Punjab-Haryana High Court
V.K. Kapoor And Others vs State Of Haryana And Others on 29 October, 2010
Author: A.N. Jindal
Bench: A.N. Jindal
IN THE HIGH COURT OF PUNJAB & HARYANA AT CHANDIGARH
(1) Civil Writ Petition No.5149 of 2010
Date of decision: October 29, 2010
V.K. Kapoor and others
.. Petitioners
Vs.
State of Haryana and others
.. Respondents
(2) Civil Writ Petition No. 2493 of 2010
Vijay Bansal Advocate and others
.. Petitioners
Vs.
State of Haryana and others
.. Respondents
(3) Civil Writ Petition No.5235 of 2010
V.K. Sood and others
.. Petitioners
Vs.
State of Haryana and others
.. Respondents
Coram: Hon'ble Mr. Justice M.M. Kumar
Hon'ble Mr. Justice A.N. Jindal
Present: Mr. Amit Jhanji, Advocate for the petitioners
in C.W.P. No.2493 and 5149 of 2010.
Mr. V.K. Jindal, Advocate for the petitioners
in C.W.P. No.5235 of 2010.
Mr. Hawa Singh Hooda, Advocate General, Haryana with
Mr. Randhir Singh, Addl. Advocate General, Haryana
for the respondent-State.
Mr. G.S. Hooda, Advocate with Mr. R.K. Saini, Advocate
for the respondent Nos. 5, 6 and 7 in CWP No.2493 of 2010.
1. To be referred to the Reporters or not?
2. Whether the judgment should be reported in the digest?
A.N. Jindal, J
This judgment shall dispose of three connected writ petitions.
One of the petition bearing No. 2493 of 2010, has been filed by an advocate
Civil Writ Petition No. 2493 of 2010
Civil Writ Petition No. 5149 of 2010 &
Civil Writ Petition No. 5235 of 2010 -2-
whereas municipal Councilors of Municipal Committee, Pinjore and
Panchkula have filed writ petitions bearing Nos.5149 and 5235 of 2010.
Since all the three writ petitions involve common questions of law,
therefore, the same are taken up together. However, the facts are picked up
from Civil Writ Petition No.5149 of 2010. In all the three petitions, the
area, where the petitioners are residing, has been merged into the Municipal
Corporation, Panchkula.
Challenge in the aforesaid three writ petitions is to the order
dated 18.01.2010 (Annexure P-6) and notification dated 17.03.2010
(Annexure P-7), issued by the Government of Haryana, Urban Local Bodies
Department, vide which a decision has been taken to declare the Panchkula
Municipal Council as Municipal Corporation after merging Municipal
Committees of Pinjore and Kalka. The principal grounds of challenge are
that the order (P-6) and notification (P-7) are violative of principles of
natural justice; ultra vires of Article 243-P, 243-Q of the Constitution and
also 2-A of the Haryana Municipal Act, 1973 as well as Section 3 of the
Haryana Municipal Corporation Act, 1994. A mandamus has also been
sought against the respondents not to give effect to the notification dated
17.03.2010 (Annexure P-7).
The major posers sought to be raised before this Court are as
under:-
1. Whether the constitution of the Municipal Corporation was
in violation of mandatory provisions of law like S. 2-A of the
Haryana Municipal Act, 1973 various provisions of
Municipal Corporation Act, 1994 and Articles 243 P and
Civil Writ Petition No. 2493 of 2010
Civil Writ Petition No. 5149 of 2010 &
Civil Writ Petition No. 5235 of 2010 -3-
243 Q of the Constitution?
2. Whether the villages, which were not part of the transitional
area could be merged into the Municipal Corporation without
dissolving the Panchayats of those villages?
3. Whether the residents of the area as well as the three
municipalities and village Panchayats were required to be
given an opportunity of hearing before including such area in
the Municipal Corporation?
In the year 2000 vide notification No.18/4/96-2C1 dated
27.07.2000, Municipal Committee of the Panchkula was upgraded to
Municipal Council while adding villages known as Bhainsa Tibba, Kharak
Mangoli, Majri, Haripur, Budanpur, Abheypur, Raily, Kundi, Fatehapur,
Maheshpur, Devi Nagar and Banna Madanpur. The total Population of the
said area as per census of 2001 was 1,78,089.
By 74th Amendment, Part IX-A was inserted into the
Constitution of India w.e.f. 01.06.1993. This part contemplates constitution
of Nagar Panchayats, Municipal Council and Municipal Corporation in
every state for the purpose of administering 'a transitional area', 'a smaller
urban area' and 'a larger urban area' respectively. Article 243 Q
contemplates and uses the aforesaid expressions. Article 243 Q (2)
empowers the Governor to declare any area of transitional area; smaller
urban area; and a larger urban area 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 the Governor may deem
Civil Writ Petition No. 2493 of 2010
Civil Writ Petition No. 5149 of 2010 &
Civil Writ Petition No. 5235 of 2010 -4-
fit, specify by public notification for the purpose of Part IX-A of the
Constitution.
The petitioners have averred that as per Section 2-A of the
Haryana Municipal Act, 1973, (for brevity, 'the 1973 Act') Municipalities
were classified as under :-
(i) "Municipal Committee" for a transitional area with
population not exceeding fifty thousand.
(ii) "Municipal Council" for a smaller urban area with
population exceeding fifty thousand but not exceeding three
lacs and
(iii) "Municipal Corporation" for a larger urban area with
population exceeding three lacs, to be governed by a separate
Act: Provided that a 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 township.
xx xx xx"
The Haryana Municipal Act further created a bar on declaring
the area of military cantonment or part thereof from making it part of the
Municipality. The Act further provided that the transitional area (smaller
urban area or a larger urban area) means such area as the State Government
Civil Writ Petition No. 2493 of 2010
Civil Writ Petition No. 5149 of 2010 &
Civil Writ Petition No. 5235 of 2010 -5-
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 the State Government may deem fit,
specify by notification for the purpose of this section. The State
Government has been further given the powers to constitute the
Municipalities and specify the class thereof in accordance with the
provisions of this Section after observing the procedure as laid down in
Section 3 of Municipal Act, 1973. It was further provided that the
Municipalities already existing on the commencement of the Haryana
Municipal (Amendment) Act, 1994 would be deemed to have been
constituted and notified as such under and in accordance with the
provisions of this Section. A further proviso has been added in Section 2-A
of the Haryana Municipal Act, amended in 1994, which reads as under :-
"Provided further that the State Government may, after giving
a reasonable notice of not less than thirty days of its intention
to do so, amend the Schedule, by notification and declare any
Municipal Committee as a Municipal Council or any
Municipal Council as a Municipal Committee."
