Himachal Pradesh High Court
Gram Panchayat vs State Of H.P. & Ors on 24 August, 2015
Bench: Rajiv Sharma, Sureshwar Thakur
IN THE HIGH COURT OF HIMACHAL PRADESH, SHIMLA.
CWP No. 2978 of 2015.
Reserved on: 20.8.2015
Decided on: 24.8.2015.
.
Gram Panchayat, Nangal Kalan ......Petitioner.
Versus
State of H.P. & ors. .......Respondents.
Coram
The Hon'ble Mr. Justice Rajiv Sharma, Judge.
The Hon'ble Mr. Justice Sureshwar Thakur, Judge.
Whether approved for reporting? 1 Yes.
of
For the petitioner: Mr. Ajay Sharma, Advocate.
For the respondents: Mr. Shrawan Dogra, Advocate General with Mr. M.A. Khan and
Mr. Anoop Rattan, Addl. Advocate Generals for the respondent-
State.
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rt
Justice Rajiv Sharma, J.
The petitioner has challenged the notification dated 27.04.2015, whereby the areas of Tahliwal, specified in the schedule, have been declared as Nagar Panchayat Tahliwal. The Director (Urban Development), has sent the communication to the Deputy Commissioner, Una on 16.03.2013 giving reference to the representations received from the public representatives for the constitution of Nagar Panchayat Tahliwal. The Deputy Commissioner, Una, was requested to do the needful and send the complete proposal, as per Section 3 of the H.P. Municipal Act, 1994 (hereinafter referred to as the Act for brevity sake). The Deputy Commissioner, Una was also called upon to send the resolution (NOC) of the concerned Gram Panchayat. The Director, (UD), sent the reminder to the Deputy Commissioner, Una on 11.06.2014.
The SDO (C) Haroli, sent the communication to Deputy Commissioner, Una dated 17.07.2014, mentioning therein that in Tahliwal area, big industrial 1 Whether reporters of the local papers may be allowed to see the judgment?
::: Downloaded on - 15/04/2017 18:47:49 :::HCHP 2units have been setup, including Cremica and Nestle and thus the Revenue Department has no objection for the constitution of Tahliwal area into Nagar Panchayat. The Additional District Magistrate, Una sent the communication .
to the Director (UD), dated 18.07.2014, stating therein that a complete case has been received from the SDO (C) Haroli and as per the report the Gram Panchayat Nangal Kalan, vide its resolution No. 11 dated 20.07.2013 has submitted NOC for the constitution of Nagar Panchayat Tahliwal. There is also reference to the big industrial units like Cremica and Nestle located at of Tahliwal in the communication dated 18.07.2014. The proposal was sent vide this communication to the Director (UD).
2. rt In sequel to the proposal sent by the Additional District Magistrate, Una Annexure R/5-4, the objections were called from the inhabitants of the area to submit their objections/suggestions, if any, to the proposed declaration of Nagar Panchayat Tahliwal. These objections/suggestions were required to be submitted to the Secretary (UD), to the Government of Himachal Pradesh in writing through Deputy Commissioner, Una within a period of six weeks from the date of the publication of the notification in the Rajpatra dated 7.7.2015, Himachal Pradesh. The objections were filed vide Annexure P4 and P5 by the residents of the area. The State Government issued notification dated 27.04.2015 under section 4 of the Himachal Pradesh Municipal Act, 1994, declaring the areas of Tahliwal, as specified in the schedule, as Nagar Panchayat, Tahliwal (Annexure P-11). Thereafter, the State Government has also issued notification dated 1.06.2015, whereby the objections were called from the Gram Sabha Nangal Kalan, within a period of 30 days.
::: Downloaded on - 15/04/2017 18:47:49 :::HCHP 33. Mr. Ajay Sharma, Advocate appearing for the petitioner has vehemently argued that declaration of areas of Tahliwal as Nagar Panchayat Tahliwal is contrary to Article 243-E of the Constitution of India, sub-section .
(2) of section 3 of H.P. Panchayati Raj Act, 1994 and also in breach of mandatory provisions of sections 3 and 4 of the Himachal Pradesh Municipal Act, 1994. On the other hand, Mr. Shrawan Dogra, learned Advocate General has vehemently argued that the writ petition on behalf of the petitioner is not maintainable. The Gram Panchayat Nangal Kalan, could not authorize the of petitioner for institution of the present writ petition. He then contended that the provisions of Sections 3 and 4 of the Himachal Pradesh Municipal Act, rt 1994, as well as the mandatory provisions of the H.P. Panchayati Raj Act, have been followed in letter and spirit. He lastly contended that the constitution of Nagar Panchayat was in the larger public interest to provide better civic amenities to the area, taking into consideration big industrial units located in Tahliwal area.
4. We have heard the learned counsel for both the sides and have also gone through the pleadings carefully.
5. The petitioner has been authorized to file the writ petition as per Annexure P-1 dated 21.04.2015. There is a detailed procedure provided under section 119 of the Himachal Pradesh Panchayati Raj Act, 1994 read with rule 111 of the Himachal Pradesh Panchayati Raj (General) Rules, 1997.
Sub-rule (5) of Rule 111 of the Himachal Pradesh Panchayati Raj (General) Rules, 1997 provides that no suit on behalf of the Panchayat shall be instituted without the previous sanction of the District Panchayat Officer. It is further stipulated therein that while according the sanction, the District ::: Downloaded on - 15/04/2017 18:47:49 :::HCHP 4 Panchayat Officer shall study the pros and cons of the suit in question and examine the facts enumerated therein to be submitted by the concerned Panchayat.
.
6. We are of the considered view that the petitioner has necessary locus standi to assail the notification(s) constituting Gram Panchayat Tahliwal, for the simple reason that judicial review is a fundamental right.
The Gram Panchayat has rightly authorized the petitioner to institute the present petition. Moreover, there is a difference between a suit and a writ of petition. The right to file a writ petition cannot be curtailed on the basis of Rule 111 (5) of the Himachal Pradesh Panchayati Raj (General) Rules, 1997.
rt In the case of Village Panchayat, Calangute vrs. Additional Director of Panchayat-II and others, reported in (2012) 7 SCC 550, their lordships of the Hon'ble Supreme Court have held that Gram Panchayat had the locus to file writ petition under Articles 226 and 227 of the Constitution of India against the decision of the Appellate Authority, who has exercised the powers illegally. It has been held as follows:
"30. It is thus evident that while the appellant and the Sarpanch had exercised their respective powers in public interest, respondent No.1 nullified that exercise because he felt that the resolution/action was contrary to law and was unjustified. While exercising the power under the Act, the Panchayat was not acting as a subordinate to respondent No.1 but as a body representing the will of the people and also a body corporate in terms of Section 8 of the Act. Therefore, it had the locus to challenge the orders passed by respondent No.1 and the High Court was clearly in error in holding that the writ petition was not maintainable.
35. By applying the ratio of the aforesaid judgments to the facts of these cases, we hold that the writ petitions filed by the appellant were maintainable and the learned Single Judge of the High Court committed ::: Downloaded on - 15/04/2017 18:47:49 :::HCHP 5 grave error by summarily dismissing the same. We also declare that the contrary view expressed by the High Court in other judgments does not represent the correct legal position.
.
36. In the result, the appeals are allowed, the impugned order is set aside and the writ petitions filed by appellant are restored to their original numbers. The High Court shall now issue notice to the respondents and decide the writ petitions on merits.
37. It will be open to the appellant to apply for interim relief. If any such application is filed, then the High Court shall decide the same on its own of merits."
7. The constitution of Municipalities is provided under Article 243Q rt of the Constitution of India. It reads as under:-
"243Q. Constitution of Municipalities.- (1) There shall be constituted in every State,-
(a) a Nagar Panchayat (by whatever name called) for a transitional area, that is to say, an area in transition from a rural area to an urban area
(b) a Municipal Council for a smaller urban area; and
(c) a Municipal Corporation for a larger urban area, in accordance with the provisions of this Part:
Provided that a Municipality under this clause may not be constituted in such urban area or part thereof as the Governor may, having regard to the size of tile area and the municipal services being provided or proposed to be provided by an industrial establishment in that area and such other factors as he may deem fit, by public notification, specify to be an industrial township (2) In this article, a transitional area, a smaller urban area or a larger urban area means such area as the Governor may, having regard to the population of the area, the density of the population therein, the revenue generated for local administration, the percentage of employment in non agricultural activities, the economic importance or such other factors as he may deem fit, specify by public notification for the purposes of this Part."
8. The Legislative Assembly, Himachal Pradesh has enacted the Act called the Himachal Pradesh Municipal Act, 1994. Section 3 of the Act provides that the State shall constitute three classes of municipalities in accordance with provisions of this Section i.e. "Nagar Panchayat", "Municipal ::: Downloaded on - 15/04/2017 18:47:49 :::HCHP 6 Council" and Municipal Corporation. The Nagar Panchayat is provided for a transitional area with population exceeding 2000 and generating annual revenue exceeding Rs. 5 lacs for the local administration. According to the .
proviso, the municipality under this Section, may not be constituted in such urban areas or part thereof, as the State Government may, having regard to the size of the area and the municipal services being provided or proposed to be provided by an industrial establishment in that area and such other factors as it may deem fit, by notification, specify to be an industrial of township. According to the explanation, the "transitional area", "a smaller urban area", or "a larger urban area", has been defined as such area as the rt State Government may, having regard to the population of the area, the density of the population therein, the revenue generated for the local administration, the percentage of employment in non-agricultural activities, the economic importance or such other factors, as the State Government may deem fit, specify in notification for the purpose of this section.
