@JUDGMENTTAG-ORDER
Goda Raghuram, J.@mdashThese three writ petitions pertain to the affairs of the Hitakarini Samaj, Rajahmundry and though raising different
aspects for consideration, could conveniently be disposed of together and having been heard, are being disposed of by this common judgment.
W.P.No.9964 of 1992:
Hitakarini Samaj, Rajahmundndry, represented by its Secretary filed this writ petition seeking the relief of ""a declaration that G.O.Ms.No.642,
Revenue (Endowments-IV) Dept., dated 14-7-1993, is illegal, null and void and for directing the respondents - the State of Andhra Pradesh, the
Commissioner of Endowments and the Executive Officer, Endowments Department, in-charge of Hitakarini Samaj, to implement
G.O.Ms.No.1133, dated 23-8-1990 and to handover all the institutions belonging to the petitioner Samaj"". This relief of challenging G.O. Ms.
No.642, dated 14-7-1993, was amended into the writ petition, by way of order dated 16-8-1994 in WPMP No.3819of 1994.
2. The facts relevant and necessary for considering the issues arising in this writ petition, are as follows in brief:
(a) The I litakrini Samaj, Rajahmiindry, was notified as a Charitable institution by a publication, dated 14-10-1968 issued under the provisions of
A.P.Act 17 of 1966 (for short ''1966 Act'') It was also registered as a Charitable Institution u/s 38 of the 1966 Act in a proceedings dated 4-5-
1972.
(b) On an application made by the private management, the State Government in G.O. Ms. No.SSl, dated 21-9-1976 accorded exemption under
Sections 15 and 27 of the 1966 Act, to the petitioner''s Institution for a period of 3 years enabling the continuance of the private management. On
the expiry of the term of exemption, the secretary of the samaj sought exemption for a further period of 3 years. On account of several complaints
having been received by the Government from the public against the conduct of the management qua the affairs of the samaj and its attached
educational institutions and on account of discovery of irregularities in the management of Institutions as were pointed in an Audit report, the
Endowment Department, recommended rejection of the application seeking further exemption. Consequent thereupon, the Commissioner of
Endowments issued orders u/s 27 of 1966 Act appointing an Executive Officer to the samaj.
(c) The private management there upon moved the State Government against the orders of the Commissioner above referred to, and obtained stay
of the orders appointing the Executive Officer. The Management also filed WP 4501/80 before this Court contending that the provisions of the
1966 Act are not applicable to the samaj since it is a minority institution falling outside the purview of the Act. Simultaneously they also filed an
O.A.12/80 before the Deputy Commissioner, Endowments, Kakinada, contending that the samaj is a private institution beyond the purview of the
1966 Act. The O.A. was dismissed by the Deputy Commissioner, Endowments, on 4-9-1981 and the WP No.450l of 1980 was withdrawn by
the petitioner on 2-11 -1981.
(d) Thereafter the private management moved the Government again for exemption from the provisions of the Act. The State Government by
G.O.Ms.Nol815, dated 10-12-1981 again issued orders exempting the Samaj from the purview of Sections 15 and 27 of the 1966 Act, for a
period of 3 years. After issue of the above orders, there was a public outcry alleging mismanagement by the private management and that the
purposes for which the institutions were brought into existence by the great social reformer late Sri Kandukuri Veeresalingam Pantulu Garu, are
being subverted by the private management. Representations were also made to the commissioner, Endowments and the Government in this
behalf. Consequent upon the allegations, the Assistant Commissioner, Endowments, was asked to enquire and submit a detailed report. In the
report, various irregularities were noticed in the management of the Samaj and its allied institutions. Instances of gross mismanagement,
misappropriation and wastage of the properties apart from violation of the Rules, were recorded in the report.
(e) Consequent upon the report, the Government issued show-cause notice to the Committee. Thereupon the Committee filed WP No.8676 of
1983 against the show-cause notice and the proposal for cancellation of exemption contained therein and obtained stay in the said writ petition.
