TMI Blog2008 (12) TMI 816X X X X Extracts X X X X X X X X Extracts X X X X ..... the discharge of Mr. A.A. Halbe, who is one of the Joint Administrators; and (iii) the appointment of any one among four named individuals as a Joint Administrator in place of Mr. A.A. Halbe. 2. On 26th March, 2007 the Supreme Court appointed Dr. Narendra Trivedi, Vice President of the Lilawati Hospital and Dr. K Ramamurthy, a senior consultant to be in charge of the Hospital for the day to day running of the Hospital and the Research Institute. The order of the Supreme Court was pending the disposal of a suit instituted by the Plaintiff before the City Civil Court inter alia to challenge her removal from the Board of Trustees. The order of the Supreme Court records that the disputes between the parties were liable to impede the running of the Hospital which was under the management of the Trust. The Supreme Court observed thus: After hearing the arguments on both sides, we find that there are serious disputes between the parties which ultimately may cause serious difficulties in the running of the hospital, which is under the management of the Trust. In view of the present circumstances, as a temporary measure, we direct that Dr. Narendra Trivedi, Vice-President of the Leela ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er was clarified on 26th October, 2007 to the effect that these directions had been passed without prejudice to the rights of the parties and the order would not tantamount to the continuance of the services of the Administrators if they were not required. 4. A First Appeal against the dismissal of the suit was lodged before this Court. A Civil Application was taken out for interim relief. On 15th February, 2008 the application for interim orders was disposed of by a Learned Single Judge. The Learned Single Judge observed that on a plain reading of the order passed by the Supreme Court appointing the Joint Administrators, it is evident that the appointment of the Administrators was in order to ensure that disputes between the Trustees do not cause any difficulties in the running of the Hospital. The Learned Single Judge was of the view that even as of date there were serious disputes between the Trustees and two separate groups were fighting a bitter battle not merely before this Court, but before the authorities constituted under the Bombay Public Trusts Act, 1950. The Learned Single Judge was of the view that the circumstances which existed when the Supreme Court passed the or ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... appearing for the Petitioner before the Court had made a reference to the reports submitted by one of the Administrators according to which there were serious irregularities in the matter of administration. On this aspect, the Supreme Court observed thus: The parties on either side are at liberty to bring it to the notice of the High Court regarding these developments and take appropriate steps for redressal of the grievance and the High Court will be at liberty to pass appropriate orders in this matter. We clarify that in passing appropriate orders, the High Court need not be carried away because the administrators were appointed by this Court and the High Court may be at liberty to pass appropriate orders considering the claim of all parties concerned. The hearing of the appeal was expedited. The Civil Application has been instituted on 15th September, 2008, after the order of the Supreme Court and the relief that has been sought, as already noted earlier, is the removal of the Joint Administrators or, in the alternate, the removal of Mr. A.A. Halbe. 7. During the course of the hearing, Senior Counsel appearing on behalf of the Applicants did not press the wider relief t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the conduct of the Administrator. Firstly, a reference was made to the reports of the Administrator where he had sought to question certain payments though as a matter of fact in his joint report together with the other Administrator, he had sanctioned the very same payments as being in order. Secondly, a reference was made to the fact that in a suit instituted on the Original Side of this Court by Shri Rajiv K. Mehta (the son of the Plaintiff) on 7th March, 2008 a disclosure was made of a report which was to be submitted by Mr. Halbe to this Court on 10th March, 2008. In sum and substance, the submission that has been urged is that as a Joint Administrator appointed in pursuance of the orders passed by the Supreme Court, Mr. Halbe was expected to discharge his duties impartially. However, the conduct of the Administrator, shows that he has failed to discharge that function with objectivity and impartiality and that he has been colluding with one of the litigating parties viz. the Plaintiff to the suit. 8. On the other hand, it has been urged on behalf of the Original Plaintiff that (i) The application for the removal of Mr. A.A. Halbe was not maintainable before this Court, hav ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 5th February, 2008 makes it abundantly clear that the Learned Single Judge was of the view that it would not be proper to deal with the submissions made by counsel appearing for the Defendants as regards the role played by Mr. Halbe since an application for his removal was pending before the Supreme Court. The order of the Supreme Court of 14th July, 2008 disposed of both the