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Sundarabai Vs. State of Maharashtra and ors. - Court Judgment

LegalCrystal Citation
SubjectCivil
CourtMumbai High Court
Decided On
Case NumberSpl. Civil Appln. No. 356 of 1961
Judge
Reported inAIR1967Bom203; (1963)65BOMLR821; ILR1964Bom1
ActsCentral Provinces and Berar Municipalities Act, 1922 - Sections 9
AppellantSundarabai
RespondentState of Maharashtra and ors.
Appellant AdvocateC.S. Dharmadhikari, Adv.
Respondent AdvocateD.B. Padhye, Asst. Govt. Pleader and G.R. Mudholkar, Addl. Govt. Pleader for ;Adv. General
Excerpt:
central provinces and berar municipalities act (ii of 1922), section 9 - power given to state government under section 9 whether oversteps limits of permissible delegation of legislative authority--vires of section 9.;section 9 of the central provinces and berar municipalities act, 1922, is ultra. vires of the powers of the legislature.;the power that is given to the state government under section 9 of the act is unguided and uncanalised power. that power oversteps the limits of permissible delegation of legislative authority, and therefore the whole of section 9 which makes it possible for the state government to formulate an altogether different code for constitution, functioning and powers of the municipal authority, is beyond the scope of the act.;union of india v. bhanamal gulzarimal.....abhyankar, j.(1) the state of maharashtra issued a preliminary notification on 29-8-1959 under s. 4 of the c. p. and berar municipalities act. 1922. by that notification,. respondent no. 1 signified its intention to declare the local areas comprising of four villages of desaiganj, wadsa, nainpur and virsitukum in gadchiroli tahsil of the chanda district to be a municipality. this notification was followed by subsequent notification bearing no. dtm (m) 2558(a)-a, dated 26-4-1961. under this latter notification , the government was pleased to declare the area comprising in these four villages to be a municipality from 1st may 1961. the government is empowered to declare a municipality comprising of certain areas under s. 5 (1) (a) of the c. p. and berar municipalities act. it may be noted.....
Judgment:

Abhyankar, J.

(1) The State of Maharashtra issued a preliminary notification on 29-8-1959 under S. 4 of the C. P. and Berar Municipalities Act. 1922. By that notification,. respondent No. 1 signified its intention to declare the local areas comprising of four villages of Desaiganj, Wadsa, Nainpur and Virsitukum in Gadchiroli Tahsil of the Chanda district to be a municipality. This notification was followed by subsequent notification bearing No. DTM (M) 2558(a)-A, dated 26-4-1961. Under this latter notification , the Government was pleased to declare the area comprising in these four villages to be a municipality from 1st May 1961. The Government is empowered to declare a municipality comprising of certain areas under S. 5 (1) (a) of the C. P. and Berar Municipalities Act. It may be noted here that in his final notification of 26-4-61, through some inadvertence mention of village Virsitukum is omitted, though the village was mentioned in the preliminary notification. It is not now disputed however that the boundaries of the area comprising the municipal limits as given in the preliminary notification and the final notification are identical. Therefore, there is not dispute that village Virsitukum is also comprised within the municipality of Desaiganj.

(2) On the same date the State Government issued two more notifications. They are as follows:

'No DTM (M)-2558(d) A Whereas the circumstances of the Desaiganj Municipality declared under Government notification. Urban Development and Public Health Department No. DTM (M) 2558 (a)-A, dated the 26th April 1961, are such that, in the opinion of Government, the provisions of Ss. 10,16,18 and sub-section (3) of S. 175 of the Central Provinces and Berar Municipalities Act, 1922 (II of 1922) are unsuited thereto;

Now, therefore, in exercise of the powers conferred by S. 9 of the said Act, Government is pleased to direct that the provisions contained in S. 10 Shall apply to the said Municipality in the modified form as specified in the schedule annexed hereto and the provisions contained in Ss. 16, 18 and sub-section (3) of S. 175 shall be deemed to be withdrawn and in their place the modified provisions as specified in the said schedule shall operate with respect to the said Municipality, namely;