9. The State Government under sub-section (2) of Section 3 has been empowered to issue notification to constitute the municipalities and specify the class to which a municipality shall belong in accordance with the provisions after observing the procedure as laid down in Section 4. The detailed procedure for declaring municipalities has been enumerated under Section 4 of the Act. According to sub-section (1) of Section 4, the State Government may, by notification, propose any local area to be municipal area under the Act and sub-section (2) of Section 4 provides that every such notification under sub-section (1) shall define the limits of the local area to which it relates. Sub-section (3) of Section 4 of the Act provides that the copy ::: Downloaded on - 15/04/2017 18:47:49 :::HCHP 7 of every notification under this section, with a translation thereof, in such language as the State Government may direct shall be affixed at some conspicuous place in the office of Deputy Commissioner, within whose .
jurisdiction the local area to which the notification relates lies, and at one or more conspicuous places in that local area. Sub-section (4) of Section 4 provides that the Deputy Commissioner shall certify to the State Government the date of which the copy and translation work so affixed and the date so certified shall be deemed to be the date of publication of the notification.
of Sub-section (5) of Section 4 stipulates that if any inhabitants desires to object to a notification issued under sub-section (1), he may within six weeks from rt the date of the publication, submit his objections in writing through the Deputy Commissioner to the State Government and the State Government shall take his objections into consideration. Sub-section (6) of Section 4 provides that when six weeks from the date of publication have expired, and the State Government has considered and passed orders on such objections, as may have been submitted to it, the State Government may, by notification, declare the local area for the purposes of this Act, to be a municipal area.
10. The constitution of the municipalities, as discussed hereinabove, is provided under Article 243Q of the Constitution of India. The Nagar Panchayat for transitional area with population exceeding 2000 and generating annual revenue exceeding Rs. 5 lacs for the local administration is visualized. The total population of the area is 3565 and as per the record produced before us, the Tehsildar of the area concerned, has certified that the total revenue generated from the area is more than Rs. six lacs. The Gram Panchayat, Nagar Kalan, has issued No Objection Certificate (NOC). The ::: Downloaded on - 15/04/2017 18:47:49 :::HCHP 8 Deputy Commissioner, Una has sent the proposal to the State Government for constitution of the Tahliwal Nagar Panchayat on 18.07.2014. The objections were called on 30.08.2014, strictly in conformity with sub-section .
(5) of Section 4 of the Act. These objections were considered and the notification has been issued on 27.04.2015 constituting Tahliwal area as Nagar Panchayat, Tahliwal.
11. Mr. Ajay Sharma, Advocate for the petitioner has failed to point out the violation of the mandatory provision of Sections 3 or 4 of the of Himachal Pradesh Municipal Act, 1994. Mr. Ajay Sharma, Advocate has also argued that before the proposal was initiated for constituting the local area rt into Nagar Panchayat Tahliwal, sub-section (2) of Section 3 of the Act was to be followed and the tenure of the Gram Panchayat Nangal Kalan could not be reduced as per Article 243Q of the Constitution of India. This submission of the learned counsel merits rejection, being not tenable.
12. Under sub-Section (1) of Section 3 of the Himachal Pradesh Panchayati Raj Act, 1994, the Government, by notification, can declare any village or group of contiguous villages with a population of not less than one thousand and not more than five thousand to constitute one or more Sabha areas for the purposes of this Act and also specify its headquarters under Section 3 of the Act. Sub-section (2) of Section 3 provides that the State Government at the request of the Gram Sabha concerned or otherwise, and after previous publication of the proposal by notification at any time, increase any Sabha by including within such Sabha area any village or group of villages or diminish any Sabha area by excluding from such Sabha area any village or group of villages, or alter the headquarter or name of any Sabha ::: Downloaded on - 15/04/2017 18:47:49 :::HCHP 9 area or declare that any area shall cease to be a Sabha area. It is clear from the plain language employed in sub-section 2 of Section 3 of the Himachal Pradesh Panchayati Raj Act, 1994 that the State Government is empowered .
to do the needful either at the request of Gram Sabha concerned or otherwise.
13. Their lordships of the Hon'ble Supreme Court in the case of Century Spinning and Manufacturing Co. Ltd. and ors. vrs. District Municipality of Ulhasnagar and ors., reported in AIR 1968 SC 859, have held that there was nothing either in Section 4 or Section 7 of the Bombay of District Municipal Act, to limit the power of the Government in constituting a municipal district to include therein the whole of the village or suburb. It has rt been held as follows:
"4. As regards the first contention, the argument was that sees. 4,7 and 8 do not permit the Government to constitute a local area by including in it not villages but only portions thereof and that when it is proposed to amalgamate different units such as villages or suburbs situate adjacent to each other to form one municipal district it can do so by bringing them into such a district as whole, units and not breaking them up and having a part or parts of such unit and not the rest. The contention was rounded on the fact that the notification dated October 30, 1959 stated that the Government proposed to constitute the local area comprising of parts of Shahad, Ambernath,. and other villages into a permanent municipal district, the limits of which were specified in the Schedule thereto. The said Schedule set out the boundaries of the proposed municipal district by showing Ulhas river as its boundary in the north and certain survey numbers of the. said villages as boundaries in the east, south and west. After considering the objections as required by the Act the Government by a further notification dated September 20, 1960 declared the said local area of which the same boundaries were set. cut in the Schedule thereto to be a permanent municipal district. It is true that in constituting the municipal district of Ulhasnagar the Government included parts of villages enumerated in the said Schedule. But the question is, was the Government competent to do so or not. Section 4 provides that subject to secs. 6, 7 and 8 the Government may declare by a notification any local urea to be a municipal district and may, by a like notification, extend, contract or otherwise after the limits of any municipal district, that every such notification constituting a new municipal district or altering the limits. of an existing municipal district shall clearly set forth the local limits of the area to be included in or excluded from such municipal district as the case may be and when so ::: Downloaded on - 15/04/2017 18:47:49 :::HCHP 10 done it is the duty of the municipality already existing or of every municipality newly constituted or whose limits are altered to set up as required by the Collector boundary marks defining its limits or the altered limits of the municipal district subject to its authority. Section 7 provides that any local area which comprises of (a) a city, town, or station or two or more neighbouring cities, towns or stations with or .
without any village, suburb or land adjoining thereto or (b) a village or suburb or two or more neighbouring villages or suburbs, may be declared a permanent municipal district. It will be seen that while the Government can declare a municipal district comprising of two or more neighbouring cities, towns or stations or a village or suburb or two or more neighbouring villages or suburbs, sec. 7 expressly provides that such a local area may comprise not only of two. neighbouring villages or suburbs but also land adjoining to a village or suburb. Therefore while constituting a municipal district the Government, when it is expedient so of to do, can join to an existing village or suburb the land adjoining thereto. Similarly sec. 4 empowers the Government to extend, contract or otherwise alter from time to time the existing limits of a municipal district or declare any local area to be a municipal district. There is nothing either in sec. 4 or sec. 7 to limit the power of the Government in rt constituting a municipal district to include therein the whole of the village or suburb as contended. The Act, on the other hand, permits the Government to include "land adjoining there to" which shows that a part of the land adjoining to an existing village or a suburb can also be added if it is thought expedient so to do. Likewise, while altering the limits of an existing municipal district it can exclude from or include in it part of the land where it becomes necessary or expedient to do. That being so, it is impossible to say that by taking parts of the villages set out in the Schedules to the two notifications the Government formed a municipal district contrary to the provisions of secs. 4 or 7 or that the constitution by it of the municipal district of Ulhasnagar was in any way contrary to or ultra vires the two sections."
14. In the case of Siya Sharan Sinha and ors. vrs. State of Bihar and ors., reported in AIR 1969 Patna 88, the Division Bench of the Patna High Court has held that the State Government must be satisfied that all the three conditions, which are conditions precedent to constitute a town a Municipality in accordance with Cl. (a) of sub-section (1) of S. 4 of the Act have been fulfilled and that the declaration of its intention to constitute the town a municipality must be published in the official gazette and in such other manner as the State Government may direct as required by sub-section (2) to S. 4. It has been held as follows:
::: Downloaded on - 15/04/2017 18:47:49 :::HCHP 11"6. Section 390A(1) of the Act reads as follows :--
"Conversion of a Notified Area into a Municipality :--
(1) Notwithstanding anything contained in Sections .
388, 389 and 390 and subject to the provisions of Section 4, the State Government may, by notification, declare that with effect from the date to be specified in the notification and subject to such provisions as the State Government may make for the period of transition, a notified area constituted under Section 388 shall be converted into a Municipality, and with effect from that date all the provisions of this Act shall apply to such Municipality unless of the State Government in the notification, or by a fresh notification, specifically bar the application of any provision in that area."
rt Clauses (b) to (d) of Sub-section (1) of Section 4 of the Act are not necessary to be read for the purpose of the present case. It is, however, necessary to quote Clause (a) of Sub-section (1) and Sub-section (2) of Section 4, which run as follows :--
"(1)(a) When the State Government is satisfied that three-fourths of the adult male population of any town are engaged on pursuits other than agricultural and that such town contains not less than five thousand inhabitants, and an average number of not less than one thousand inhabitants to the square mile of the area of such town, the State Government may declare its intention to constitute such town, together with or exclusive of any railway station, village, land or building in the vicinity of such town, municipality, and to extend to it all or any of the provisions of this Act (2) Every declaration under this section shall be published in the Official Gazette and in such other manner as the State Government may direct."
It is manifest, therefore, that the conversion of a Notified area into a Municipality under Section 390A has been subjected to the provisions of Section 4 of the Act. In other words, the State Government must be satisfied that all the three conditions, which are conditions precedent to constitute a town a Municipality in accordance with Clause (a) of Sub- section (1) of Section 4 of the Act, have been fulfilled and that the declaration of its intention to constitute the town a municipality must be ::: Downloaded on - 15/04/2017 18:47:49 :::HCHP 12 published in the official gazette and in such other manner as the State Government may direct as required by Sub-section (2).
