TaxTMI 
TaxTMI 
2011 (4) TMI 1534
X X X X Extracts X X X X
X X X X Extracts X X X X
....on 21(3) of this Act. Section 27 of this Act provides that the term of office of the Mayor/Chief Councilor and the members of the Empowered Standing Committee shall be co-terminus with the duration of members of the Municipality. The Act provides for the removal of the Mayor/Chief Councilor and the Deputy Mayor/Deputy Chief Councilor under Section 25(4) of the Act by a vote of no confidence, which can be moved only after two years from taking over of the charge of the post. Section 23(3) of the Act provides for the election of a new Mayor/Chief Councilor when a vacancy arises in the office of Mayor/Chief Councilor on account of death, resignation, removal or otherwise. There is, however, no specific provision for the removal of the members of the Empowered Standing Committee appointed by the earlier Mayor or for nomination of new members on the Committee in their place by the newly elected Mayor/Chief Councilor, thereby leading to an anomalous situation, namely that the Municipal Council will have a new Mayor/Chief Councilor having the confidence of the house, but the members on the Committee nominated by the previous Mayor/Chief Councilor who has lost the confidence of the house w....
X X X X Extracts X X X X
X X X X Extracts X X X X
....tay on the fresh election being held to fill the vacancy in the post of Mayor arising out of the no confidence motion. Ultimately the petition was allowed. That decision was challenged in an appeal to the Division Bench of the Patna High Court, and the Division Bench set aside that order by its judgment dated 14.5.2010. Shri Sanjay Kumar challenged the decision of the Division Bench by filing Special Leave Petition No. 16578/2010. A prayer was made to this Court that the election to fill the vacancy should not be permitted. This Court did not grant that prayer, but vide its order dated 31.5.2010 directed that the subsequent election will be subject to the decision on this SLP. (It is relevant to place it on record at this stage that this Writ Petition came to be dismissed by this bench by its separate order passed on 3.2.2011). 6. In view of the order passed by this Court on 31.5.2010, a notice was given on 3.6.2010, and a meeting was accordingly convened on 14.7.2010 wherein the Appellant was elected as the Mayor of the Municipal Corporation. We are informed that the he obtained 44 votes and Shri Sanjay Kumar 18 votes, a third candidate 9 votes and 1 vote was rejected. The Appe....
X X X X Extracts X X X X
X X X X Extracts X X X X
....at cessation of membership to the municipality automatically brings to an end the membership of the Empowered Standing Committee. The High Court therefore repelled the challenge to the constitutionality of Section 27 of the Act. This Division Bench rendered its decision on 14.11.2008 which is reported in 2009 (2) PLJR 394 in the case of Jagdish Singh v. State of Bihar. 8. It so transpired that in another Municipal Corporation, namely Gaya Municipal Corporation, the Mayor of the Municipal Corporation expired, and one Sagufta Parween was elected as a new Mayor in that vacancy. She wanted to nominate her nominees on the Empowered Standing Committee, but was not allowed to do so in view of the above referred Government Direction in Memo No. 6020 dated 18.12.2009, to the effect that notwithstanding the change of Mayor or Chief Councilor, the Empowered Standing Committee of the Municipal Corporation, as nominated earlier, would continue. Meaning thereby, that the Mayor/Chief Councilor newly elected would not have the power to nominate members of the Empowered Standing Committee of the Corporation in terms of Section 21(3) of the Municipal Act. Smt. Sagufta Parween challenged ....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... dismissed in limine. This order is being challenged in this Appeal by Special Leave wherein the issues which are mentioned at the outset of this judgment have been raised for our consideration. 11. We have heard the learned Counsel for the Appellant as well as the counsel for the State of Bihar, Patna Municipal Corporation and the counsel for the intervening members of the Empowered Standing Committee who would be unseated if this appeal was to be allowed. We have also gone through the written submissions presented by them. 12. The relevant Sections of the Bihar Municipal Act, 2007 In this appeal we are concerned with the interrelation amongst Sections 21, 23, 25 and 27 of the Act. The sections of the Bihar Municipal Act relevant for our purposes are as follows: 2. Definition: (36) "Empowered Standing Committee" means the Empowered Standing Committee referred to in Section 21. Section 21. Constitution of Empowered Standing Committee of Municipality. (1) In every Municipality there shall be an Empowered Standing Committee. (2) The Empowered Standing Committee shall consist of- (a) in the case of a Municipal Corporation, the Mayo....
