Chapter V POWERS AND DUTIES OF, AND RESTRICTION ON, TRUSTEES

1[CHAPTER V-A POWERS AND DUTIES OF, AND RESTRICTION ON, TRUSTEES] 2(1) Where the trust property consists of money and cannot be applied immediately or at any early date to the purposes of the public trust the trustee shall be bound 3[notwithstanding any direction contained in the instrument of the trust to deposit the money in any Scheduled Bank as defined in the Reserve Bank of India Act, 1934 (II of 1934), in the Postal Savings Bank or in a Co-operative Bank approved by the State Government for the purpose or to invest it in public securities] : Provided that such money may be invested in the first mortgage of immovable property situate in 4[any part of India] if the property is not leasehold for a term of years and the value of the property exceeds by one-half the mortgage money : Provided further that the Charity Commissioner may by general or special order permit the trustee of any public trust or classes of such trusts to invest the money in any other manner : 5[provided also that, if any public trust has made the application to the Charity commissioner for seeking the order granting the permission for investing the money in any other manner under the second proviso, the Charity Commissioner shall decide such application within three months from the date of receipt of such application and where it is not practicable so to do, the Charity Commissioner shall record the reasons for the same.]. 6[(2) Nothing in sub-section (2) shall affect any investment or deposit already made before the coming into force of the Bombay Public Trusts (Amendment) Act, 1954 (Bom. LIX of 1954), in accordance with a direction contained in the instrument of the trust : Provided that any interest or dividend received or accruing from such investment or deposit on or after the coming into force of the said Act or any sum 7[so invested or deposited] on the maturity of the said investment or deposit shall be applied or invested in the manner prescribed in sub-section (1)].

1[(1)] 2[Notwithstanding anything contained in the instrument of trust-]

1. (a) no sale, 3* exchange or gift of any immovable property, and
2. (b) no lease for a period exceeding ten years in the case of agricultural land or for a period exceeding three years in the case of non-agricultural land or a building, Belonging to a public trust, shall be valid without the previous sanction of the Charity Commissioner. 4[Sanction may be accorded subject to such condition as the Charity Commissioner may think fit to impose, regard being had to the interest, benefit or protection of the trust;
3. (c) if the Charity Commissioner is satisfied that in the interest of any public trust any immovable property thereof should be disposed of, he may, on application, authorise any trustee to dispose of such property subject to such conditions as he may think fit to impose, regard being had to the interest or benefit or protection of the trust. 5[Provided that, the Charity Commissioner may, before the transaction for which previous sanction is given under clause (a), (b), or (c) is completed, modify the conditions imposed thereunder, as he deems fit: Provided further that, if such condition is of time-limit for execution of any contract or conveyance, then application for modification of such condition shall be made before the expiry of such stipulated time.]. 6[(1A) The Charity Commissioner shall not sanction any lease for a period exceeding thirty years under this Act.].

1. (2) The Charity Commissioner may revoke the sanction given under clause (a) or clause (b) of sub-section (1) on the ground that such sanction was obtained by fraud or mis-representation made to him or by concealing from the charity Commissioner, facts material for the purpose of giving sanction; and direct the trustee to take such steps within a period of one hundred and eighty days from the date of revocation (or such further period not exceeding in the aggregate one year as the Charity Commissioner may from time to time determine) as may be specified in the direction for the recovery of the property. 7[Provided that, no sanction shall be revoked under this section after the execution of the conveyance except on the ground that such sanction was obtained by fraud practiced upon the Charity Commissioner before the grant of such sanction.].
2. (3) No Sanction shall be revoked under this section unless the person in whose favour such sanction has been made has been given a reasonable opportunity to show-cause why the sanction should not be revoked.
3. (4) If, in the opinion of the Charity Commissioner, the trustee has failed to take effective steps within the period specified in sub-section (2), or it is not possible to recover the property with reasonable efforts or expense, the Charity Commissioner may assess any advantage received by the trustee and direct him to pay compensation to the trust equivalent to the advantage so assessed.] 8[(5) Notwithstanding anything contained in sub-section (1), in exceptional and extraordinary situations where the absence of previous sanction contemplated under sub-section (1) results in hardship to the trust, a large body of persons or a bona fide purchaser for value, the Charity Commissioner may grant ex-post-facto sanction to the 9[transfer of the trust property, effected by the trustees prior to the date of commencement of the Maharashtra Public Trusts (Second Amendment) Act, 2017 (Mah. IV of 2018)], if he is satisfied that,-
   • (a) there was an emergent situation which warranted such transfer,
   • (b) there was compelling necessity for the said transfer,
   • (c) the transfer was necessary in the interest of trust,
   • (d) the property was transferred for consideration which was not less than prevalent market value of the property so transferred, to be certified by the expert,
   • (e) there was reasonable efforts on the part of trustees to secure the best price,
   • (f) the trustees actions, during the course of the entire transaction, were bonafide and they have not derived any benefit, either pecuniary or otherwise, out of the said transaction, and
   • (g) the transfer was effected by executing a registered instrument, if a document is required to be registered under the law for the time being force. ] 10[Explanation.- For the purpose of sub-section (5), the term "the Charity Commissioner" shall mean only the Charity Commissioner appointed under section 3.]