It was pleaded that as per Section 2-A of the 1973 Act the
State Government was required to issue a reasonable notice of not less than
thirty days of its intention to declare a Municipal Committee as Council but
with regard to creation of Municipal Corporation, the Haryana Municipal
Civil Writ Petition No. 2493 of 2010
Civil Writ Petition No. 5149 of 2010 &
Civil Writ Petition No. 5235 of 2010 -6-
Corporation Act, 1994 (for brevity, 'the 1994 Act') has been brought on the
statute book. Section 3 of the 1994 Act has been relied upon in this regard
which reads as under :-
"3. Declaration of Municipal area as Corporation - (1)
From the 31st of May, 1994, the Municipal Corporation
of Faridabad shall be deemed to have been declared as
such for the Municipal Area specified in the first
schedule appended to this Act.
(2) The Government may, from time to time, by notification
in the Official Gazette, declare any municipality
including area comprising rural area or a part thereof,
if any, to be a Corporation known as "the Municipal
Corporation of _______________ (name of the
Corporation):
Provided that no municipality including area,
comprising rural area or a part thereof, if any, shall be
so declared to be a Corporation unless the population
thereof is three lacs or more.
(3) The Government may, from time to time after
consultation with the Corporation, by notification in the
official Gazette, alter the limits of the Municipal area of
the Corporation declared under sub-sections (1) and (2)
so as to include therein or exclude there from such areas
as may be specified in the notification.
(4) When the limits of the Municipal areas are altered, so as
Civil Writ Petition No. 2493 of 2010
Civil Writ Petition No. 5149 of 2010 &
Civil Writ Petition No. 5235 of 2010 -7-
to include therein any area, except as the Government
may otherwise by notification, direct, all rules,
regulation, notifications, bye laws, order, directions and
powers issued or conferred and all taxes imposed under
this Act; and in force in the Municipal area shall apply
to such area.
(5) When a local area is excluded from the Corporation
under sub-section (3) -
(a) this Act, and all notifications, rules, bye-laws,
orders, directions and powers issued, made or conferred
under this Act, shall cease to apply thereto; and
(b) the Government shall after consulting the
Corporation, frame a scheme determining what portion
of the balance of the Corporation fund and other
property vesting in the municipal Corporation shall vest
in the Government and in what manner the liabilities of
the Corporation shall be apportioned between the
Corporation and the Government, and, on the scheme,
being notified, the property and liabilities shall vest and
be apportioned accordingly."
The petitioners have averred that though the Government, from
time to time, could declare any Municipality including the area comprising
of rural area or part thereof to be Corporation known as Municipal
Corporation, but it could not have joined two or more than two
Civil Writ Petition No. 2493 of 2010
Civil Writ Petition No. 5149 of 2010 &
Civil Writ Petition No. 5235 of 2010 -8-
Municipalities. They have also asserted that the villages could also not be
clubbed because they could not be termed as rural area as defined under the
provision of the 1994 Act. In this regard reference has been made to the
definition of the Rural Area as mentioned in Section 2 (51) of the 1994 Act
which reads as under :-
"Rural area" means the part of the Municipal area which
immediately before their inclusion within the limits of the
Municipal area were situated within the local limits of Gram
Panchayat but shall not include such portion thereof as may,
by virtue of a notification under section 413 ceases to be
included in the rural areas as herein defined."
By referring to the aforesaid section, the petitioners have urged
that the area of 42 villages which is being added now to clear the eligibility
test with regard to population for converting the Municipal Council into
Corporation would not be considered as rural area. They further urged that
the village Panchayats could only be dissolved by specific notification and
in the absence of such notification they could still work and do not cease to
be village Panchayats and area cannot be termed as merged in the Municipal
Corporation. The petitioners further urged that a Municipality could be
upgraded to make it a Municipal Corporation but a number of
Municipalities could not be dumped altogether to create a Municipal
Corporation, but only the Metropolitan area as defined under Article 243(P)
(c) of the Constitution could include two or more Municipalities. In this
Civil Writ Petition No. 2493 of 2010
Civil Writ Petition No. 5149 of 2010 &
Civil Writ Petition No. 5235 of 2010 -9-
regard, they have referred to Section 2 (29) of the 1994 Act which is
reproduced as under :-
"2 (29) "Metropolitan area" means an area having a
population of ten lakhs or more, comprised in one or more
districts and constituting of two or more municipalities or
panchayats or other contiguous areas, specified by the
Government by notification in the Official Gazette to be the
metropolitan area for the purposes of this Act."
Thus, the areas have been segregated and named differently for
the purposes of administration on population basis. The Municipal
Corporation could be declared for the area having population of three lacs
or more whereas, the Metropolitan area could be declared having
population of more than ten lacs. Thus, it was urged by the learned counsel
for the petitiones that on combined reading of Section 3 of 1994 Act, the
Government could declare any Municipality including the area comprising
in rural area or part thereof to be a Corporation. In this regard, the
Government though could propose to declare an area as a Municipal
Corporation but for altering the limits of the Municipal area of the
Corporation, the Government was to consult the Municipal Corporation and
then to declare by the notification with regard to alteration of its limits.
Thereafter, the Government after deciding the objections invited by it, is
required to issue second notification for declaring an area as Municipal
Corporation. The notification also required to specify the applicability of
all the rules and regulations in force including the bye-laws, orders,
Civil Writ Petition No. 2493 of 2010
Civil Writ Petition No. 5149 of 2010 &
Civil Writ Petition No. 5235 of 2010 -10-
directions as also powers conferred and all taxes imposed under the 1994
Act. It has been agitated by the petitioners that the population was the sole
basis to upgrade the Municipal Committee to Municipal Council and from
Municipal Council as Corporation and from Municipal Corporation to
Metropolitan area. The Article 243P (g) of part IX (a) of the Constitution
further envisages to make the population of the preceding census as the
basis for making such declaration. Under Article 243P (g), the word
"population" has been defined as under :-
"population" means the population as ascertained in the last
preceding census of which the relevant figures have been
published."
