Municipal statutory immunity fails where negligent drainage works are done without good faith, and damage claims are proved.

Statutory immunity for a municipality under the Bombay District Municipal Act applied only to acts done honestly in good faith while discharging statutory duties; it did not cover wanton or wilful negligence. The court held that Sections 167 and 167A had to be read harmoniously, and the plea of absolute protection against negligence claims failed. On the facts, the municipality was found negligent in narrowing the nullah, leaving centring and debris to obstruct flow, and causing flood damage to the plaintiffs' goods. The evidence supported the loss claimed, so the decree for damages with interest and costs was restored.

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Issues: (i) Whether the suit for damages against the municipality was barred by Sections 167 and 167A of the Bombay District Municipal Act, 1901 in view of the plea of good faith. (ii) Whether the municipality was negligent in narrowing the nullah and leaving the slab centring and debris to obstruct flow, thereby causing the plaintiffs' loss, and whether the damages awarded were proved.

Issue (i): Whether the suit for damages against the municipality was barred by Sections 167 and 167A of the Bombay District Municipal Act, 1901 in view of the plea of good faith.

Analysis: The two provisions were read together and construed harmoniously. Protection was held to extend only to acts done honestly in discharge of statutory duties, even if negligent, but not to acts done without honesty or with wanton or wilful negligence. The definition of good faith under the Bombay General Clauses Act was applied to Section 167, and the presence of Section 167A did not create an absolute immunity against negligence claims.

Conclusion: The suit was not barred; the plea of statutory immunity failed.

Issue (ii): Whether the municipality was negligent in narrowing the nullah and leaving the slab centring and debris to obstruct flow, thereby causing the plaintiffs' loss, and whether the damages awarded were proved.

Analysis: The evidence showed that the municipality knew of the demolition of the Varala dam, yet proceeded with the work before reconstruction, narrowed the waterway without adequate provision for the increased catchment, and allowed centring and debris to obstruct the drain. An adverse inference was drawn from the suppression of correspondence. The flood damage to the plaintiffs' goods was supported by oral, documentary, and expert evidence, and the amount awarded was found justified.

Conclusion: Negligence was proved and the damages of Rs. 54,560 were upheld.

Final Conclusion: The decree dismissing the suit was set aside and the plaintiffs succeeded in recovering damages with interest and costs.

Ratio Decidendi: A municipality is protected by the statutory immunity only when the act complained of is done honestly in good faith in discharge of its statutory powers; where the act is carried out with wanton or wilful negligence and without honesty, the immunity does not apply and liability for resulting damage can arise.

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