Temple Funds Belong To Deity Not Government; Misuse Of Funds Amounts To Criminal Breach Of Trust: Himachal Pradesh High Court

The Petitioner had approached the High Court invoking provisions of Article 226 of the Constitution seeking a direction to the respondent authorities to ensure strict compliance of the Hindu Public Religious Institutions and Charitable Endowments Act, 1984 specifically provisions pertaining to preparation of budget (Section 22), maintenance of accounts (Section 23) and incurring of expenditure (Section 17).

The Division Bench of Justice Vivek Singh Thakur and Justice Rakesh Kainthla held, “Where it is found that any trustee has misutilised or cause to misutilize the funds of the temple, it will be recovered from him and he will be personally held liable for the misutilisation of such funds. It must always be remembered that the deity is a juristic person, funds belong to the deity, not the government, trustees are only custodians, and any misuse of temple funds amounts to criminal breach of trust.”

Advocate Nitin Thakur represented the Petitioner while Advocate General Anup Rattan represented the Respondent.

Reasoning

Explaining how Temples have always been custodians of Hindu culture and how they can become powerful catalysts for the transformation of modern Hindu society, the Bench stated, “For temples to realise their transformative potential, a shift in mindset is required. Temple administrations, spiritual leaders, and the wider community must work together to create a more inclusive, progressive, and socially responsive environment. By embracing their rich heritage of service and community engagement, temples can once again become the beating heart of a rejuvenated and dynamic Hindu society, guiding it towards a future rooted in dharma and universal well-being.”

The Bench noted that the administration of temples and their funds is rooted in Article 25 (2) of the Indian Constitution, which allows the State to make laws for regulating or restricting any economic, financial, political, or other secular activity which may be associated with religious practice. Highlighting the role of the State, the Bench stated, “Therefore, apart from the management of secular functions, it is also the duty of the State to ensure that the income of the Temple, donations of the devotees, are spent in consonance with and for the propagation of the true meaning of the Hindu Religion/Dharma.”

The Bench was of the view that as a trustee, the State and functionaries should evolve a mechanism, infrastructure to propagate the tenets of Hinduism in consonance with the Core Principles of Hinduism, teaching of Saints, Gurus, as well as the mandate of the Constitution.

Finding the concern shown by the petitioner regarding the expenditure of the funds donated by the devotee to be legitimate, the Bench stated, “Devotees offer donations to temples—and through them, to the Divine—with the clear belief that these will support the care of deities, maintain temple spaces, and promote Sanatana Dharma. When the government appropriates these sacred offerings, it betrays that trust. Such diversion is not just a misuse of public donations—it strikes at the core of religious freedom and institutional sanctity. Therefore, it has become necessary to regulate the funds donated to the temple to prevent their misuse and their utilisation for the intended purposes.”

The Bench enumerated certain situations when temple funds would be utilised. These include the creation of infrastructure and establishing institutions to teach, learn and propagate Vedas and Yog, running schools and colleges, hospitals, and dispensaries. The Bench stated that the funds could also be used for organising eye camps, blood donation camps, running and managing cowsheds and supporting destitute, old-age homes, and orphanages.

Highlighting the prohibited areas of expenditure, the Bench stated, “Every rupee of temple funds must be used for the temple’s religious purpose or dharmic charity. It cannot be treated like general revenue for the State or general public exchequer. It cannot be diverted to or transmitted or donated to any welfare schemes of the Government or other similar purpose or activity unrelated to the temple or religion.”

The Bench also held that temples should publicly display their monthly income & expenditure, details of projects funded by donations and audit summaries on notice boards or websites to instil confidence in the devotees that their donations are being utilised for the propagation of the religion and welfare of Hindus. “Every temple must maintain proper accounts of income and expenditure, which will be audited annually, and the result of the audit will be published to ensure that the funds are being utilised for the intended purpose”, the Bench ordered while disposing of the Petition.

Cause Title: Kashmir Chand Shadyal v. State of H.P. (Neutral Citation: 2025:HHC:34567)

Appearance

Petitioner: Advocates Nitin Thakur, Udit Shaurya Kaushik

Respondent: Advocate General Anup Rattan, Additional Advocates General Ramakant Sharma, Pawan Kumar Nadda, Deputy Advocates General S.D. Vasudeva, Seema Sharma, Senior Penal Counsel Lokender Thakur

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