While referring to the last census conducted in the year 2001,
the learned counsel for the petitioners has referred to the Statistical Abstract
of Haryana Gazette published in 2005-06 issued by the Economic and
Statistical Adviser, Planning Department, Government of Haryana,
according to which, the rural and urban population of Panchkula, Kalka and
Pinjore is as under :-
City Population within
Municipal Committee
Councils/Corporations
Limits (Census, 2001)
Kalka : 30887
Pinjore : 29766
Panchkula : 140992
Total 201645
Civil Writ Petition No. 2493 of 2010
Civil Writ Petition No. 5149 of 2010 &
Civil Writ Petition No. 5235 of 2010 -11-
Thus, It has been averred that according to the last census of
three towns, their total population comes to 201645 and at best population
of 42 villages, which is 80328, could be added to bring the Corporation
into existence. But these villages do not form the part of the rural area as
defined under Section 2 (51) of the 1994 Act. It is averred that the creation
of the Corporation is in violation of the Government of India instructions
dated 22.9.2009 (Annexure P-1) issued to all the State Governments
wherein it was clearly stated that there should not be any change in the
boundaries of administrative blocks after 1.1.2010 for conducting census for
the next decade i.e. 2010-11. The said instructions were forwarded to the
Government of Haryana vide memo dated 24.11.2009 (Annexure P-2)
issued by the Financial Commissioner-cum-Principal Secretary,
Government of Haryana to the Director Urban Local Bodies, Haryana
wherein it is clearly mentioned that there should not be any change in the
boundaries of administrative blocks after 1.1.2010. They have referred
before us a copy of the said memo dated 24.11.2009 (Annexure P-2). They
have further asserted that the Government of Haryana issued notification
dated 12.1.2010 conveying its decision freezing all the boundaries of all the
Districts, Towns, Tehsils, Villages etc. from 1.1.2010 till 31.3.2011 to
facilitate the Haryana Government to undertake census operations. The
notification in this regard has been referred as Annexure P-3.
It is further asserted that the guidelines and the criteria issued
by the Government of Haryana for the formation of the Municipal
Corporation has been formulated keeping in view Section 12 of the 1994
Civil Writ Petition No. 2493 of 2010
Civil Writ Petition No. 5149 of 2010 &
Civil Writ Petition No. 5235 of 2010 -12-
Act as well as Article 243 (u) of the Constitution of India. The relevant
guidelines, as referred, indicate as under :-
"The Government while forming the Municipal Corporation
should keep in mind the urban character of the area :
(a) The people of the area to be included should
predominantly be engaged in non agricultural activities to the
extent of 60%.
(b) The said character can be determined only on the basis
of the population determined as per the last census which in
the present case was conducted in the year 2001.
Thus, in the absence of assessment by the authorities, regarding
the involvement of 60% of the population of the area in non agricultural
activities, such an area could not be added in the Municipal Corporation. It
was next submitted that in order to constitute the Municipal Corporation,
Gram Panchayats to be inducted in the Corporation were also required to
pass resolution to that effect followed by recommendation of the concerned
Divisional Commissioner. According to the learned counsel this is true
interpretation of Section 12 of the 1994 Act as well as guidelines issued
under Article 243(U) of the Constitution.
The other submission made by the petitioners is that neither any
opportunity of hearing to the residents of the area which is to be added was
afforded nor any resolution till date has been passed by the municipalities
as well as gram panchayats (except few of them) submitting themselves to
be a part of the Municipal Corporation, but the State Government has
straightway issued a notification without following the procedure as well as
Civil Writ Petition No. 2493 of 2010
Civil Writ Petition No. 5149 of 2010 &
Civil Writ Petition No. 5235 of 2010 -13-
guidelines issued by it on 1.1.2010 vide order dated 18.1.2010. It has also
been submitted that vide notification dated 17.3.2010 the State Government
not only declared the Panchkula Municipal Council as Corporation but also
combined two other Municipal Committees i.e. Pinjore, Kalka and 42 other
villages so also the reserved and protected forest area was made part of the
urban area, which has been challenged in another writ petition No.3097 of
2009 Vijay Bansal vs. State of Haryana. The Union of India in the said case
has already submitted its reply and has clearly taken the stand that no
clearance has been taken by the State of Haryana before declaring the
Panchkula, Pinjore and Kalka as Urban Complex.
The petitioners are actually not averse to the formation of the
Panchkula Municipal Corporation up to the extent that it should be done
only after taking census already under process 2011 and in that case only
area of Panchkula Municipal Council and surrounding areas falling in the
vicinity of Panchkula Municipal Council, could serve to declare the
Municipal Corporation. It is also submitted that an anomalous situation has
been created by virtue of notification dated 17.1.2010 while adding two
urban areas namely Pinjore and Kalka and 42 other villages and also had
disturbed the census process. Learned counsel has brought to our notice that
the increasing trend of population i.e. 50.91% as per census of 2001
addition of two Municipalities and villages was not warranted by law
because merger of the area of Panchkula town and surrounding areas around
it, would itself be sufficient to form as Municipal Corporation without
further merging other urban areas of Kalka and Pinjore in the year 2011.
Ultimately while impugning the aforesaid two notifications, the learned
Civil Writ Petition No. 2493 of 2010
Civil Writ Petition No. 5149 of 2010 &
Civil Writ Petition No. 5235 of 2010 -14-
counsel has submitted that the same be declared illegal and void.