SCHEDULE

(1) In S. 10 after sub-section (7) the following sub-section shall be inserted, namely:

'(8) Notwithstanding anything contained in sub-sections (2) to (7), the Committee of the Desaiganj Municipality shall, until a committee consisting of elected members can be constituted, consist of thirteen members appointed by Government by a notification.' (2) For Ss. 16 and 18, the following sections shall be substituted, namely:

'16 The term of office of the members of the Committee of the Desaiganj Municipality Constituted under sub-section (8) of S. 10 shall expire on the 30th April 1963 or on the date on which the successors of the members of the Committee take office, whichever is later.'

'18 The President and Vice-President of the Committee of the Desaiganj Municipality constituted under sub-section (8) of S. 10 shall be elected by the members appointed by the State Government.'

(3) For sub-section (3) of S. 175, the following sub-section shall be substituted, namely:

'(3) All rules other than rules made under the first proviso to sub-section (3) of S. 86 DTM (M) 2558-(e)-A. In exercise of the powers conferred by sub-section (8) of Section 10 of the Central Provinces and Berar Municipalities Act 1922 (II of 1922), as amended by Government Notification. Urban Development and Public Health Department No. DTM (M) 2558(d) A, dated the 26th April 1961. Government is pleased to appoint the following persons to be members of the Desaiganj Municipal Committee in the Chanda District namely:

1. Shri Gyanchand Dunichand, President

2. Shri Doma Saoji Dahikar, Vice-President

3. Shri Haridas maniram Gedam.

4. Shri Abdul Hamid Abdul Shakur

5. Shri Ambalal Shiwabhai

6. Smt Sundrabai w/o Pundlik Sonkusare.

7. Shri Maidi Husain.

8. Shri Pandurang Laxman Sapate.

9. Shri Jasanmal Ramdas.

10. Shri Tukaram Honduji Sahare.

11. Shri Govinda Tukaram Raut.

12. Shri Mukhru Mangru.

13. Shri Pandurang Somaji.'

(3) By the first of these notifications bearing No. DTM(M)-2558-(d)-A, the Government purported to act under S. 9 of the Municipalities Act. In exercise of the powers conferred by S. 9 of that Act, the Government directed that the provisions of S. 10 of the Municipalities Act shall apply to the Municipality of Desaiganj in the modified form given in the schedule. Similarly, Ss. 16 and 18 of the Municipalities Act were substituted for original Ss. 16 and 18 in their application to the Municipality of Desaiganj as shown in the first notification. There was a slight modification in sub-section (3) of S. 175 of the Municipalities Act and in such modified form this sub-section was made applicable to the new Municipality of Desaiganj.

(4) By the second notification No. DTM(M)-2558-(e)-A, the State Government purported to exercise powers conferred by it on itself in the new sub-section (8) of S. 10 which it made applicable to Desaiganj Municipality by the first notification. In exercise of this power, the Government appointed 13 persons to be members of the Desaiganj Municipality as given in the second notification. It has to be noted that against the name of Shri Gyanchand Dunichand it was mentioned that he was the President and against the name of Shri Doma Saoji Dahikar, it was mentioned that he was a Vice-President. It has to be noted that this notification was in respect of the appointment of members of the Desaiganj Municipality and not apparently for the appointment of Office-bearers of the Municipality.

(5) Thereafter on 11-7-1961, the State Government issued two more notifications as follows:

'No. DTM(M)-2558(d)-A Corrigendum In exercise of the powers conferred by Section 9 of the Central Provinces and Berar Municipalities Act 1922, S. 18 of the said Act as applied in respect of the Municipal Committee, Desaiganj, by Government Notification No. DTM(M)-2558(d)-A, dated the 26th April 1961, should be replaced by the following.