X X X X Extracts X X X X
X X X X Extracts X X X X
....cancy. Section 25. Removal of Chief Councilor/Deputy Chief Councilor. - (1) The Chief Councilor/Deputy Chief Councilor shall cease to hold office as such if he ceases to be a Councilor. (2) The Chief Councilor may resign his office by writing under his hand addressed to the Divisional Commissioner and Deputy Chief Councilor may resign his office by writing under his hand addressed to the Chief Councilor. (3) Every resignation under Sub-section (2) shall take effect on the expiry of seven days from the date of such resignation, unless within the said period of seven days he withdraws such resignation by writing under his hand addressed to the Divisional Commissioner or the Chief Councilor, as the case may be. (4) The Chief Councilor/Deputy Chief Councilor may be removed from office by a resolution carried by a majority of the whole number of councillors holding office for the time being at a special meeting to be called for this purpose in the manner prescribed, upon a requisition made in writing by not less than one-third of the total number of Councillors, and the procedure for the conduct of business in the special meeting shall be suc....
X X X X Extracts X X X X
X X X X Extracts X X X X
....connected provisions to enable us to decide the question of law which is raised in this appeal. As far as Patna Municipal Corporation is concerned, it was earlier governed under the Patna Municipal Corporation Act, 1951 (which has been repealed by Section 488 of the Bihar Municipal Act, 2007). It is material to note that under Section 36 of the repealed Act, the principal committee of the Municipal Corporation was known merely as the 'Standing Committee', and the members of the Standing Committee were directly elected under Section 37 of the Act by the full house of the Municipal Corporation, and their tenure was for two years. They were not nominated by the Mayor. Under the present Act, they are nominated by the Mayor. Now, the principal committee of the Municipal Corporation is known as the 'Empowered Standing Committee' under Section 22 of the Act. 15. Delegation of Powers Section 28(1) of the present Act provides for delegation of the powers and functions of the Municipal Corporation to the Empowered Standing Committee, and under Section 28(2), the Empowered Standing Committee may delegate its powers and function to the Chief Councilor or to the Chief Muni....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... is to be exercised. This section is divided into six Sub-sections, though for our purpose it is Section 57(1) which is relevant which reads as follows: 57. Right of councillors to ask questions.- (1) A Councilor may, subject to the provisions of Sub-section (2), ask the Empowered Standing Committee questions on any matter relating to the administration of the Municipality or municipal governance, and all such questions shall be addressed to the Empowered Standing Committee and shall be answered either by the Chief Councilor or by any other member of the Empowered Standing Committee. (emphasis supplied) In continuation of this Section 57, Section 59 provides for asking for a statement from the Empowered Standing Committee on any urgent matter relating to administration of the Municipality. This section reads as follows: 59. Asking for statement from Empowered Standing Committee.(1) Any Councilor may ask for a statement from the Empowered Standing Committee on an urgent matter relating to the administration of the Municipality by giving notice to the Municipal Secretary at least one hour before the commencement of the meeting of the Municipality on any ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ty shall vest in the Empowered Standing Committee. Executive Powers shall be used collectively. Provided that administrative control on the Staffs of Municipality shall vest in Chief Executive Officer/Executive Office. Resolution shall be passed in the light of orders/directions issued time to time by State Government. Officially brought agenda shall contain the following- (a) items relating to the establishment as per provision of the Act, which includes appointments promotions, benefits, transfers, disciplinary actions etc. of the employees of the Municipality. items relating to the collection of taxes and fees. (b) items relating to the financial position of the Municipality. (c) development activities undertaken and to be undertaken by the Municipal body. (d) items necessary for effective implementation of the provision of the Act. Provided that all items are to be placed before the committee by the Chief Municipal officer and shall be in the form of memorandum which will include the subjects, the status and the proposal to be approved by the committee. A separate sheet is to be attached under the signature....
X X X X Extracts X X X X
X X X X Extracts X X X X
....nd the other members of the Empowered Standing Committee, and the new Mayor who is elected by the House will not be able to carry the municipal governance as per the desire of the House, since his proposals could be opposed by the members of the Empowered Standing Committee who are nominated by the erstwhile Mayor. This straight reading of Section 27 thus leads to an anomalous position. The counsel for the Appellant submits that although there is no difference in the position of the newly elected Mayor and the earlier Mayor, if literal interpretation is accepted, the newly elected Mayor will be treated dis-similarly as against the earlier elected Mayor, and the entire municipal governance will come under strain. He therefore submits that Section 27 is ultra-vires Section 21 of the Act and Article 14 of the Constitution of India. Section 27 should therefore be either struck down, or if it is to be saved, it should be read down harmoniously with Sections 25(4), 23(3) and 21(3) of the Act. 19. Submissions on behalf of the Respondents: The counsel for the Respondents, on the other hand, submit that as held by different benches of the Patna High Court, the appointment of the....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... from amongst themselves, nominates his Mayor-in-Council members. Section 37(3) provides that the members shall hold office during the pleasure of the Mayor. Section 37(8) provides that the new Mayor (i.e., elected after the office of the Mayor is declared vacant) has the choice to continue the old Council members or appoint new members in their place. (iii) The same is the effect and import of Section 70 (in place since the 1998 Amendment) of the M.P. and Chhattisgarh Municipalities Act, 1961. Section 70 deals with President-in-Council of the Municipal Council and is in pari materia with Section 37 of the Madhya Pradesh Municipal Corporation Act, 1956. (iv) In the Mizoram Municipalities Act, 2007, there is a provision for an Executive Council similar to the Empowered Standing Committee. The tenure of the members of the Executive Council is co-terminus with that of the Chairman under Section 21(d) of Mizoram Municipalities Act, 2007. (v) Somewhat similar are the provisions under Sections 52, 64 and 66 of the Goa Municipalities Act 1968. Under Section 66(1) of the Act, the term of office of the members of the Standing Committee is co-terminus with the term....
