BISHWA!'IATH A'.'iD ANR.

\' SHRI THAKt; R RADHABALLABHJI & ORS.

February 6, 1967

[K. ScDBA RAO, C.J. A~D J.M. SHELAT, J.]

Code of Ciii/ Prvced11rc (Act 5 of 190~). s. 92-Shebait of Hindu idol alienating idots proper1y-Srdt by \\'ors/zipper on behalf of iclol for declaration of title and recovery of said properry-Suit 'khether governed

hy .<, 92.

Hindu Lall'-Shehait acting adversely to interests of idol or not Protecting ils intere.Hs-Right of H:or.<::hipper 10 file .uil.

The :\fanagcr o[ a temple alienated the idol's property.

A worshipper of the idol who f.llso assisted the Manager in his duties, filed d suit as next friend of 1he idol challenging the alienation.

The reliefs sought were a declaration that the property belonged 10 the idol and recovery of posses sion.

The trial court's decree in favour of the plaintiff was upheld by the High Court. me defendants came to this Court, with certificate.

It was urged on behalf of the appellants that s. 92 of the Code of Civil Procedure was a har lo the suit, and that no one hut 1he Shehait was entitled to file 1hc suit and represent the deity.

HELD : (i) The suil was filed by the idol for possession o[ iL< propcny from the person who was in illegal possession thereof and there . fore it was a suit by the idol to enforce its private right.

The suit also was for a declaration of the plaintiffs title and for possession thereof, and was not therefore a suit for one of the reliefs mentioned in s. 92.

In either view this was a suit outside the purview of s. <J2 of the Code and therefore ,.,_, said section was not a bar to its maintainability. [621 D-EJ

Abdur Rahim v. Barkat Ali, (1928) L.R. 55 I.A. 96 and Mahant Pra11dasji Guru Bhagwundasji v. Patel lshwarlalbhai Narsibhai, (1952) S.C.R.

513, relied on.

Mukhda Mannuda.r Bairagi v. Chagan Kisan Blrawasar.

1.L.R. 1957 Dom. 809, Danhan Lal v. Shibji Maharaj Birajman, (1922) I.L.R. 45 All. 215 and Mad/iavrao Anandrao Rtstc v. Shri Omkareshvar Gh111,

(1928) 31 Born. L.R 192, referred to.

(ii) An idol is in the position of a minor; when a person representing it leaves it in the lurch, a person interested in the v.orship of the idol can certainly be clothed with an ad hoc JlOWer of representation to pro-- tect its interest.

It is a pragmatic, yet a legal solution to a difficult situa tion.

Should it be held that a Shebail, who transferred the property, can only bring a suit f1Jr recovery, in most of the cases it will be an indirect approval of the dereliction of the Shebait's du!y, for more often than not he will no! admit his default and take step~ to recover the property apan

from other technical pleas that may be open 10 the transferee in a suit.

Should i1 be held that a wol'ihipper can file only a suil for the removal of a Shebait and for the appointment of another in order to enable him to take step.~ to recover the property. such a procedure will be rather a

proloned and complicated one and the inte"Cest of the idol may irrcpara bly suffer.

That is why a worshipper is permitted in such circumstances to represent the idol and 10 recover 1he properly for the idol. [622 G- (, Z3 Bl

Kun; Behari Chandra v. Sri Sri Shyam Chand Thakur, A.l.R. 1938 Pat. 394 and Artatran Alekhagadi Brahma v. Sudersan Mohapatra, A.I.R. 1954 Orissa II, disapproved.

Pramatha Nath Mullick v. Pradyumna Kumar Mullick, (1925) L.R. 52 I.A. 245 and Kanhaiya Lal v. Hamid Ali,

(1933) L.R. 60 I.A. 263, applied.

In the present case the suit was brought on behalf of the idol by a worshipper and therefore in the circumstances of the case the High Court rightly held that it was maintainable. [624 DJ

C!vrL APPELLATE JURISDICTION : Civil Appeal No. 780 of 1964.

Appeal from the judgment and decree dated December 21

19~9 of the Allahabad High Court in First Appeal No. 87 of 1948.

M. S. Gupta, La/it Kumar and S. N. Varma, for the appellants

J. P. Goyal and Raghunath Sinf{h, for respondent No. I.

The Judgment of the Court was delivered by

Sobba Rao, C.J. This appeal by certificate is preferred against the decree of the High Court of Judicature at Allahabad decreeing the suit filed by the respondents for possession of the plaint schedule property.

Shri Thakur Radhaballabhji, the deity, represented by Yasodanandan as next friend, filed O.S. No. 61 of 1946 in the Court of the 2nd Civil Judge, Kanpur, against the appellants for a declaration that the deity was the proprietor of house No. 49/54 situate in Ban Bazar in the City of Kanpur, for possession thereof and for mesne profits-. The case of the plaintiff (!st respondent herein) was that Lala Jagan Prasad, the 2nd defendant to the suit, was the manager llnd Sarvarakar of the deity, that the said manager executed a sale deed dated January 13, 1942, conveying the said property to one Lala Behari Lal, the 1st defendant to the suit, for a consideration of Rs. 10,000 and that the sale, not being for necessity or for the benefit of the idol, was not binding on the deity. It was further alleged that, as the 2nd defendant had taken no steps to recover the property, in order to safeguard the rights of the idol the suit was filed through Jagan Pr:asad, who was one of the devotees and worshipper of the deity and who had been taking keen interest in the management of the temple where the deity is installed. To that suit the alienee was made the !st defendant and the manager, the 2nd defendant.

The 1st defendant set up the case that the suit property die! not constitute the property of the idol but was the property of the 2nd defendant purchased by him out of his own funds.