'18. The President and Vice-President of the Committee of the Desaiganj Municipality constituted under sub-section (8) of S. 10 shall be nominated by the State Government from amongst the members appointed to the Committee.' No. DTM(M)-2558-(c)-A, Addendum. In exercise of the powers conferred by S. 18 of the Central Provinces and Berar Municipalities Act, 1922, as amended by Government Notification, Urban Development and Public Health Department No. DTM(M)-2558-(d)-A, dated the 26th April 1961, read with Government Notification, Urban Development and Public Health Department, No. DTM(M)-2558-(d)-A, dated the 11th July 1961, following should be added to the Government Notification No. DTM(M)-2558-(e)-A dated the 26th April 1961, published in the 'Maharashtra Government Cazette Extraordinary, 'Nagpur Division Supplement, Part I-A, dated the 28th April 1961:

Government is also pleased to appoint Shri Gyanchand Dunichand and Shri Doma Saoji Dahikar as President and Vice-President, respectively of the Municipal Committee, Desaiganj, for the period for which the nominated body holds office.'

(6) The first notification is styled as Corrigendum. By this notification, substituted S. 18 enacted by the State Government in the first notification dated 26-4-1961 was replaced by new S. 18 in its application to Desaiganj Municipality. By the second notification dated 11-7-1961, which is called Addendum, the Government purported to direct that the latter portion of that notification should be added to the earlier Government Notification No. DTM(M)-2558-(e)-A, publishing the names of the members appointed by the Government.

(7) The petitioner Sundarabaj is one of the persons appointed by the Government as a member of the Municipal Committee at Desaiganj. The petitioner had originally alleged that village Virsitukum did not appear to be included within the municipal area of Desaiganj Municipality as declared by the Government. In view of the return this position is not now contested.

(8) The petitioner has placed on record the questions asked on the floor of the house in the Legislative Assembly of the State of Maharashtra on 19th July 1961, and the answers given by the Hon'ble the Minister in charge of local Self-government. They are to be found as annexures B at pages 16 and 17. The petitioner has challenged the action of the State Government in issuing these various notifications after constitution of a Municipal Committee for Desaiganj nominating certain persons as members of the Committee, appointing two persons, respondents 3 and 4, as President and Vice-President of that Municipal Committee, and amending or altering the provisions of certain sections of the C. P. and Berar Municipalities Act, 1922, in its application to the Municipal Committee of Desaiganj. Briefly stated, the petitioner's contention is that the State Government had no power under the notification first issued by it on 26-4-61 to appoint any person from among the appointed members as President and Vice-President, that this power was expressly reserved in the appointed members to elect office-bearers of the Municipal Committee, that the subsequent notifications of 11th July 1961 which purported to substitute section 18 as originally amended, was not a proper exercise of the power under S. 9 of the Municipalities Act. The State Government could not therefore in exercise of the power alleged to be given by virtue of the notification of 11th July 1961 which was styled as a Corringendum, appoint respondents 3 and 4 as President and Vice-President of the Municipal Committee of Desaiganj. They have raised fundamental objection to the action on the ground that S. 9 of the C. P. and Berar Municipalities Act itself is ultra vires the legislative power of the State Legislature of madhya Pradesh, that it has overstepped the limits of the delegation of the legislative power and that the powers granted to the State Government as the delegate of the Legislature are far in excess of well-recognized limits of delegation. The delegate, namely,. the State Government, has been empowered according to the petitioner not only to withdraw the operation of certain provisions of the Municipalities Act , or modify certain provisions before application but also to add to the provisions in respect of any of the matters mentioned in the provision which has been withdrawn from its application to the Municipal Committee. In short, the contention is that the amplitude of the power is so wide that the State Government is empowered to erect a new Municipal Code entirely inconsistent with the policy of the parent Act and to make it applicable to any Municipal committee. It is also urged that there is no indication, guidance, or standard in the section itself viz S. 9, or any other part of the Act, to find out in what circumstances the State Government may exercise the powers given in S. 9. Thus, the power is non-canalised, arbitrary and without any guidance from the Legislature itself. It is these contentions which we have to examine in this petition.

(9) In our opinion, if the last contention as to the vires of S. 9 is well founded, then it is not necessary to enter into a detailed examination of the action of the State Government in issuing various notifications of 26-4-61 of 11-7-61.

