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Kalol Nagarpalika Vs. Shah Priyavadan Bhailalbhai - Court Judgment

LegalCrystal Citation
SubjectCivil
CourtGujarat High Court
Decided On
Judge
Reported in(1986)1GLR352
AppellantKalol Nagarpalika
RespondentShah Priyavadan Bhailalbhai
Cases ReferredShanabhai v. M.P. Panchal
Excerpt:
.....merely prescribes the manner of suing and though a municipality cannot be sued except through the chief officer, even then he is not competent to sign and verify the pleadings unless he is specifically authorised prior to his entering appearance on behalf of the municipality. where the legislature intended to place a limitation on the powers of the courts to take cognisance of an offence unless certain conditions were fulfilled like the provisions of sections 196 and 197 criminal p. ..there is nothing in section 179 companies act which can be construed as restricting the powers of the court to take cognisance of an offence or the powers of the police to initiate prosecution or even of a private citizen to move the machinery of the criminal courts to bring an offender like the appellant..........defended since the written statement and the affidavit in support thereof were signed by the chief officer, who was not a competent authority. the learned judge directed that unless the chief-officer of the petitioner-defendant produces the necessary authority authorising him to depend the suit before he signed the vakalatnama, the pleadings would not be taken on record.2. i am of the opinion that the impugned order of the learned judge is bad in law and void as he has failed to exercise the jurisdiction to accept the pleadings, of the petitioner-defendant-municipality. the reasons are obvious. section 5 of the gujarat municipalities act, 1963 enjoins that in every municipal borough there shall be a municipality, and every such municipality shall be a body corporate having.....
Judgment:

B.K. Mehta, J.

1. This rule has been issued against the order of Civil Judge (J.D.) Kalol, dated May 26, 1981 on an application Ex. 19 filed by the opponent-plaintiff in Regular Civil Suit No. 68 of 1981 for declaration that the suspension order passed against the opponent-plaintiff was bad in law and void. By the said application, it was contended that the suit was not properly defended since the written statement and the affidavit in support thereof were signed by the Chief Officer, who was not a competent authority. The learned Judge directed that unless the Chief-Officer of the petitioner-defendant produces the necessary authority authorising him to depend the suit before he signed the Vakalatnama, the pleadings would not be taken on record.

2. I am of the opinion that the impugned order of the learned Judge is bad in law and void as he has failed to exercise the jurisdiction to accept the pleadings, of the petitioner-defendant-Municipality. The reasons are obvious. Section 5 of the Gujarat Municipalities Act, 1963 enjoins that in every municipal borough there shall be a municipality, and every such municipality shall be a body corporate having perpetual succession and a common seal, and may sue and be used in its corporate name through its Chief Officer. This section is in pari-materia with Section 8 of the Bombay Municipal Boroughs Act, 1925. However, it should be recalled that Section 9 of the Bombay District Municipal Act, 1901 was not in pari-materia with the present provision, though it did provide that a municipality and every municipal district shall be a body corporate, and may sue and be sued in its corporate name. It did not prescribe as the present provision in Section 5 requires that a suit by and against a municipality must be in its corporate name through its Chief Officer. It should be also remembered that the executive power of a municipality for the purposes of the Gujarat Municipalities Act vests in the Chief Officer, subject to the restrictions imposed by the said Act and the Rules made there under. It should also be recalled at this stage that the Kalol Municipality was a District Municipality constituted under the District Municipal Act, 1901 and as such framed the Rules in exercise of the rule-making powers under Section 46 of the said Act. It should be also brone in mind that under Section 23A of the District Municipal Act the municipal government of a municipal district vests in the municipality, and in a municipal district for which there is a municipal commissioner, the executive power for the purposes of the said Act vests in the Municipal Commissioner subject to the Act and the Rules framed there under. It is in light of this legislative history that the question is to be decided as to whether the Chief of the Municipality under the Gujarat Municipalities Act is competent to sign a pleading in a suit filed by or against the municipality. The learned Judge, with respect did not bear in mind this legislative history. If therefore, the Gujarat Municipalities Act has empowered the Chief Officer to sue or is made liable to be sued for and on behalf of a Municipality, it is difficult to agree with the learned Judge that he is not competent to sign the pleadings in a suit filed by or against the Municipality. The learned Judge has failed to appreciate also the provision contained in the Code of Civil Procedure as to who is competent to sue or be sued and verify the pleadings in a suit filed by or against a corporate body. Rule 1, Order 29 of the Code of Civil Procedure permits, inter alia any Principal Officer of the Corporation who is able to depose to the facts of the case, sigh and verify any pleading en behalf of a Corporation. Order 6, Rate 14 permits a party and its pleader to sign any pleading and if a party is unable to sign on account of absence, or any good cause, any authorised person of such a party may sign the same, or sue or defend on his behalf. Similarly, Rule 15 of Order 6 provides that the pleadings shall be verified by the parties or one of the parties, or some other persons acquainted with the facts of the case. Order 29 is merely a permissive and not a mandatory, nor does it exclude the operation of Order 6 of Rules 14 and 15 see : Calico Printers Association v. Karim (1930) 55 Bom. 158 and performing Bright Society Ltd. v. Indian Morning Post Restaurant AIR 1939 Bom. 377. The learned Civil Judge was, therefore, clearly in error of law in holding that Section 5 of the Gujarat Municipalities Act merely prescribes the manner of suing and though a municipality cannot be sued except through the Chief Officer, even then he is not competent to sign and verify the pleadings unless he is specifically authorised prior to his entering appearance on behalf of the Municipality. In other words, he is not a party to the suit. It is difficult to agree with the view of the learned Civil Judge. Assuming that he is not a party, he being a principal officer in as much as the executive control of a municipality vests in him, and if he is able to depose to the facts of the case, he is competent to sign. It is nobody's case here that the Chief Officer concerned was not able to depose to the facts of the case. The learned Judge, however, relief upon Rule 131, which prescribes that no suit shall be instituted compromised or defended on behalf of a municipality without sanction. The learned Civil Judge has read this rule as a qualification on the power of a Chief Officer and in the opinion of the learned Civil Judge such sanction should be a prior sanction to the entering of the apperance by the Chief Officer. The view of the learned Civil Judge that the sanction of the Municipality is a condition precedent inter alia, for defending the suit is not brone out one the plain reading of the said Rule and the interpretation which found favour with the learned Judge who read more than what the Municipality has prescribed. Since the sanction can be post-facto also and is no warrant either explicit or inherent in the structure of rule to hold that this sanction should be as a matter of fact prior to entering upon the defence of the suit and, therefore, amounting to a condition precedent. In the context of similar legal provision, contained in Section 457 of the Companies Act requiring the sanction of the Court for criminal prosecution of the Managing Director of the Company, the Supreme Court in Jaswantrai Manilal v. The State of Bombay AIR 1956 8C 575 held as under:.Where the Legislature intended to place a limitation on the powers of the Courts to take cognisance of an offence unless certain conditions were fulfilled like the provisions of Sections 196 and 197 Criminal P.C. it has used words such as these. No court shall take cognizance....: 'There is nothing in Section 179 Companies Act which can be construed as restricting the powers of the Court to take cognisance of an offence or the powers of the police to initiate prosecution or even of a private citizen to move the machinery of the criminal Courts to bring an offender like the appellant to Justice.

