trust, registered under the Bombay Public Trusts Act, 1950. Respondents no. 1 & 2 who claim to be 2 19.wp.916.10.sxw beneficiaries of the petitioner-Trust have file Application No.16 of 2009 under Section 41E of the Bombay Public Trusts Act, 1950 (hereinafter referred as “the said Act”) before the Joint Charity Commissioner, Greater Mumbai Region, Mumbai for various directions. In the said application, respondents no.1 & 2 filed an application at Exh.6 for interim reliefs. This application was disposed of by the impugned order thereby restraining the petitioners, from entering into any transaction with regard to the trust property, using trust funds for defending criminal case No.FIR/104/09 and other incidental proceedings thereto. By the said order, petitioners were also directed to give detail statement about all the transactions entered into for which the applications under Section 36 of the said Act are not moved. 4 Mr.Thorat, learned Senior Counsel submitted that as far as clause-1 of the operative order is concerned, the petitioners could not have been totally prohibited from entering into any transaction. He further submitted that, the trustees are entitled to use the trust fund to recover trust properties. He lastly submitted trust property is not sold without obtaining prior permission under Section 36 of the said Act. 5 Mr.Shettigar, learned coun 3 19.wp.916.10.sxw sel for respondents no.1 & 2 on the contrary, supported the impugned order. He submits that looking into the past conduct of the trustees of the Petitioner-trust, equitable order is passed. 6 Having heard learned counsel for the respective parties and having gone through the impugned order, I find that there are twelve trustees of the petitioner-Trust. The names of these trustees are recorded in the record of the Trust. Respondents nos. 1 & 2 are the original applicants in proceedings under Section 41E of the said Act and therefore presence of other respondents may not be necessary while disposing of this petition. 7 The Charity Commissioner is custodia legis of the trust property. The trustees cannot transfer the trust property without prior approval of the Charity Commissioner under Section 36 of the said Act. The title of the trust property does not pass over to the purchaser unless and until approval under Section 36 of the said Act is granted by the Charity Commissioner. While granting approval, the Charity Commissioner is obliged to consider relevant factors namely : (a) need to sell property; (b) whether transaction is beneficial to the trust and (c) whether the trust is getting best available price. 4 19.wp.916.10.sxw In the circumstances, the injunction prohibiting trustees of the petitioner- trust from entering into any transaction with regard to the trust property, in my view, cannot be granted. The property and the interest of the trust would be sufficiently protected if the trustees are restrained from alienating, transferring, selling and/or creating third party interest in the trust property without taking prior permission under Section 36 of the said Act. 8 So far as the clause 2 of the operative order is concerned, Mr.Shettigar, learned counsel for respondents no.1 & 2 submitted that restrictions are only for using trust funds to defend criminal case No.FIR No.104/2009 and incidental proceedings thereto and there is no restriction for spending the trust fund for recovery of property of the trust which is seized in criminal proceedings. In view of the statement, I am not inclined to modify clause 2 of the operative order. 9 So far as the clause 3 of the operative order is concerned, the respondents no. 1 & 2 have disputed the statement of the petitioners that none of the transaction is entered into in violation of Section 36 of the said Act. The issue whether trustees of the petitioner-trust have contravened the provisions of Section 36 of the said Act, will be decided 5 19.wp.916.10.sxw at the time of final hearing of the main application under Section 41E of the said Act. However, it is the case of the petitioners that none of the transaction is entered into without obtaining sanction under Section 36 of the said Act. The petitioners can point out these facts to the Joint Charity Commissioner. Therefore, there is no need to modify clause 3 of the operative order. In these facts and circumstances, I dispose of the writ petition by passing the following order : : O R D E R : 1 Clause 1 of the operative part of impugned order is substituted as under : The respondents-Trustees are restrained by an order of injunction from alienating, transferring, selling and/or creating third party interest in the trust property without obtaining prior permission under Section 36 of the said Act. 2 Clause 2 of the operative part of impugned order is confirmed. However, petitioners are at liberty to spend money from the trust fund for recovery of the trust property which is seized in criminal proceedings. 3 Clause 3 of the operative part of the impugned order is confirmed. However, petitioner is granted three weeks extension to give statement on the basis of available record. [ R.V. MORE, J.]