Sree Padmanabha Swamy Temple: Supreme Court Orders Special Audit for Financial Transparency

The case of Sri Marthanda Varma (D) Th. LRs & Ors. v. State of Kerala & Ors. revolves around the financial management and auditing of the Sree Padmanabha Swamy Temple, one of India’s richest temples. The Supreme Court examined whether the temple’s financial crisis, worsened by the COVID-19 pandemic, warranted state intervention and a special audit of its financial transactions, including those of the Sree Padmanabha Swamy Temple Trust (SPSTT).

Background of the Case

The dispute stems from a long-standing litigation regarding the administration and financial management of the temple, previously controlled by the erstwhile Travancore royal family. In its July 2020 judgment, the Supreme Court upheld the rights of the Travancore royal family to manage the temple but directed financial audits to ensure transparency.

During the implementation of these directions, two committees—the Administrative Committee and the Advisory Committee—submitted reports highlighting a severe financial crisis faced by the temple due to the COVID-19 lockdown, which halted the flow of donations from devotees. The committees requested government assistance and an extension for complying with the Supreme Court’s earlier directions.

Key Issues Before the Supreme Court

Whether the financial crisis justified state intervention in temple management.
Whether a special audit for the last 25 years should include the Sree Padmanabha Swamy Temple Trust (SPSTT).
Whether the SPSTT is a separate legal entity from the temple and exempt from administrative control.

Arguments by the Petitioners (Travancore Royal Family)

The petitioners contended that:

The Sree Padmanabha Swamy Temple Trust was established in 1965 as an independent trust by the erstwhile Maharaja of Travancore for religious offerings and rituals.
The trust’s funds were meant exclusively for temple rituals and had no legal obligation to support the temple’s day-to-day expenses.
Any attempt to audit the trust was beyond the scope of the Supreme Court’s earlier judgment.
Temple finances had already been audited in compliance with court orders, and another special audit was unnecessary.

Arguments by the Respondents (State of Kerala)

The respondents argued that:

The temple was facing an unprecedented financial crisis, making external financial assistance necessary.
The trust’s finances were historically linked to temple operations, and its funds should be used to support temple management.
The Supreme Court’s 2020 judgment clearly required an audit of both the temple and all associated trusts.
The trust was not a separate legal entity but an extension of temple administration.

Supreme Court’s Analysis

The Supreme Court, comprising Justices Uday Umesh Lalit, S. Ravindra Bhat, and Bela M. Trivedi, examined the financial crisis and the nature of the temple trust.

Key Findings

Temple Facing Severe Financial Crisis: The pandemic led to a steep decline in temple income, making it difficult to cover operational expenses.
Special Audit Warranted: The Court upheld its previous directive that a 25-year audit be conducted by a reputed firm of chartered accountants.
SPSTT Must Cooperate with the Audit: Despite its claims of independence, the Court held that the trust had a historical financial connection with the temple, requiring its accounts to be audited.
Audit to Be Completed in Three Months: Given the urgency of the financial situation, the Court directed that the special audit be conducted and completed within three months.

Key Observations by the Supreme Court

“The audit contemplated by direction 116(g) was not intended to be confined to the Temple but was also with respect to SPSTT.”

“SPSTT was created by the erstwhile Maharaja of Travancore to ensure that offerings and rituals in the temple continued, but this does not exempt it from financial scrutiny.”

Final Judgment

The Supreme Court ruled:

The special audit for the last 25 years must be completed within three months.
SPSTT must cooperate with the audit, as its funds were historically linked to the temple.
The Administrative and Advisory Committees must take immediate steps to ensure financial stability.
The Kerala government must assist in securing financial relief for the temple.

Implications of the Judgment

The ruling has several important implications:

Greater Financial Transparency: The decision ensures that temple funds and trust accounts are audited to prevent mismanagement.
Trusts Cannot Evade Scrutiny: Even if created as independent entities, trusts managing temple finances must comply with legal audits.
State Support for Religious Institutions: The judgment highlights the role of state governments in assisting religious institutions during financial crises.

Conclusion

The Supreme Court’s ruling in Sri Marthanda Varma v. State of Kerala underscores the importance of financial transparency in temple administration. By ordering a comprehensive audit and ensuring accountability, the judgment protects the interests of devotees while preserving the sanctity of temple finances. This decision sets a crucial precedent for the financial oversight of religious institutions across India.

Petitioner Name: Sri Marthanda Varma (D) Th. LRs & Ors..
Respondent Name: State of Kerala & Ors..
Judgment By: Justice Uday Umesh Lalit, Justice S. Ravindra Bhat, Justice Bela M. Trivedi.
Place Of Incident: Kerala.
Judgment Date: 22-09-2021.

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