1[36A. Powers and duties of, and restrictions on, trustees.- (1) A trustee of every public trust shall administer the affairs of the trust and apply the funds and properties thereof for the purpose and objects of the trust in accordance with the terms of the trust, usage of the institution and lawful directions which the Charity Commissioner or court may issue in respect thereof, and exercise the same care as a man of ordinary prudence does when dealing with such affairs, funds or property, if they were his own.

1. (2) The trustee shall, subject to the provisions of this Act and the instrument of trust, be entitled to exercise all the powers incidental to the prudent and beneficial management of the trust, and to do all things necessary for the due performance of the duties imposed on him.
2. (3) No trustee shall borrow moneys (whether by way of mortgage or otherwise) for the purpose of or on behalf of the trust of which he is a trustee, except with the previous sanction of the Charity Commissioner, and subject to such conditions and limitations as may be imposed by him in the interest or protection of the trust. 2[Provided that, the Charity Commissioner or the Joint Charity Commissioner, as the case may be, shall decide the application for borrowing money from the Bank or Financial Institution forthwith and preferably within a period of fifteen days, if the Bank or the Financial Institution has provisionally sanctioned the loan.]. 3[(3A) Notwithstanding anything contained in sub-section (3), in exceptional and extraordinary situations where the absence of previous sanction contemplated under sub-section (3) result in hardship to the trust, beneficiary or bona fide third party, the Charity Commissioner may grant ex-post-facto sanction to borrow moneys from any nationalized bank or the Scheduled Bank, by the trustees.].
3. (4) No trustee shall borrow money for his own use from any property of the public trust of which he is a trustee : Provided that, in the case of a trustee who makes a gift of debentures or any deposit in his business or industry the trustee shall not be deemed to have borrowed from the trust for his own use.

1. (1) A public trust shall prepare and maintain a register of all moveable and immovable properties (not being property of a trifling value) of such trust in such form or forms giving all such information, as may be prescribed by the Charity Commissioner.
2. (2) Such register shall show the jewels, gold, silver, precious stones, vessels and utensils and all other moveable property belonging to the trust with their description, weight and estimated value.
3. (3) Such register shall be prepared within three months from the expiry of the accounting year after the commencement of the Bombay Public Trusts (Amendment) Act, 1970 (Mah. XX of 1971).
4. (4) Such register shall be signed by all the trustees or by any person duly authorised by trustees in this behalf after verifying its correctness, and shall be made available to the auditor for the purpose of auditing if the accounts are required to be audited under the provisions of this Act. Where the accounts are not required to be audited, the trustees shall file a copy of such register duly signed and verified, with the Deputy or Assistant Charity Commissioner of the region.
5. (5) The auditor shall mention in the audit report whether such register is properly maintained or not, and the defects or inaccuracies, if any, in the said register and the trustees shall comply with the suggestions made by the auditor and rectify the defects or inaccuracies mentioned in the audit report within a period of three months from the date on which the report is sent to the trustees.
6. (6) Every year within three months from the date of balancing the accounts, the trustee or any person authorised by him shall scrutinize such register, and shall bring it up-to-date by showing alterations, omissions or additions to the same, and such changes shall be reported to the Deputy or Assistant Charity Commissioner in the manner provided in section 22.]