For a prosecution for breach of trust even by a Director of a company no such condition precedent as the previous sanction of any authority is contemplated by law, unless it is a prosecution in the name and on behalf of the company by the official liquidator who has to incur expenses out of the funds of the company. Section 179 is an enabling provision to enable the liquidator to do certain things with the sanction of the Court. It does not control the general law of the land.

Again in Dr. Sailendranath v. Jasoda : 1959CriLJ242 in the context of Section 179 of the Companies Act, 1913 which, inter alia, provided for the power of liquidator, to institute or defend the proceedings with the sanction of the Court. Justice Kapur observed as under:

Section 179 deals with the powers of the liquidators to institute or defend proceedings with the sanction of the Court, and Section 237(i) deals with the powers of the Court to give directions for prosecution of delinquent directors etc. But neither Section 179 nor Section 237 indicates that if the liquidator takes action without a direction of the court, the action would be illegal or invalid or it would invalidate a prosecution.

In Everest Coal. Co. v. State of Bihar : [1978]1SCR571 the Supreme Court held that the leave granted post-facto by the Court for prosecuting the suit against the Receiver appointed by the Court under Order 40 of the Civil Procedure Code is perfectly valid. Mr. Justice Krishna Iyer, speaking for the Court, held as under:

10. The extreme view taken in Pramatha Nath (1905) ILR 32 Cal. 270 is not good law Banku Behari (1911) 15 Cal WN 54) a later ruling of the same High Court has struck the correct note:

But we are unable to appreciate upon what intelligible principle the position can be defended that because the suit as been instituted without leave previously obtained it must necessary be dismissed, and that it is act open to the Court to stay proceedings in the suit with a view to enable the plaintiff to obtain leave of the Court to proceed with the suit against the Receiver. Bombay and Madras, Kerala and Mysore, have chimed in some going into long erudition, others readily granting the position. The standard commentaries on the C.P.C. (Mulla as well as AIR) concur in this view, footnoting the flow of pan-Indian case-law.

This Court (B.K. Mehta, J.) has also taken the same view in the context of Section 481 of the Bombay Provincial Municipal Corporations Act, 1949 which makes obligatory for the Commissioner to obtain the approval of the Standing Committee for instituting and prosecuiting the suit see Shanabhai v. M.P. Panchal (1979) 20 Guj. L.R. 21.

3. In view of the settled legal position, therefore, the learned Civil Judge was clearly in error of law in refusing to accept the written statement and Vakalatnama signed by the Chief Officer as no sanction of the Municipality granted before entering the appearance was produced. It should be noted that the present suit was withdrawn by the plaintiff and filed a fresh suit where such sanction was produced. However, the action of prior sanction is not such an infirmity which would impeach the jurisdiction of the trial court or the cause of action and is not a condition precedent to prosecution or defence of the suit. If sanction is obtained before the termination of the suit, it will ensure for good from the inception. In that view of the matter, this revision application is allowed and the impugned order is quashed and set aside. There is no necessity to grant further direction to accept the pleadings and Vakalatnama of the defendant-Municipality since in view of the withdrawal of the suit that has become academic. Rule is made absolute accordingly with no order as to costs.


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