Summary
The Court set aside an order approving sale of charitable-trust property for Rs 80 lakh and directed fresh valuation and competitive bidding. Although the appellant had defaulted on earlier opportunities, his subsequent deposit of Rs 1 crore and the rival bidder’s incremental increases showed that the trust’s full property value might not have been realised. Neither bidder was awarded the property. The writ petition was restored, while unchallenged findings concerning legal necessity for sale remained undisturbed.
Issues
- Whether protection of a charitable trust’s property warranted fresh competitive bidding despite the challenger’s earlier failure to honour his offer.
Provisions considered
- Section 36(1), Maharashtra Public Trusts Act, 1950Sanction for alienating trust property must protect the trust’s interest and benefit; the process must seek proper value rather than simply accept the previously negotiated offer. (¶¶ 5, 8, 17, 18, 19)
Held
- Trust property requires vigilant protection. The governing consideration in sanctioning alienation is the trust’s interest, benefit or protection, including obtaining appropriate market value through a transparent process. (¶ 17)
- The appellant’s earlier default was acknowledged, but accepting Rs 80 lakh after he deposited Rs 1 crore would jeopardise the trust’s interests. The second respondent’s repeated incremental increases, including willingness to match Rs 1 crore, supported an inference that proper value had not been realised. This did not entitle either party to an immediate award of the property. (¶¶ 13, 14, 18)
- The Joint Charity Commissioner was to obtain a fresh valuation, fix an upset price based on it of at least Rs 1 crore, advertise in at least two widely circulated local newspapers, receive fresh bids including from both parties, and report to the High Court. The writ petition was restored for appropriate final directions, with the parties’ rights and contentions preserved. (¶ 18)
- The appellant’s deposit was to remain in a periodically renewed nationalised-bank fixed deposit, subject to High Court directions; he could apply for adjustment against his bid. Unchallenged findings concerning legal necessity for sale were not disturbed. The Commissioner was to act immediately and endeavour to complete the process by 31 December 2021. (¶¶ 18, 19, 20)
Result
Appeal allowed; sale direction set aside, writ petition restored and fresh valuation and bidding directed. No outright sale to either contestant was ordered.