The writ petition was, however, not pressed and was withdrawn on 4-5-1985 and the period of exemption granted had also expired by
November, 1984. The application of the private management for further exemption from 1984 was rejected and the Inspector, Endowments
Department, Rajahmundry, was appointed as the Executive Officer and he assumed charge as such on 15-4-1985. The suit filed by the
management committee was also dismissed on 30-4-1985.
(f) Thereupon the management filed W.P.Civil No.5388 of 1985 before the Supreme Court again contending that the Samaj is a minority institution
and that the provisions of the 1966 Act are not applicable. In the said writ petition a stay was obtained on 3-6-1985 against the appointment of the
Executive Officer. The said stay was, however, vacated subsequently since the executive Officer took charge of the samaj prior to the grant of the
orders of stay. During this period a number of representations were made from the people of the locality and also from public representatives
complaining of irregularities in the management by the private management, including non-payment of salaries to the staff of the educational
institutions under their management. These representations urged that it is not desirable to entrust the management to the private persons.
(g) While so under G.O.Rt.No.1133 Revenue (Endowments IV) Department, dated 23-8-1990, orders were issued, considering the
representations of the private management prosposing withdrawal of the appointment of Executive Officer and restoration of the management to
the private committee, on condition that the management committee withdraws the Civil W.P.5388/85 and the connected CMPs, pending before
the Supreme Court. The said order also averred that the Commissioner of Endowments may take further necessary action and send proposals for
exempting the institution for a specific period from the provisions of Sections 15 and 29 of the A.P.Act 38 of 1987 (A new Act which replaced
A.P.Act 17 of 1966).
(h) According to the petitioner, pursuant to the above orders of the Government they withdrew the Civil Writ Petition in the Supreme Court and
withdrawal was accorded by the Supreme Court by orders dated 25-3-1991. A consequent application was also made to the Department on 31-
7-1991 requesting orders restoring the management in terms of the proposal contained in G.O.Ms.No.1133, dated 23-8-90.
(i) The petitioner contended that contrary to the proposals in G.O.Ms.No.1133 the Commissioner of Endowments issued proceedings calling upon
the private management to repay an amount of Rs.3,40,000/- due from the committee to Annavaram Devasthanam as a condition precedent to
processing the proposal for grant of exemption u/s 29 of the 1987 Act and for withdrawing the Executive Officer. It is contended that such a
condition, not contained in G.O. Ms.No.1133, is arbitrary and illegal.
(j) However, in G.O.Ms.No.642, Revenue (Endowments-IV) Department, dated 14-7-1993, orders were issued by the Government cancelling
the earlier orders issued in G.O.Ms.No.1133, dated 23-8-1990, rejecting the proposal for handing over the management to the private committee
and thus declined to grant orders of exemption from the provisions of the 1987 Act. Assailing the said G.O. the present writ petition is filed.
3. The principal contention in the writ petition is that G.O.Ms No.642, Revenue (Endowments IV) Department, dated 14-7-9193 is invalid as it is
barred by principles of promissory estoppel and violation of principles of natural justice. Integral to the said contention it is contended that as C.G-
Ms-No. 1133 proposed grant of exemption, the cancellation can only be done after giving an opportunity and that since a promise of exemption
was made in G.O.Ms.No.1133, dated 23-8-1990, based on which the petitioner withdrew the writ petition in the Supreme Court, the
Government is bound by principles of promissory estoppel from resiling from the promise contained therein and the issuance of the impugned G.O
is thus invalid and non est.
