Shiv Kumar Jatia & Anr. v. Satyam Kanoi & Ors.

1. The present application has been filed on behalf of the Administrator, who was so appointed vide order dated 15.09.2023 to look after the functioning and administration of Ram Pyari Devi Charitable Trust (hereinafter referred to as “the said Trust”), seeking appointment of new set of Trustees and thereafter, discharge the applicant as Administrator.

2. The major activities of the Trust are that of running a school by the name of DPS New Town School at Kolkata. Vide order and judgment dated 15.09.2023, Hon‟ble Mr. Justice V. Ramasubramanian, former Judge of Hon‟ble Supreme Court, was appointed as an Administrator to manage the day-to-day affairs of the Public Trust. The Trustees were directed to forthwith handover all the documents of movable and immovable properties, including the lease deeds, Bank accounts, cheque book etc. and all the records pertaining to the School to the Administrator.

3. It was further directed vide order aforementioned that for better administration, the Administrator shall supervise and control the movable and immovable properties, bank account, fixed deposit etc. belonging to the Trust. However, he shall not have any power or authority to alienate or sell any of the properties on behalf of the Trust. Liberty was granted to the learned Administrator to seek any further documents or information from the Trustees, who shall extend full co-operation to him. Also directed that the Administrator shall from time to time pay all State taxes, Income Tax and other statutory dues in respect of the Trust in accordance with law. Liberty was also granted to the Administrator to appoint officers (of his choice) for secretarial services to oversee the functioning of the Trust, whose remuneration shall be paid from the funds of the Trust. The 15:21 Administrator was further directed that he shall also make endeavour to bring the parties to a common ground to resolve their differences. The appointment of the Administrator was directed to be continued until the differences between the parties are resolved and also the Trustees were directed to function effectively as the Board of Trustees of the Trust. The Trustees were directed not to create any obstacle in the functioning of the Trust by the Administrator. It was made clear that if any of the Trustees failed to comply with the terms, as directed by this Court, its noncompliance shall result in prosecution under the Contempt of Courts Act,

1971.

4. Consequent to the afore-noted directions issued vide order dated 15.09.2023, the Administrator had indicated to the parties and their counsel that he would be visiting the school on 15.11.2023 and 06.11.2023. Accordingly, he visited the school on the aforesaid dates at Kolkata and thereafter continued to look after the functioning of the Trust, as directed by this Court.

5. The present application has been moved by Ms. Jahanvi Worah, Advocate on behalf of the Administrator wherein it is averred that after visiting the school at Kolkata on 15.11.2023 and 06.11.2023, the Administrator hired the services of a firm of Chartered Accountants to assist him in handling its finance and accounts and they accompanied the Administrator to the school.

6. After inspecting the school records and ascertaining complete details, letters were addressed to the banks in which the Trust and the School had accounts, informing them of the appointment of the Administrator. Since the Principal of the School had the cheque signing power, the cheque books 15:21 were entrusted to his custody, with a direction that she must take approval for every item of expenditure incurred for the School.

7. It is stated in the present application that since two of the four Trustees namely, Satyam Kanoi and C.D. Choudhuri are based out of Kolkata, they were not physically present during the inspection. They informed the Administrator that the returns for Financial Year („FY‟) 2021- 2022 and FY 2022-2023 were not filed. The Trust had received notices dated 09.08.2023 and 12.10.2023 from the Income Tax Department under Section 142(1) of the Income Tax Act, 1961, in relation to the Assessment Year 2016-2017. A huge demand of about Rs.2,71,83,760/- for the Assessment Year 2021-2022 had been made under order dated 24.11.2022 but no appeal had been preferred and also no action was taken on order dated 31.03.2023 passed under Section 148A(d) of the Income Tax Act, 1961 for the Assessment Year 2016-2017.

8. It is also stated in this application that the Auditor found that amount paid by the school to the Transport Operator was Rs.1.40 crores per month, while the amount collected from the children towards transport was only Rs.1.06 crores per month. It was also found that total seating capacity of all the buses provided by the contractor was 4840 though the number of children who availed the bus services was only 3194, which shows that there was only 66% capacity utilisation. It was also found that on certain routes, 50 seater buses had occupancy of only 15 students.

9. Learned Administrator has pointed out the area of concern is that of not providing direct access to the accounting system „Tally‟ to the Chartered Accountant, which had become a contentious issue and took time to resolve.

10. Much has been said with regard to disputes between the Trustees 15:21 and the Administrator in this application but each and every aspect need not to be noted down in the present order. However, the present application has been filed seeking modification of order dated 15.09.2023 and for substitution of Board of Trustees.

11. During the hearing, it is agreed by the parties that the same Administrator may continue or this Court is at liberty to appoint another Administrator(s) (as deemed fit in the present circumstances).

12. It is apparent that the disputes between the Trustees of the Trust, have not been resolved. The parties have certain such disputes which are potential to effect on the functioning of the Trust/school. The subject matter of the present litigation is a Public Trust and none of the parties can assert any claim and it is the responsibility of all the parties towards the common goal of the Trust.

13. Learned Administrator though tried his level best to resolve the issues, however, he could not do so for the reason seems to be that the Trustees did not cooperate with him to his satisfaction.

14. In view of above, we hereby relieve the Hon‟ble Mr. Justice V. Ramasubramanian, the learned Administrator from the responsibility granted by this Court vide order dated 15.09.2023. We appreciate the efforts made by the learned Administrator to resolve the issues.