He further alleged that the suit house was in a dilapidated condition, that its rebuilding would involve the idol in heavy and unprofitable expen-

620 SUPll.IMI OOtaT RBPOltTS (1967] 2 s.c..a.

diture, that therefore the second defendant as its manager, acting as a prudent man, sold the same for a good price to the I st defendant and that. as the sale transaction was for the benefit of the idol, it would be binding on the plaintiff. He also questioned the right of Yasodanandan to represent the idol and to bring the suit on its behalf.

Both the learned 2nd Civil Judge, Kanpur, in the first instance, and. on appeal, the High Court concurrently held that the sale was not for the benefit of the deity and that the consideration was not adequate. They also held that in the circumstances of the case the idol had the right to file the suit represented by Yasodanandan, who was a worshipper of the deity and was helping the second defendant in the management of the temple.

In the result the trail court gave a decree for possCS6ion and for recovery of Rs.

1,400 as past mense profits against the 1st defendant on condition that the plaintiff returned a sum of Rs. 10,000 to the 1st defendant within two months from the date of the decree and also that the plaintiff would be entitled to future mesne profits at Rs. 45 p.m. till the date of delivery of possession of the property. The High Court confirmed the same.

Hence the present appeal.

Mr. M. S. Gupta, learned counsel for the appellant, canvassed the correctness of the findings of both the courts on the questions of fact as well as of law. On the questions of fact, namely, whether the impugned transaction was binding on the idol and was supported by consideration, we do not think we would be justified to permit the appellant to question their correctness, because the said findings are concurrent and are based upon appreciation of the relevant evidence.

We accept the said findings . ..

The only outstanding question, therefore, is whether the suit is maintainable by the idol represented by Yasodanandan, who is a worshipper as well as a person who had been assisting the 2nd' .; defendant in the management of the temple.

Two obstacles are raised against the maintainability of the suit, namely, (I) s. 92 of the Code of Civil Procedure is a bar to the maintainability of the suit, and (2) a suit for possession of the property of the idol, after setting aside the alienation, could only be filed by the Shebait and none else could represent the deity.

It is settled law that to invoke s. 92 of the Code of Civil Procedure, 3 condit'ons have to be satisfied, namely, (i) the trust is created for public purposes of a a charitable or religious nature;

(ii) there was a breach of trust or a direction of court is necessary

in the administration of such a trust; and (iii) the relief claimed is one or other of the reliefs enumerated therein.

If any of the 3 conditions is not satisfied, the suit falls outside the scope of the said section. A suit by an idol for a declaration of its title to property and for possession of the same from the defendant, who is In possession thereof under a void alienation, is not one of the ntliefs

found in s. 92 of the Code of Civil Procedure. That a suit for declaration that a property belongs to a trust is held to fall outside the scope of s. 92 of the Code of Civil Procedure by the Privy Council in Abdul. Rahim v. Barkat Ali(') and by this Court in Mahant Pragdasji Gu; u Bhagwandasji v. Patel Ishwarlalbhai Narsibhai(2) on the ground that a relief for declaration is not one of the reliefs enumerated in s. 92 of the Code of Civil Procedure. So too, for the same reason a suit for a declaration that certain properties belong to a trust and for possession thereof from the alience has also been held to be not covered by the provisions of s. 92 of the Code of Civil Procedure: See Mukhda Mannudas Bairagi v. Chagan Kisan Bhawasar( ). Other decisions have reached the same result on a different ground, namely, that such a suit is one for the enforcement of a private right. It was held that a suit by an idol as a juristic person against persons who interfered unlawfully with the property of the idol was a suit for enforcement of its private right and was, therefore, not a suit to which s. 92 of the Code of Civil

Procedure applied: see Darshan Lal v. Shibji Maharaj Birajman(4); and Madhavrao Anandrao Raste.v. Shri"Omkareshvar Ghat('). The present suit is filed by the idol for possession of its property from the person who is in illegal possession thereof and, therefore, it is a suit by the idol to enforceits private right. The suit also is for a declaration of the plaintiff's title and fqr possession thereof and is, therefore, not a suit for one of the reliefs mentioned in s. 92 of the Code of Civil Procedure. In either view, this is a suit outside the purview of s. 92 of the said Code and, therefore, the said section is not a bar to its maintainability.

The second question turns upon the right of a worshipper to represent an idol when the Shebait or manager of the temple is. acting adversely to its interest. Ganapathi Iyer in his valuable treatise on "Hindu and Mahomedan Endownments", 2nd edn., at p. 226, had this to say in regard to the legal status of an idol in Hindu law:

"The ascription of a legal personality to the deity supposed to be residing in the image meets with all praGtical purposes. The deity can be said to possess property only in an ideal sense and the theory is, therefore, not complete unless that legal personality is linked to a natural per sun." It would be futile to discuss at this stage the various decisions which considered the relationship between the idol and its Shebait or Manager qua the management of its property, as the Privy Council in Maharaja Jagadindra Nath Roy Bahadur v. Rani Hemanta Kumari Debi(') has settled the legal position and stated thus:

(I) [1928] L. R. SS I. A. 96.

(3) I. L .. R. 1'157 Bombay 809.

(5) (1928] 31 Born L. R. 192.

(2) (1952] S.C.R. 513.

(4) [1922] I. L. R. 45 AU. 215.

(6} [19J4] L. R. 31 I. A. 203, 209, 210

G22 SUPREME COURT REPOll.TS

[ 1967) 2 S.C.R..