4. The factual narrative above as established from the pleadings clearly discloses grave allegations and a sordid record of mismanagement and
irregularities by the private management committee in the conduct of affairs of a public charitable institution. That it is a public charitable institution
falling within the purview of the Endowment Act is clear from the various proceedings already narrated. The dismissal of O.A.No.12/80 on 4-9-
1981 by the Deputy Commissioner of Endowments, Kakinada; the withdrawal of W.P.No.4501/81 by the orders dated 2-11-1981, the various
applications of the writ petitioner for exemption from the provisions of the Endowments Act, which were granted by the Government, would all
conclusively establish that the petitioner himself concedes the applicability of the provisions of the Endowment Act to the institutions in question and
recognises the status of the institution as a public charitable institution falling within the provisions of the Endowments Act. Orders passed by the
quasi-judicial officers under the Act and the withdrawal of various writ petitions filed by the petitioner, would disentitle the petitioner to agitate the
question of non-applicability of the provisions of the Endowments Act to the petitioner-institutions. Be that as it may, the contents of
G.O.Ms.No.M33, dated 23-8-1990, are merely in the nature of proposals calling upon the Commissioner of Endowments to send proposals for
grant of exemption. The Commissioner of Endowments, who is a statutory functionary operating under the Legislative Dicta of the provisions of the
Act is ordained to exercise his powers in accordance with the text and structure of the Act in order to advance the purposes of the Legislation, in
particular such of those provisions which are meant to preserve, protect and regulate the properties and management of a public charitable
institution. No promise of the Government could subvert this Legislative position nor disable the Commissioner of Endowments nor even the
Government itself from performing its Legitimate role in obediance to the commends of the Legislation. The gross mismanagement of the affairs of
the institution by the private management is amply recorded and to grant exemption from the provisions of the Act and restore the management of
the public charitable institutions into such hands would be a gross subversion of public policy and of public interest. The principles of promissory
estoppel do not ensure in such situations. This position is well settled and it is not necessary to reiterate the vast catena of authorities on this aspect.
Sufficient to state that the recent decision of the Supreme Court in State of Rajasthan and Another Vs. M/s Mahaveer Oil Industries and Others, ,
reaffirms this settled principle circumscribing the application of the doctrine of promissory estoppel.
5. Supervening and preponderating public interest ordains that no exemption be granted to the private management from the operation of the
provisions of the Endowments Act. The doctrine of promissory estoppel cannot thus be validly invoked.
6. The other contention regarding the violation of principles of natural justice would also not avail the petitioner in obtaining the relief. It is equally a
settled principle of law that an executive order will not be invalidated where it would result in he activation of an order which would be reductive of
public mischief, in particular in exercise of discretionary jurisdiction under Article 226 of the Constitution of India - vide Godde Venkateswara Rao
Vs. Government of Andhra Pradesh and Others, . In our view the provisions of G.O. Ms. No.1133, dated 23-8-1990 are only in the nature of
proposals which do not confer any vested right to exemption in favour of the petitioner. An exemption can only be granted by exercising a
discretion in accordance with the law and within the parameters of the text and legislative philosophy of the Endowments Act, which clearly, as we
have noticed above, do not warrant issuance of any such exemption, in public interest.
7. For the reasons stated above there are no merits in the writ petition, which fails and is accordingly dismissed, but in the circumstances of the
case without costs.
W. P. No. 10009 of 1992
The Hitakarini Samaj, Rajahmundry, represented by one Sri R. Subba Rao, styling himself as its Secretary, has filed this writ petition. The
petitioner contends a) Among the properties of the Samaj land measuring Ac.2.99 cts., in Sy.No.411 was mixed up in Rajahmundry town.
(b) Respondents 1 to 3 who are the State of Andhra Pradesh, the Commissioner of Endowments and the Executive Officer appointed to took
after the affairs of the samaj, intended to sell the said property and in pursuance of the said objective paper publication was issued inviting tenders
for the purchase of the said land. The objections of some of the members of the samaj were ignored and the property was ultimately sold to the 4th
respondent and others as per sale deed No.2646/92, dated 18-3-1992.
(c) The said transfer by way of sale is illegal, without jurisdiction and opposed to the provisions of the Endowments Act.
(d) The property worth more than Rs.25 lakhs was sold for a very low sum and that the sale was a result of collusion an for gaining illegal benefit,
(e) The prescribed procedure was not followed.
8. Founded on the above allegations, the petitioner sought a declaration that the transfer of land measuring Ac.2.99 cts., in Sy.No.411 in
Rajahmundry town by sale deed No.2646/92, dated 18-3-1992, executed by the 3rd respondent in favour of the 4th respondent and others is
illegal and for a consequential order directing the respondents to resume the said property and hand it over to the petitioner.
