Assam Maheswari Seva Trust And 34 Ors vs. Sri Niranjanlal Kabra And 13 Ors

Held

The High Court modified the trial court's order regarding expenditure. While directions (a), (b), (d), and (f) were maintained, direction (c) was modified to allow the ad-hoc body to spend up to Rs. 30,000/- per month for trust maintenance without prior general body approval. For expenses exceeding Rs. 30,000/-, prior approval of the general body is still required. Direction (e) was replaced to permit the ad-hoc body to pay specific recurring expenses without general body approval, including electricity bills, GST, GMC taxes, insurance, AC maintenance (amounting to Rs. 1,17,000/-), generator fuel, laundry, and security deposit refunds. For any other emergent purpose, the ad-hoc body can spend up to Rs. 25,000/- per month without approval, but any expenditure beyond that requires a special meeting and written approval from the general body. The appeal was disposed of with these modifications, and the trial court was directed to dispose of the suit expeditiously.

Facts

This appeal arises from an order passed by the Additional District Judge concerning a dispute over the management of the Assam Maheshwari Seva Trust. The plaintiffs (respondent Nos. 1-3) sought a declaration that the existing Board of Trustees had no authority to hold office after their term expired on 04.11.2015 and sought to restrain them and the Election Officer from conducting fresh elections for the 2016-19 session. The trial court, while allowing the existing body to function as an ad-hoc body, imposed restrictions on their expenditure, limiting monthly maintenance expenses to Rs. 10,000/- without general body approval, and requiring approval for any expenses exceeding this amount. The appellants (defendant Nos. 2-37) challenged these restrictions, arguing they were unreasonable and would hinder the trust's functioning, particularly its maintenance of a marriage hall and a five-storied building.

Key Issues

1. Whether the restriction of spending not more than Rs. 10,000/- per month for the maintenance of the Trust by the ad-hoc body, without prior approval of the general body, is reasonable and facilitates the smooth functioning of the charitable trust, as per the principles governing interim orders in suits concerning trusts. Contentions: Petitioner/Appellant: Argued that the Rs. 10,000/- spending limit is unreasonably low, given the trust's obligations for maintaining its properties (marriage hall, five-storied building), regular payments like electricity bills, GST, GMC taxes, insurance, AC maintenance, generator fuel, and security deposit refunds. They contended that requiring general body approval for every expense exceeding Rs. 10,000/- is impractical and could paralyze the trust's operations. Revenue/State: Submitted that the restrictions were imposed to ensure a check on the expenditure of the ad-hoc body. However, they conceded that government bills, GST, and similar expenses might be allowed without general body sanction.