.. There is no doubt that an id<>l may he regarded as a juridical person capable as such of hold111g property, though it is only in an ideal sense that property is so held." Dealing with the position of the Shebait of such an idol, the Privy Council rroceedcd to state:

. . . . . 1t still remains that the po; sessio11 and e management of the dedicated property belong to the Shehait. And this carries with it the right to hring whatever suits are necessary for the protection of the property. Every such right of suit is vested in the Shebait, not in the idol." This was a case where the Shehait filed a suit for eviction from the dedicated property within three years after attaining majority and the Board held that, as he had the right to bring the suit for the protection of the dedicated property. s. 7 of the Limitation Act, 1877, would apply tu him. The present question, namely, if a Shebait acts adversely to the interests of the idol whether the idol represented by a worshipper can maintain a suit for eviction, did not arise for consideration in that case. That question falls to be decided on different considerations.

Three legal concepts are well settled : (I) An idol of a Hindu temple is a juridical person; (2) when there is a Shehait, ordinarily no person other than the She bait can represent the idol; and (3) worshippers of an idol arc its beneficiaries, though only in a spiritual sense.

It has also been held that persons who go in only for the purpose of devotion have, according to Hindu law and religion. a greater and deeper interest in temples than mere servants who serve there for som! pecuniary advantage : sec Ka/yana Venkataramana Ayyangar v. Kasr11ri Ranga Ayya!!gar(').

In the present case. the plaintiff is not only a mere worshipper but is found to have been assisting the 2nd defendant in the management of the temple.

The question is, can such a person represent the idol when the Shebait acts adversely to its interest and fails to take action to safeguard its interest. On principle we do not sec any justification for denying such a right to the worshipper. An idol is in the position of a minor; when the person representing it leaves it in the lurch, a person interested in the worship of the idol can certainly be clothed with an ad hoc power of representation to protect its interest.

It is a pragmatic, yet a legal solution to a difficult situation.

Should it be held that a Shebait, who transferred the property, can only bring a suit for recovery, in most of the cases it will be an indirect approval of the dereliction of the Shebait's duty, for more often than not he will not admit his default and take steps to recover the property. apart from other technical pleas that may be open to the transferee in a suit. Should it be held that a worshipper can

- (I) (1916) l.L.R. 40 Mad. 212, 225.

• • .

BISHWANATH v. RADHABALLABHJI (S11bha Rao, C.I.) 623

file only a suit for the removal of a Shebait and for the appointment of another in order to enable him to take steps to recover the property, such a procedure will be rather a prolonged and a complicaied one and the interest of the idol may irreparably suffer. That is why decisions have permitted a worshipper in such circumstances to represent the idol and to recover the property for the idol.

It has been held in a number of decisions that worshippers may file a suit praying for possession of a property on behalf of an endowment: see Radlwbai Ko111 Chi11111(1ji Safi v.Chimnaji Bin Ramjil ') Za/aarab Ali v. Bakhta1l'ar Singh('\ Chidambaranat Tlwmhiran fli Sirngnana Desika G11anasa111banda Pandora Sa1111ml/; i '" P. S. Nallasfra(3) Muda/iar, Dasondhay v. Muhammad Abu Nasar(4 ), Kalavana Venkataramana Aiyangar v. Kasturi Ranga Aiyangarl') Sri Radha Kirshnaji v. Rameshwar Prashad Singh(6) Manmo/wn Haldar v. Dibbendu Prasad Roy Choudhury.(7)

There are two decisions of the Privy Council, namely Pramatha Nath Mullick v. Pradyun:na Kumar Mullick(') and Kanhaiya Lal

v. Hamid Ali (9) wherein the Board remanded the case to the High Court in order that the High Court might appoint a disinterested per>on to represent the idol. No doubt in both the cases no question of any deity filing a suit for its protection arose, but the decisions are authorities for the position that apart from a Shebait, under certain circumstances, the idol can be represented by disinterested persons. B. K. Mukherjea in his book "The Hindu Law of Religious and Charitable Trust" 2nd Edn., summarizes the legal position by way of the following propositions, among others, at p. 249.

"(!)An idol is a juristic person in whom the title to the properties of the endowment vests.

But it is only in an ideal sense that the idol is the owner. It has to act through human agency, and that agent is the Shebait, who is, in law, the person entitled to take proceedings on its behalf. The personality of the idol might therefore be said to be merged in that of the Shebait.

(2) Where, however, the Shebait refuses to act for the idol, or where the suit is to challenge the act of the Shebait himself as prejudicial to the interests of the idol, then there must be some other agency which must have the right to act for the idol. The law accordingly recognises a right in persons interested in the endowment to take proceedings on behalf of the idol.

(1) [1878] I. L. R. 3 Bom. 27.

(2) [1883} I. L. R. 5 All. 497.

(3) (1911) 6 Law Weekly, 666.

(4) [1911} I. L. R. 33 All. 660, 664.

(5) A. I. R. 1917 Mad. 112.

(6) A. I. R. 1934 Pat. 584.

(1) A. I. R. 1949 Cal. 199.

(8) [1925} L. R. 52 l.A. 245.

(9) [1933] L. R. 60 I. A. 263.

~24 SUPIUIMB COUJ. T llJIPOl!.TS

(1967] 2 S.C.R.

This view is justified by reason as well as by decisions.

Two cases have been cited before us which took a contrary view.

In Kunj Behari Chandra v. Sri Sri Shyam Chand Thakur(') it was held by Agarwala, J., that in the case of a public endowment, a part of the trust property which had been alienated by the Sheliait or lost in consequence of his action could be recovered only in a suit instituted by a Shebait. The only remedy which the membrs of the B public have, where the property had bn alienated by a person who was a Shebait for the time being was to secure the removal of the Shebait by proceedings under s. 92 of the Code of Civil Proc.:dure and then to secure the appointment of another She bait who would

thn have authority to represent the idol in a suit to recover the idol properties. So too, a division Bench of the Orissa High Court C in Artatran A/ekhagadi Brahma v. Sudersan Molzapatra (2) came to the same conclusion. For the reasons given above, with great respect. we hold that the said two decisions do not represent the correct law on the subject.