7. The wordings of Sub-section (2), extracted above, clearly indicate that .
the publication of the declaration of the intention to constitute a town a Municipality is mandatory both in regard to its publication in the official gazette as also in such other manner as the State Government may direct The publication of the declaration of the intention in the official gazette only is not sufficient nor is it sufficient to give a notice of the said declaration to the Notified Area Committee, because the publication of the declaration of the intention must be in such other manner as the of State Government may determine. Giving of notice to the Notified Area Committee is not the publication of the declaration within the meaning of Sub-section (2) of Section 4 of the Act."
rt
15. In the instant case, the provisions of Section 4 of the Himachal Pradesh Municipal Act, 1994 have been followed scrupulously.
16. In the case of Sunil Ranjan De vrs. The State of Assam and others, reported in AIR 1972 Gauhati 50, the Division Bench of the Gauhati High Court has held that once a Town Committee is lawfully constituted, even including an erstwhile portion of the Anchalik Panchayat, that area gets automatically excluded from the Anchalik Panchayat, in view of the provisions of Section 1(2) of the Assam Panchayat Act, 1959. It has been held as follows:
"..........It presupposes that there may be already some Anchalik Panchayats which are constituted and it takes note of the possibility of some portion of such area being included later in a Town Committee. Once a Town Committee is constituted in accordance with law even including an erstwhile portion of the Anchalik Panchayat, that area gets automatically excluded from the Anchalik Panchayat in view of the provisions of Section 1(2) of the Act. There is no necessity for another notification excluding the area from the Anchalik Panchayat. The absence of a second notification excluding a particular area from the Panchayat is therefore not fatal to the constitution of the Town ::: Downloaded on - 15/04/2017 18:47:49 :::HCHP 13 Committee in this case. The submission of the learned counsel is therefore of no avail."
17. In the case of Baikunth Nath Upadhyaya vrs. The State of Bihar and ors. reported in AIR 1972 Patna 307, the Division Bench has .
held that where an area is constituted as a 'Notified Area' or a 'Municipal Committee', the Government is not required to consult Panchayat Samiti, the area of which is included in such Notified Committee or Municipality. It has been held as follows:
of "1. The petitioner is the Pramukh of Namkun (Khijri) Pan-chayat Samiti is the district of Ranchi. He has filed this writ application for quashing Notification No. 8220 L. S. G., dated the 27th of November, 1970, purported to have been issued by the Government of Bihar under Clause rt
(c) ofSection 6 of the Bihar and Orissa Municipal Act, 1922. A copy of the said notification has been made Annesure '1' to the writ application. By the impugned notification a number of villages either in whole or in part have been included within the Doranda Notified Area.
3. I will first deal with the main ground on which the validity of the notification has been challenged. Chapter II of Bihar Act 6 of 1962 provides for constitution, incorporation, composition etc. of the Fanchayat Samitis. Under Section 3 (1) of that Act the State Government has been empowered (a) to declare any area within a particular district to be a Block and name the Block, (b) to include any area within the same district in a Block so declared, (c) to exclude any area from any such Block, or (d) to transfer any area from one Block to another within the same district. By Bihar Act 4 of 1964 a proviso has been added to Section 3 (1) which reads as under:
"Provided that before issuing any notification under' Clause (b),
(c) or (d), the State Government shall consult the concerned Panchayat Samiti and Zila Parishad, if any, and where no Panchayat Samiti for any Block or Zila Parishad for the district has been constituted, the concerned Block Development Committee and the District Development Committee, if any, constituted under the orders of the State Government."
Mr. Thakur Prasad submitted that before excluding any area from a Block it is incumbent on the State Government to consult the Panchayat Samiti of the Block concerned. As in the instant case the State Government did not consult the Namkum Panchayat Samiti before excluding various villages either in whole or in part from the Block and including them in the Doranda Notified Area, there has been a contravention of the mandatory provisions as contained in the proviso ::: Downloaded on - 15/04/2017 18:47:49 :::HCHP 14 to Section 3(1) of Bihar Act 6 of 1962. There does not appear to be any substance in the contention raised.
A plain reading of Section 3 (1) of Bihar Act 6 of 1962 would show that the State Government has to consult the concerned Panchayat Samiti before excluding any area from a Block for the purposes of the .
Act. In the instant case there has been no notification by the Government excluding any area from the Namkum Block for the purposes of Bihar Act 6 of 1962 and as such the State Government was under no obligation to consult the Namkum Panchayat Samiti. The provisions of Bihar Act 6 of 1962 are not attracted when an area has been constituted a Municipality or a Notified Area under the provisions of the Bihar and Orissa Municipal Act, 1922. This is clear from the proviso to sub-section (2) of Section 1 of Bihar Act 6 of 1962, which reads as under:
of "Provided that save as otherwise expressly obtained in this Act nothing therein shall apply to any local area to which the provisions of the Fatna Municipal Corporation Act, 1951 (Bihar Act 13 of 1952), apply or any area which has been or may hereafter be constituted a Municipality or a Notified Area under the rt nrovisions of the Bihar and Orissa Municipal Act, 1922 (B. & O. 7 of 1922), or a Cantonment under the provisions of the Cantonment Act, 1924 (Act 2 of 1924)."
The notification, therefore, cannot be held to be invalid on the ground that the State Government did not consult the Namkum Panchayat Samiti before issuing the same.
4. The second ground on which the validity of the notification has been impugned is equally without substance. Section 3 (3) of Bihar Act 7 of 1948 reads as under:
"Provided that before making any alteration in the local limits of the jurisdiction of any Gram Panchayat, the Government shall, in the prescribed manner, ascertain the views of the people of the area affected by such alteration."
In the instant case the Government has not issued any notification under Section 3 (3) of Bihar Act7 of 1948 excluding any village or part of a village from any Gram Panchayat, thereby making an alteration in the local limits of the jurisdiction of that Gram Panchayat. It was, therefore, not necessary for the Government to ascertain the views of the people of the area affected by such alteration. As provided under sub-section (2) of Section 1 of Bihar Act 7 of 1948, the provisions of that Act are not applicable to an area which has been or may be constitued a municipality or a notified area under the provisions of the Bihar and Orissa Municipal Act, 1922, hereinafter to be called "the Act", The State Government was, therefore, under no obligation to consult the views of the people of the area as required by the proviso to Section 3 (3) of Bihar Act 7 of 19-18 before issuing the notification under the provisions of the Act. For the ::: Downloaded on - 15/04/2017 18:47:49 :::HCHP 15 foregoing reasons I am of the view that there is no substance even in the second contention."
18. Their lordships of the Hon'ble Supreme Court in the case of Tulsipur Sugar Co. Ltd. vrs. The Notified Area Committee, Tulsipur, .
reported in (1980) 2 SCC 295, have held that Section 3 of the U.P. Town Areas Act, 1914 was in the nature of conditional legislation. The power of the State Government to make a declaration under that section is legislative in character because the application of the rest of the provisions of the Act to of the geographical area which is declared as a town area is dependent upon such declaration. It has been held as follows:
"7.
rtWe are concerned in the present case with the power of the State Government to make a declaration constituting a geographical area into a town area under section 3 of the Act which does not require the State Government to make such declaration after giving notice of its intention so to do to the members of the public and inviting their representations regarding such action. The power of the State Government to make a declaration under section 3 of the Act is legislative in character because the application of the rest of the provisions of the Act to the geographical area which is declared as a town area is dependent upon such declaration. Section 3 of the Act is in the nature of a conditional legislation. Dealing with the nature of functions of a non-judicial authority, Prof. S. A. De Smith in Judicial Review of Administrative Action (Third Edition) observes at page 163:-
"However, the analytical classification of a function may be a conclusive factor in excluding the operation of the audi alteram partem rule. It is generally assumed that in English law the making of a subordinate legislative instrument need not be preceded by notice or hearing unless the parent Act so provides".
8. In Bates v. Lord Hailsham of St. Marylebone & Ors. the facts were these: In 1964, the British Legal Association was formed. Out of about 26,000 practising solicitors some 2,900 were members of the association. The Lord Chancellor announced on May, 1, 1972, that the scale of fees under Schedule I to the Solicitors' Remuneration Order, 1883 were proposed to be abolished and that for all conveyancing transactions the system of quantum meruit was to be applied. On June 6, pursuant to section 56 (3) of the Solicitors Act 1957, the Law Society was sent by the committee set up under section 56 (1) a draft of the order proposed to be made under section 56 (2). The draft order was published in The Law Society's Gazette on June 21. The association set out two ::: Downloaded on - 15/04/2017 18:47:49 :::HCHP 16 circulars about the proposed order, the first at the end of May, to all solicitors, and the second on July 17, making a series of accusations against the Lord Chancellor and the Law Society. On July 11, the association sent printed submissions to the statutory committee, requesting that the order should not be approved at this juncture and that the Lord Chancellor should seek further consultations with the .
profession and professional organisations. On July 14, the association wrote to each member of the committee asking for further time and a deferment of the decision for two months. The Lord Chancellor's reply dated July 18, was that he saw no reason for postponing the meeting or for refraining from making the order in such terms as the committee approved. On July 18, the plaintiff as a member of the national executive committee of the association, took out a writ against all members of the statutory committee, seeking a declaration and an injunction, and on July 19, at 2 P.M. having previously notified the Treasury Solicitor of the of intention, he moved the court ex parte, seeking to restrain the committee from holding the meeting which was to be held at 4.30 P.M. on that day. The motion was dismissed by Megarry, J. and we feel rightly with the following observations:
rt "In the present case, the committee in question has an entirely different function: It is legislative rather than administrative or executive. The function of the committee is to make or refuse to make a legislative instrument under delegated powers. The order, when made, will lay down the remuneration for solicitors generally; and the terms of the order will have to be considered and construed and applied in numberless cases in the future. Let me accept that in the sphere of the so-called quasi-judicial the rules of natural justice run, and that in the administrative or executive field there is a general duty of fairness. Nevertheless, these considerations do not seem to me to affect the process of legislation, whether primary or delegated. Many of those affected by delegated legislation, and effected very substantially, are never consulted in the process of enacting that legislation, and yet they have no remedy. Of course the informal consultation of representative bodies by the legislative authority is a commonplace, but although a few statutes have specifically provided for a general process of publishing draft delegated legislation and considering objections (see for example, the Factories Act1961, Schedule 4), I do not know of any implied right to be consulted or make objections, or any principle upon which the courts may enjoin the legislative process at the suit of those who contend that insufficient time for consultation and consideration has been given. I accept that the fact that the order will take the form of a statutory instrument does not per se make it immune from attact, whether by injunction or otherwise; but what is important is not its form but its nature, which is plainly legislative".