(10) As already stated, we had suspended the Judgment and given a notice to the Advocate General. That notice had been sent to the Advocate General and the Advocate General has instructed the learned Additional Government Pleader to appear in this Court on his behalf. We have heard the learned Government Pleader further in support of the action and we now proceed to discuss the merits of the case.

(11) Section 9 of the C. P. & Berar Municipalities Act is as follows:

'If the circumstances of any municipality are such that in the opinion of the Provincial Government, any provision of this Act is unsuited thereto, the Provincial Government may by notification-

(a) Withdraw the operation of that provision from the municipality;

(b) apply that provision to the municipality in a modified form to be specified in such notification.

(c) make any additional provision for the municipality in respect of the matter mentioned in the provision which has been withdrawn from, or applied in a modified form to, the municipality.'

(12) It is undoubtedly true that the Provincial Government has been empowered if the circumstances of any municipality are such as in the opinion of the Provincial Government require that any provision of this Act is unsuitable to it, that action may be taken under sub-clauses (a),(b) of S. 9 Clause (a) permits the State Government to withdraw the operation of any provision of the Act from that municipal committee. Clause (b) empowers the State Government to apply that provision in a modified form. On the other hand, Clause (c) permits the State Government to make any additional provisions for the municipal committee in respect of the matter mentioned in the provision which has been withdrawn or applied in a modified form to the municipal committees. Thus each one of the sub-clauses in their descending order gives increasing power to the State Government either to withdraw the application of any provision of the Act or to modify any provision of the Act or completely to substitute a provision of the Act by a provision made by them. It was not disputed before us by the learned Additional Government Pleader that the amplitude of this power may well sustain an action on behalf of the State Government in completely changing the structure of a municipal body in all vital matters connected with the constitution, functioning, powers and control of a municipal authority. The C. P. and Berar Municipalities Act is founded on a principle of elective franchise for constitution of the committees. Originally, the franchise was wide enough to permit the general electorate to elect a President by direct vote and also the elect members by direct election from respective wards. A certain amount of indirect franchise was permitted in the matter of selection of certain class of members such as Harijans, women and others. By a later amendment a change has been effected in this form of franchise. In the present form the President is elected not by the whole body of electorate of the town but by elected members. On the other hand, there is no person now capable of being selected as a member of the Municipal Committee by elected members. Thus, the present policy of the legislature is that all persons who may form a municipal committee either as member or as office-bearers such as President and Vice-President should enter only by one door, namely, that of election. So the elective mode of constitution of the members and office-bearers of the committee is one of the policies of the legislature. The legislature has also fixed the term of membership of the committee and its office-bearers originally as three years, but by subsequent notification it was fixed at five years after 1941. There are certain safeguards provided in the Act as to the manner in which the bye-laws and statutory rules are to be framed and brought into force. There is a well-defined procedure prescribed for imposing taxes, for inviting objections to the proposed taxes, and for giving due publicity to all these measures which are likely to affect the life, property and civic rights of the citizens of the locality. Rules can be framed only after prior publication and they are generally subject to objections being received and considered by the authorities. So are the bye-laws. So the whole pattern of municipal administration under system incorporated in the C.P. and Berar Municipalities Act is based on well-defined policies. Section 9 permits the State Government to withdraw the application of any of these provisions of the Act from a particular municipal committee. Thus instead of a municipal committee being constituted by election of members, the State Government may impose a municipal committee which may consist of members appointed by it. In fact, in the instant case, this has been done by the State Government by adding an overriding and non-obstante clause as sub-clause (8) of S. 10 by which all the provisions of that section as it originally stood in sub-clauses 2 to 7 have been in effect abrogated, giving place to appointed members in lieu of elected members. Section 18 of the Act provides for election of a President by the elected members as normal mode. In the instant case the State Government has altered the provisions of S. 18 to such an extent that it has taken to itself the power of appointing the office-bearers like the President and Vice-President from among the members. The rule-making power of the State Government is itself subject to previous publication of the rules. In one case at least the State Government has taken the power in the instant case to withdraw this requirement of previous publication of a rule in connection with certain budgetary provisions. These are only illustrations of the manner in which the power given under S. 9 of the C. P. and Berar Municipalities Act can be exercised by the State Government. If S. 9 is intra vires, then the State Government without being all accused of any want of bona fides may well exercise the power in such a manner as to completely alter the structure of a municipality for a particular town. It may extend the provisions of the Act so as to extend the terms of the office of the municipality for an unlimited period. It may alter the procedure of imposition of taxes in such a manner as to deprive citizens of any right to object to such imposition. It is not to be suggested that the power will be exercised in a manner prejudicial to the interest of the people; it may well be that the power may be exercised in a benevolent manner and in the best interests of the people concerned. But that hardly is of any relevance when the question of ambit of the power is being discussed and its validity is to be decided. It is not answer to the charge to say that however arbitrary the powers may be, there is an assurance that the repository of the power being State Government it will always exercise that power in the best interests of the people. That may or may not happen. We have no reason to think in the instant case that what has been done by the State Government in respect of the Municipal Committee of Desaiganj was from any motive other than the interests of the people concerned. But what is to be found is whether the Legislature can delegate its function of legislation in creating as it were a parallel though subordinate legislature with the same amplitude of powers to legislate with respect to the policy and also the manner in which the body to be constituted shall function. In our opinion, the limits of subordinate legislation in the instant case have been overstepped and it is not possible to sustain the vires of section 9 of the C. P. and Berar Municipalities Act.