In the result, agreeing with the High Court, we hold that the suit filed hy the idol represented by a worshipper, in the circumstan- D ces of the case is maintainable. The appeal fails and is dismissed with costs.

G.C.

Appeal dismissed.

(ll A. I. R. 1938 Pat. 394.

(2) A. J. R. 1954 Orissa, 11.

THAKt; R RADHABALLABHJI & ORS

K. ScDBA RAO, C.J.

M. SHELAT, J.

s. 92

s. 92

the Code of Civil Procedure

s. 92

(1928) L.R. 55 I.A. 96

(1925) L.R. 52 I.A. 245

(1933) L.R. 60 I.A. 263

Allahabad High Court

M. S. Gupta

La/it Kumar

S. N. Varma

J. P. Goyal

Raghunath Sinf{h

Sobba Rao

Thakur Radhaballabhji

Yasodanandan

Lala Jagan Prasad

January 13, 1942

Lala Behari Lal

Jagan Pr:asad

M. S. Gupta

s. 92

the Code of Civil Procedure

s. 92

the Code of Civil Procedure

s. 92

the Code of Civil Procedure

s. 92

the Code of Civil Procedure

Mahant Pragdasji Gu

s. 92

the Code of Civil Procedure

s. 92

the Code of Civil Procedure

s. 92

s. 92

the Code of Civil Procedure

s. 92

Ganapathi Iyer

L. R. 31 I. A. 203

s. 7

Limitation Act, 1877

B. K. Mukherjea

L. R. 60 I. A. 263

Agarwala

s. 92

Orissa High Court


STATE OF ORISSA

DR. (MISS) BINAPANI DEi & ORS.

February 7, 1967

(J.C. SHAH AND G. K. MITTER, JJ].

Natural Justice-Govenment servant-Enquiry held into date of birth-Report and evidence not disclosed--Oppo:tunlry to meet ••ld•nc• not given-Date re-fixed and compulsory retirement orderod--Order whether sustainable.

Constitution of India, Art. 226-High Court's discretion to go into questions vf fact.

The first respondent joined the service of the State Government in

1938. In 1961 the Government held an enquiry into her date of birth.

She was then asked to show cause why a certain date should not be t2ken as her date of birth. The report of the enquiry .officer was not <fuclosed, and the first respondent was not given an opportunity to meet the evidence used against her. The Government 'refuted the date of birth of the first respondent and ordered that she be compulsorily retired.

The first res pondent then filed a writ petition in the High Court which was allowed.

The State appealed, It was contended on behalf of the appellant State that (i) the High Court in dealing with a petition under Art. 226 of the Constitntion ought not to have proceeded to determine disputed questions of fact, (ii) the order re-iixing the date of birth of the respondent was an administrative order and the High Court had no power to sit in appeal over the decision of the State authorities.

HELD : (i) Under Art. 226 of the Constitution the High Court is not precluded from entering upon a decision on questions of fact raised by the petition.

Whe.re an enquiry into complicated questions of fact arises in a petition, the High Court may in appropriate cases decline to enter upon the enquiry and may refer the party claiming relief to a suit.

But the question is one of discretion and not of the jurisdiction of the Court. No interference with the exercise of the discretion of the High Court in the present case was called for. (627 G]

(ii) Even an administrative order which involves civil consequences must be made consistently with the rules of natnral justice. 'lbe person concerned must be informed of the case of the State and the evidence in support thereof and must be given a fair opportunity to meet the case before an adverse decision is taken. In the present case 110 auch ateps were admittedly taken; the High Court was therefore right in setting a1ide the order of the State. [630 GJ

CIVIL APPELLATE JURISDICTION : Civil Appeal No. 499 of 1.965. .

Appeal from the judgment and order dated May 6, 1964 of the Orissa High Court on 0. 1. C. No. 254of1963.

Dipak Dutta Choudhury and R. N. Sachthey for the appellant.

Naunit Lal, for the respondents.

626 SUPllBMB C:OUIT llBPOllTS

( 1967] 2 S.C.R.

The Judgment of the Court was delivered by

Shah, J. The first respondent who holds the degree of M .B.B.S. of the Punjab University, the Diploma in Gynaecology and Obstetrics from the Madras University and the Diploma in Obstetrics from the Royal College of Obstetricians and Gynaecologists of London was aprointed on June 12, 1938, as Assistant Surgeon in the Orissa Medical Service. At the time of her appointment by the Omsa Government. the first respondent declared that her date of birth was April 10, 1910. The first respondent claims that her claim was supported by document?.ry cvidece tendered by her father which was verified and accepted and the birth date was recorded in the Civil List and in the History of Service of Gazetted Officers of the Government of Oriss;1 maintained bv the Accountant General of the State. In the normal course the first respondent would have been due for superannuation on April 10, 1965, after comrleting the age of 55 years.

But in consequence of a notification of the State of Orissa dated May 21, 1963, the age of superannuation was raised from 55 to 58 years in respect of all Government servants who were to retire after December ! , 1962.

Some anonvmous letters were addressed to the Accountant General that the first respondent had mis-slated her age when she was admitted to Service of the State.

After an inquiry the first respondent was required to show cause why her date of birth should not he accepted as April 4, 1907. The first respondent submitted that her date of birth was correctly rccMded and that certain school record relied upon by the Stat~ "was erased, altered or overwritten".

By letter dated June 27, 1963. the Government of Orissa determined the date of birth of the first respondent as April 16, 1907, and declared that she should b~ deemed to have retired on April 16, 1962, subject however to extension of service granted from April 16, 1962 till the afternoon of July 15, 1963.

By this order the first respondent who should have on her case retired on April 10, 1968 was deemed to have retired on July 15, 1963.