9. We are, therefore, of the view that the maxim 'audi alteram partem' does not become applicable to the case by necessary implication.
::: Downloaded on - 15/04/2017 18:47:49 :::HCHP 1710. The second limb of the argument in support of the above contention is that the declaration made under section 3 of the Act being in the nature of subordinate legislation, it was the duty of the State Government to follow the same procedure which was applicable to the promulgation of rules under section 39 of the Act. Our attention was drawn in this connection to sub-section (3) of section 39 of the Act which .
provided that the power to make rules under the said section was subject to the condition of the rules being made after previous publication. We are of the view that it is not possible to equate a declaration to be made under section 3 of the Act with rules made under section 39. Sub-section (3) of section 39 of the Act does not in terms apply to a declaration to be made under section 3 of the Act. The contention that the declaration to be made under section 3 of the Act is in the nature of a subordinate legislation is also not tenable. We may refer at this stage to the decision of the Judicial Committee of the Privy Council in The Queen v. Burah.
of Section 9 of Act No. XXII of 1869 of the Indian Legislature which camp up for consideration in that case conferred upon the Lieutenant Governor of Bengal the power to determine whether that Act or any part of it should be applied to a certain area within his jurisdiction. It read as under:-
rt "9. The said Lieutenant-Governor may from time to time, by notification in the Calcutta Gazette, extend mutatis mutandis all or any of the provisions contained in the other sections of this Act to the Jaintia Hills, the Naga Hills, and to such portion of the Khasi Hills as for the time being forms part of British India. Every such notification shall specify the boundaries of the territories to which it applies."
17. We are, therefore, of the view that a notification issued under section 3 of the Act which has the effect of making the Act applicable to a geographical area is in the nature of a conditional legislation and that it cannot be characterised as a piece of subordinate legislation. In view of the foregoing, we hold that the contention of the plaintiff that the declaration made by the State Government under section 3 of the Act declaring the area in which the sugar factory of the plaintiff is situated as a part of the Tulsipur town area is invalid is not tenable."
19. In the case of Kamakhya Narain Singh vrs. State of Bihar and ors., reported in AIR 1981 Patna 236, the Division Bench of the Patna High Court has held that the State Government is competent to create a ::: Downloaded on - 15/04/2017 18:47:49 :::HCHP 18 Corporation by combining two municipalities or by including an area which was not a municipality. It has been held as follows:
"4. Mr. B. C. Ghose, learned counsel appearing for the petitioner, has .
raised a number of contention which I propose to discuss in detail along with the submissions of the learned Additional Advocate General, appearing on behalf of the State, and Sri Prabha Shanker Mishra, appearing on behalf of respondent No. 2. Firstly, it has been contended by Mr. Ghose that by theCorporation Act 1978 (Act 12 of 1978) the Legislature intended to create a Corporation of such municipal area having a population of two lacs but this could not have been done by combining two municipalities and such amalgamation was not permissible except by express resolution of the two municipalities as of provided for under Section 4 (1) (d) of the Municipal Act. He has urged that inclusion of Jagannathpur which was not a municipality, is also illegal. Learned Addl. Advocate General, on the other hand, has submitted that Section 1 of Corporation Act does not limit the power of the State Government to constitute corporation in the area where there rt is a municipality existing from before nor it envisages that the area sought to be covered must be a part of the municipal town. Thus, according to him, any urban population having an area of two lacs can be converted into corporation and this is the only requirement and the three areas combined together fully satisfy that condition. Here it will be relevant to refer to the relevant provisions of the Act and Sections 1 and 2 of the Act are as follows :
"1. Short Title: extent and commencement :
(1) This Ordinance may be called the Bihar Municipal Corporation Ordinance, 1978.
(2) It shall extend to the whole of the State of Bihar.
(3) It shall come into force in any city having a population of two lacs or more on such date as the State Government may appoint by notification and different dates may be appointed for different cities.
2. Constitution of Corporation and specification of the area thereof:
(1) The State Government may, by notification in the Official Gazette, declare any area including the area of any municipality or notified area constituted under the Bihar and Orissa Municipal Act, 1922 (B. & O. Act 7 of 1922) with such other areas as may be specified therein to be a Municipal Corporation, which shall be known by the name assigned to it by the State Government.
(2) The State Government may from time to time by notification in the Official Gazette alter the limits of such Municipal Corporation so as to include therein on exclude therefrom such area or areas as may be ::: Downloaded on - 15/04/2017 18:47:49 :::HCHP 19 specified in the notification." The word "City" as mentioned in Section 1 (3) has not been defined under the Act. City, according to Chambers' Dictionary, means a large town, a town with a Corporation or a Cathedral, the business centre or original area of a large town. "Town"
according to Strouds' 4th Edition, Vol. 5, Item No. 3 is as follows :
.
" 'Town' is not restricted by its legal meaning but is expanded popularly and means the space which, for the time being, is covered by, or occupied as accessory to, houses collected together in a mass, and in sufficient number to be ordinarily designated as a Town; and includes unbuilt of lands that may lie within the ambit of such collected mass of houses but no lands outside such of ambit though within a borough,"
Learned Additional Advocate General has drawn our attention to a Bench decision of the Calcutta High Court in the case of Balait Sheikh v. State of Bengal (AIR 1952 Cal 753) where the word 'Town' was rt interpreted by their Lordships in absence of any definition in the Bengal Municipal Act and held as follows (at p. 755):
"The word 'Town', in absence of any definition in the Act has to be understood in the sense in which ordinary people having the main attributes of the existence of houses in clear proximity, concentration of a large number of people in a comparatively small area and engagement of the bulk of the population in non- agricultural pursuits."
The word 'Town' has, however, a fairly defined connotation to the ordinary man--the main attributes of a Town being the existence of house in clear proximity concentration of a large number of people in a comparatively small area, engagement of the bulk of population in non- agricultural pursuits. This decision gives us some light OQ the subject.
Mr. Ghose has, however, relied on the definition of Section 4 (gg) of the Patna Municipal Corporation Act which reads as follows:
" 'Town' means the local areas comprised within the limits of Patna City Municipality and within Patna is defined in Section 2 of the Patna Administration Act, 1915, immediately before the commencement of this Act and includes any other area specified in a notification under Section 514."::: Downloaded on - 15/04/2017 18:47:49 :::HCHP 20
Reading the provisions of Act 12 of 1978 and after going through the relevant provisions it is difficult to accept the submission of Mr. Ghose that only those towns which have a population of two lacs can only be converted into Corporation. Section 2 of the Act clearly says that any area including the area of any Municipality or Notified Area constituted under the Municipal Ac) with such other areas (underlined by me) as .
may be specified therein to be a Municipal Corporation. The submission of Mr. Ghose is, therefore, contrary to the provisions of the Act which have to be read together and not in isolation in order to give harmonious construction. The provisions of Patna Municipal Corporation (Act) are not at all relevant for consideration and it confines to Patna and its adjoining area only. In my opinion, therefore, Legislature has given power to the State Government to include any area in order to constitute a Corporation; may be Municipality, Notified Area Committee joining the area with such area as the State Government may think fit and of proper. The only basic requirement is that it must have an urban population of two lacs or more. From the affidavit filed on behalf of the State, as I have stated earlier, it is clear that objections were invited from those living in area, sought to be included, and after the expiry of the period notification was issued and no objection was filed Therefore, the rt first contention of Mr. Ghosej fails."
20. In the case of Raghunath Pandey and ors. vrs. The State of Bihar and ors., reported in AIR 1982 Patna 1, the Division Bench of the Patna High Court has held that inclusion of suburbs bearing urban character does not mean that agriculture of the area is likely to be ruined. It has been also held that it is not necessary to ascertain the opinion of the Panchayat under Section 3(3) of the Bihar Panchayati Raj Act, 1948 and inclusion of Panchayat in Municipal Corporation does not amount to stultifying progress of Panchayat. It has been further held that constitution of Municipal Corporation on dissolution of existing Municipality or Gram Panchayats does not amount to depriving the rights of the seating Municipal Councilors and Members to continue as such for the full term and the principles of natural justice won't be violated. It has been held as follows:
"15. It has further been argued that the inclusion of the Gram Panchayat is in violation of P. R. Act.Section 3 of that Act deals with the establishment and constitution of the Gram Panchayat. The first two Sub-sections deal with initial ::: Downloaded on - 15/04/2017 18:47:49 :::HCHP 21 constitution of the Gram Panchayat and the next two Sub-sections deal with inclusion and exclusion of any portion from that area. For better appreciation I would quote the first four Sub-sections of Section 3 of the P. R. Act. They are as follows:--
"Establishment and constitution of a Gram Panchayat:--
.