(13) There is considerable guidance in the pronouncements of the highest Court in the country in testing the arguments of the petitioner. The earliest case in In re Delhi Laws Act AIR 1951 S. C. 332 has now been accepted as laying down at least two propositions which had the backing of the majority of the opinions expressed by the Court in that case. At page, 338 the learned Chief Justice observed as follows:

'Before considering these arguments in detail, I think it is essential to appreciate clearly what is conveyed by the word 'delegation.' That word is not used, either in discussions or even in some decisions of the courts, with the same meaning. When a legislative body passes an Act it has exercised its legislative function. The essentials of such function are the determination of the legislative policy and its formulation as a rule of conduct. These essentials are the characteristics of a legislature by itself. It has nothing to do with the principle of division of powers found in the Constitution of United States of America. Those essentials are preserved, when the legislature specifies the basic conclusions of fact, upon ascertainment of which, from relevent data, by a designated administrative agency, it ordains that its statutory command is to be effective. The legislature having thus made its laws, it is clear that every detail for working it out and for carrying the enactments into operation and effect may be done by the legislature or may be left to another subordinate agency or to some executive officer. While this also is sometimes described as a delegation of legislative powers, in essence it is different from delegation of legislative power which means a determination of the legislative policy and formulation of the same as a rule of conduct.'

To the same effect are the observations of Mr. Justice B. K. Mukherjea at page 400, which are as follows;

'The essential legislative function consists in the determination or choosing of the legislative policy and of formally enacting that policy into a binding rule of conduct. It is open to the legislature to formulate the policy as broadly and with as little or as much details as it thinks proper and it may delegate the rest of the legislative work to a subordinate authority who will work out the details within the frame work of that policy.'

His Lordship quoted the following from an American decision in A.L.A. Schechter Poultry Corpn. v. United State (1934) 295 US 495:

'So long as a policy is laid down and a standard established by statute no constitutional delegation of legislative power is involved in leaving to selected instrumentalities the making of subordinate rules within prescribed limits and the determination of facts to which the legislation to apply.'

