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Ganesh Ramchandra Jadhav v. Govardhan Sanstha (Regd) Wai Pune & Ors.

Civil Appeal · 2021 INSC 339Decided 19 Jul 2021
Civil Appeal No. 2748 of 2021
Dr. Justice D.Y. Chandrachud · Justice M.R. Shah

Background

A registered charitable trust in Satara, Maharashtra invited bids to sell a parcel of land. Over several years of litigation and repeated bidding rounds, a rival bidder's offer rose from Rs. 50 lakh to Rs. 80 lakh, while the appellant, who entered later with a higher offer, failed to meet a High Court deadline to deposit Rs. 75 lakh (though he later deposited Rs. 1 crore on the Supreme Court's direction). The High Court approved the sale to the rival bidder at Rs. 80 lakh and refused the appellant further time.

Decision Breakdown

The Supreme Court emphasised that trustees and courts must jealously protect charitable trust property and ensure it is sold at a transparent, maximum market price, not through a process that leaves value on the table. Noting that the appellant had since deposited Rs. 1 crore, more than the rival's Rs. 80 lakh offer, and that the rival's offer had crept up only in small increments, the Court held that accepting Rs. 80 lakh would deprive the trust of its property's true value. It set aside the High Court's order, directed a fresh valuation with a floor price of at least Rs. 1 crore, a fresh public auction open to both bidders, and restoration of the matter to the High Court for final disposal based on the auction outcome.

Lesson Learnt

When charitable or trust property is being sold, courts prioritise realising the maximum fair value through a transparent public process over simply penalizing a bidder's earlier default.

Official source (sci.gov.in)View Judgment (PDF)

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