AI Drafter 
TaxTMI 
TaxTMI 
1981 (9) TMI 305
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....uzaffarpur Municipality. Through a petition filed on 11-5-1981. 19 persons came to intervene out of whom 9 are Mukhiyas and 6 are surpanchas of some of the Gram Panchayats which have been included within the limits of the porporation. There is also one punch of a' Gram Panchayat. Petitioners Nos. 16 and 17 are the Secretary and General Secretary of the Taxation Bar Association, Muzaffarpur, petitioner No. 18 is the General Secretary of the Bar Association, Muzaffarpur and petitioner No 19 is the Convenor of Sawami Sahajanand Saraswati Smarak Samiti. They also support the original petitioners. On the date of the admission of the application itself a caveat was filed by 9 persons of whom caveator No. 9 ultimately backed out, They include the Vice-President of the Bar Association, Muzaffarpur, Chairman Citizens Assistance Council, Secretary District (Cong. I) Committee, Chairman, Town Congress Committee, two Mukhiyas and two villagers. They oppose the application. The petitioners of C. W. J. C. No. 1391 of 1981 are two Mukhiyas of Gram Panchayats. Their case is also same as of the petitioners of the other case. Amongst the respondents, apart from State of Bihar and certain officer....
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....within the limits of the corporation. It was also mentioned that the suburban areas suggested to be included fell within the jurisdiction of Muzaffarpur Improvement Trust. A map and details of the areas to be included were all given. It was first placed before the Cabinet on 14-4-1981 as would appear from Annexure 5, but it was postponed. Ultimately on a fresh memorandum it was again placed on 12-5-1981 when it was approved as would appear from Annexures B1 and B2 to the supplementary counter-affidavit of the respondents. Annexure 1 is the notification which" followed after the said Cabinet approval. Respondent No. 7 was appointed Administrator and he took charge on 18-4-1981 i.e., within two days of the notification, 5. The petitioners namely Chairman and Commissioner of the Muzaffarpur Municipality and the Mukhiyas of the Panchayats, who are all elected office bearers have challenged the constitution of the Muzaffarpur Corporation on the ground that their period to continue in their respective offices have been cut short by taking recourse to an undemocratic method. Petitioner No 1 of C. W. J. C. No. 1324 of 1981, Sri Raghunath Pandey, the Chairman of the Municipality, has att....
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.... an undemocratic method. There is no dispute on the point that the opinion of the people residing out of the municipal limits or within the panchayat was not taken in any manner. Further argument has been that it was their fundamental right to continue till their term of election and if that has been infringed that would amount to civil consequence, and as such, even in administrative action, rule of audi alteram partem (a rule of natural justice) was required by law to be followed, which was not followed, and hence constitution of the corporation must be struck down. It has also been argued that the suburban areas included in the corporation do not at all bear any urban character and as such they could not have been included in the corporation. The action of the State Government is also said to be in violation of Articles 14, 19 and 21 of the Constitution. 7. After the Advocate General had concluded his argument on behalf of the respondents a supplementary affidavit on behalf of the petitioners was filed which was not accepted on the objection raised by the Advocate General. 8. Counter-affidavits have been filed on behalf of the respondents in both the cases. It is admitted ....
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....he areas of Gram Panchayats were also included in violation of the provision of the P. R. Act. (d) when the alteration of the existing boundaries of the municipality were involved the provisions of Section 2 (3) of the Corporations Act were attracted which were not followed. (2) Since civil consequence of the petitioners are involved and since it is a case of delegated legislation the principles of natural justice are attracted which have not been followed. (3) If the rules of natural justice be excluded Section 2 (1) of the Corporations Act will become unconstitutional as being violative of Articles 14 and 21. (4) The notification is factually arbitrary and is hit by Article 14 of the Constitution. (5) The mala fide motive of the Chief Minister has vitiated the entire action. 11. For appreciating the first point (page 8) it is necessary to refer first two sections of the Corporations Act. The English rendering of the sections is as follows :-- "1. Short title, extent and commencement.- (1) This Act may be called the Bihar Municipal Corporations Act, 1978. (2) It shall extend to the whole of the State of Bih....