(14) In a subsequent decision of the Supreme Court in Harishankar Bagla v. State of Madhya Pradesh, : 1954CriLJ1322 their Lordships observed in paragraph 9 at page 468 to the following effect;

'It was stated by the majority judgment in the 'Constitution of India and Delhi Laws Act, 1912, etc. AIR 1951 SC 332, that essential powers of legislation cannot be delegated. In other words, the Legislature can not delegate its function of laying down legislative policy in respect of a measure and its formulation as a rule of conduct. The Legislature must declare the policy of the law and the legal principles which are to control any given cases and must provide a standard to guide the officials or the body in power to execute the law. The essential legislative function consists in the determination or choice of the legislative policy and of formally enacting that policy into a binding rule of conduct...' In the same year the Supreme Court had to consider the vires of another legislation in connection with municipal laws. That was in the case of Rajnarain Singh v. Chairman Patna, Administration Committee, : [1955]1SCR290 . It is worthwhile to remember that in that case an executive authority, namely, the Local Governments of Bihar and Orissa was empowered by the Legislature by an amendment effected by Act IV of 1928 to Act No. I of 1915 to do the following things:

(1) To cancel or modify any existing municipal laws in the Patna Administration area.

(2) To extend to this area all or any of the sections of the Bihar and Orissa Municipal Act of 1922 subject to such restrictions and modifications as it considered fit.

(3) To add to the Patna Administration area other areas not already under municipal contract. Purporting to act in the exercise of these powers the Local Government on 25-4-31 repealed the existing laws in the Patna Administration Area and in their place introduced a new set of laws culled from Bihar and Orissa Act of 1922 with certain restrictions and modifications as they thought fit. Then in 1951 the Bihar State Government issued the notification of 23rd April 1951 which was the subject-matter of challenge before the Supreme Court. In paragraph 31 at page 574 their Lordships observed as follows with regard to the 1951 Delhi Laws Act:

'In our opinion, the majority view was that an executive authority can be authorised to modify either existing or future laws but not in any essential feature. Exactly what constitutes an essential feature cannot be enunciated in general terms, and there was some divergence of view about this in the former case, but this much is clear from the opinions set out above it cannot include a change of policy.' Furtheron, applying these principles their Lordships observed at page 575 as follows:

'But even as the modification of the whole cannot be permitted to effect any essential change in the Act of an alteration in its policy, so also a modification of a part cannot be permitted to do that either. If that were not so, the law, as laid down in the previous decision, could be evaded by picking out parts of the Act only., with or without modification, in such a way as to effect an essential change in the Act as a whole. It follows that when a section of an Act is selected for application, whether it is modified or not, it must be done so as not to effect any change of policy, or any essential change in the Act regarded as a whole. Subject to that limitation we hold that section 3 (1) (f) is 'intra vires', that is to say, we hold that any section or sections of the Bihar and Orissa Municipal Act of 1922 can be picked and applied to 'Patna' provided that does not effect any essential change in the Act or alter its policy.' Ultimately their Lordships held that the notification dated 23-4-51 did effect a radical change in the policy of the Act and therefore it travelled beyond the authority which was given by section 3 of the Bihar and Orissa Act was declared ultra vires.

(15) The same question has been subject to debate before the Supreme Court in Hamdard Dawakhana v. Union of India, : 1960CriLJ671 . In that case the impugned section empowered the State Government to make a rule as to 'any other disease or condition which may be specified in the rules' with regard to which no person was to take part in publication of any advertisement referring to any drug in terms which suggested or calculated to be used for any such disease. The contention was that there is no indication in the action as to what other disease or diseases were to be specified in making the rule by the rule-making authority. This was struck down as travelling beyond the permissible limits of delegated legislation inasmuch as an uncontrolled and unguided power was vested in the rule-making authority to bring within the mischief of the section any disease or impose any conditions to be specified by the rule-making authority.