Replies to the writ petitions have been filed wherein the legal
provisions as incorporated under the 1973 Act as well as the 1994 Act have
not been disputed. However, it was submitted that total population of the
area to be added comes to 3.18 lacs. As per present population the estimated
growth is 4.66 lacs, therefore, the State Government was fully competent to
constitute the aforesaid Corporation. It has further been asserted that
provisions of Article 243(P) (g) of the Constitution, Section 2(a) of the 1973
Act and also Section 4 of the 1994 Act have been fully complied with by
the Government before issuing notification concerning declaration of the
Panchkula Municipal Corporation. As regards the violation of the orders
issued vide notification dated 22.9.2009 and the subsequent letter issued by
the State Government on 24.11.2009, it has been stated that these
instructions were issued to facilitate the census work and it has nothing to
do with the notification in question. It has been further explained that the
matter has been discussed with the Director General-cum-Census
Commissioner of India who has agreed that the Census Department has no
objection to the formation of the Corporation if the census operations are
carried out smoothly. The Census Department has been assured that no
boundaries were to be changed by formation of Corporation and the work
would go on smoothly. It has also been submitted that the formation of the
Corporation does not violate any provisions of the Constitution. After
formation of the Municipal Corporation, Panchkula, it would be feasible to
undertake larger number of development works which would be in the
larger interest of the public as some of the schemes which can only be
Civil Writ Petition No. 2493 of 2010
Civil Writ Petition No. 5149 of 2010 &
Civil Writ Petition No. 5235 of 2010 -15-
executed in the larger urban area i.e. Municipal Corporation, as the funding
of the Municipal Corporation is better than the Municipal Council or the
Committee. The Government of India has desired to introduce city
development plan under JNNURM Scheme for Panchkula City. With the
indication of the said scheme huge funds would be drained out for
development of the Panchkula city which would be fruitful for greater
development of the infrastructure and also to serve the public interest. It
has also been mentioned that the Haryana Urban Development Authority in
its Panchkula extension scheme has also extended residential/commercial
sectors adjoining to the Pinjore town. With regard to the population, as per
census 2001, the respondents have submitted that while adding the
population of 42 villages i.e. 80328, it comes to 314657 as per census 2001
which is required for creating the Municipal Corporation, Panchkula.. As
such, there is no bar on the creation of the corporation at Panchkula. In
reply to para No.10 of the writ petition it is submitted that guidelines issued
vide letter dated 1.1.2010 had been duly complied with and the factors of
non agricultural activities to the extent of 60% has already been determined
on the basis of the last census 2001. Accordingly, notification for formation
of Municipal Corporation, Panchkula has been issued strictly as per the
relevant provisions of law. The respondents have also placed on record the
details of the total population as per census of 2001 for Panchkula
Municipal Council as well as Pinjore and Kalka Municipal Committees and
also 42 Panchayats.
A rejoinder to the written statement has also been filed wherein
the petitioners have reiterated the allegations while further adding that
Civil Writ Petition No. 2493 of 2010
Civil Writ Petition No. 5149 of 2010 &
Civil Writ Petition No. 5235 of 2010 -16-
before constituting the municipality, the objections were to be invited from
the inhabitants of the area before such notification is finalised. Section 4 of
the Act further provides requirement of inviting objections from the
inhabitants within six weeks of the publication of the notification. The
respondent Nos. 1 and 2 having issued guidelines on 1.1.2010 (Annexure
P-4) have themselves not taken care of the same. With regard to the
developmental acts, it has been submitted by the petitioners that in the State
of Haryana, the responsibility of urban planning is entrusted to the Town
and Country Planning, Department and not to the municipalities.
Before pondering over the first poser i.e. "whether the
notification is in contravention of the requirement of Section 2-A of the
1973 Act, Section 3 of 1994 Act, the guidelines and the principles of natural
justice?", it would be appropriate to mention that Government of Haryana
issued two notifications first vide memo No.18/1/95/2008-3C1 dated
18.1.2010 (Annexure P-6) and Notification No.18/7/2010-3C1 dated
17.3.2010 (Annexure P-7). The memo dated 18.1.2010 (Annexure P-6)
reads as under :-
"From
Financial Commissioner & Principal
Secretary to Government of Haryana, Urban
Local Bodies, Department.
To
Divisional Commissioner,
Ambala, Rohtak and Hisar.
Memo No. 18/1/95/2008-3C1 dated 18.1.2010
Subject: Regarding constitution of various Municipal
Corporations in the State.
Reference to the subject cited above.
Civil Writ Petition No. 2493 of 2010
Civil Writ Petition No. 5149 of 2010 &
Civil Writ Petition No. 5235 of 2010 -17-
In this connection, I am directed to inform you
that the State Government has decided that the following
Municipal Councils to be declared Municipal Corporation, as
per provision made in Section 2 (a) of the Haryana Municipal
Act, 1973 and Section 3 of the Haryana Municipal Corporation
Act, 1994:-
1. Karnal
2. Panipat
3. Hisar,
4. Yamunanagar (After merging Municipal Council,
Jagadhari),
5. Ambala City (After merging Municipal Council,
Ambala Cantt.)
6. Panchkula (After merging Municipal Committee
Pinjore and Kalka).
7. Rohtak
You are therefore requested to convene a meeting of the
Committee constituted under your Charmanship as conveyed
vide Govt. Letter No.53/2/78-08-3C1 dated 1.1.2010 (Copy
enclosed) for fixing the boundary of the above said
Corporation falling under your jurisdiction immediately and
send the same to the Government along with notification with
schedule of boundary and plan.
Sd/- For Financial Commissioner &
Principal Secretary to Government of
Haryana, Urban Local Bodies, Department."
Thereafter, notification dated 17.3.2010 was issued. The
relevant portion of which is reproduced as under :-
"Notification
Civil Writ Petition No. 2493 of 2010
Civil Writ Petition No. 5149 of 2010 &
Civil Writ Petition No. 5235 of 2010 -18-
Dated 17th March, 2010
No.18/7/2010-C31
In exercise of the powers conferred by
Sub-Section (2) of Section 3 of the Haryana Municipal
Corporation Act, 1994 (16 of 1994), the Governor of Haryana
hereby declares the Municipal Council, Panchkula, Municipal
Committee, Kalka & Pinjore and adjoining rural areas as
shown in the drawing No.DTP(P) 1151/10 dated 10.2.2010, the
area as specified in the schedule given below, to be a
Corporation known as Municipal Corporation, Panchkula.
xxx xxx xxx
xxx xxx xxx
Raj Kumar
Financial Commissioner and
Principal Secretary to
Govt. of Haryana, Urban Local Bodies Department."
