JUDGMENT : Sunil B. Shukre, J. Heard Shri Naik, learned counsel for the petitioner and Smt. Jachak, learned A.G.P. for the respondents. 2. This petition contains two-fold challenges, one questioning vires of Section 58(1) of the Maharashtra Public Trust Act, 1950 (for short, the "Act") on the ground of it being unconstitutional and the second challenge relates to the validity of order dated 31.03.2000 passed by Joint Secretary, Law and Judiciary Department, Mantralaya, Mumbai in exercise of powers under Section 58(1) and (4) of the Maharashtra Public Trust Act, 1950. 3. The first challenge, as submitted by learned counsel for the petitioner, is not pressed by him and so we need not deal with it now. The learned counsel for the petitioner has focused his argument only upon second challenge. According to him, the impugned order dated 31.03.2000 suffers from vices of non-application of mind and arbitrariness. He submits that Section 58(1) of the Trust Act confers power upon the State to fix the rate or rates not exceeding 5% of Gross Annual Income or Gross Annual receipt as the case may be, on contribution from every public trust and fixation of such rate is to be made by taking into consideration three factors as prescribed in sub-section (4) of Section 58 of the Act. He submits that these factors have not been in any manner considered while fixing the 2% rate of contribution of the trust to the Public Trusts Administration Fund (PTAF for short). 4. Learned A.G.P. submits that while it may be true that impugned order lacks in some of the details, but it can never be said that impugned order is arbitrary and reflects non-application of mind on the part of Authorities. She further submits that it is not necessary that all the reasons must be stated in an order issued in exercise of power under section 58(1) of the Trust Act. 5. The impugned order has been issued in exercise of power under section 58(1) and (4) of the Act. It determines the contribution to be made by the Trusts to the PTAF to be at the rate of 2% of Gross Annual Income or Gross Annual Collection or receipt as the case may be, by public trust or Dharmaday Trust. The impugned order does not give any reasons nor it had referred any factors relevant for fixing the contribution rate at 2%. The impugned order does not give any reasons nor it had referred any factors relevant for fixing the contribution rate at 2%. Sub-section (1) of Section 58 of Act gives discretion to the State Government to determine the rate at such percentage not exceeding 5% of the gross annual income or gross annual collection or receipt as the case may be of public trust or Dharmaday Trust. This power is discretionary and confined to fixation of percentage of annual contribution to be made. The discretion so conferred upon State Government is not uncanalised. It is governed by the limits circumscribed in sub-section (4) and therefore, it would be of benefit to us if we consider provisions made in sub-section (4). For the sake of connivance, sub-section (4) of Section 58 of the Act is reproduced thus :- (4) In determining the rate or rates of contribution to be notified under sub-section (1), the State Government shall take into consideration the balance available in the Public Trust Administration Fund and the estimated income and expenditure (including any capital expenditure) of the Charity Orgainsation and ensure that the levy has reasonable corelation with the services rendered or to be rendered or any expenditure incurred or to be incurred for carrying out the purposes of this Act. For this purpose, the rates of contribution may be increased or decreased, or reductions or remissions may be granted, from time to time, prospectively or retrospectively, by the State Government, by an order or orders made as provided in this section and published in the Official Gazette. 6. It would be clear that primarily three factors are required to be considered by the State Government or authorized officer while determining the percentage of rate of contribution to be made in terms of Section 58(1) of the Trust Act. These three factors are as below :- (i) Balance available in the Public Trust Administration Fund. (ii) The estimated income and expenditure (including any capital expenditure) of the charitable organization. (iii) Rate being fixed has reasonable co-relation with the service rendered or to be rendered or any expenditure incurred or to be incurred for carrying out purposes of the Trust Act. 7. In the case of State of Maharashtra and others Vs. (ii) The estimated income and expenditure (including any capital expenditure) of the charitable organization. (iii) Rate being fixed has reasonable co-relation with the service rendered or to be rendered or any expenditure incurred or to be incurred for carrying out purposes of the Trust Act. 7. In the case of State of Maharashtra and others Vs. The Salvation Army, Western India Territory, (1975) AIR SC 846, the Hon'ble Apex Court had an occasion to consider the importance of afore-stated factors prescribed in sub-section (4) of Section 58 of the Trust Act. The Hon'ble Apex Court held that the contribution to be levied under Section 58 of the Act, as a matter of principle, must have a co-relation to the services rendered or to be rendered and that the Charity Organization must balance its budget so that the contribution levied does not become disproportionate to the balance available with the Charity Organization and turns itself into a tax instead of levy of fees. The Hon'ble Apex Court has also observed that if such co-relation between the contribution levied and the balance available does not exist in any year, at least for that year, the levy of contribution would assume the character of tax. The Hon'ble Apex Court has added that the organizations can not be permitted to augment its income year after year in this fashion. In that case, such levy would become impermissible, it being made without authority of law. The relevant observations of the Hon'ble Apex Court, as made in paragraphs nos. 24 and 28 of the judgment, are reproduced thus :- 24. The surplus in the account of the Public Trusts Administration Fund at the end of March, 1970, was Rs. 84,49,473/- after meeting the capital expenditure of Rs. 17,46,794/- incurred during the years 1953 to 1970. In the figure of Rs. 84,49,473/- is