Special Leave Petition against the order of the Learned Single Judge continuing the mechanism of the Joint Administrators as well as the Interim Application for the removal of Mr. Halbe. The Supreme Court observed that while it was not interfering with an interim discretionary order passed by the High Court, the submission before the Supreme Court was that one of the Administrators had submitted reports according to which there were serious irregularities in the administration of the Trust. The Supreme Court expressly clarified that parties on either side would be at liberty to bring this to the notice of the High Court and to take appropriate steps for the redressal of their grievances. The High Court, the Supreme Court observed, would be at liberty to pass appropriate orders in this matter . The expression ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the Administrators and the scope of their authority. The Administrators were placed incharge of the Hospital and were to look after the day to day running of the Hospital and the Research Institute. The two Administrators were directed to take all decisions relating to the administration of the Hospital. The Supreme Court observed that the Administrators were to give a report to the Board of Trustees every two weeks and any directions by the Board of Trustees would have to be issued to the two Administrators in the form of resolutions. The order of the Supreme Court therefore clearly contemplates that there was a Trust in relation to which there were serious disputes and these disputes were causing difficulties in the running of the Hospital. The appointment of the Administrators was for the purpose of looking after the day to day management of the Hospital. The Administrators had no role to play either in the administration of the Trust or in the conduct of the litigation between the parties, relating to the Trust. Both the Administrators were expected to speak with one voice, because it is evident from the order of the Supreme Court that they were to submit a report -meaning ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er Kirtilal Mehta. 7) Taking the overall view of the various paragraphs of the trust deed, one thing is manifestly clear that the trustees shall deal with the property only within ambits and purposes of the trust and that seems to be very consistent with the provisions of Bombay Public Trust Act, 1950. Under Section 36-A of the Act, it is clearly provided that the trustees of every public trust shall administer the affairs of the trust and apply the funds and property thereof for the purposes and objects of the trust in accordance with terms of the trust, usage of the institution and lawful directions that the Charity Commissioner or Court may issue. The trustees shall exercise the same care as man of ordinary prudence, when dealing with such affairs, funds or properties, as if they were his own. The trustees are entitled to exercise powers only for the prudent and beneficial management of the trust. Every trustee is jointly and severally liable for the acts of all the trustees on the board. Sub-section 3 of Section 36-A further provides as follows: No trustee shall borrow monies by way of mortgage or otherwise for the purpose of or on behalf of the trust of which he is the tru ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n inference that what was set out in the report of the Administrator was a statement of facts which have been investigated and found to be true. It was the bounden duty of Mr. Halbe as the Administrator to point out to this Court that what he had culled out were allegations from pleadings - something which he had said in his earlier report to the Board of Trustees but which he chose to delete while submitting the subsequent report to this Court. 14. A third report was addressed by Mr. Halbe to the Judges of this Court on 25th October, 2007. The First Appeal before this Court against the dismissal of the suit by the City Civil Court was lodged on 25th October, 2007. The report of Mr. Halbe was filed on the very same day. In fact, it has been stated by Counsel appearing for the Applicants that the papers and proceedings in the First Appeal were not even served on the Applicants on 25th October, 2007. The report of Mr. Halbe refers to the appeal against (Short Cause Suit No. 1997 of 2006 of the City Civil Court . The report was submitted on the very same day as the filing of the appeal. The attention of the Court has been drawn to the fact that the same report was submitted before ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ievance to the fact that some company by the name of Hospet Company has been appointed to handle the day to day and policy matters of the Hospital without notice to the Administrator. In his report Mr. Halbe stated that this was derogatory to the appointment of the Administrators by the Supreme Court and the Trustees had by-passed the jurisdiction that has been conferred upon the Administrators. The attention of the Court has, however, been drawn to the fact that the payment of professional fees to the same entity in the amount of ₹ 4,57,470/- had, as a matter of fact, been certified by Mr. Halbe under his own signature Volume VII page 1078. 