The first respondent then applied to the High Court of Orissa for a writ declaring that the order of retirement passed by the State Government was contrary to law and against the Constitution and principles of natural justice, and that in any event the order was passed maliciously by the Government to the prejudice of the first respondent, and for a writ of mandamus or certiorari quashing the order passed on June 27. 1963. and decbring the respondent to be entitled to continue in service till April 10, 1968. The first respondent claimed that the order made by the State amounted to an order of compulsory retirement contrary to the rules governing her service and was violative of the principles of natural justice, that the same was arhitrary and ma/a fide, that the order of retirement am<'Unted to puni, hmenl involving consequences such as loss

ORJSSA v. BJNAPANI DEi (Shah, !.) 8%7

of pay, status and deprivation of service and since it was not made in consonance with Art. 311 of the Constitution, the order was liable to be quashed as invalid.

The High Court held that the order declaring the first respon dent to be superannuated on April 16, 1962, on the footing that her date of birth was April 16, 1907, amounted to compulsory retirement before she attained the age of superannuation and was contrary to the rules governing her service conditions and amounted to removal within the meaning of Art. 311 of the Constitution, and since the first respondent was not given a reasonable opportunity of showing cause against the action proposed to be taken in regard to her the order was invalid. The High Court did not express any opinion on the plea of ma/a jides as it raised questions of fact which could not in the view of the Court appropriately be determined in a petition under Art. 226 of the Constitution. With certificate granted by the High Court this appeal has been preferred by the State of Orissa.

Counsel for the State raised two contentions in support of this appeal: (I) that the petition raised disputed questions of fact and the High Court should not have decided those questions in a writ petition; and

(2) that the order refixing the age of the first respondent was an administrative order and the High Court had no power to sit in appeal over the decision of the State authorities refixing the age of the first respondent.

In our view these contentions are without substance.

It was the case of the first respondent in her petition before the F High Court that the State had arbitrarily fixed her date of birth as April 16, 1907, and on that basis had declared her superannuated before she attained the age of 58 years. On behalf of the State it as denied that the true date of birth of the first respondent was Apnl 10, 1910, and that the authorities of the State had arbitrarily and maliciously chosen to refix her date of birth. Under Art. 226 of the Constitution the High Court is not precluded from entering G upon a decision on questions of fact raised by the petition. Where an enquiry into complicated questions of fact arises in a petition under Art. 226 of the Constitution before the right of an aggrieved party to obtain relief claimed may be determined, the High Court may in appropriate cases decline to enter upon that enquiry '.ind may refer the party claiming relief to a suit. But the question H is one of discretion and not of jurisdiction of the Court. In the present case the question in dispute was about the regularity of the enquiry and the High Court was apparently of the view that the question whether the State acted arbitrarily did not raise any M2Sup.CI/67-JI

1211 SUPREME COUllT llEPOlTS (1967] 2 S.C.ll.

question of investigation into complicated issues of fact. No interference with the exercise of the discretion of the High Court is therefore called for.

It is common ground between the parties that no enquiry in accordance with the provisions of Art. 311 was made by the State Government. It was the plea of the State in the High Court that Art. 311 has no application tothe case of the first respondent, because she has not been dismissed or removed from service. The State contended that the true date of brith of the first respondent was April 16, 1907, and she had been properly declared superannuated in consonance with the finding arrived at in an enquiry held for that purpose by the State.

The date of birth disclosed by the the first respondent at the time when she entered service was accepted by the State. She claims that a statement was made by her father on that occasion relying on which the date of her birth was determined and entered in the service register, and thereafter the State sought arbitrarily to re-fix the date of her birth. In considering that plea the relevant Service Rules regarding superannuation may be noticed in the first instance.

Rule 13 of the Orissa Civil Services {Classification, Control and Appeal) Rules, 1962, sets out the penalties which may be imposed

"for good and sufficient reasons" on a Government servant and the seventh penalty is "compulsory retirement". But the Explanation to the rule states that "compulsory retirement" of a Government servant in accordance with the provisions relating to his supemnuation or retirement is not a penalty within the meaning of the rule.

Rule 459(b) of the Civil Service Regulations provides that officers. other than ministerial, who have attained the age of 55, should ordinarily be required to retire on completion of that age. By notification dated May 21, 1963, the age of superannuation was fixed at 58 in respect of all public servants who were to retire after December I, 1962.

The first respondent held office in the Medical Department of the Orissa Government. She as holder of that office, had a right to continue in service according to the rules framed under Art. 309 and she could not be removed from office before superannuation except "for good and sufficient reasons." The State was undoubtedly not precluded, merely because of the acceptance of the date of birth of the first respondent in the service register, from holding an enquiry if there existed sufficient grounds for holding such enquiry and for re-fixing her date of birth. But the decision of the State could be based upon the result of an enquiry in manner consonant with the basic concept of justice. An order by the State

to the prejudic? of a person in. derogation of his ve;; tcd rights my be made only m accordance with the basic rules of Justice and fair-· play. The deciding authority, it is true, is not in the position or a

ORISSA V. BINAPANI DJ!! (Shah, J.).

Judge caJled upon to decidt: an action between contesting parties, and strict compliance with the forms of judicial procedure may not be insisted upon. He is however under a duty to give the person against whom an enquiry is held an opportunity to set up his version or defence and an opportunity to correct or to controvert any evidence in the possession of the authority which is sought to be relied upon to his prejudice. For that purpose the person against whom an enquiry is held must be informed of the case he is called upon to meet, and the evidence in support thereof. The rule that a party to whose prejudice an order is intended to be passed is entitled to a hearing applies alike to judicial tribunals and bodies of persons invested with authority to adjudicate upon matters involving civil consequences. It is one of the fundamental rules of our constitutional setup that every citizen is protected against exercise of arbit>tU)' authority by the State or its officers. Duty to act judically would therefore arise from the very nature of the function intended to be performed; it need not be shown to be super-added. If there is power to decide and determine to the prejudice of a person, duty to act judiciaJiy is implicit in the exercise of such power. If the essentials of justice be ignored and an order to the prejudice of a person is made, tho order is a nullity. That is a basic concept of the rule of law and importance thereof transcends the significance of a decision in any particular case.

