Chennai: The National Company Law Tribunal has removed all the directors and office bearers managing the country’s largest protestant group – The Church of South India -and installed retired judge K Sampath in an interim order dismantling the power structure in a church administration ridden with alleged charges of misappropriation.
The church is already working to contest the order. Further proceedings in the case begin early next month. The Church of South India Trust Association, a Chennai-headquartered charity organisation registered as a Section 25 company, runs schools, hospitals and earns predominantly through rental income from lands left behind by Anglican philanthropists. It has been facing charges of alleged fraud and misappropriation of funds for about a decade now. The trust, garnering total revenue of nearly Rs 1,300 crore every year, runs 23 dioceses across 16,000 villages and claims a membership of well over 4 million people.
The Ministry of Corporate Affairs had in October engaged the Serious Fraud Investigation Office to probe into alleged balance-sheet irregularities.
Economic Times had first reported about the SFIO beginning its probe in July 2016. Even as the investigation picked up pace, a company petition was filed by church member John S Durai, seeking to remove all the directors of the trust. The petition claimed their election by the church governing council, the Synod, had made rule violations. A counter was filed by church member John S Durai, seeking to remove all the directors of the trust. The petition claimed their election by the church governing council, the Synod, had made rule violations. A counter was filed by the church challenging the grounds made in the company application some time back.
In a revised order two days back accessed by ET, Mohd Sharief Tariq, Member-Judicial at the corporate court, said: “Since the company petition is held maintainable in the given circumstances, there is an urgent need to regulate the affairs of the R1 company (Church of South India Trust Association). Thus I proceed to remove all the directors and managing committee including office bearers…”
The court has appointed retired Madras High Court judge K Sampath as chairman, who will recommend to the court on directors and office bearers.
“The erstwhile management committee is directed to hand over all the documents and books of accounts and other records of the R1 company to the Registry of this bench is a sealed cover within a week from the date of pronouncement of this order…” read the order.
The court said the other administrative members recommended by the chairman should “neither be chosen from the group of petitioner nor from the respondents.”
Rev Dyvasirvadham, the moderator of the Synod, which is the administrative body of the church, said the structure of a 70-year-old institution has been disrupted unilaterally. He said the church had been serving in thousands of rural parishes, making accounting a serious difficulty in the absence of a solid reporting mechanism.He told Economic Times: “We respect the law of the land. But we are a democratically elected body. We will contest this order.”
A similar litigation has reached the Madras HC. Church members from the Coimbatore diocese have obtained a stay on council elections on grounds that a poll slated mid-November should not be conducted when the serious fraud office is probing a financial scam.The final verdict on the case is expected soon.