9. Counter affidavits have been filed by the official respondents, one on behalf of respondents 1 and 2 and another on behalf of 3rd respondent.
Taken together the averments in the above said affidavits are to the effect--
(a) that the writ petition is not maintainable as on the date of its nstitution it is governed by the Hindu Religious and Charitable Endowments Act
and under the management of an Executive Officer appointed under the provisions of the said Act, who alone is authorised to institute proceedings
on behalf of the institution.
(b) that the private management in the year 1968 has leased out an extent of 2029 sq.yds, comprised in the land in question to an individual for a
period often years on an monthly rent of Rs.100/- to continue in tenancy for two further terms often years each on a monthly rent of Rs.150/- and
Rs.200/- respectively, that the said lease agreement entitles the tenant to erect structures, plant and machinery in the said land and also provide an
exclusive option to the lessee to purchase the premises on the same terms and at the same price as any bona fide offer for the premises received by
the samaj, is acceptable to the lessee.
(c) that the tenant sold away the equipment in the site to one Sri M.Veera Raghava Reddy by an agreement dated 9-4-1976 and that the private
management committee also agreed to assign the lease hold rights to Sri M.V. Raghava Reddy, Managing Partner of Sri Raghu Industries, who is
paying the current monthly rent of Rs.200/- and that the lease is due to expire on 30-9-1998.
(d) that the private committee under another agreement leased out another 500 Sq.Ys, to the eastern side of Sri Raghu Industries, to one Sri
K.Veerabhadra Rao, for a period of 5 years on a monthly rent of Rs.150/- and that the said lessee subleased the said extent of land to Sri Raghu
Industries. It is also stated that on measurement the extent of land, however, was found to be not 500 sq.yds, but 942 sq.yds.
(e) that the Managing Partner of Sri Raghu Industries by his letter dated 23-11-1989 requested the Samaj to sell away the site under his lease hold
rights at the rate of Rs.250/- per Sq.Yd., that latter he also gave consent to purchase the site of 942 Sq.Yds. at the rate of Rs.400/- per Sq.Yd.
(f) that the basic value of the site is Rs.233/- per Sq.Yd.,
(g) that the State Government in G.O. Rt. No. 1110 Rev.(Endts.IV) Department, dated 20-8-1990, accorded permission for sale of the land
admeasuring 3,164 Sq.Yds., in favour of M/s Raghu Industries, Rajahmundry, the sitting tenant at the rate of Rs.400/-per Sq.Yd., otherwise than
by public auction and that the Commissioner of Endowments, in accordance with the procedure laid down u/s 80 of the Endowments Act (Act
38/87) issued a notice dated 15-11-90 calling for objections and suggestions in respect of the said proposal and further that the Secretary of the
erstwhile committee requested the Commissioner, Endowments, to differ the matter for the present to enable availability of a better price for the
institution.
(h) that the Commissioner of Endowments, directed that the issue will be placed before a committee of 3 officials nominated by the Government in
G.O. Rt. No. 1062 Revenue (Endowments.IV) Department, dated 18-7-1991, consisting of the Joint Collector, E.G.District, Deputy
Commissioner, Endowments Department, Kakinada and District Women Welfare Officer (Women & Child Welfare Department), E.G. District.
(i) that the matter was considered by the Official Committee on 7-12-1991 and a resolution was passed to the effect that the sale value of Rs.
12,65,600/- should be realised in lump sum in addition to the interest thereof collected from the date of issuance of the G.O., that the said proposal
of the Committee is stated to have been approved by the Commissioner, Endowments on 29-2-1992.
(j) that accordingly an amount of Rs.12,65,600/- was collected towards the sale proceeds in addition to an amount of Rs.1,75,200/- towards the
stipulated interest and the property was registered in favour of M/s. Raghu Industries, on 18-2-1992. It is further stated that the aforesaid amount
was deposited in the shape of FDR in the name of the Samaj in Andhra Bank, Danavaipet Branch, Rajahmundry.