The State has undoubtedly authority to compulsorily retire a public servant who is supperannuated. But when that person disputes the claim he must be informed of the case of the State and the evidence in support thereof and he must have a fair opportunity of meeting that case before a decision adverse to him is taken.

In this background, the facts of the case may be reviewed. In 1957 anonymous letters were received by the Director of Health Services that the first respondent had mis-stated her age, but no steps were taken immediately to hold an enquiry. In 1961 some investigation was undertaken through the Vigilance Department. The Secretary to the Government in the Health Department on August 23,

1961 informed the first respondent that the Government of Orissa had information that when she was admitted into Class X in the Ravenshaw Girl's School, her date of birth was 15 years, and when she was admitted into the First Year Class on July 9, 1924, her age was 17 years and 2 months, and she was required to show cause why May 9, 1907, should not be accel'ted as her date of birth on the basis of the entry in the Admission Register of the First Year Class. The first respondent submitted her explanation stating that she did not recollect if she had ever attended the Ravenshaw Gir!s' Schon!. After some correspondence the Admission Register was examined by the first respondent in the presence of the. Director of Health services and the officers of the Vigilance Department, and thereafter on March 19, 1962, she wrote a letter pointing out the

630 SUPRl!MI! COURT RBPO!t.TS

[1967] 2 S.C.R.

irregularities in the entries relating to age in Ravenshaw Girls School Admission Register. The Additional Director of Family Planning Dr. S. Mitra was then asked to make a report. In his report Dr. S.

Mitra largely relied upon a letter written by the Principal, Lady Hardinge Medical College, Delhi, that the birth date of the first respondent was April 4, 1908. In the course of the enquiry before Dr. S. Mitra the letter was shown to the first respondent but she declined "to make any comments thereon." Thereafter on September 28, 1962 there was a notice from the Secretary in the Department of Health stating that according to the school Admission Register her date of birth was August 22, 1906, and according to the First Year Class Admission Register it was April 1907, and it was intended to treat the latter date as the date of her birth, and the first respondent was called upon to show cause why that date should not be atcepted. Tjle report which Dr. S. Mitra had submitted to the State was not disclosed to the first respondent. It may be recalled that there were four different dates before the State authorities;

(1) the entry in the Ravenshaw Girls' School Admission Register showing the date of birth as August 22, 1906; (2) the entry in the Admission Register of the First Y car Class showing the date of birth as some date in April, 1907; (3) the report of the Principal, Lady Hardinge Medical College, Delhi, showing the date of birth as April 4, 1908, as recorded in the Medical College Admission Register; and (4) the first respondent's statement supported by her father's statement at the time when she joined the service in 1938 giving her date of birth as April 10, 1910. If an enquiry was intended to be made, the State authorities should have placed all the materials before the first respondent and called upon her to explain the discrepancies and to give her explanation in respect of those discrepancies and to tender evidence about her date of birth.

It is true that some preliminary enquiry was made by Dr. S.

Mitra. But the report of that Enquiry Officer was never disclosed to the first respondent. Therafter the first respondent was required to show cause why April 16, 1907, should not be acceptedas the date of birth and without recording any evidence the order was passed. We think that such an enquiry and decision were contrary to the basic concept of justice and cannot have any value. It is true that the order is administrative in character, but even an administrative order which involves civil consequences as already stated, must be made consistently \vith the rules of natural justice after informing the first respondent of the case of the State, the evidence in support thereof and after giving an opportunity to the first respondent of being heard and meeting or explaining the evidence.

No such steps were admittedly taken; the High Court was, in our judgment, right in setting aside the order of the State.

The appeal therefore fails and is dismissed with costs.

G.C.

Appeal dismissed.

STATE OF ORISSA

MISS) BINAPANI DEi & ORS

February 7, 1967

C. SHAH

G. K. MITTER, JJ

Constitution of India

Art. 226

Art. 226

Art. 226

Dipak Dutta Choudhury

R. N. Sachthey

Naunit Lal

Shah

June 12, 1938

Orissa Medical Service

Omsa Government

Government of Oriss;1

State of Orissa

Government of Orissa

High Court of Orissa

April 10, 1968

Art. 311

April 16, 1962

Art. 311

Art. 226

Art. 226

Art. 226

Art. 311

Art. 311

April 16, 1907

May 21, 1963

Art. 309

ORISSA V. BINAPANI

August 23,

1961

July 9, 1924

May 9, 1907

March 19, 1962

S. Mitra

S.

Mitra

Lady Hardinge Medical College, Delhi

September 28, 1962

April 10, 1910


KHAMBALIA MUNICIPALITY & ANR.

STATE OF GUJARAT

February 16, 1967

[K. N. WANCHOO, R. S. BACHAWAT AND J.M. SHE!.AT, JJ.)

Gujarat Panc/wyats Act, 1961 (G11j. Act No. 6 of 1962), s. 9(1) and (2j-lnquiry, if delegated-Applicability ro m1111icipa/ di.urict-Sectio11 9 if suffers from excessive delegation.

The respondent-State authorised its Development Commissioner to exercise powers exercisable by the Government under s. 9( I) of the Gujarat Panchayats Act, 1961. After making the prescribed inquiry under s. 9(1) of the Act the Development Commissioner i8'ued a notification under s. 9(1) of the Act declaring the whole area of the existin1 limits of the appellant-municipalitr, to be a nagar. The appellants field a writ petition for quashing the notdlcation and declariag s. 9 of the Act as ultra vires and unconstitutional which the High Court dismissed.