(1) For every village or part of different villages, the Government may, by notification, establish a Gram Panchayat:--
Provided that the Government may, if it thinks fit, establish one Gram Panchayat for a group of contiguous villages or more than one Gram Panchayat in a big village consisting of several Tolas.
(2) The Government shall specify the name and the local limits of the of jurisdiction of Gram Panchayat in the notification mentioned in Sub- section (1).
(3) The . Government may, by notification in the official Gazette, alter the local limits of the jurisdiction of any Gram Panchayat by including therein, or excluding therefrom, any village or part of a village and also rt alter the name of such Gram Panchayat:
Provided that before making any alteration in the local limits of the jurisdiction of any Gram Panchayat, the Government shall, in the prescribed manner, ascertain the views of the people of the area affected by such alteration, (4) Upon the issue of a notification under Sub-section (3), the Gram Panchayat shall be deemed to have been established under Sub-section (1) with its local limits so altered."
It would appear from Sub-sections (1) and (2) that the Government may straightway issue a notification constituting a Gram Panchayat for a group of contiguous villages or may constitute more than one Gram Panchayat in any big village consisting of several tolas. The name and local limit of jurisdiction will have to be given in the notification. Thus there is no provision for eliciting the opinion of the public regarding the constitution of the Panchayat. But if after constitution any area is sought to be included or excluded the Government have to ascertain the views of the people of the area affected by such alteration as required by Sub-section (3) quoted above. Mr. Mridul has contended that bringing the Panchayat within the fold of the corporation amounts to altering the areas and so it was incumbent on the State Government to ascertain the views of the people of that area. The Advocate General on the other hand has argued that this provision is applicable only where an area is desired to be taken out from one panchayat and put in another panchayat and not in a situation where the entire panchayat is included within a corporation. He has relied upon certain cases where actually some areas from one panchayat were put in another panchayat but instead of issuing one notification of exclusion and inclusion two notifications were made defining the limits of the two panchayats. It was held that in such situation it was not necessary to obtain the views of the people. It all depends upon the notification that is issued. The cases referred to are reported in 1965 B. L. J.R. 227 (Ramautar Mahton v. Sub-divisional Officer, Begusarai 1965 B. L. J. R., 397 (Daroga Singh v. State of Bihar) and 1966 B. L. ::: Downloaded on - 15/04/2017 18:47:49 :::HCHP 22 J. R. 779 (Braalal Prasad v. State of Bihar). The first two are single Judge cases but the third one is a Division Bench. Brijlal Prasad's case was dismissed on the . ground of delay but the earlier two single Bench decisions have also been noticed. Mr. Mridul has challenged these decisions on the ground that there is violation of natural justice by taking recourse to such a method, and merely issuing two notifications in a different garb instead of one, gives the colour of .
contrivance which is unconstitutional. The learned Advocate General has submitted that if the notification can be supported by the P. R. Act it can never be said that they are unconstitutional until and unless the provision itself held to be ultra vires. The argument of the Advocate General is supported by the decision of this very Court and as such it cannot be said that issuing of notification would be unconstitutional. It would thus follow that the opinion of the Panchayats as or in the manner laid down in Sub-section (3) of Section 3 of the P. R. Act, was not required to be elicited before including those panchayats within the limits of the corporation, and the notification (Annexure 1) is not in of violation of any provision of the P. R. Act. Attention was also invited to Article 40 of the Constitution which says that "the State shall take steps to organise village panchayat and endow them with such powers and authority as may be necessary to enable them to function as unit of self-Government". It has been argued that the directive principles require the State to develop panchayat as rt unit of the self-Government, and hence it would be against the directive principles to obliterate the Gram Panchayat by bringing them within the fold of corporation. The argument is not appealing because it could never be the intention of the constitution, while laying down directive principles, to rule the whole country through panchayats and panchayats alone. If the intention in any act of the State Government be to stultify the progress of the gram panchayat, then of course Article 40 might be attracted but where better privileges are given to particular area, better administration and all round improvement is envisaged in any act, I do not think Article 40 is any way offended. If of course the constitution of the corporation is held to be unconstitutional the question would be otherwise.
20. Coming to the second point (at pags 9 of the judgment) with the creation of the corporation, the municipality and some gram panchayats have no doubt ceased to function. The Chairman and Members of the Committee as also the Mukhiyas had a right to continue for the period they were elected. They were endowed with certain rights and burdened with certain responsibilities, all of a nature commanding respectful regard from the public. Therefore the consequences they may personally suffer may be civil consequences. The question however is as to whose civil consequences will be taken into account -- those of a few persons who may choose to come to Court of law, or of the mass which is going to be affected or benefited in other words it should be for examination if the general public will be benefited by the corporation or they will suffer on account of it. Whenever any act, even beneficial is done, it is hardly possible to find that somebody has not suffered. If a pitch' road is constructed the builockcart-walas who had a right to carry their own profession suffer. When buses are allowed to ply on the road the ricksha-walas do suffer. When tram-lines are laid, the bus-owners suffer. When circuit Bench of High Court is created at any place the counsel of the parent Court suffer and raise their voice against it When a new school or college is opened, the older institutions suffer, as the students who would have usually gone there, go to ::: Downloaded on - 15/04/2017 18:47:49 :::HCHP 23 new institutions. When a new district is carved out some residents of parent district do suffer. Similar is the case when a new judgship is carved out from an old one. But in all these cases it is the advantage to the general public which is kept in view. If there is a gain to the mass the loss to a few individuals is insignificant. The civil consequences of a few individual should not be considered in isolation, where any act is for benefit to the general public. It was .
argued that the villagers of the area included within the corporation have their own right of cultivating their lands, which they might loose by bringing the area within the corporation. This argument does not cut any ice, because whether it is a corporation or a municipality or a village, if the land is agricultural no body can be stopped from cultivating it: rather by bringing it under corporation, better facilities of cultivation may be made available to them. In cases like this, therefore, a pragmatic view of the whole thing should be taken. The inspection hole should not be narrow. The Chairman and the Commissioner may also have better chances and better prospects with the corporation coming in. There will of be so many electoral posts for which they may contest and those who succeed will certainly have higher status than the present one, What would have happened if the population of Muzaffarpur would have been 2 lakhs? The Corporation Act would have applied straightway, the Chairman and Commissioners would not have been heard at all. even though they would have rt suffered the same consequence, which they are suffering now. How can the same consequence be civil in one case only to enable them to raise the plea? In my opinion whether it is a case of civil consequence or not should be determined on facts of individual cases and the answer to this question must be given after considering not only the rights of a few but the rights of the general public going to be affected, and for the simple gains of a few the advantage to the mass must not be sacrificed. Taking a pragmatic view of the situation, I am of opinion that the consequences which the petitioners may suffer will be such a small drop in the ocean, that in the larger interest it should be held that the petitioners also do not suffer from any civil consequence.
22. Thus the impugned notification (Annexure 1) does not offend against the principle of natural justice, on the ground that the petitioners would suffer civil consequences.
24. It is thus clear that in the instant case (a) petitioners do not suffer from any civil consequence, (b) even if they suffer, the law of natural justice will not be attracted, and (c) it is not a case of delegated legislation at all : rather it is a piece of conditional legislation, where law of natural justice does not operate."
21. In the instant case, the Panchayat area has acquired the urban character after the establishment of the industrial units, including Cremica and Nestle and 78 other industrial units. The civic amenities are required to be provided to the area in larger proportion which the Gram Panchayat cannot cater for, taking into consideration its meager resources.
::: Downloaded on - 15/04/2017 18:47:49 :::HCHP 2422. Their lordships of the Hon'ble Supreme Court in the case of Bhaskar Textile Mills Ltd. vrs. Jharsuguda Municipality and others, reported in AIR 1984 SC 583, have held that while including a village in a .
municipality, proviso to Section 4(1) of the Orissa Municipal Act, 1950, has no application and it cannot be a ground to challenge the notification. It has been further held that when the objections have been examined by the District Magistrate and Revenue Divisional Commissioner and the Department has agreed and final notification was issued, it could not be said of that objections had not been considered by the State Government. It has been held as follows:
rt " 15. The argument proceeds on the assumption that the proviso to s.4(1) applies. But a bare perusal of the proviso clearly indicates that the requirement is that two-thirds of the adult male population of the town to which it refers should be engaged in non-agricultural ' pursuits. The provision, to our mind, applies not to all the classes of sub-s.(l) of s.4 but it applies only to cl.(a) of sub-s.(l) of s.4, because it is cl.(a) of s.4(1) which talks of town. Therefore, the proviso, in . . Our opinion, has no application to the present case and that cannot be taken to be a ground for challenging the notification for inclusion of village Ektali in the Jharsuguda Municipality. This takes us to the third ground.
16. The appellant had filed an objection under sub-s.(2) of s.4. The said objection was examined by the District Magistrate, Sambalpur and the Revenue Divisional Commissioner (Northern Division), Sambalpur:
They overruled the objection treating it to be of general nature. Thereafter, the Community Development and the Panchati Raj (Grama Panchayat) Department were consulted to agree with this proposal, to which they agreed, and it was thereafter that the Urban Development Department issued a final notification dated 12th August, 1975 to include the above village into the municipal limits of Jharsuguda Municipality. The contention of the appellant that the objection had not been considered by the State Government cannot be accepted in as much as the objection is required to be made through the Magistrate of the district. Naturally, the District Magistrate while forwarding the objection to the State Government made his comment. The Revenue Divisional Commissioner intervenes in the channel of communication between the District Magistrate and the State Government and he, therefore, had an occasion to. process the matter. The-State Government while dealing with the matter consulted the. Panchayati Raj Department and ::: Downloaded on - 15/04/2017 18:47:49 :::HCHP 25 ultimately notified in terms of notification dated 12th August, 1975. In the circumstances it cannot be accepted that the objection filed by the appellant had not been considered by the State Government."