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....f Bihar". But what is a 'big city' is shown by Sub-section (3) of Section 1, according to which it would be a city having a population of 2 lakhs or more. Undisputedly the erstwhile Muzaffarpur within its municipal limits had a population of about 10,000 less than that what is required, and so ordinarily a corporation could not have been constituted, but there is another relevant clause in Sub-section (3) itself and that gives the date on which the population should be 2 lakhs or more, and that date is the date of notification. It, therefore, comes to this that on the date of notification the population should be 2 lakhs or more. Obviously the difficulty, if for any reason the Government choose to have a corporation at any place lesser population, can be overcome by extending the area of the city itself. Whether this can be legally done or not is provided in Section 2. This section says which areas can constitute a corporation. The opening sentence itself shows that corporation may be declared for "any area". It is further made clear by saying that it may include (a) the area of any municipality or notified area and (b) such other areas as may be specified therein (underlin....
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....tion. Of course it is not for this Court to take evidence on this question from both the parties and come to its independent decision. On the materials placed on affidavit the Court can find if the State Government were justified in holding that those areas had come to assume urban character. The caveators in paragraphs 3 and 4 of the caveat have said that the areas included are mostly within the radius of about 4 to 5 miles of the heart of the town. The newly added areas according to them contain various institutions and offices like L. N. Mishra Institute of Business Management, office of the Director of the Animal Husbandry, M. P. Singh Science College, Medical College, Aerodrome, office of the Chief Engineer, Gandak Project, Engineering College, police line etc. etc., The counter-affidavit on behalf of the respondents also shows in paragraph 4 that they are all urbanised, electrified connected with pitch road at various places, some of them having drainage and water supply and other facilities. It also says that quite a number of factories, schools, mills, shops, police line, furniture mart, cold storage, housing colony, aluminium factory etc. etc. are there. Over and above, it....
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....e agriculture of the area is likely to be ruined if it is brought within the corporation. The Constitution, however, requires efforts for organising agriculture on modern and scientific lines: the chances thereof are surely better if the area is within corporation. Hence Article 48 of the Constitution is not violated by bringing suburbs within the corporation limits. In my opinion, therefore, the suburbs added bear urban character and the State Government have rightly satisfied themselves on the point. 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 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:-- ....
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....ning 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. 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 i....
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....nstitute 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. (b) When the State Government is satisfied that any municipality, or any area in a municipality, does not fulfil 'the conditions specified in clause (a), or when the Commissioners at a meeting have made a recommendation in this behalf, the State Government may declare its intention to withdraw such municipality from the operation of this Act, or to exclude such area from such municipality. (c) When the Commissioners at a meeting have made a recommendation in this behalf, the State Government may declare its intention to include within a municipality any area contiguous to the same or to subdivide any municipality into two or more municipalities. (d) When the Commissioners of each of the municipalities concerned at a meeting have made a recommendation in this behalf, the State Government may declare its intention to unite two or more municipalities so as to form one municipality. (2) Every declaration under this section shall be published in th....
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....y-passing the law for changing the limits of a municipality. The learned Advocate General has, however, contended that the argument could have force only if Muzaffarpur municipality had been allowed to continue as a municipality, and the provisions mentioned above have no application at all in a case like this, when the constitution of a corporation is under the Corporation Act which does not provide for any such notification declaring the intention and inviting objections. Of course the intention of the State Government in this regard is further made clear by the repeal of the words "proposed to be" from Section 2 (3) (b) of the Corporation Act as mentioned in para 11 of this judgment. When the legislature has laid down an unambiguous law, it is submitted, there is no use to trying to camouflage it with reference to the provisions of any other Acts. 17. Mr. Mridul has further contended with reference to the provision of the Municipal Act and P. R. Act already discussed that when the legislature enacted the Corporation Act but did not lay down a rule for inviting objection from existing municipalities and panchayats in respect of alteration of other areas, it would be presumed t....