10. In the counter-affidavits it is further averred that the writ petitioner cannot be heard to contend that the sale is arbitrary, particularly when it is
the private committee''s decision which has brought about this imbroglio. The terms of the lease including the right accrued in the tenant by the said
terms to purchase the property have necessitated the action ofthe official respondents in disposing of the property at far above the market value
together with the benefit of calculating interest. It is also averred that as against an annual rent of Rs.4200/- which was being realised from the
tenant, on account of the sale an amount of Rs. 14,40,800/-was realised which on deposit in the Bank fetches an annual interest of Rs.1,30,980/-
and that in the circumstances the sale is bona fide, made in the demonstrable interest of the institution, in accordance with the procedure ordained
by the Endowment Act and as the best possible alternative in the circumstances narrated above. It is also contended that the writ petition, apart
from being not maintainable for the reasons already stated, has been instituted with a mala fide intention of subverting the interest of die charitable
institution.
11. The 4th respondent-Purchaser, in his counter-affidavit reiterates the contentions in the counter-affidavit of repondents 1 to 3 and contends that
he purchased the property pursuant to a detailed scrutiny and determination of the value by the Committee constituted by the Government for the
said purpose and at a price far above the market value prevailing on the date of the transaction. He also contends that apart from the sale
consideration, he paid an amount of Rs.1,75,200/- towards interest from the date of the Government''s permission to sell the property, viz., dated
20-8-1990, despite the fact the property was registered only on 18-3-1992. In summation the 4th respondent contends that the sale is bona fide in
accordance with the provisions of the Act and is not liable to be invalidated by this Court.
12. Sri M.S.K.Sastry, learned senior Counsel for the writ petitioner places reliance on decision of the Supreme Court in Chenchu Rami Reddy and
Another Vs. Government of Andhra Pradesh and Others, , and a judgment of the Division Bench of this Court dated 4-10-1996 in W. A.No. 1 of
1996, for contending that the action of the official respondents in disposing of the endowment''s property otherwise than by public auction has been
deprecated and that the property ought to have been sold only by way of public auction and having been sold otherwise than by the said method,
the sale is invalid.
13. The principle is well settled that public property intended to be sold for the purpose of generating revenue ought normally to be sold by public
auction so as to avoid the evils of mal-administration and to achieve the best possible price involved in the competative bidding, which can only be
achieved by sale in public auction.
14. The facts of the case on hand, in our view, warrant a departure from the said principle. On account of the lease granted by the private
management of the Samaj (under the a seigs of the writ petitioner himself) the tenant has been in possession of the property on payment of very
meagre rent, Rs.4200/- p.a., as on the date of the sale proposals. Under the terms of the lease he was also entitled to exercise the first option to
purchase the property if proposed to be sold by the lessor. There were an established industry and structures on the land in question which were in
possession of the lessee for over 30 years. Large number of workmen were employed in the said industry. A conspectus of this fact situation
rendered the process of evicting the lessee and obtaining clear possession of the property by the institution, remote, tartuous and time consuming.
The charitable institution thus had either to continue with the tenancy at a nominal rent or to dispose of the property for getting reasonable good
return which if invested would fetch a far better annual return. In these circumstances, the State Government and the Commissioner of
Endowments decided to dispose of the property to the sitting tenant otherwise than by public auction. The price for the sale was arrived at on a
procedurally rational method by constituting a Committee for the said purpose. The Committee determined the price at Rs.400/- per sq.yd., which
was above the basic value of the land during the period as stated in the counter-affidavit. The Government could also manage to persuade the 4th
respondent to pay interest from the date the Government permitted the sale of the property till the actual date of the sale. An amount of Rs.
12,65,600/- plus an amount of Rs.1,75,200/- coming to a total amount of Rs. 14,40,800/- was obtained which, when invested in the Bank,
fetches an annual interest of Rs. 1,30,980/- as against the annual rent of Rs.4,200/- being paid by the lessee.