23. Now, as far as proviso to Section 3(1)(iii) of the H.P. Municipal .
Act, 1994 is concerned, it is for the State Government to take a conscious decision under the proviso after taking into consideration the size of the area and the municipal services being provided or proposed to be provided by an industrial establishment in that area and such other factors as it may deem fit. Thus, there is no merit in the contention of Mr. Ajay Sharma, Advocate, of appearing for the petitioner that proviso to Section 3(1) (iii) of the Himachal Pradesh Municipal Act, 1994, has not been taken into consideration.
24. rt Their lordships of the Hon'ble Supreme Court in the case of Baldev Singh and ors. vrs. State of Himachal Pradesh, reported in (1987) 2 SCC 510, have held that affording of hearing to the affected persons is essential prerequisite for constituting notified area. However, it has been further held that hearing contemplated is not required to be oral and can be by inviting objections and disposing them of in a fair way. It has been held as follows:
"4. Appellants counsel has raised a more serious issue namely denial of an opportunity of being heard before the notified areas has been constituted Since Section 256 of the Act requires certain aspects to be satisfied before a notified area can be constituted, factual determination had to be made as to whether those statutory conditions were satisfied Ours is a democratic polity. At every level, from the villages up to the national level; democratic institution have been introduced The villages are under Gram Panchayats, urban areas under Municipalities and Corporations, districts are under Parishads for the State the is a Legislature and for the entire country, we have the Parliament People residing within Gram Panchayats have their electoral rights to exercise and in exercise of such rights, they have elected their representatives. Citizens of India have a right to decide, what should be the nature of their society in which they live-agrarian, semi-urban or urban Admittedly, the way of life varies, depending upon where one lives ::: Downloaded on - 15/04/2017 18:47:49 :::HCHP 26 Inclusion of an area covered by a Gram Panchayat within a notified area would certainly involve civil consequences. In such circumstances it is necessary that people who will be affected by the change should be given an opportunity of being heard, otherwise they would be visited with serious consequences like loss of office in Gram Panchayats. an imposition of a way of life, higher incidences of tax and the like.
.
5. Reliance was placed on two decisions of this Court in support of the appellants' stand that natural justice required an opportunity of being heard to be extended to the people of the area before the administrative decision to constitute the notified area was taken The first is the case of S.L. Kanpoor V Jagmohan and Ors. 1. (1980) 4 SCC 379. That was a case where the committee constituted under the Municipal Act was superseded. This Court held that where the administrative action entails civil consequences, observance of natural justice would be warranted of and unless the law excludes the application of natural justice it should be taken as implanted into the scheme. The other is the case of Slate of Orissa v Sridhar Kumar Mallik and Ors.. 2. (1985) 3 SCC 697. where the validity of the action taken under Section 417-A of the Orissa Municipal Act in constituting a notified area was being examined. The Court, rt referring to the statutory scheme, found :
The extension of the Orissa Municipality Act to an area other than a municipality is a matter of serious moment to the residents of the area. It results in the provision of amenities and conveniences necessary to civil life and their regulation by a local body. But the Act also provides for the imposition of taxes of different kinds on the residents. The tax structure does not embody an integrated unified impost expressed in a single tax measure. Different kinds of taxes are contemplated by the Act.
The scheme set forth in Chapter XXX-A of the Act intends that before the Government extends the operation of the Act to an area under a municipality it must afford an opportunity to the local residents to object to the proposed action. The objections are submitted to the District Magistrate, who forwards them along with his views to the State Government. The State Government must take into consideration all the material before it and decide thereafter what should be the precise area to which the Act should be extended, and indeed whether all the provisions of the Act or only certain specified provisions should be so extended. The possibility of some only of the provisions of the Act being applied to the notified area is evident from the terms in which the grant of power has been conferred on the State Government. Sub-section (1) of Section 417-A specifically envisages that when issuing the notification contemplated therein the State Government must decide whether administrative provision needs to be made "for all or any of the purposes" of the Act in the area proposed to be notified. Unless the proposal formulated in the proclamation made under Sub-section (1-a) of Section 417-A is precise and clear, and indicates with sufficient accuracy the area intended to be notified, and further indicates whether the administrative provision is proposed for all the purposes of the Act or only some of them, and if only some of them then which of them, it will not be possible for the residents to properly avail of the right conferred on them by the statute to make their objections to the proposal of the State Government. We do not see how it can be otherwise.::: Downloaded on - 15/04/2017 18:47:49 :::HCHP 27
It is a fact that the Orissa Act provides in clear terms a right of hearing whereas Section 256 of the Himachal Act makes no such provision but the settled position in law is that where exercise of a power results in civil consequences to citizens, unless the statute specifically rules out the application of natural justice, the rules of natural justice would aply. We accept the submission on behalf of the appellants that before the notified .
area was constituted in terms of Section 256 of the Act, the people of the locality should have been afforded an opportunity of being heard and the administrative decision by the State Government should have been taken after considering the views of the residents. Denial of such opportunity is not in consonance with the scheme of the Rule of law governing our society. We must clarify that the hearing contemplated is not required to be oral and can be by inviting objections and disposing them of in a fair way.
of
7. The appeal is allowed and the impugned notification of 31st March, 1982 constituting the particular notified area is quashed. We make it clear that it is open to the State Government to make a fresh notification after complying with the law and this judgement of ours would not stand in the way of the State Government to do so. Parties are directed to bear rt their own costs."
25. In the instant case, the objections were called for from the residents of the area. These were also notified in the official gazette on 7.7.2015 and thereafter, the objections were heard in just, fair and reasonable manner. Thus, it cannot be held that there was violation of principles of natural justice.
26. Their lordships of the Hon'ble Supreme Court in the case of Sundarjas Kanyalal Bhathiaja and ors. vrs. The Collector, Thane, Maharashtra and ors., reported in AIR 1990 SC 261, have held that function of the Government while establishing a Corporation is neither executive nor administrative. It is legislative process. The rules of natural justice are not applicable to legislative action plenary or subordinate. It has been held as follows:
"23. Reverting to the case, we find that the conclusion of the High Court as to the need to reconsider the proposal to form the Corporation has neither the attraction of logic nor the support of law. It must be ::: Downloaded on - 15/04/2017 18:47:49 :::HCHP 28 noted that the function of the Government in establishing a Corporation under the Act is neither executive nor administrative. Counsel for the appellants was right in his submission that it is legislative process indeed. No judicial duty is laid on the Government in discharge of the statutory duties. The only question to be examined is whether the statutory provisions have been complied with. If they are complied with,, .
then, the Court could say no more. In the present case the Government did publish the proposal by a draft notification and also considered the representations received. It was only thereafter, a decision was taken to exclude Ulhasnagar for the time being. That decision became final when it was notified under Section 3(2). The Court cannot sit in judgment over such decision. It cannot lay down norms for the exercise of that power. It cannot substitute even "its juster will for theirs.""
27. Their lordships of the Hon'ble Supreme Court in the case of of Karnail Singh and another vrs. Darshan Singh and ors., reported in 1995 Supp.(1) SCC 760, have held that amalgamation of two gram sabhas rt into one is an administrative decision in public interest and if there is some material, the Court would not interfere unless it is vitiated by malafides. It has been held as follows:
"[6] But the second contention of Shri Manoj merits acceptance. It is seen that the government not only had taken into consideration that there exist a high school, a mini bank and veterinary hospital but also with a view to avoid friction among the people of their respective locations, the government thought it expedient to amalgamate the two gram sabhas into one. It would also be clear that Atma Ram appears to have misused his office and obtained Fictitious and collusive decrees in the names of his supporters and had appropriated valuable 86 acres 2 kanals of the panchayat land for his personal benefit. The government appears to have thought that such a misuse or abuse of the power should be prevented by amalgamating two panchayats.
Other corrective measures though may be evolved, the action of the government cannot be said to be unwarranted or illegal or invalid. Atma Ram represents Harigarh and Bhorakh Gram Panchayat is represented by another Sarpanch. It would appear that if a person, having sufficient influence over the people in the one area, when he had managed to secure the valuable gram panchayat property in his name for personal benefit, the government thought it expedient that such misuse or abuse of office could be curbed and such insidious effects could be prevented by amalgamation. The decision taken, thereby, cannot be said to be irrelevant, arbitrary and unwarranted, on the facts of the case. It is seen that the public interest would be better ::: Downloaded on - 15/04/2017 18:47:49 :::HCHP 29 served for taking appropriate decision by the government either for constituting one or more than one gram sabha areas or amalgamating into an existing one. It is a public policy and an administrative decision taken by the government. It is an administrative action. But the government should have material and should consider the material before it takes the decision. In .
the absence of any material, it can be said that it is an arbitrary decision taken by the government. But when there is some material before the authority or the government and the same was considered though two views may be possible to be taken on the same material, it must be left to the government to take a decision which unless it is vitiated by mala fides, the court cannot substitute its view to that of the government in constituting two " separate gram sabhas or equally amalgamating the two existing gram panchayats situated in the revenue estate of or two contiguous villages with a population of not less than 500. [7] Mr M. K. Dua, learned counsel appearing for the respondent has stated that the two gram sabhas, created on 30/6/1988, have been properly functioning and that, therefore, the government was not justified in amalgamating the two rt panchayats into one. We have already stated that it is only an executive policydecision taken by the government to create separate panchayats or to amalgamate the existing gram sabhas. It would not be for the courts to evaluate and decide whether the existence of the two gram sabhas should be continued or further bifurcated or amalgamated. It is also stated in the additional affidavit that Atma Ram had not misused his office nor has taken the properties into his possession and in support thereof relied on the entries from the revenue records. It is further stated that it was done in the year 1966. We cannot appreciate that evidence. The report given by the Director of Panchayats shows that the Sarpanch had misused the office and obtained fictitious decrees. Necessarily the entries in the revenue records would be in the names of spurious persons but that does not conclude that Atma Ram had not misused the office and the circumstance taken by the government cannot be said to be irrelevant or arbitrary."