On perusal of the aforesaid two notifications, it transpires
that :-
(a) The State Government before issuing such notification
did not call for any objection by the individuals, councils,
institutions or societies of the area or Panchayats or Municipal
Committees
(b) Nothing was mentioned; if the cantonment area or the
forest area was excluded from its operation. The Municipal
Councils were not consulted for altering or adding the area
within their respective municipal limits.
(c) No draft notification was issued and these two notifications
Civil Writ Petition No. 2493 of 2010
Civil Writ Petition No. 5149 of 2010 &
Civil Writ Petition No. 5235 of 2010 -19-
by the State Government and the other by the Governor were ,
directly issued for creation and declaring the Municipal
Corporation consisting of the area as referred to in the
notification dated 17.3.2010.
(d) Though, the area of Gram Panchayats was added, yet, no
specific notification for dissolving of the gram panchayats was
issued.
(e) The notification issued by the Governor of Haryana on
17.3.2010 does not record his subjective satisfaction as to
whether it satisfied the guidelines issued by the Government
and is in consonance with the provisions of two acts, as referred
to above and Article 246(Q) of the Constitution.
There is no dispute regarding the proposition of law that to
declare certain municipal area as 'Municipal Corporation' is the legislative
act. However, no such act could be done in contravention of the laws of the
State and procedure as laid down under Section 2-A of the 1973 Act as well
as Section 3 (2)(3) of the 1994 Act. The legislature never intended to give a
go bye these provisions while creating a Municipal Corporation by
upgrading Municipal Committee and Municipal Council.
As per provisions of Section 2-A of the 1973 Act, the
classification of the municipality was made which indicates that the
Municipal Corporation could be constituted only for a larger municipal area
for a population of three lacs or more and is to be governed by the 1994 Act.
Section 2-A further reveals that the State Government may give a reasonable
Civil Writ Petition No. 2493 of 2010
Civil Writ Petition No. 5149 of 2010 &
Civil Writ Petition No. 5235 of 2010 -20-
notice of not less than 30 days of its intention to declare any Municipal
Committee as Municipal Council or any Municipal Council as Municipal
Committee. As far as Municipal Corporation is concerned, it was to be
constituted as per provisions of Section 3 of the 1994 Act. There is also no
denying a fact that as per Section 2-A of the 1973 Act, Municipal Council
includes Municipal Committee. Section 3 of the 1973 Act, provides the
procedure for declaring the Municipal Corporation. The relevant extract of
the provisions is re-produced as under :-
"3. Procedure for declaring Municipality -
(1) The State Government may, by notification, propose any
local area to be a municipality under this Act.
(2) Every such notification shall define the limits of the local
area to which it relates.
(3) A copy of every notification under this section, with a
translation there of in such language as the State Government
may direct, shall be affixed in some conspicuous place in the
court-house of the Deputy Commissioner within whose
jurisdiction the local area to which the notification relates lies,
and in one or more conspicuous places in that local area.
(4) The Deputy Commissioner shall certify to the State
Government the date on which the copy and translation were
so affixed and the date so certified shall be deemed to be the
date of publication of the notification.
(5) Should any inhabitant desire to object to a notification
Civil Writ Petition No. 2493 of 2010
Civil Writ Petition No. 5149 of 2010 &
Civil Writ Petition No. 5235 of 2010 -21-
issued under sub-section (1), he may, within six weeks from the
date of its publication submit his objection in writing through
the Deputy Commissioner to the State Government and the
State Government shall take his objection into consideration.
(6) Within six weeks from the date of the 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 purpose of this Act, to be a municipality].
(7) The State Government may, by notification, direct that
all or any of the rules which are in force in any municipality
shall with such exceptions and adaptations as may be
considered necessary, apply to the local area declared to be a
municipality under this section, and such rules shall forthwith
apply to such municipality without further publication.
(8) Omitted
(9) Omitted
(10) A committee shall come into existence at such time as the
State Government may, by notification, appoint in this behalf."
Similarly, Section 3(2) of the 1994 Act refers to the procedure
for altering the limits of the Municipal Corporation so declared under sub-
section (1) and (2) so as to include therein or exclude therefrom such area as
may be specified in the notification.
Civil Writ Petition No. 2493 of 2010
Civil Writ Petition No. 5149 of 2010 &
Civil Writ Petition No. 5235 of 2010 -22-
From the bare reading of the aforesaid provisions of two acts
i.e. the 1973 Act and the 1994 Act, it transpires that first of all a notification
is to be issued which is to be followed by calling of objections and then in
consultation with the corporation, a final notification is to be issued.
Thereafter Government is also required to issue notification for
implementation of the directions and the rules as adopted by the
Corporation accordingly. But, nothing was done in this case and the
Government abruptly, without even issuing a draft notification, issued the
notification while limiting the boundaries of the Corporation.
The doctrine of natural justice and the prudence require that all
the administrative acts and decisions effecting the rights of individuals must
be taken care of, after providing fair hearing to those who were adversely
effected by the same. It has been laid down by the Apex Court in case State
of Maharashtra and others v. Jalgaon Municipal Council and others,
(2003) 9 SCC 731 as under :-
"30. It is a fundamental principle of fair hearing incorporated
in the doctrine of natural justice and as a rule of universal
obligation that all administrative acts or decisions affecting
rights of individuals must comply with the principles of
natural justice and the person or persons sought to be affected
adversely must be afforded not only an opportunity of hearing
but a fair opportunity of hearing. The State must act fairly just
the same as anyone else legitimately expected to do and where
the State action fails to satisfy the test it is liable to be struck
Civil Writ Petition No. 2493 of 2010
Civil Writ Petition No. 5149 of 2010 &
Civil Writ Petition No. 5235 of 2010 -23-
down by the courts in exercise of their judicial review
jurisdiction. However, Warns Prof. H.W.R. Wade that the
principle is flexible :
The Judges, anxious as always to preserve some freedom
of manoeuvre, emphasise that 'it is not possible to lay
down rigid rules as to when the principles of natural
justice are to apply: nor as to their scope and extent.
Everything depends on the subject-matter'. Their
application resting as it does upon statutory implication,
must always be in conformity with the scheme of the Act
and with the subject-matter of the case. 'In the
application of the concept of fair play there must be real
flexibility'. There must also have been some real
prejudice to the complainant: there is no such thing as a
merely technical infringement of natural justice." (Wade
& Forsyth: Administrative Law, 8th Edn., 2000, pp 491-
92).