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....corporation at Mazaffarpur means supersession of the municipality, but for superseding the municipality certain conditions are laid down in Section 385, and unless they are fulfilled the municipality could not be superseded, and if it ceases to exist by the notification of the corporation, it amounts to the supersession of the municipality by a contrivance which is unconstitutional. This argument is also challenged on the very same ground on which the arguments based on Sections 4, 5 and 6 of the Municipal Act have been refuted Obviously the situation envisaged in Section 385 of the Municipal Act is quite different from the situation under which corporation is constituted. While the situation in Section 385 gives strong stigma to the commissioners, no such stigma is involved against them in constitution of corporation. 19. It would thus appear that the grounds on which the vires of the notification (annexure 1) is challenged are not tenable in law and as such the notification is not ultra vires but intra vires the Corporation Act. 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 ....
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.... the Commissioner may also have better chances and better prospects with the corporation coming in. There will 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 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 no....
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....for selecting officers of the forest department for appointment to the Indian Forest Service. Mr. N. who was an acting Chief Conservator of Forest, Jammu and Kashmir was one of the members and he was himself a candidate also. Ultimately his name came at the top of the recommendations. Of course Mr. N had not taken part in the deliberations when his name was being considered but he had certainly taken part when his contestants (some of whom were even senior to him) were discussed. Mr. N was a Judge in his own case, which is abhorrent to concept of justice. In this circumstance it was held that there was miscarriage of justice caused by non-observance of the rule of natural justice. Here the natural justice was not the rule of audi alteram partem but it was rule according to which Mr. N should not have been a member of the board. It has been mentioned in this very authority that rules of natural justice are not embodied rules and what particular rule should apply to a given case must depend on facts and circumstances of the case. The learned counsel for the petitioners has cited this authority only for showing that in administrative enquiries also rule of natural justice should follo....
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....mpounding and as such it was necessary to give her an opportunity of showing cause and of being heard. The lacuna was, however, taken as fulfilled by the subsequent opportunity given to her. The present case is quite distinguishable on facts. While Maneka Gandhi had in her possession a passport, the citizens of Muzaffarpui had not got any such thing of which they are being deprived. Upgradation of municipality or even panchayat should not be taken as entailing civil consequences. The petitioners here cannot be said to represent the entire population of the corporation area. They are elected bodies for certain purpose under the Bihar and Orissa Municipal Act or P. R. Act. If at all they suffer any loss that would be absolutely negligible as indicated earlier. Apart from that, if they or the members of any portion thereof are aggrieved by the creation of corporation, there is a provision in the Act for taking that area out of corporation. If, therefore, they have any grievance it is not that there is no provision for redressal. If it be held that in all administrative actions rule of audi alteram partem shall be applied, that can be taken as cured by the provision of exclusion given ....
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....taken over. In the set up of Section 15 to Section 18AA of that Act the question was whether Section 18AA excluded the giving of a prior hearing. Ultimately it was held that the rule of prior hearing was not specifically excluded rather a prior hearing in the context of that case should have been given. This case is a trump card of Mr. Mridul, but as I am going to show on facts and also on law the case has no application to the instant case. The scheme of that Act has been given in paragraphs 45 to 51 of the report. Section 15 gives power to the Central Government, to cause investigation to be made into a scheduled industry or industrial undertaking before taking over the same. So before the industrial undertaking is taken over an investigation has to be made -- this is of importance. Section 16 empowers the Central Government to issue proper direction to the industrial undertaking on completion of the investigation. The directions that can be given are all indicated there. The investigation and the directions obviously required sufficient time. It was felt that the Government could not take over the management of any industrial undertaking even in a situation calling for emergent ....
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....rring the power, can by express language exclude its application. Such cases do not present any difficulty. However, difficulties arise when the statute conferring the power does not expressly exclude this rule........" In the instant case, I think that the intention of the legislature to exclude the rule of natural justice is more than clear, and that is shown by omission of the word "proposed to be" from Section 2 (3) (b) of the Corporation Act. If those words had been left there it would have been obligatory on the part of the State Government to seek the view of the people affected. By omitting those words the intention is clear that the legislature did intend to include the provision of eliciting opinion. Eliciting prior opinion is a rule of natural justice, parallel to or the same as the rule of audi alteram partem. The rule of natural justice is not a codified rule, ,it varies from situation to situation. " The phrase is not capable of a static and precise definition. It cannot be imprisoned in the strait-jacket of a cast-iron formula" (para 24 of the report -- Swadeshi Cotton Mills). Needless to repeat that by constitution of the Muzaffarpur corporation absolute....