15. In the totality of the circumstances of the case, we are satisfied that the sale impugned in the writ petition, by the respondents 1 to 3 in favour of
the 4th respondent does not suffer from any infirmity warranting invalidation in exercise of discretionary jurisdiction under Article 226 of the
Constitution. Apart from the above we are clearly of the view that the writ petition instituted in the name of Hitakarini Samaj by one Sri
R.Subbarao, styling himself as the Secretary is certainly not maintainable. The admitted and demonstrated fact is that as on the date of the
institution of the said suit and even thereafter the Hitakarini Samaj, a public charitable institution, governed by the provisions of the Endowments
Act is under the management of an Executive Officer, appointed under the provisions of the said Act, who alone is authorised to institute
proceedings in the name of the public charitable institution. We are also clearly of the view having regard to the totality of the pleadings in this writ
petition and on a conspectus of the other two writ petitions disposed of by this judgment, that the motive of Sri R. Subbarao in instituting the
present proceedings are not bona fide to say the least. Sri Subbarao is actuated by a selfish motive of obtaining control of the management of the
properties of the public charitable institution and to deal with the same according to his personal whims. There is no public interest underlying the
initiation of the present writ petition.
16. In the circumstances stated above, there are no merits in the writ petition and it is accordingly rejected and for the reasons referred to with
costs quantified at Rs.5,000/- to be paid by Sri R. Subbarao to the Andhra Pradesh State Legal Services Authority, Hyderabad, within a period of
three months.
WP No. 11660 of 1992:
A journalist of Rajahmundry has filed this writ petition assailing the validity of G.O. Rt. No. 1133 Revenue (Endowments-IV) Department, dated
23-8-1990. The petitioner avers that he is a permanent resident of Rajahmundry, follower of teachings of late Sri Kandukuri Veeresalingam
Pantulu Garu, deeply associated with social, educational and cultural activities and Editor of a Telugu daily published from the town and that his
forefathers were closely associated with the social reformer who brought into existence and endowed his vast personal properties in favour of the
Trust known as Rajahmundry Hitakarini Samaj.
17. In the writ petition he has chronicled the aims and objects for the achievement of which the Samaj was founded and the manner in which the
private Management has over the years subverted the objectives for which the Trust was founded. Details of various litigations initiated by the
private management to subvert the attempts of the Endowments Department to manage the properties in accordance with the provisions of 1966
and 1987 Acts, have also been set out. Specific details have been pleaded to show that the properties of the Samaj were mismanaged, wasted and
mis-utilised by the private management. The petitioner also pleaded that the Samaj cannot, in terms of the trust deed and the objectives of the
endowment, be termed as either a minority institution or a private trust falling outside the purview and reach of the Endowments Act. This writ
petition has been filed aggrieved by the proposals of the Government in the impugned G.O. In the contention of the writ petitioner the impugned
proposals for handing over the institution to the private management by exempting the Samaj from the provisions of the Endowment Act, would be
in violation and subversion of the provisions of the Act, public policy and public interest and would also run contrary to the objectives of the late
Social reformer, which animated the founding of this institution. The petitioner also pleaded that the plea of the private management seeking
exemption is founded on bad faith and motives of personal aggrandizement and in the circumstances no exemption could be granted as proposed in
the impugned G.O.
18. In view of the fact that the proposals contained in G.O.Rt.No.1 133, Revenue (Endowments.IV) Department., dated 23-8-1990, have been
superseeded by G.O.Ms.No.642, Revenue (Endowments.IV), dated 14-7-93 and for the further reason that the later orders of the Government
dated 14-7-1993 have been upheld by us in WP No.9964 of 1992, the case urged in this writ petition does not survive for consideration. The 4th
respondent in this writ petition has filed a counter-affidavit questioning the locus standi of the writ petitioner to maintain this writ petition. Since, in
our view, as stated above, the writ petition has become infructuous, a pronouncement on the locus standi of the writ petitioner is not called for.
19. The writ petition is accordingly dismissed as infructuous. No order as to costs.