31. The learned authors quote from two authorities in
support of preserving flexibility. In Russel v. Duke of Norfolk,
All ER at p.118 E, Tucker, L.J. Opined :
"The requirements of natural justice must depend on the
circumstances of the case, the nature of the inquiry, the
rules under which the tribunal is acting, the subject-
matter hat is being dealt with, and so forth."
In Lloyd v. McMahan, AC at p. 702, Lord Bridge stated
Civil Writ Petition No. 2493 of 2010
Civil Writ Petition No. 5149 of 2010 &
Civil Writ Petition No. 5235 of 2010 -24-
in his speech (All ER p. 1161c-e)
"The so-called rules of natural justice are not engraved
on tablets of stones. To use the phrase which better
expresses the underlying concept, what the requirements
of fairness demand when any body, domestic,
administrative or judicial, has to make a decision which
will affect the rights of individuals depends on the
character of the decision-making body, the kind of
decision it has to make and statutory or other framework
in which it operates. In particular, it is well established
that when a statute has conferred on any body the power
to make decisions affecting individuals, the courts will
not only require the procedure prescribed by the statute
to be followed, but will readily imply so much and no
more to be introduced by way of additional procedural
safeguards as will ensure the attainment of fairness."
(Administrative Law, ibid., at p. 493.)
The caution of associating rules of natural justice with the
flavour of flexibilities would not permit the courts applying different
standards of procedural justice in different cases depending on the whims or
personal philosophy of the decision-maker. The basic principles remain the
same; they are to be moulded in their application to suit the peculiar
situations of a given case, for the variety and complexity of situation defies
narration. That is flexibility. Some of the relevant factors which enter the
Civil Writ Petition No. 2493 of 2010
Civil Writ Petition No. 5149 of 2010 &
Civil Writ Petition No. 5235 of 2010 -25-
judicial process of thinking for determining the extent of moulding the
nature and scope of fair hearing and may reach to the extent of right to
hearing being excluded are : (i) the nature of subject matter and (ii)
exceptional situation. Such exceptionality may be spelled out by (i) in the
cases of urgency; (ii) in the absence of legitimate expectation, (iii) by
refusal of remedies in discretion; (iv) doctrine of pleasure such as the power
to dismiss an employee at pleasure, and (v) express legislation. But, they
were of the stringent view that where hearing would make some difference
and statutory provisions have been made for hearing, then right of hearing
must predominantly be given. This principle of "audi alteram partem" has
been approved by this Court in number of judgments i.e. Kamaljeet Singh
v. State of Punjab through Principal Secretary to Government of Punjab,
Local Government Department, 2002 (3) R.C.R. (Civil) 438 : 2002 (3)
P.L.R. 184 : 2002 (2) P.L.J. 189 : 2002 (4) ICC 226, Harjinder Singh and
others v. State of Punjab 2002 (1) R.C.R. (Civil) 610. It may also be
noticed that way back in the year 1987, the Apex Court in case Baldev
Singh and others v. State of Himachal Pradesh and others, AIR 1987 SC
1239 while approving the principle of natural justice and interpreting
Section 4 (1) of the Himachal Pradesh Municipal Act, 1968 observed as
under :-
"......... 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. Inclusion of an area covered by a Gram
Panchayat within a notified area would certainly involve civil
Civil Writ Petition No. 2493 of 2010
Civil Writ Petition No. 5149 of 2010 &
Civil Writ Petition No. 5235 of 2010 -26-
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 incidence of
tax and the like."
In the instant case not only 42 Sarpanches of Gram Panchayats
are losing their offices and period of their remaining tenure would remain in
abeyance. The developmental work would be stopped. Similarly, municipal
council and three municipal committees would lose their tenure of office
before it is completed. The developmental activities which are in progress
and undertaken by the Municipal Council respectively would be hampered
by switching over to the constitution of a Municipal Corporation. The
constitution of Municipal Corporation would result in imposition of more
and higher taxes casting additional financial burden on the inhabitants of the
area, therefore, it was the requirement of the natural justice and fair play that
the population of the Municipal Council and the Committees would have
been heard and their objections should have been decided. In Jalgaon
Municipal Council's case (supra) the objections with regard to providing
them opportunity of hearing was over ruled on the ground that since the
notification issued by the Maharashtra Government was just a proposal for
constitution of the Municipal Corporation which could be issued without
consultation as such, the same is not applicable to the facts of the present
case.
Civil Writ Petition No. 2493 of 2010
Civil Writ Petition No. 5149 of 2010 &
Civil Writ Petition No. 5235 of 2010 -27-
The learned State counsel has referred before us a Division
Bench judgment pronounced by this Court in case Kulraj Kataria vs. State
of Haryana, (CWP No.10720 of 2008, decided on 29.4.2009), in order to
contend that as per the said judgment there was no requirement for giving
any prior notice in case of alteration of the boundaries. The judgment has
been passed while relying on a judgment of Hon'ble the Supreme Court
delivered in case State of Punjab v. Tahal Singh and others, AIR 2002
Supreme Court 533 wherein it was observed that the State Government
under the provisions of the Municipal Act, while proceeding to alter the
limits by excluding or including certain areas in a municipality is legislative
in nature. Therefore, no requirement of giving any prior notice or personal
hearing before declaring the area as a Municipal Corporation arises as no
legal rights of the petitioners were to be infringed. The Hon'ble Division
Bench further observed that since the petitioner had failed to press into
service any provisions of the Act for giving any prior notice or personal
hearing before declaring the Municipal Committee as Municipal
Corporation, therefore, no prior notice or personal hearing was required. In
this regard, it may be observed that the said judgment was passed only for
extending the municipal area of Gurgaon to convert into Municipal
Corporation Gurgaon whereas, in the present case not only Municipal
Council Panchkula is being converted into Corporation but there is merger
of two other Municipal Councils and 42 other villages which were never the
part of the rural area as defined under the 1994 Act. Further Division Bench
has not considered the provisions of Section 2-A and 3 of the 1973 Act and
the 1994 Act respectively at that time. The Hon'ble Division Bench also did
Civil Writ Petition No. 2493 of 2010
Civil Writ Petition No. 5149 of 2010 &
Civil Writ Petition No. 5235 of 2010 -28-
not discuss the provisions of these two acts which require the hearing of
objections and the consultation of the Corporation at the time of fixing or
limiting the boundaries of the Corporation.