In ap~ peal to this Court. the appellants contended that (i) the power to make enquiry under s. 9(1) was not delegated to the Development Commi.- sioner; (ii) s. 9 of the Act did not apply to a municipal district as it was not a local area or such other administrative unit or part thereof; (iii) the notification was issued in mala fide exercise of power as it was issued after the mµnicipatity indicated its unwillingness to accept the opinion of tfle Govemment to include within its limits certain vadi areas; and (iv) s. 9 of the Act was ultra vires by reasons of excessive delegation of legislative power in favour of the State Government.

HELD : (per Full Court) (i) The power to make the declaration necessarily carries with it the power to make the inquiry preliminay to the declaration.

There can be no declaration without an inquiry.

The Development Commissioner was sufficiently authorised to issue the declaration after making the prescribed inquirv. [635 G-Hl

(ii) Section 307 Of the Act shows that a local area co-extensive with or included within the limits of a municipal district or a municipal borough may be declared to be a gram or nagar under s. 9 and on such a declara~

tion, the Municipality functioning within the local area or part thereof ceases to exist.

On a combined reading of ss. 9 and 307, it would appear that a municipal borough is an administrative unit within the meaning of s. 9( 1) and a local area co-extensive with or included in a municipal borough may be declared to be a gram or nagar. [636 BCJ

(iii) Tb.ere was no mala fide in the issuance of the notification. Under s. 4(1 )(b) of the Gujarat Municipalities Act, 1963, the State Govrn ment has the power to alter the limits of the municipal borough after consulting the municipality. The State Government had duly consulted the .municipality.

If the Government wanted to exercise its powers under the aforesaid s. 4(l)(b), it could do so without the consent of the municipality.

For the purpose of imposing its opinion, it wa~ not necessary for the government to take recourse to the device of a declaration under s. 9( I) of the Gujarat Panchayats Act., 1961.

Nor was the surroundinc vadi area included in the nagar declared by the notification under s. 9( 1).

[636 F'. GJ

632 SUPRl!MI! CO~T Rl!PORTS

[1967] 2 S.C.R.

(iv) (PN Wanchoo and Bachawat, JJ.) Section 9(l) does not suffer from the vice of cxccsive delegation.

An cssentiul legislative function consists in the determination of a legislative policy and its formulation as

<t binding rule of conduct.

Having laid down the legislative policy, the legislature nL1y confer discretion on an administrative agency as to the 1..xccution of 1hc policy Jnd leave it lo the agency to \1,.ork out the details within the frame work of the policy.

[637 B-C]

It i• the policy of the Act that panchayats •hould be established within a reasonable time in all local areas "''ith population not exceeding 3(},000 ; ind not included in a noiificd area or a cantonment. This policy guides and controls tbc dicrctionary power of the Slate Government under s. 9( 1).

Having reard to the policy of the Act, it is plain that the discrelionary power under s. 9(2) is vested in the State Government for the

purpoe of rcorani.; ing. the local ; ircas into new units 0f local sclf- Government. [6J8 C.D]

It i1 not correct to say that even a municipal borough '"°'ith a population of over 30,000 i• at the mercy of the State Government under s. 9(1).

Under s. 9( 1) read with ' 307, the government has no power to declare a municipal horough with a population exceeding 30,000 as a gram or M[?ar.

It wilJ he an ahuse of the power under s. 9(1) if hy declaring sn1all fragments of such municipal borough into eparate grams or nagar.f, the government seeks to achie\e indirectly what it cannot do directly.

But s. 9(1) cannot be held unconstitutional because of the possibility that it may be unfaithfully •dministered by those who II" charged with its execution. [638 H-639 BJ

In" Delhi law.1 Act [1951] S.C.R. 747 and Raj Narain Si11gh v. The Chaim1an, Pa11w Administration Commirt.u, [ 1955] 1 S.C.R. 290, referred to.

(Ptr Shelat, J. <li\senting) : Section 9 suffers from the vice of excessive delegation.

Even if a policy is declared by a statute it may be couched in such vague terrn'i thJt it may not set down a definite standard or criterion forthc guidance of the delegate. (644 D-E]

In spite of the avowed policy of the Act to set up Panchayat Raj throughout the State the Government, by virtue of the power to declare

being discretionary under s. 9( 1) 1 may or may not declare a local area to be nagar or a gram, The only fetter is that where it desires to make a declaration in respect of any particular local area it can do so after

making an inquiry as prescribed.

But neither s. 9 nor any other proviliion In the Act lays down that even if the inquiry ends in a particular conclusion the Goverrunent must make the declaration What the requisite result of such an inquiry for a declaration should be is also not prescribed in the Act and the Government is left to decide its course of action after' such an inquiry. (645 D-F]

Sub-section 2 confers a discretionary power on the Government . to •liter by inclusion or exclusion any area or areas from a nagar or a gram panchayat and convert one into the other, the only re.•triction on such

power being the necessity to consult the district, the taluka, and the 1llll/Dr or the gram panchayat as the case may be.

The restriction is consultation but not the consent of the concerned panchayats. Suh-section 2 does not require c\"cn an inquiry <ts sub-s. I docs at the time of the decbra-

- F

KHAMBALIA MUNICIPALITY v. GUJAitAT (Bachawat, J.) 833

lion. Nor does it lay down any principle or criterion as to when and in what circumstances the Government can launch upon such alteration of the local limits. Thus the Government can modify at any time the structure and the nature of a panchayat from a nagar to a gram panchayat and vice versa by simply altering its area a!Wr a mere consultation and even if the pancbayats concerned are against such alteration. Under thi1 power the Government can also transfer a portion or portions of a nagar or gram panchayat after formally going through the process of con1ulta tion and join it or them with another panchayat even if the people con cerned were (0 be unwilling to such a transfer. [645 F-646 BJ

Raj Narain Singh v.