(16) The danger of permitting a delegate of the Legislature to exercise legislative power has been emphasized in the following words by the Supreme Court in Vasanlal Maganbhal v. State of Bombay, : 1978CriLJ1281 :

'The Constitution confers a power and imposes a duty on the legislature to make laws. The essential legislative function is the determination of the legislative policy and its formulation as a rule of conduct. Obviously it cannot abdicate its functions in favour of another. But in view of the multifarious activities of a welfare State, it cannot presumably work out all the details to suit the varying aspects of a complex situation. It must necessarily delegate the working out of details to this executive or any other agency. But there is a danger inherent in such a process of delegation. An overburdened legislature or one controlled by a powerful executive may unduly overstep the limits of delegation. It may not lay down any policy at all; it may declare its policy in vague and general terms; it may not set down any standard for the guidance of the executive; it may confer an arbitrary power on the executive to change or modify the policy laid down by it without reserving for itself any control over subordinate legislation. This self-effacement of legislative power in favour of another agency either in whole or in part is beyond the permissible limits of delegation. It is for a Court to hold on a fair, generous and liberal construction of an impugned statute whether the legislature exceeded such limits. But the said liberal construction should not be carried by the Courts to the extent of always trying to discover a dormant or latent legislative policy to sustain an arbitrary power on executive authorities. It is the duty of this Court to strike down without any hesitation any blanket power conferred on the executive by the legislature.'

(17) It is in the light of these pronouncements that we have to consider whether the power that is given to the State Government under section 9 of the C. P. and Berar Municipalities Act oversteps the limits of permissible delegation. The learned counsel for the State has invited out attention to another decision of the Supreme Court in Union of India v. Bhanamal Gulzarimal Ltd., : [1960]2SCR627 . In that case fixation of maximum rates for iron and steel was challenged as permitting exercise of essentially legislative power under clause 11-B of the Iron and Steel (Control of Production and Distribution) Order. Now that order was itself passed under the Essential Supplies (Temporary Powers) Act 1946. The vires of the Act and the power to issue Orders under that Act have been upheld by the Supreme Court in Harishankar Bagla's case cited already : 1954CriLJ1322 . What clause 11-B of the Iron and Steel Control Order permitted was fixation of maximum rate at which steel may be sold or price may be fixed. Undoubtedly there is a certain margin within which the prices have to be fixed, and it is unthinkable that the Legislature can in advance indicate what the prices may be in respect of a given commodity. It all depends on supply position, transport facilities, the need for the article and manifold factors which are to be taken into consideration by the price-fixing authority from time to time. Such a machinery having been created it was not held possible to uphold the contention that the power to fix prices given under clause 11-B of the Order was in any manner indicative of excessive delegation of legislative power. We do not think that this decision is of any assistance to the respondents in this case. Similar contentions were raised in the case of Banarasidas v. State of M. P., : [1959]1SCR427 where power is given to the State Government to fix the rate of sales tax by amendment of Schedule. That power has also been upheld by the Supreme Court.

(18) The history of section 9 will also throw considerable light in showing how the amendment effected in section 9 in 1947 has overstepped the limits of permissible delegation. Section 9 as it originally stood in its unamended form was as follows:

'9 (1). If the circumstances of any municipality are such that, in the opinion of the Local Government, any of the provisions of this Act are unsuited thereto, the Local Government may, by notification, except the municipality from the operation of those provisions, and thereupon the said provisions shall not apply to the municipality until applied thereto by notification.

(2) While such exception remains in force, the Local Government may make rules for the guidance of the committee and public officers in respect of the matters excepted from the operation of the said provisions.'