28. Neither specific malafides have been alleged against a particular person nor that person has been arrayed as a party.
29. Their lordships of the Hon'ble Supreme Court in the case of Cantonment Board, Secunderabad vrs. G. Venketram Reddy and ors., reported in 1995 Supp. (2) SCC 576, have held that the word "municipality"
has a wide connotation. The Constitution also understands it in a broad ::: Downloaded on - 15/04/2017 18:47:49 :::HCHP 30 sense. Articles 243 P and 243 Q indicate that a Corporation or a Municipal Council or Nagar Panchayat is constituted on the strength of population and the area or place where it is constituted, namely, rural or urban. But, all .
these three are deemed to be municipality. It has been held as follows:
"3. Section 60 of the Act reads as under:-
"S.60 - General power of taxation:- (1) The Board may impose with the previous sanction of the Central Government in any Cantonment any tax which under any enactment for the time being in force may be imposed in any Municipality in the State wherein such cantonment is situate".
of A very perusal of it would indicate that this is a general power of taxation which is enjoyed by the Board which can be exercised with the previous sanction of the Central Government. There was no dispute that the octroi " was levied by the Cantonment Board after obtaining sanction of the rt Central Government. But what has been found is that the ambit of the power being restricted to only those taxes which for the time being in force could be imposed by any Municipality in the State wherein such cantonment was situated, the appellant was precluded from imposing octroi as no such octroi was being levied by any Municipality in the State. How the expression, 'Municipality in the State' should be understood? The word 'Municipality' has been defined is Webster's New Dictionary as, 'a town, city or borough which has local self government'. In Black's Law Dictionary it is extended to 'legally incorporated or duly authorised association of inhabitants of limited area for local governmental or other public purposes. A body politic created by the incorporation of the People of a prescribed locality invested with the subordinate powers of legislation to assist in the civil government of the State and to regulate and administer local and internal affairs of the community'. This word thus has a wide connotation. The Constitution also understands it in broad sense. Chapter (IX-A) deals with the Municipality. Clause (e) of Article 243-F defines Municipality to mean, 'an institution of self- government constituted under Article 243-Q' Article 243-Q reads as under:
"243-Q, Constitution of Municipalities :-
(1) There shall be constituted in every State, -
(a) a Nagar Panchayat (by whatever name called) for a transitional area, that is to say, an area in transition from a rural area to an urban area;
(b) a Municipal Council for a smaller urban area; and ::: Downloaded on - 15/04/2017 18:47:49 :::HCHP 31
(c) a Municipal Corporation for a larger urban area, b accordance with the provisions of this Part:
Provided..........."
This definition indicates that a Corporation or a Municipal Council or .
Nagar Panchayat is constituted on strength of population and the area or place where it is constituted namely rural or urban. But all the three are deemed to be municipality. A Municipal Corporation with a larger area is as much a municipality as a council with smaller area. The expression, 'Municipality in the State' thus has to be read in broad and larger sense.
The Hyderabad Corporation which came into existence in 1956 is as much municipality as any other municipality in the State, Since Corporation is imposing octroi the Board could in exercise of power under Section 60 levy octroi."
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30. Their lordships of the Hon'ble Supreme Court in the case of Solapur Midc Industries Association and ors. vrs. State of Maharashtra rt and ors., reported in (1996) 9 SCC 621, have held that notification enlarging limits of territorial jurisdiction of Municipal Corporation can bring within the municipal limits industrial estate/area even though the same has not yet withdrawn from the purview of Industrial Development Corporation under S. 56 of Maharashtra Industrial Development Act, 1961. It has been further held that the two Acts i.e. Bombay Provincial Municipal Corporation Act, 1949 and Industrial Development Corporation under S. 56 of Maharashtra Industrial Development Act, 1961, operate in different fields and there is no inter se conflict between them. It has been held as follows:
"3. It is not disputed that since the State Government has not yet withdrawn the industrial estate/industrial area concerned from the hold of the Corporation, the provisions of the 1961 Act continue to apply. The Preamble thereof is suggestive of its objects sought to be achieved namely the orderly establishment in industrial areas and industrial estates of industries, and to assist generally in the organisation thereof, and for that purpose to establish the Industrial Development Corporation and for purposes connected with the matters therewith. The purpose of the 1949 Act on the other hand, as is suggestive from its Preamble, is to provide for the establishment of Municipal Corporations with a view to ensure a better municipal government of the cities in which municipal corporations are set up. These being the basic ::: Downloaded on - 15/04/2017 18:47:49 :::HCHP 32 differences as to the ambit of the two statutes, the High Court, in our view, rightly arrived at the conclusion that there was inter se no conflict between the two. There may be certain areas such as provision for civil amenities in which there is identity of purpose but these are ancillary and incidental to the main purpose of the respective two statutes. The suggestion drawn from the Assembly debates, to which our attention has .
been drawn, while passing the 1961 Act, suggestive of the fact that the industrial estates or industrial areas on ripening were meant to be kept under the purview of the 1961 Act until some civic administration in the form of a Panchayat or Municipality could take over is not supported by any statutory provision available in the respective two Acts. As said before the topics of legislation being different, there was no question of their rubbing against each other because being enacted under two different legislative fields."
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31. In this case also, the H.P. Panchayati Raj Act, 1994 and H.P. Municipal Act, 1994, operate in entirely different fields.
32. Their lordships of the Hon'ble Supreme Court in the case of Saij rt Gram Panchayat vrs. State of Gujarat and ors., reported in (1992) 2 SCC 366, have held that while constituting the industrial township out of the rural area, there is no violation of the Constitutional provision regarding local self government for rural areas contained in Part IX of the Constitution where notified industrial areas are converted by notification into industrial townships and also removed from the ambit of Gram Panchayats. There was no violation of Constitutional Scheme of local self-government and the purpose of notification under S. 16 was to avoid dual control and administration. It has been held as follows:
"16. The contention is based on a misconception about the relationship of the provisions of Parts IX and IXA of the Constitution with any legislation pertaining to industrial development. The Gujarat Industrial Development Act operates in a totally different sphere from Parts IX and IXA of the Constitution as well as the Gujarat Panchayats Act, 1961 and the Gujarat Municipalities Act, 1962 - the latter being provisions dealing with local self Government while the former being an Act for industrial development, and orderly establishment and organisation of industries in a State. The industrial areas which have been notified under Section 16 of the Gujarat Industrial Development Act on 7.9.1993 were notified as industrial areas under the Gujarat ::: Downloaded on - 15/04/2017 18:47:49 :::HCHP 33 Industrial Development Act long back in the year 1972. These industrial areas have been developed by the Gujarat Industrial Development Corporation and they can hardly be looked upon as rural areas covered by Part IX of the Constitution. It is only such industrial areas which can be notified under Section 16 of the Gujarat Industrial Development Act, 1963. If by a notification issued under Section 16, these industrial areas .
are deemed to be notified areas under the Gujarat Municipalities Act and are equated with industrial townships under the proviso to Clause (1) of Article 243Q, the constitutional scheme is not violated. In fact, under Chapter 3 of the Gujarat Industrial Development Act, 1962, the Gujarat Industrial Development Corporation, has been given power, inter alia, to develop land for the purpose of facilitating the location of industries and commercial centres. It has also been given the power to provide amenities and common facilities in such areas including provision of roads, lighting, water supply, drainage facilities and so on. It may do this of either jointly with Government or local authorities or on an agency basis in furtherance of the purposes for which the corporation is established. The industrial area thus has separate provision for municipal services being provided by the Industrial Development Corporation. Once such an area is a deemed notified area under the Gujarat Municipalities Act, rt 1964, it is equated with an industrial township under Part IXA of the Constitution, where municipal services may be provided by industries. We do not see any violation of a constitutional provision in this scheme."
33. The area has become industrial hub. It is necessary for the State Government to provide basic amenities and other facilities to the residents of the area by constituting Nagar Panchayat.
34. Their lordships of the Hon'ble Supreme Court in the case of State of Maharashtra and another vrs. Deep Narayan Chavan and others, reported in (2002) 10 SCC 565, have held that the moment the Corporation is constituted lawfully, the elected Municipal Council would cease to function and the Councillors, though elected would have to vacate the office. The apprehension that even in such an event the Municipal Council would continue to function for the balance of its duration of five years under Article 243-U was repelled. It has been held as follows:
"2. Mr. Lalit, learned counsel appearing for the State of Maharashtra, contends that once a Municipal Council is constituted, then its duration should be five years in accordance with the constitutional provisions ::: Downloaded on - 15/04/2017 18:47:49 :::HCHP 34 contained in Article 243U and, therefore, in the event the writ application is dismissed and the State Government constitutes a Corporation, the Municipal Council will continue to function. This apprehension, in our considered opinion, is misconceived, inasmuch as under Section 341 of the Maharashtra Municipal Councils, Nagar Panchayats and Industrial Townships Act, 1965 when the whole of the local area comprising a .
municipal area ceases to be a municipal area, with effect from the date on which such local area ceases to be a municipal area, the Council constituted for such municipal area shall cease to exist or function and the Councillors of the Council shall vacate office. Article 243U of the Constitution unequivocally indicates that every Municipality, unless sooner dissolved under any law for the time being in force, shall continue for five years from the date appointed for its first meeting and no longer. The expression "unless sooner dissolved under any law for the time being" would bring within its sweep the provisions of Section 341 of the Maharashtra of Municipal Councils, Nagar Panchayats and Industrial Townships Act, 1965 and therefore the moment the Corporation is constituted in ...3 (3) accordance with law, the elected Municipal Council would cease to function and so also the Councillors though elected will have to vacate the office. In this view of the matter, we are not inclined to interfere with the interim rt order passed by the Bombay High Court directing holding of election to the Municipal Council."
