Whenever there is talk of selling community property, there is an instant tsunami of protests. Many of those opposing the sale do it instinctively without viewing the merits of the proposal or the compulsions that led to the decision. The first reaction is to suspect the bona fides of the seller. The second is to assume money will change hands privately, under the table. A few offer a more reasoned approach as to why they believe the property should not be sold.
The proposed sale of agricultural land in Palghar belonging to the Iranian Zoroastrian Anjuman (IZA) is a case in point. No sooner did an advertisement appear in The Economic Times of November 24, 2022 announcing the sale, anonymous social media posts opposed the proposal. One party stipulated the land, ranging from 963 to 986 acres, "should be only for Parsis and not for sale to non Parsis." Another claimed the land was being sold "for sheer greed…by certain devious characters." None of the posts stated how the land, if kept, could be utilized by Parsis and, more importantly, safeguarded.
IZA trustee and honorary secretary Gaiv Irani, in response to the critics, sent a WhatsApp message to some IZA members stating, "This valuable land is on the verge of being acquired by government… Income from it is not much. (It’s) a white elephant… People are trying to encroach. (It’s) difficult and expensive to protect…The trust income has dwindled. (We are) unable to help needy people. (The) sale proceeds will help to take care of the needs of the community to a large extent."
A proposal to sell the lands a decade ago was scuttled when the then IZA president Mehrwan Irani reneged on his earlier approval to the proposal. At that time Viva Builders had made an offer of Rs 732 crores. This time, IZA has appointed the reputed real estate firm of Knight Frank to conduct the sale. The company produced a slick video stressing Palghar’s proximity to Bombay ("90 minutes") and claiming that Palghar, which is around 100 km away, would be Bombay’s "newest frontier…the destination of the future."
If the Palghar property hypothetically fetches Rs 1,000 crore (USD 123,179,300) although more is expected, it could generate an annual income of around Rs 60 crore plus (USD 7,393,215) or five crore rupees (USD 616,101) a month. A fixed deposit with a bank garners around six percent interest per annum.
Selling or leasing trust property is a long, arduous and expensive task. Unless all the legal procedures and safeguards are followed meticulously, alienating property is next to impossible. Gone are the days when a board of trustees could dispose of trust property without keeping the populace informed and involved.
Objectors may move the courts anytime during the process. Few trustees may have the will, the resources and the funds to go through all the requirements and hurdles. But saddled with dilapidated property, high maintenance costs, low rent paying tenants, an aging population, fewer earning members and empty coffers, they may have little choice but to liquidate any unutilized assets from which the trust can augment their corpus.
Nine years ago the managing committee of the Parsi Zoroastrian Anjuman, Mhow decided to sell five of their 15 properties (see "Three Mhow properties sold," pg 26). A "vision document" had been circulated. A year later the sale was endorsed by a majority of members at a general meeting of the trust. The vision document had outlined the existing income and expenditure and the purpose the sale proceeds would be put to. The trust then applied to the Registrar for charities for permission to sell. In 2017 the Registrar rejected the application. An appeal to a single judge as well as a division bench of the Madhya Pradesh High Court met the same fate. Finally a three-member bench of the Supreme Court (SC) of India in January this year granted the Mhow anjuman permission to sell.
But if all due processes are followed, the chances of success are high. In the Mhow matter, the SC ruled that the Charity Commissioner (CC) cannot refuse permission "unless in their opinion the alienation or transfer is prejudicial to the interests of the public trust."
The bench noted, "Any organization which is self-governed, cannot be subjected to overarching state control. As long as its decisions are well informed and grounded on relevant considerations, the interests of the trust are those defined by its members."
The interest from the seven-and-a-half crore rupees the Parsi Zoroastrian Anjumam, Mhow has earned from the sale of three properties should go a long way in easing the trust’s finances.
Thanks to those who have opposed the sale of trust property in the courts over the years, safeguards have been incorporated to try and make the system foolproof.
The decision to sell/lease the land adjacent to the Behramji Cowasji Batliwalla Agiary at Tardeo, though permitted by the CC in 2004, and upheld by the Bombay High Court, was struck down by the SC 13 years later (see "The lessons to be learnt," Editorial Viewpoint, Parsiana, January 21, 2018). "No public notice had been published in the newspaper inviting offers," observed the two-member bench. "It was not in the public interest or the benefit of the trust to act in such a clandestine manner," they added.
If sellers follow the stipulated procedures and requirements, there is every chance the sale will go through despite challenges and within a reasonable time frame. Otherwise, as so often happens, the sale/lease is stymied, the property neglected or encroached upon and the objects of the founders of the trust defeated.
That the community is in dire need of funds is undeniable. The Bombay Parsi Punchayet which manages around 4,200 flats in Bombay does not have the funds to subsidize the repairs. Timely payments to mobeds and parents of two and three children have not been made. Even salaries are delayed. The B. D. Petit Parsee General Hospital had a loss of Rs 14 crore (USD 1,722,960) last year. Their deficit was covered by the interest received from their investments but how long will that suffice? Inflation ranges from six to eight percent annually. Unless the donations received are substantial, the interest earned will not cover the deficit endlessly.
Over 30% of the community is over 60 years of age. The number of earning members is declining while the cost of looking after the elderly keeps mounting. Who will bear the cost of looking after the aged? The only obvious source of funding may be liquidating unused or underutilized assets.