Supreme Court issues notice in dispute over transfer of Ratanshi Premji Charitable trust lands to Fenkin Infotech; Stays Bombay HC order

Supreme Court: In a Special Leave Petition (‘SLP’) arising from a dispute concerning the transfer of lands situated in Village Vadavli, Thane, Maharashtra, the Division Bench of Pamidighantam Sri Narasimha and Atul S. Chandurkar, JJ. issued notice and directed status quo, noting that the Thane Municipal Corporation (‘TMC’) had neither been heard nor made a party before the Bombay High Court, and the impugned order was passed without affording any opportunity for TMC to be heard.

On 08-07-2024, the managing directors and office bearers of the Ratanshi Premji Charitable Trust (‘Trust’) wrote to the Joint Charity Commissioner seeking sanction for the sale of a property for ₹75.05 crore to Fenkin Infotech LLP (Petitioner). While granting permission, the commissioner imposed conditions, requiring the proceeds to be kept in fixed deposits and mandating prior approval for their utilization. A former trustee (respondent), challenged this order in the High Court, arguing that it violated the principles governing charitable trust administration.

A Single-Judge Bench of the High Court quashed the sale, pointing out multiple deficiencies in the valuation report issued by the commissioner. The Bench emphasised that trustees cannot alienate immovable property solely to enhance profitability or engage in real estate speculation. Consequently, the court struck down the order and the registration of the conveyance deed, returning ownership of the property to the trust.

The present SLP was filed challenging the final judgment and order passed by the Single Judge of the High Court , wherein the High Court had, exercising its supervisory jurisdiction under Article 227 of the Constitution of India, quashed the judgment and order passed by Charity Commissioner and annulled the registered Conveyance Deed dated 06-09-2024 executed by the Trust in favor of the Petitioner.

The petitioner submitted that at the admission stage, the High Court proceeded to pass the impugned judgment hastily without issuing notice or granting time for the petitioner to file a reply. The Court overlooked the fact that the petitioner was a bona fide purchaser of the trust property, which was sold after obtaining the necessary permissions from Charity Commissioner under Section 36(1)(a) of the Maharashtra Public Trust Act, 1950 (‘MPT Act’). By cancelling the Conveyance Deed, the High Court wrongly assumed the role of a Civil Court, disregarding Section 31 of the Specific Relief Act, 1963. The petitioner had agreed to purchase the land for Rs. 75,05,00,000/-, and after obtaining the required permissions, the Trust executed and registered the conveyance deed in favor of the petitioner. However, the High Court failed to recognize the registered Conveyance and exceeded its jurisdiction by annulling it.

Additionally, the petitioner submitted that the High Court disregarded Section 36(2) of the MPT Act, which outlines grounds—fraud, misrepresentation, or concealment of material facts, under which a sanction for the sale of trust property can be revoked by the Charity Commissioner.

The petitioner filed an application seeking to implead TMC as a party respondent in the Petition. The petitioner further submitted that, after the CC Order, the Trust executed the Conveyance Deed, transferring the land to the petitioner. The petitioner subsequently entered a Transfer Deed on 03-02-2025, transferring parcels of land to TMC, as per the Development Plan remarks finalised by TMC. The extracts showed the property was mutated in favor of TMC. Despite this, TMC was not included as a party in the Writ Petition, which was decided in its absence. The High Court erred by allowing the Petition filed by a party not privy to the Transfer Deed, thereby challenging the transfer without notifying or impleading TMC.

The Court after considering the submissions issued notice and allowed the impleadment application of TMC filed by the petitioner and impleaded it as a party in the SLP. The captioned matter remains sub-judice and the Court has extended the status quo pending disposal of the SLPs.

The matter was listed after four weeks.