Religious & Charitable Endowments LawSupreme Court of India
Operation Asha v. Shelly Batra
The Supreme Court dismissed the appeal, holding that the suit could go ahead. It undertook a detailed examination of when a society (as opposed to a religious/charitable trust in the traditional sense) can be treated as holding its assets "in trust" for Section 92 purposes, concluding that a society is not automatically an "express trust" merely by being registered under the Societies Registration Act, 1860, but that a "constructive trust" can arise by operation of law where a fiduciary, such as an office-bearer entrusted with the society's donations and funds, is alleged to have misappropriated or diverted that property for personal benefit. The Court found that the allegations here (of large-scale siphoning of donations into shell entities, misuse of funds, and financial impropriety by the accused office-bearers) were serious enough to prima facie satisfy the conditions needed to invoke Section 92, and that Dr. Batra and her mother, as long-time members with a genuine stake in the society's affairs, qualified as "persons having an interest in the trust" entitled to bring such a suit. However, the Court clarified that purely personal or internal grievances, such as the dispute over Dr. Batra's own removal from the Board: do not themselves belong in a Section 92 suit and must be pursued separately; only the allegations concerning misuse of the society's charitable funds and property fall within its scope. The underlying suit was directed to proceed before the High Court, which must now examine on the merits whether a constructive trust over the diverted funds actually exists.