We also find merit in the contention raised by Mr. Amit Jhanji,
Advocate for the petitioners that necessary criteria for declaring the
Municipal Committee, Municipal Council, Municipal Corporation and
Metropolitan area, are size of population and the commercial activities in
the area to be included amongst other factors to be discussed later on. For
declaring the Municipal Corporation, Section 3 (2) of the 1994 Act required
that the Municipality could be declared as Municipal Corporation if its
population exceeds 3 lacs. The relevant extract of the Section 3 reads as
under :-
"3(1) xx xx xx
3(2) The Government may, from time to time, by notification
in the Official Gazette, declare any municipality
including area comprising rural area or a part thereof,
if any, to be a Corporation known as "the Municipal
Corporation of _______________ (name of the
Corporation):
Provided that no municipality including area,
comprising rural area or a part thereof, if any, shall be
so declared to be a Corporation unless the population
thereof is three lacs or more.
3(3) to (5) xx xx xx"
Civil Writ Petition No. 2493 of 2010
Civil Writ Petition No. 5149 of 2010 &
Civil Writ Petition No. 5235 of 2010 -29-
The Metropolitan area was to be declared by merging two or
more Municipal Councils. Thus, the Haryana Municipal Corporation Act,
1994 does not any where state that the State Government was vested with
the powers to merge more than one Municipal Committee to form the
Municipal Corporation. Thus, it would be suffice to say that as per the 1995
Act, the State Government was not competent to declare the Municipal
Corporation by merging two Municipal Committees and 42 villages which
were never treated as rural area or transitional area at any time before
declaring the Municipal Council.
It is further noticed that guidelines/criteria for constitution or
abolition of any Municipal Corporation in the State has been issued by the
Financial Commissioner and Principal Secretary to Government of Haryana,
Urban Local Bodies Department to all the Municipal Corporations and also
to the Deputy Commissioners in the State vide memo No.53/2/78-08-3C1
dated 1.1.2010. According to the criteria the population of that area should
not be less than 3 lacs; density of the said population should be 400 persons
per square kilometer for such census town; the income of the municipal
corporation should be sufficient enough to meet out their own establishment
charges for salary, provident fund share, pension, gratuity of its employees
and other local and mandatory obligations like audit fees, repayment of
loans contracted by them etc. and the expenditure on these heads should not
be more than 80% of the total income of the municipality. The guideline
No.5 further provides that the residents of Gram Panchayat / Municipal
Civil Writ Petition No. 2493 of 2010
Civil Writ Petition No. 5149 of 2010 &
Civil Writ Petition No. 5235 of 2010 -30-
Committee who want to constitute a Municipal Corporation, the
Municipality/ Gram Panchayat should pass a resolution to the effect
followed by the recommendation of the concerned Divisional
Commissioner. In case the Municipality/ Gram Panchayat does not pass
such resolution either in favour or against then the Divisional Commissioner
should give his clear cut findings with reasons for constitution of Municipal
Corporation in the area. There is no compliance with these guidelines.
Neither the resolutions were passed by all the three Municipal Committees/
Municipal Councils nor by Panchayats of all the villages and no such order
was passed by the Financial Commissioner giving clear cut findings with
reasons for constitution of the Municipal Corporation in the area. Thus,
declaration of the Corporation could be said to be illegal when viewed in
the light of these guidelines, which were framed by the Government itself.
It would also be significant to mention here that Municipal
Council, Panchkula was created in January, 2001 after the census of 2001
was finalised. Had there been any such position that even after adding the
population of Pinjore and Kalka then the Municipal Corporation could be
declared at that very time. Even now the Government is declaring the
Municipal Corporation Panchkula on the basis of that census. It may further
be elaborated that so far as Pinjore town is concerned, as per census
conducted by the Government of India in the year 2001, the population was
29766, therefore, rightly the Municipal Council was existing. So far as
Kalka is concerned, as per said census, the population was 30887 and the
population of Panchkula was 140992, therefore, the Municipal Council was
brought into operation. Thus, even if a combined population of three towns
Civil Writ Petition No. 2493 of 2010
Civil Writ Petition No. 5149 of 2010 &
Civil Writ Petition No. 5235 of 2010 -31-
is taken then it does not comes to three lacs. Now the Government wants to
fulfill the population criteria by adding population of 42 villages which is
against the fundamental principles and in contravention of the mandatory
provisions of law. Before the area of Gram Panchayat is included in the
Municipal Corporation, the Government by way of official Gazette will
have to make a specific notification declaring that this rural area shall be
ceased to be the part of the Gram Panchayat. Section 413 of the 1994 Act
reads as under :-
"413. Special provisions as to rural area - Notwithstanding
anything contained in the foregoing provisions in this Act :-
(a) The Corporation with previous approval of the
Government may, by notification in the Official Gazette,
declare that any portion of the rural areas shall cease to
be included therein and upon the issue of such
notification that portion shall be included in and form
part of the urban area ;
(b) the Corporation with previous approval of the
Government may, by notification in the Official Gazette,
-
(i) exempt the rural areas or any portion thereof from such of the provisions of this Act as it deems fit;
(ii) levy taxes, rates, fee and other charges in the rural area or any portion thereof at rates lower than those at which such taxes, fee and other charges are levied in the urban areas or exempt Civil Writ Petition No. 2493 of 2010 Civil Writ Petition No. 5149 of 2010 & Civil Writ Petition No. 5235 of 2010 -32- such area or portion from any such tax, rate, fee or other charge."