35. Section 120 of the Himachal Pradesh Panchayati Raj Act, 1994 provides that every Panchayat shall continue for five years from the date appointed for its first meeting and no longer unless sooner dissolved under the Act. Now, as far as Section 140 of the same Act, referred to by Mr. Ajay Sharma, Advocate, for the petitioner is concerned, if at any time, it appears to the State Government or the prescribed authority that a Panchayat is persistently making default or abuse of power etc., it is for the State Government to provide reasonable opportunity to the Panchayat for furnishing its explanation. In the present case, the Gram Panchayat area is being converted into Nagar Panchayat and objections were called from all the members likely to be affected by the impugned notification. Their lordships of the Hon'ble Supreme Court in the case of Kamal Jora vrs. State of Uttarakhand and anr., reported in AIR 2013 SC 2242, have held that when the objections were called from all the persons likely to be affected and ::: Downloaded on - 15/04/2017 18:47:49 :::HCHP 35 the objections were filed and considered, it would be in conformity with the principles of natural justice. Their lordships have held as follows:
"12. Hence, the first question that we have to decide is whether an opportunity of hearing was granted to the Municipal Council, Haridwar .
before the two notifications dated 21.7.2011 were issued dissolving the Haridwar Municipality and appointing an administrator under Section 8-AA of the Act. The public notice which was issued on 29.06.2011 soon after the judgment dated 23.06.2011 of the Division Bench of the High Court in Special Appeal No.104 of 2011 is extracted hereinbelow:
"Under Section 3 sub-section (2) of Uttar Pradesh Municipal Corporation Act, 1959 (U.P. Act No.2 of 1959) (as applicable in the State of Uttarakhand) read with Article 243 U of Part 2, it is the considered opinion of the State Government that smaller Urban of Area Nagar Palika Parishad, Haridwar be converted into a larger Urban Area and consequently into a Municipal Corporation, Haridwar.
In view of the above, the Chairman of Nagar Palika Parishad, Haridwar, the councilors of Nagar Palika Parishad, rt Haridwar and the entire public who ordinarily reside in the said area are invited to give their objections and suggestions. The written objections and suggestions should reach the office of Director, Department of Urban Development, Uttarakhand 43/6, Mata Mandir Marg Dharmpur, Dehradun by 11th July 2011. Any suggestion and objection received after the said notified date will not be accepted. On the receipt of the written objections and suggestions, a hearing would be done on 13th July 2011 by Principal Secretary, Urban Development Department, Government of Uttarakhand in the office of Director, Department of Urban Development, Uttarakhand 43/6, Mata Mandir Marg, Dharmpur, Dehradun. The time would be 1.30 P.M. to 4.00 P.M. During the hearing the persons would also be given an opportunity of personal hearing. After receiving such objections and suggestions and after considering the same, the final decision to convert the place into a larger Urban Area will be taken."
It will be clear from the aforesaid public notice dated 29.06.2011 issued by the Government of Uttarakhand that the Chairman of the Haridwar Municipality, the Councilors of Haridwar Municipality and the entire public who ordinarily reside in the area were invited to give their objections and suggestions. It will also be clear from the public notice dated 29.06.2011 extracted above that on receipt of the written objections and suggestions, a hearing was to be conducted on 13th July 2011 by Principal Secretary, Urban Development Department, Government of Uttarakhand between 1.30 p.m. to 4.00 p.m. and during the hearing the persons were to be given an opportunity of personal hearing on the objections. By a subsequent corrigendum the date of hearing was altered to 16.07.2011. We further find from paragraph 4 of the order dated 19.07.2011 annexed to the counter affidavit filed on behalf of respondent Nos. 1 and 2 as Annexure C-I that the Principal Secretary Urban Development Department, Government of Uttarakhand ::: Downloaded on - 15/04/2017 18:47:49 :::HCHP 36 has provided an opportunity of hearing to the objectors on their respective objections on 16.07.2011 from 11.00 a.m. to 3.00 p.m. at Kumbh Fair Controlling House, Haridwar and amongst the objectors there were several Municipal Councilors of Haridwar Municipality, namely Dinesh Joshi, Rakesh Prajapati, Yashoda Devi, Leela Devi, Ashok Sharma, Jagdhir Singh, Nikhil Mehta, Idris Ansari, Satya Narayan, .
Karuna Sharma, Sanjay Sharma, Radhey Krishna, Prabha Ghai and Ram Ahuja. Hence, the appellant, who was the Chairman of the Municipal Council, Haridwar could have also participated in the hearing in support of his objections. We cannot, therefore, find any infirmity in the impugned judgment of the Division Bench of the High Court that an opportunity of hearing was actually given to all persons likely to be affected by the two notifications dated 21.07.2011."
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36. The moment the Nagar Panchayat, Tahliwal is constituted, the Gram Panchayat would cease to function and the office bearers of the Gram Panchayat would have to vacate the office.
rt
37. Under Section 268 of the Himachal Pradesh Municipal Act, 1994, it has been stipulated that when a municipal area is constituted under the Act, the State Government may appoint a person to exercise the powers, discharge the duties and perform the functions of the municipality, for a period not exceeding six months or until the municipality is established, whichever is earlier, and he shall for the purpose be deemed to be the municipality. The person, so appointed under sub-section (1) shall comply with such directions as may be given to him by the State Government from time to time for carrying the said purposes.
38. Their lordships of the Hon'ble Supreme Court in the case of Municipal Board, Hapur and ors. vrs. Jassa Singh and ors., reported in (1996) 10 SCC 377, have held that the Legislature of the State may, by law, endow the municipalities powers and authority as may be necessary to enable them to function as institutions of self- government. It has been held as follows:
::: Downloaded on - 15/04/2017 18:47:49 :::HCHP 37"6. Clause (b) thereof provides for the regulation or prohibition of any description of traffic in the streets where such regulation or prohibition appears to the Board to be necessary. It would, thus, be seen that the Board has been empowered statutorily to prescribe the fee for use of the public property vesting in or belonging to the municipality. Even under the recent amendment brought by the Constitution [73rd .
Amendment] Act, 1992 which came into force w.e.f. April 20, 1993, it imposes the statutory responsibilities on the municipalities. Article 243 - p(d) defines "municipal area" to mean the territorial area of a Municipality as is notified by the Governor. Article 243(a)(i)envisages that subject to the provisions of the Constitution, the Legislature of a State may, by law, endow the municipalities powers and authority as may be necessary to enable them to function as institutions of self- government and such law may contain provisions for the devolution of powers and responsibilities upon municipalities, subject to such of conditions, as may specified therein, with respect to the preparation of plans for economic development and social justice. Entry 17 of the 12th Schedule provides for public amenities including street lighting, parking lots, bus stops and public conveniences. Thus, the Constitution enjoins the appropriate Legislature to provide for preparation of the plans for rt economic development and social justice including power to provide public amenities including street lighting, parking lots, bus stops and public conveniences. On such public amenities including bus stops having been provided by the municipalities, as a is statutory duty, it is the duty of the user thereof to pay fee for service rendered by the municipality. The municipality had prescribed the minimum fee to the user at the rate of Re. 0.75 per day or part thereof, for use of any transport vehicle, as mentioned hereinbefore. The High Court is clearly in error in striking down the demand of fee power holding that it is ultra vires their power."
39. Their lordships of the Hon'ble Supreme Court in the case of Nagar Panchayat Kurwai and another vrs. Mahesh Kumar Singhal and ors., reported in (2013) 12 SCC 342, have held that Nagar Panchayat, is a unit of self-government, which is a sovereign body having both constitutional and statutory status and considerable powers are conferred on it to carry out various schemes for economic development and social justice at the local level. It has been held as follows:
"6. Nagar Panchayat is, therefore, a unit of self-government, which is a sovereign body having both constitutional and statutory status. Article 243Q and 243W(a)(i) and (ii) read with Entry 17, confer considerable powers on the Nagar Panchayat to carry out various schemes for economic development and social justice. Municipalities need funds for ::: Downloaded on - 15/04/2017 18:47:49 :::HCHP 38 carrying out the various welfare activities and for the said purpose, it can always utilize its assets in a profitable manner to its advantage so that various welfare activities entrusted to it under law could be properly addressed and implemented. Bus stand has been provided by the Nagar Panchayat for the benefit of all vehicle owners and the passengers, spending public money. Nagar Panchayat has to get a reasonable return .
for its upkeep and maintenance."
40. Thus, it shall now be open for the State Government to immediately, after the constitution of the Nagar Panchayat Tahliwal, appoint a person to exercise the powers discharging the duties and perform the functions of the municipality, for a period not exceeding six months in the of interregnum.
41. Accordingly, in view of the observations and discussion made rt hereinabove, there is no merit in this petition and the same is dismissed. The respondent-State is directed to constitute Nagar Panchayat, Tahliwal, within a period of eight weeks from today. The elected members of the Gram Panchayat, Nangal Kalan, shall cease to function immediately after the constitution of the Nagar Panchayat, Tahliwal and the respondent-State is directed to appoint a person to exercise the powers to discharge the duties and to perform the functions of the Municipality for a period not exceeding six months under Section 268 of the Himachal Pradesh Municipal Act, 1994.
Pending application(s), if any, shall stand disposed of.
( Rajiv Sharma ), Judge.
August 24, 2015, ( Sureshwar Thakur ),
(karan) Judge.
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