Under the original section prior to its amendment the Local Government was empowered to except a particular municipality from the operation of any of the provisions of the Act and thereupon on issue of such a notification the said provisions were not applied to the municipality until they were again applied by a fresh notification. While such an exception was in force, the Local Government was given power to make rules for the guidance of different officers in respect of operation of the said provisions. Now, this power may well be considered within the limits of permissible delegation. It was merely a power to withdraw the application of any particular provision to a municipal committee. What the amendment has done is not only to permit withdrawal of the application of a provision to a particular committee but to substitute it by an altogether different provision and there is no guidance in the section itself or anywhere else in the Act as to what that provision should be. There is a further infirmity in the wide amplitude in which the power is given. It does not indicate as to the circumstances in which a particular municipal committee may be considered unsuitable for the normal provisions of the Act being made applicable to it. There is hardly any indication in the section as to what will be the circumstances justifying the State Government to exercise the power under section 9. We asked this question to the learned counsel appearing for the State because no mention was made as to the circumstances in which this power may be used in the return. Not only the notification itself did not specify or indicate any such circumstances but even the return was utterly silent on this point. We should have expected that when the vires of the section and the exercise of the power under the section were challenged by the petitioner, the State Government should have come forward to indicate the circumstances showing unsuitability of this particular municipality. For this purpose reference was made to the statement made on the floor of the Legislative Assembly by the Honourable Minister. That statement is made later and the action was taken much earlier. But even that statement does not indicate what were the peculiar futures of this area as to deprive the Municipal Committee of Desiganj of the normal operation of the Municipal Act. For instance, the Desaiganj are now comprised in the Municipality originally had three Gram Panchayats, Gram Panchayats are elected bodies for local government at that leval. Elective franchise was not unknown to the citizens of this area. There is no reason why simply because the form of local government was changed from Gram Panchayat to a municipality the people should have been deprived of their franchise to elect their representatives to the body. A faint reference was made to the possibilities of financial difficulties of this area in being converted into an urban municipal committee. We have no material on record from which any such inference could be drawn, and even assuming that there was any such difficulty, ample provision could have been made for retaining the effective control of Government over the budgetary provision and the power of expenditure of the newly constituted committee. It is difficult to see why for that purpose it was necessary for the Government to take upon itself to appoint members of the committee and also its office-bearers. It was urged that this was a temporary measure and there was no lack of bona fides in the exercise of the power. In our opinion, these considerations are hardly of any relevance. If the section is capable of being so construed as to invest the State Government with the necessary power of formulating a new code for municipal committees in place of the Municipal Act,. that in effect amounts to a complete abdication of power by the Legislature. The Legislature cannot permit its delegate to formulate the policy of local self-government in the State in the use of making provision for any municipalities. That policy must be found in the statute itself and it cannot be altered by anybody except by the Legislature itself. It was alleged that if this interpretation is to be accepted, it will be difficult for new areas to be brought under municipal administration. We fail to see why the Legislature cannot make adequate provision for underdeveloped areas to be brought under operation of urban administration of local self-government. Actually, in these areas there was local authority known as the Notified Area Committee. They exercised only certain of the functions of full-fledged municipal committee. The Act itself could be so amended as to make provision for gradual development of local self-government in an area, but that decision must be of the Legislature and not of any other delegate of the Legislature. We therefore hold that the power that is given to the State Government under section 9 of the C. P. and Berar Municipalities Act is unguided and uncanalised power. That power oversteps the limits of permissible delegation of legislative authority, and therefore the whole of section 9 which makes it possible for the State Government to formulate an altogether different code for constitution, functioning and powers of the municipal authority, is beyond the scope of the Act and is therefore ultra vires of the powers of the Legislature. We therefore declare section 9 of the Act as ultra vires.

(19) With this decision it is not necessary to adjudicate on the earlier contentions raised by the petitioner as to the propriety of the powers exercised in issuing the various notifications. It may however be observed that even assuming that there is a power to withdraw the provisions of certain sections or to amend certain sections in exercise of the powers under section 9 in respect of a particular municipal committee, the notification itself must show the circumstances in which the power is required to be exercised. It is conceded that the notification should be able to indicate the necessity of exercise of this power. This has not been done even in the subsequent notifications of 11th July 1961. They are issued merely as corrigendum. In fact, they are not merely corrections; they completely alter the scheme of the earlier notifications altogether. Whereas in the earlier notifications the method of choosing the office-bearers like President and Vice-President was by election of the members, it was subsequently altered to their being appointed by the State Government which is not a mere corrigendum. This is a complete change in the policy in the matter of office-bearers coming into office as President and Vice-President. We therefore hold that the subsequent notification of 11th July 1961 was also not issued in proper exercise of the powers conferred by section 9.

(20) Thus, the result is that all the subsequent notifications issued after the notification constituting the Desaiganj Municipal Committee, are ultra vires and are of no effect. The result is that the petition is allowed but in the circumstances there will be no order as to costs.

(21) Petition allowed.


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