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....tional legislation the power of legislation is exercised by the legislature conditionally leaving to the discretion , of an external authority the time and manner of carrying its legislation into effect as also the determination of the area to which it is to extend........." "Thus when the delegate is given the power of making rules and regulations in order to fill in the details to carry out and subserve the purposes of the legislation the manner in which the requirements of the statute are to be met and the rights therein created to be enjoyed it is an exercise of delegated legislation. But when the legislation is complete in itself and the legislature has itself made the law and the only function left to the delegate is to apply the law to an area or to determine the time and manner of carrying it into effect, it is conditional legislation......" It would appear from above that in a conditional legislation the law is complete in itself and certain conditions are laid down as to how and when the law would be applied by the delegate. In other words the delegate, namely the State Government here, has only to be satisfied if what it is going to do, is in conformity with ....
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.... Article 21 which reads as follows:-- "No person shall be deprived of his life or personal liberty except according to procedure established by law." There is no question of deprivation of anybody's life or personal liberty here. If by personal liberty the right to carry on the profession or the right to be governed by village panchayats is concerned, the State has the right to interfere with it by law. I have shown above and I am also going to show hereafter that the Act by which it has been done is quite constitutional. Article 14 of the Constitution runs as follows :-- "The State shall not deny to any person equality before the law or the equal protection of the laws within the territory of India". Mr. Mridul who has taken both the Articles together has assailed the Corporation Act on the grounds which I am now going to discuss. (i) The first argument is that Councillor and Mukhiyas will be visited with civil consequence and no procedural safeguard has been provided for regulating the exercise of power of the State Government. This point I have already discussed in detail and hence I need not dwell upon it any further. I may only say that wha....
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....adduced materials before the court and have not given cogent reasons for its action. Except the last one, all the points have already been discussed and rejected. So far the materials and reasons are concerned, the Advocate-General in the course of the argument submitted that formerly the whole of State had been divided into four commissionaires , namely, Tirhut, Patna, Chotanagpur and Bhagalpur. Out of these Patna and Ranchi had already been converted into corporations. Both these were in South Bihar. The Government from administrative point of view thought it desirable to have at least one in the North Bihar also, and with this end in view the case of Muzaffarpur was taken up first, because in North Bihar there is no town with a higher population. Of course simultaneously with Muzaffarpur, a corporation at Bhagalpur was also constituted. When law for constitution of the corporation is satisfied, I think the reasons given by, the Advocate-General do deserve consideration. This is a step for satisfying the people of the different parts of the State. This objection also therefore is to he ruled out. If the Corporation Act is constitutional and if the notification (Annexure 1) has....
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....imself and not by Sri Sayeeduz Zafar, an Assistant in the Urban Development Department. The argument is that the nature of allegations made against the Chief Minister are personal in nature and so the best person to swear the affidavit is the Chief Minister. He has referred to the cases of G. Sadanandan v. State of Kerala ( AIR 1966 SC 1925) and the case of Mohammad Ibrahim v. B. Rama Rao (AIR 1976 SC 1822). In the case of Sadanand it has been held that where allegations are specifically made against an authority then if the denial is by anybody else the conclusion should be of mala fide. In the instant case the allegation of political rivalry is too vague to be called specific. In the case of Mohammad Ibrahim an Executive Engineer was reverted as an Assistant Engineer and in the writ filed against that, counter-affidavit was sworn by an Assistant Secretary disclosing some charges. Their Lordships of the Supreme Court deprecated the practice of the affidavits being sworn by the junior officers. Their Lordships hoped that the higher officers of the State Government would cease to utilise lower ones to provide an alibi for their own want of care. In that case the counter-affidavit ga....