17. On behalf of the Applicants a detailed chart has been submitted before this Court to establish that almost every one of the reports was submitted before this Court or before the Charity Commissioner so as to coincide with a hearing that was to take place in a proceeding between the parties. The chart does in fact establish the allegation. Fairly, in the submissions which were urged on behalf of the Plaintiff, no attempt has been made at all to displace the allegation or the correctness of the chart. 18. That leads to more se ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... al copy of my representation to the High Court dated 10/3/2008 existed on 7/3/2008 and there is no question of acting in concert with original Plaintiff, Mrs. C.K. Mehta in First Appeal No. 2667 of 2007. The representation of 10/3/2008 was forwarded to the Prothonotary and Sr. Master on the same day and so were the copies to the parties. 22. During the course of the hearing of these proceedings the papers and proceedings of Suit No. 1224 of 2008 were called for. Certain uncontroverted facts have emerged before the Court. The plaint was affirmed on 7th March, 2008 and the suit was lodged thereafter on 11th March, 2008. In the Plaint as originally filed there is a handwritten addition of paragraph 31A which makes a reference to the report of Mr. Halbe. Exhibit Z-2 to the Plaint as originally filed (corresponding to Exhibit N-2 of the plaint now on the record) is the report of Mr. Halbe dated 10th March, 2008. Exhibit N-2 of the plaint contains the signature of the Court Associate, and the date 7th March, 2008 below it. The endorsement of the Court Associate as been made in accordance with the provisions contained in the High Court Original Sides Rules viz. Rules 198 and 209. The r ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of ₹ 100/- immediately. He purchased stamp from nearby stamp vendor T.D. Jadhav at Vikhroli, where his office is located. The stamp paper is issued by General stamp office, Mumbai on 21.11.2008 to stamp vendor and it is purchased by me on 28.11.2008. In order not to miss date, I prepared the affidavit on 1.12.2008 and got it filed before the Court on 2.12.2008. 24. Judgments and orders of this Court are converted in the electronic form and loaded on the Internet. The Court maintains records of the uploading of the orders of the Court. Orders of the Court are uploaded immediately after they are signed. The relevant register in this regard has been produced for the perusal of the learned Counsel and it clearly shows that the order of this Court was, as a matter of fact uploaded on the Internet and was made available only on 29th November, 2008. The explanation of the Administrator that his son had obtained a simple copy of the order on 28th November, 2008 is therefore manifestly untrue. Counsel for the Administrator urges that this is unrelated to his conduct as an Administrator. The fact remains that the Administrator has furnished an explanation on affidavit to this Court ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ot decide a lis nor does he deliver a judgment or an award. But equally there can be no dispute about the fundamental position that when a retired Judge of the Court is appointed as an Administrator, he or she is appointed by virtue of the credentials of independence, impartiality and integrity which is associated with the office of a Judge of the High Court which was held at one time. When parties litigate over the control of institutions such as public trusts, the interests of the body which they are intended to subserve are liable to be sacrificed at the altar of an internecine dispute. An Administrator is appointed under an order of the Court because of the objectivity and impartiality with which he is expected to discharge his duties particularly when he happens to be a Former Judge of the High Court. Therefore, the submission which has been urged on behalf of the Plaintiff that an Administrator cannot be impartial as a Judge cannot warrant scrutiny. 27. The material which has been placed on the record clearly establishes that the Administrator has transgressed the bounds of his authority defined by the terms of the order under which he came to be appointed. The order passe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Charity Commissioner. The submission cannot be accepted. The framing of charges, as was submitted on behalf of the Applicants is subject to a Letters Patent Appeal which is pending before a Division Bench of this Court. But, that apart, once this Court has come to the conclusion that the Administrator has failed to discharge his duties impartially and has entered upon the arena of conflict by siding with one of the parties to the dispute, relief cannot be denied merely because charges have been framed against one of the Applicants by the Charity Commissioner. The framing of those charges would not deprive the litigating parties of the basic assurance that the Administrator must be impartial and fair. Our jurisprudence does not deprive a party to a dispute of the right to receive fair treatment merely because charges against him are under investigation. Insofar as the question of conduct is concerned, Mr. Seervai, learned Senior Counsel has fairly disassociated himself from supporting certain acts which are attributable to the conduct of the litigation. An advocate practicing before this Court since July 1983 has filed an affidavit in these proceedings relating to Suit No. 1224 ..... X X X X Extracts X X X X X X X X Extracts X X X X
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