No such notification has been issued by the Government for dissolving the Gram Panchayats and including such area in the Municipal Corporation. The law has gone to the extent that in the absence of any notification that Gram Panchayat has ceased to exist, it could not be said to have been dissolved and had a powers to levy taxes on the land and building situated within its jurisdiction. The aforesaid view was taken in case BIMA Office Premises co-operative Society and etc. v. Kalamboli Village Panchayat and others AIR 2001 Bombay 83 which reads as under :-
"33. At this juncture, it will be worthwhile to notice that Section 4 of the BVP Act provides for declaration of village. Every village specified in the notification issued under clause
(g) of Article 243 of the Constitution of India is known by the name of that village specified in that notification and where the circumstances so require, provision is made to include or exclude any local area from the local area of a village or to alter the limits of a village or to take away that local area from the concerned village by the notification issued, in the like manner, after consultation with the Standing Committee and upon such declaration local area is either included or excluded shall form the village with the publication of such notification the local is either included or excluded and the limits of the village, accordingly, stand altered. Upon exclusion of the local Civil Writ Petition No. 2493 of 2010 Civil Writ Petition No. 5149 of 2010 & Civil Writ Petition No. 5235 of 2010 -33- area of the village, it ceases to be a village under the BVP Act.
In the light of the said provisions, we agree with the submissions advanced by respondent No.1 that so long as notification is not issued under sub-section (2) of Section 4, the respondent No.1 Gram Panchayat cannot be said to have ceased to exist. In absence of any such notification by the State, the respondent No.1 - Gram Panchayat cannot be said to have ceased to be a Gram Panchayat within the provisions of the said Act. It is, therefore, clear that there is no substance in the contention raised by the petitioners that in view of the constitution of a site for new town under Section 113 of the MRTP Act, the respondent No.1- Gram Panchayat has ceased to exist and, therefore, respondent No.1- Gram Panchayat has no right to levy tax on the petitioners. In our view, so long as respondent No.1 continues to exist as a Gram Panchayat, it has a right to levy tax on the lands and buildings situated within its jurisdiction and, consequently, action of respondent No.1- Gram Panchayat, levying assessing and calling upon the petitioners to pay tax cannot be said to be bad and illegal."
Again action of the Government for declaring the Corporation being self-contradictory could not be approved. The respondents did not take into consideration the Government of India instructions "Annexure P- 1" and its own notification dated 12.1.2010 (Annexure P-3), wherein it has Civil Writ Petition No. 2493 of 2010 Civil Writ Petition No. 5149 of 2010 & Civil Writ Petition No. 5235 of 2010 -34- been stated that changes of the administrative boundaries of all the districts, tehsils, towns, villages etc. shall stand frozen with effect from 1st January, 2010 till 31st March, 2011 in order to facilitate Haryana Government to undertake census operations. It is surprising that inspite of the instructions of the Government of India, a notification issued by the Government of Haryana itself and the change in the administrative boundaries have been done by constituting Municipal Corporation, Panchkkula.
The inclusion of 42 Gram Panchayats to declare the Municipal Corporation is, in fact, against the intent of the Constitution itself. Article 243 (Q) provides for transitional area i.e. from rural to urban area, therefore, the first step for taking the rural area into urban area is by constituting Nagar Panchayat. The State of Haryana, has defined urban area as Municipal Committee. It is also significant to mention here that the purpose of 73rd as well as 74th amendment in the Constitution was to bring maximum participation of the people in the local self government by the rural or semi urban population. The respondent- State in this case instead of decentralizing the powers is amalgamating the same in the hands of a few which body would certainly not take so close care which the smaller bodies were doing. The purpose to introduce the 73rd and 74th amendment was that once the village attains the character which is more urban in nature then the said rural area is to be put in to transitional area i.e. in the present case as a Municipal Committee and the urban character of the said rural area is to be seen from last preceding census wherein non agricultural activities, revenue generated in the local administration etc. are determined. It is only after a period and after seeing the population of that particular area on the basis of Civil Writ Petition No. 2493 of 2010 Civil Writ Petition No. 5149 of 2010 & Civil Writ Petition No. 5235 of 2010 -35- last preceding census that the transitional area is given the second step of being converted into a Municipal Council and then into a Municipal Corporation. In the present case none of the above mandatory provisions of the Constitution as well as the 1973 Act and the 1994 Act have been followed. The act of the respondents in declaring the Corporation by inclusion of 42 Gram Panchayats has been only to fulfill the criteria of reaching the bench mark of three lacs but still the bench mark is lacking while taking the census of 2001. No public interest is going to be served by making suo moto unlawful declaration of Municipal Corporation Panchkula on the basis of 2001 census. Keeping in view the ratio of increase in population, the government could wait the census to be completed in near future and declare the Municipal Corporation Panchkula without merging of Municipal Committees of Pinjore and Kalka or any rural area. It is further noticed that the respondents did not take care to make specific observations as per guideline No.4 of order dated 1.1.2010 (Annexure P-4) and concluded that the people of the area engaged in non agricultural activities had exceeded 60%. It would further be significant to mention that the percentage of that urban character again has to be seen from the last preceding census which in this case was conducted on the year 2001.
It has also been observed in case Junagadh Municipality v. State of Gujarat 2003 (3) Gujrat Law Reporter 2663 that the discretion exercised by the Governor should not be based on his personal satisfaction. Thus, it would be suffice to say that the arbitrary exercise of the powers by the Government, being detrimental to the public interest cannot be taken as an action in support of the welfare of the State.
Civil Writ Petition No. 2493 of 2010 Civil Writ Petition No. 5149 of 2010 & Civil Writ Petition No. 5235 of 2010 -36- Thus, viewing the case from all the angles, it would have to be held that memo No.18/1/95/2008-3C Dated 18.1.2010 (Annexure P-6) and notification dated 17.3.2010 (Annexure P-7) are in clear cut contravention of 73rd and 74th amendment of the Constitution so also the guidelines as well as the aforesaid provisions of the 1973 Act and the 1994 Act, therefore, the same are hereby quashed. However, the State Government would be at liberty to issue fresh notification after following due procedure as provided under the aforesaid Acts and Guidelines and in accordance with the principles of natural justice. It is further made clear that any development scheme would not be hampered and the funds allocated to the town of Panchkula under the J.N.N.U.R.M. Scheme would not go unutilized. Rather, such development schemes would remain in operation and remain unaffected during the process to constitute the Municipal Corporation, Panchkula is in operation.
(M.M. Kumar) (A.N. Jindal)
Judge Judge
October 29, 2010
deepak