Section 34 explained: this guide covers what it means, who it applies to, the step-by-step process, documents required, fees, due dates and penalties in India — so you can stay compliant with confidence and avoid costly mistakes.
This article explains the Maharashtra Public Trusts Act, 1950 as it applies in the State of Maharashtra, formerly the Bombay Public Trusts Act, 1950. Section 34 sets out what the auditor of a public trust must prepare and send, what the auditor's report must specify, and the trustee's duty to file a copy of the balance sheet and income and expenditure account with the Deputy or Assistant Charity Commissioner or the Charity Commissioner when required.
This article explains section 34 as amended up to Maharashtra Act No. XXXVI of 2018 (in force 21 May 2018), per the official text of the Law and Judiciary Department modified up to 19 December 2018. Maharashtra amended the Act again in 2019, 2020, 2024 and 2025; the amending texts consulted do not change this section, but the current text should be checked on the Charity Commissioner's website before relying on it.
The auditor must prepare a balance sheet and an income and expenditure account and forward a copy, with his report, to the trustee. He sends a copy to the Deputy or Assistant Charity Commissioner of the region or sub-region or to the Charity Commissioner, if the Charity Commissioner requires it (s.34(1)). The trustee must file a copy of the balance sheet and income and expenditure account with that officer when required (s.34(1A)). The report must specify irregular, illegal or improper expenditure, failures to recover trust money or property, and loss or waste, and say whether breach of trust, misapplication or misconduct caused it (s.34(2)).
Sub-section (1): the auditor's duty to prepare and forward
The sub-section begins: "It shall be the duty of every auditor auditing the accounts of a public trust under section 33 to prepare a balance sheet and income and expenditure account and to forward a copy of the same along with his report to the trustee, and to the Deputy or Assistant Charity Commissioner of the region or sub-region or to the Charity Commissioner, if the Charity Commissioner requires him to do so."
| Step | Who | What |
|---|---|---|
| 1 | Auditor | Prepares a balance sheet and an income and expenditure account |
| 2 | Auditor | Forwards a copy, with his report, to the trustee |
| 3 | Auditor | Forwards a copy to the Deputy or Assistant Charity Commissioner of the region or sub-region, or to the Charity Commissioner, if the Charity Commissioner requires |
The words "along with a copy of his report to the trustee, and" were inserted by Mah. 20 of 1971, s. 20(1), as the footnote prints. Before that insertion the duty was to prepare and forward the statements; the report to the trustee is now part of the sub-section. The auditor's duty to the officer is conditional: "if the Charity Commissioner requires him to do so". The Act does not say whether the requirement is general or case by case; check any direction the Charity Commissioner has issued.
For who may audit and the auditor's access to books, see Section 33. Trusts that want statements ready for the auditor can use financial statement preparation support.
Sub-section (1A): the trustee's duty to file
Sub-section (1A) was inserted by Mah. 20 of 1971, s. 20(2). It says: "It shall be the duty of the trustee of a public trust to file a copy of the balance sheet and income and expenditure account forwarded by the auditor before the Deputy or Assistant Charity Commissioner of the region or sub-region or to the Charity Commissioner, if the Charity Commissioner requires him to do so."
So there are two parallel routes. The auditor may be required to send the statements; the trustee may be required to file them. Both duties turn on the Charity Commissioner's requirement. A trustee should not assume that the auditor's forwarding discharges the trustee's own duty to file when the requirement applies. For the practical filing of annual accounts, see how to file annual accounts of a trust with the Charity Commissioner.
Sub-section (2): what the report must specify
The auditor "shall in his report specify" the following:
| Head | Words of the section |
|---|---|
| 1 | All cases of irregular, illegal or improper expenditure |
| 2 | Failure or omission to recover moneys or other property belonging to the public trust |
| 3 | Loss or waste of money or other property of the public trust |
| 4 | For each of the above, whether it was "caused in consequence of breach of trust, or misapplication or any other misconduct on the part of the trustees, or any other person" |
Three points stand out.
- "Specify all cases". The report is not a general opinion. It must identify the cases.
- "Irregular, illegal or improper". These are three different words. Expenditure may be irregular without being illegal, and improper without being either; the report must catch all three.
- Causation. The auditor must say whether the cause was breach of trust, misapplication or other misconduct, and by whom: "the trustees, or any other person". The auditor therefore does not stop at the figure; he must say, on the records, whether trustee conduct was behind it.
These statements matter later. The Charity Commissioner's office can call for an explanation on the auditor's report under Sections 38 and 39, and a finding of loss can lead to an order of surcharge: see Section 41.
Illustration. A charitable hospital trust in Nagpur gets its annual audit. The auditor notes that a trustee's relative was paid for a repair contract without quotations, that rent owed by a tenant for two years has not been recovered, and that stock was written off after a fire. In the report, he lists each case, says that the rent was not recovered through omission, and states for each case whether he considers it the consequence of breach of trust, misapplication or misconduct, and by whom. He sends the balance sheet and income and expenditure account with the report to the trustees, and to the Deputy Charity Commissioner if the Charity Commissioner so requires. The trustees file their copy when required.
What section 34 does not say
- It prints no time limit for the report. Time limits, if any, come from other provisions or the rules.
- It does not give the form of the statements.
- It does not say what the Charity Commissioner must do with the report; that is for the Chapter on control.
Need help with accounts before the audit?
Our team can prepare the balance sheet and income and expenditure account, reconcile the books and organise vouchers so that the auditor's report is clean and any queries can be answered. Ask for financial statement preparation.
Key takeaways
- The auditor must prepare a balance sheet and an income and expenditure account and forward a copy, with his report, to the trustee (s.34(1)).
- The auditor sends a copy to the Deputy or Assistant Charity Commissioner or the Charity Commissioner if the Charity Commissioner requires it.
- The trustee must file a copy of the balance sheet and income and expenditure account when required (s.34(1A), inserted in 1971).
- The report must specify irregular, illegal or improper expenditure, failure to recover trust property, loss and waste, and whether breach of trust, misapplication or misconduct caused them (s.34(2)).
- The section prints no time limit or form.
Read next
- Section 33: balancing and audit of trust accounts
- Sections 38 and 39: explanation on the audit report and the report to the Charity Commissioner
- Section 41: order of surcharge against trustees
- How to file annual accounts of a trust with the Charity Commissioner
Disclaimer: Based on the Maharashtra Public Trusts Act, 1950 as modified up to 19 December 2018 in the official text of the Law and Judiciary Department, Government of Maharashtra, as consulted on 3 October 2026. Maharashtra amended the Act again in 2019, 2020, 2024 and 2025; the current text, the Maharashtra Public Trusts Rules and the Charity Commissioner's circulars should be checked. This article is general information, not legal advice; check the official text before acting.