A bench of Acting Chief Justice Gita Mittal and Justice C Hari Shankar said if the ashram was a "spiritual" place, why were the girls and women being kept behind locked doors.
It also said that if Virender Dev Dixit, the founder of the ashram, was preaching spirituality, he should come forward and there should be no need for the CBI to trace him.
A three-member panel, appointed by the court to inspect the Rohini ashram and its other branches in Delhi, claimed the institute was making the inmates write letters and complaints making similar allegations of sexual assaults against their family members.
The committee, comprising Delhi Commission for Women chairperson Swati Maliwal and advocates Nandita Rao and Ajay Verma, said the letters and complaints were being used to pressure the family members from initiating any action against the ashram or Dixit.
The bench said "prima facie there appears to be substance in the submission of the committee" that the ashram and Dixit may be utilising the complaints to make similar allegations against the family members as a "shield" to keep the inmates on the premises.
The court was also of the prima facie view that the complaints and letters were "motivated" and meant to "dissuade" the family members from pursuing any PIL or criminal case, and to obstruct proceedings in ongoing matters.
The court said while it would not obstruct or interfere in any legitimate, honest or genuine spiritual work, it "will not countenance any fraudulent or illegal activity".
The court listed the matter for further hearing on January 17.
During the hearing, the bench said it was aware that the entire organisation was run and managed by Dixit, and arguments to the contrary by the ashram's lawyer are "falsified" by information on the website as well as YouTube videos.
The court had on December 22, 2017 directed the CBI to trace Dixit who was ordered to be present before the bench today.
The CBI was asked to investigate the alleged illegal confinement of girls and women at the ashram after the court appointed committee said the inmates there were kept in "animal-like" conditions behind metal doors in a "fortress- like" building surrounded by barbed wire fence.
The court had directed the agency to constitute a special investigation team (SIT) forthwith to take charge of all records and documents pertaining to the case.
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