included the figure of Rs. 7,06,016/-, the accumulated balances under the repealed enactments transferred to the Public Trusts Administration Fund, plus interest of Rs. 7,13,004/- on the said figure vide exhibit No. 3. Even deducting the Rs. 14 lakhs from Rs. 84 lakhs, the surplus in the account of the Public Trusts Administration Fund at the end of March, 1970, was Rs.70 lakhs. Allowing the capital expenditure of Rs. 30 lakhs on the building said to have been purchased by the Charity, Organisation, the surplus was Rs. 40 lakhs. Even deducting the Rs. 14 lakhs from Rs. 84 lakhs, the surplus in the account of the Public Trusts Administration Fund at the end of March, 1970, was Rs.70 lakhs. Allowing the capital expenditure of Rs. 30 lakhs on the building said to have been purchased by the Charity, Organisation, the surplus was Rs. 40 lakhs. As we said, as a matter of principle, expenses for service should be correlated to the contribution levied under Section 58 of the Act. And the capital expenses should be met from the surplus funds including the sum of Rs. 14 lakhs (receipt under Sec. 61 plus interest thereon: Total: Rs. 14 lakhs). The surplus at the end of March, 1970 being Rs. 40 lakhs or, to be more accurate, Rs. 54 lakhs, the rate of fee at 2 per cent cannot continue, in any event after March, 1970 without taking into account the corpus of Rs. 54 lakhs and the income therefrom. We think that the contribution at the rate of 2 per cent on the gross income of the trusts after March 31, 1970 onwards undoubtedly assumed the character of a tax as that merely augmented the income of the Charity Organisation. If the Organisation is allowed to go on increasing its surplus year after year out of the amount of fee collected under S. 58 of the Act, it would demonstrate that the fee levied was unjustifiably disproportionate to the service rendered. We are, therefore, of the opinion that before levying any fee or determining its rate after March, 1970, the Charity Organisation has to balance its budget in the light of this judgment. 28. We, therefore, hold that the respondent is liable to pay contributions in respect of the three sums and that the Division Bench went wrong in quashing the orders passed by appellants 3 and 4 upholding the levy of contribution on these sums. We also hold that after 31st March, 1970, the levy at the rate of 2 per cent of the gross income of the trust cannot be justified as a fee. This does not mean that no levy of contribution was permissible thereafter. We only say that any levy thereafter should have correlation with the services, taking into consideration the existence of the surplus fund which was not immediately required for further expenditure by way of services including capital expenditure. This does not mean that no levy of contribution was permissible thereafter. We only say that any levy thereafter should have correlation with the services, taking into consideration the existence of the surplus fund which was not immediately required for further expenditure by way of services including capital expenditure. We declare that levy of contribution at the rate of 2 per cent of the annual gross income of the trusts became levy of tax after 31st March, 1970 and was without the authority of law. Since there was a prayer in the writ petition to declare Rule 32 as ultra vires, we think that the respondent is entitled to this relief. 8. The observations made by the Hon'ble Apex Court and the discussion we have just now made would only highlight importance of application of mind by the Authorities to the factors prescribed in sub-section (4) of Section 58 of the Trust Act while fixing the rate of contribution in terms of sub-section (1) of Section 58 of the Trust Act. The discretion conferred upon Authority, we would at the cost of repetition say, is not unrestricted, rather it is governed by well defined parameters stated in sub-section (4) of Section 58 of the Trust Act. The manner in which discretion is to be exercised, and limits within which it must be exercised are all statutorily prescribed. It therefore, becomes incumbent upon the Authorities to exercise the discretion in that manner and within those limits only. We are also bolstered up in such view by the law laid down by the Hon'ble Apex Court in the aforesaid case of Salvation Army (supra). 9. Going back to the impugned order, we find, it does not refer to any of the parameters prescribed in sub-section (4) of Section 58 of the Trust Act and therefore, the impugned order cannot be said to be an order passed by following well settled principles of law. There is also no other material placed before us to satisfy ourselves that the impugned order is passed by following the principles of law. It is well settled law that it is not mandatory for the Authority exercising its discretion to give any detailed reasons, while exercising discretionary power in administrative matters, one way or the other, and it is enough if the authority says or indicates that it has considered the relevant material existing on record. It is well settled law that it is not mandatory for the Authority exercising its discretion to give any detailed reasons, while exercising discretionary power in administrative matters, one way or the other, and it is enough if the authority says or indicates that it has considered the relevant material existing on record. But, it is necessary that the material does infact exist and that it is appropriately considered. The reason being that exercise of discretion is always dependent upon subjective satisfaction made by the authority and it is the material on record which offers objective criterion for the authority to make up its mind. The availability of such objective criterion or material before the learned Joint Secretary who has passed the impugned order, has not been demonstrated before us. Therefore, viewed from any angle, the impugned order cannot be sustained in the eye of law. In the result, we are inclined to allow the petition. 10. Petition is allowed. The impugned order is hereby quashed and set aside. The State Government would have to initiate new process for performing its duty under Section 58(1) read with Section 58(4) of the Trust Act, which we hope and trust, would be performed by it as expeditiously as possible. 11. Rule is made absolute in these terms. No costs.