X X X X Extracts X X X X
X X X X Extracts X X X X
....sus omissus cannot be readily inferred by the Court except in the case of clear necessity and when reason for it is found in the four corners of the statute itself. The decision was rendered in view of the facts of the case and the relevant provisions of the Forest Act, 1927, and while so doing, the court did make it clear that if literal construction of a particular clause leads to manifestly absurd or anomalous results, a literal interpretation may not be preferred. The proposition of law laid down in this case, is thus quite clear and does not help the Respondents. In para 21 of the judgment this Court (per Arijit Pasayat, J) observed as follows: Two principles of construction - one relating to casus omissus and the other in regard to reading the statute as a whole - appear to be well settled. Under the first principle a casus omissus cannot be supplied by the court except in the case of clear necessity and when reason for it is found in the four corners of the statute itself but at the same time a casus omissus should not be readily inferred and for that purpose all the parts of a statute or section must be construed together and every clause of a section should be con....
X X X X Extracts X X X X
X X X X Extracts X X X X
....itimately arise. 25. Consideration Constitutional Provisions concerning the Municipalities Before we deal with the rival submissions, we may note that the Municipalities are expected to render wide-ranging functions. They have now been enumerated in the Constitution. Article 243W lays down the powers of the Municipalities to perform the functions that are listed in Twelfth Schedule It reads as follows: 243W. Powers, authority and responsibilities of Municipalities, etc. - Subject to the provisions of this Constitution, the Legislature of a State may, by law, endow - (a) the Municipalities with such 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 conditions as may be specified therein, with respect to- (i) the preparation of plans for economic development and social justice; (ii) the performance of functions and the implementation of schemes as may be entrusted to them including those in relation to the matters listed in the Twelfth Schedule; (b)....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... Chapter 22 on Water-supply, Chapter 23 on Drainage and Sewerage, Chapter 24 on other provisions relating to Water-supply, Drainage and Sewerage, Chapter 25 on Solid Wastes, Chapter 26 on Communication Systems which deals with the public streets and street lighting, Chapter 27 on Markets, Commercial Infrastructure and Slaughter Houses. Part VI deals with Urban Environmental Management, Community Health and Public Safety. Chapter 28 is on local agenda for Urban Environmental Management, Chapter 29 on Environmental Sanitation and Community Health, Chapter 30 on restraint of infection, Chapter 31 on disposal of the dead, Chapter 32 on Urban Forestry, Parks, Gardens, Trees and Playgrounds. Part VII deals with the Regulatory Jurisdiction, and contains chapters on Development Plans, Improvement, Public Streets, Buildings, Municipal Licenses, Vital Statistics, Disaster Management and Industrial Townships. Lastly Part VIII deals with the Powers, Procedures, Offences and Penalties. 27. Thus, it will be seen that the Bihar Municipal Act is quite a comprehensive Act, and as noted earlier ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ongwith him and a newly elected Mayor be permitted to have his nominees on the Empowered Standing Committee. 28. The concept of Executive Power and Article 14 As seen above, the term executive power has been specifically used in Section 22 of the Act and Section 57 specifically uses the term Municipal Governance. The concept of executive power has been read widely by Constitution Bench of this Court way back in Rai Sahib Ram Jawaya Kapur and Ors. v. The State of Punjab, reported in AIR 1955 SC 549, wherein this Court has observed: 12. It may not be possible to frame an exhaustive definition of what executive functions means and implies. Ordinarily the executive power connotes the residue of governmental functions that remain after legislative and judicial functions are taken away.... 13. ...The executive function comprises both the determination of the policy as well as carrying it into execution.... This being the breadth of the executive power of the Empowered Standing Committee, the newly elected Mayor will not be able to exercise the same effectively and the entire municipal governance will come in jeopardy, if the other members on the Committee are n....
X X X X Extracts X X X X
X X X X Extracts X X X X
....on match the contextual. A statute is best interpreted when we know why it was enacted. With this knowledge, the statute must be read, first as a whole and then section by section, clause by clause, phrase by phrase and word by word. If a statute is looked at, in the context of its enactment, with the glasses of the statute-maker, provided by such context, its scheme, the sections, clauses, phrases and words may take colour and appear different than when the statute is looked at without the glasses provided by the context. With these glasses we must look at the Act as a whole and discover what each section, each clause, each phrase and each word is meant and designed to say as to fit into the scheme of the entire Act. No part of a statute and no word of a statute can be construed in isolation. Statutes have to be construed so that every word has a place and everything is in its place. It is by looking at the definition as a whole in the setting of the entire Act and by reference to what preceded the enactment and the reasons for it that the Court construed the expression "Prize Chit" in Srinivasa and we find no reason to depart from the Court's construction. (emphasis ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....oncerning the election to the Legislative Assembly of the then State of Madras held in the year 1957. In this case arising under the Representation of the People Act, 1951, the Supreme Court held that if the Returning Officer had rejected a nomination paper of a candidate on one disqualification, it was open for the Election Tribunal to find the rejection proper on some other ground of disqualification which may not have been raised before the Returning Officer. It was pointed out that if this construction is not placed on Section 100(1)(c) of the Act, the result will be anomalous in that if the decision under Section 36(6) of the Returning Officer on the objection on which he rejected the nomination paper is held to be bad, the Tribunal will have no option but to set aside the election under Section 100(1) (c) even though the candidate was disqualified and his nomination paper was rightly rejected. In holding so, Venkatarama Aiyer, J. observed as follows in para 13: ...It is no doubt true that if on its true construction, a statute leads to anomalous results, the Courts have no option but to give effect to it and leave it to the Legislature to amend and alter the law. But....
X X X X Extracts X X X X
X X X X Extracts X X X X
....umber of directors beyond the prescribed maximum. After considering the relevant Articles, the Privy Council held that Articles 126 and 109 were two textually inconsistent provisions. The proposition that emerges from the judgment is that it is permissible to read words such as "subject to" etc. in order to reconcile two apparently inconsistent provisions. To reconcile Article 109 with Article 126 and to give effective content to them, it was necessary to imply words such as "subject to". The Court therefore, observed in paragraph 5 as follows: The omission to make such cross-references as may be required to reconcile two textually inconsistent provisions is a common defect of draftsmanship. There is thus no insuperable difficulty in reconciling Article 109 with Article 126 either by implying in the former some such opening words as "subject to Article 126" or implying in the latter some such opening words as "notwithstanding anything containing in Article 109. 34. Reading a section subject to another to realize the real intent of the two provisions Recently this Court was concerned with the anomaly between Section 23(3) of the Code of civil Procedure and Section 25 ....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... High Court has no power, authority or jurisdiction to transfer a case, appeal or other proceedings pending in a court subordinate to it to any court subordinate to another High Court in purported exercise of power under Sub-section (3) of Section 23 of the Code and it is only this Court which can exercise the said authority under Section 25 of the Code.... 35. Reading down a section to save it from being ultra vires We have noted that the view canvassed by the Respondents that the nomination of the members on the Empowered Standing Committee is a one time act, is possible only if the words are added in Section 21(3) of the Act as pointed out above. The intention of the legislature as seen from the provisions of the Act and the Rules is to have a 'Mayor-in-Council' who enjoys the confidence of the Municipal House. The Empowered Standing Committee along with him is vested with the executive power and is expected to run the municipal governance. There is no reason to treat the subsequently elected Mayor differently, and deny him the right to nominate his nominees on the Empowered Standing Committee which right is available to the duly elected Mayor under Section 21(3) o....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... in the course of inter-State trade and commerce and sales which occasioned import of goods. Although Section 8A of the Act provided that nothing in this Act would be deemed to impose or authorize imposition of any tax on a sale outside the State or in the course of the import or export or inter-state trade or commerce but the explanation has not been amended accordingly. There is a provision for exemption of turnover related to goods in respect of which tax has already been paid under the Bombay Sales Tax Act, 1952, but there is no provision that such exemption would be available in case of goods which have suffered sales tax under the other Sales Tax Laws. In the circumstances, this Court held as follows in para 38 (per V.N. Khare, J (as he then was) speaking for the majority on the bench): We are, therefore, of the view that since the explanation has not been amended in conformity with Section 8A of the Act, the explanation to Section 2(10) of the Maharashtra Act transgresses the limits of legislative power conferred on the State Legislature under Entry 54 of List II and we, thus, instead of striking it down, direct that the explanation to Section 2(10) of the Act shall....