CIVIL APPELLATE JURISDICTION Civil Appeal No. 1340 of 1966.

Appeal from the judgment and order dated April 5 and 6, 1966 of the Gujarat High Court in Special Civil Application No. 657 of 1965.

Purshottam Trikamdas, and Ravinder Narain, for the appellants.

N. S. Bindra, K. L. Hathi, S. P. Nayvar and R. H. Dhebar, for the respondents.

The Judgment of WANCHOO and

BACHAWAT,

JJ. wa~ delivered by BACHAWAT, J. SHELAT, J. delivered a dissenting Opinion

Bachawat, J. This appeal arises out of a writ application challenging a notifieation issued on June 14, 1965, declaring the area of Khambalia municipality in Jamnagar district to be a nagar under s. 9(1) of the Gujarat Panchayats Act, 1961 (Gujarat Act No. VI of 1962). The Jamnagar district was formerly a part of the State of Saurashtra which merged in the State of Bombay in 1956.

Before the merger, the State of Saurashtra adopted the Bombay District Municipalities Act 1901 under which the town of Khambalia was constituted into a municipality. On the bifurcation of the State of Bombay, the district of Jamnagar became a part of the State of Gujarat. The Gujarat Panchayats Act 1961 was passed on February 24, 1962.

The population of Khambalia municipality according to the census of 1961 was 12,249. By a notification dated August 17, 1962, issued under s. 9 of the Gujarat Panchayats Act 1961, the local area within the limits of the Khambalia municipality was declared to be a nagar and the municipality ceased to exist. On February 5, 1963, upon the publication of the Gujarat Panchayats (Suspension of )>rovisions and reconversion of certain local areas into municipal districts) Act, 1962 the Kharnbalia municipalityandothermunicipalities converted into nagar panchayats by notifications under s. 9(1) of the Na.gar Panchayats Act 1961 stood revived. On February 7, 1963,

SUP REM I! COURT REPORTS

(1967) 2 S.C.R

the Gujarat Panchayat Laws (Amendment) Ordinance 1963 repealed s. 3 of the Gujarat Panchayats (suspension of provisions and reconversion of certain local areas into municipal districts) Act 1962 and all the provisions of the Gujarat Panchayats Act 1961 became again operative. In April 1962, the State Government converted some of the revived municipalities into nagar or gram Panchayats, but the Khambalia municipality was not then so converted.

Meanwhile. the State Government started proceedings for the supersession of the Khambalia municipality under s. 179 of the Bombay District Municipal Act, 1901 and in this connection there was litigation between the Government and the municipality. On December 23, 1964, the Gujarat Municipalities Act, 1963 (Act No. XXXIV of 1964) was passed, and the Khambalia municipality

becam~ a municipality constituted under this Act for the Khambalia municipal borough. On June 14, 1965, the Development Commissioner, Gujarat State, issued a notification under s. 9 (1) of the Gujarat Panchayats Act, 1961, declaring "the whole area of the cii:isting limits of the Khambalia municipality in Jamnagar district'" to be a nagar with effect from the date of the issue of the notification. This notification was issued by the Development Commissioner after making the prescribed enquiry under s. 9(1).

The effect of the notification was that the entire local area included within the limits of the municipal borough for which the Khambalia municipality was constituted became a nagar. On June 22. 1965. the appellants filed a writ petition in the High Court of Gujarat. praying for an order quashing the notification dated June 14. 1965 .and declaring s. 9 of the Gujarat Panchayats Act, 1961 as 11/tra vires

and unconstitutional, and for other reliefs. The High Court dismissed this application. The appellants now appeal to this Court under a certificate granted by the High Court.

To appreciate the contentions raised by learned counsel for

the appellants, it is necessary to read s. 9 of the Gujarat Panchayats ll' Act, 1961.

That section is in these terms:-

"9. (I) After making such inquiries as may be prescribed, the State Government may. by notification in the Official Gazette, declare any local area. comprising a revenue village, or a group of fC\'ellUC villages Of hamlets forming part of a revenue village, or such other administrati\'e unit or part thereof,-

(a) to be a nagar, if the population of such local area exceeds 10,()()(1 but does not exceed 30,000. and

(b) to be a gram, if the population of such local area does not exceed 10,000. •

(2) After consultation with the taluka panchayat, the district panchayat and the nagar or gram panchayat

KHAMBAL!A MUNICIPALir.Y v. GUJARAT (Bachawat, J.) 635"

concerned (if already constituted) the State Government may, by like notification, at any time-

(a) include within, or exclude frcm, any nagar or gram, any local area or otherwise alter the limits of any nagar or gram; or

(b) declare that any loc&l area shall cease to be a nagar or gram;

and thereupon the local area shall be so included or excluded, or the limits of the nagar or gram so altered or, as the case may be, the local area shall cease to be a nagar or gram."

Rule 2 of the Gujarat Panchayats (Declaration of nagal' or gram) Inquiry Rules, 1962, prescribes the inquiry to be made by the State Government under s. 9 (I) it reads:

"2. Inquiry by State Government.-(!) Before declaring any local area to be a nagar or gram under subsection ( 1) of section 9 of the Act, the State Government shall make inquiries as to:-

( 1) the population and the ordinary land revenue of the revenue village or each of the revenue villages or hamlets, or as the case may he, any other administrative unit or part thereof, comprised in the local area,

(2) whether the revenue villages or ham lets or other administrative units or parts thereof can be conveniently grouped so as to form a gram or nagar, as the case may be,

(3) for the purpose of sub-rule (1), the District Development Officer or where there is no such officer the Collector when so required by the State Government, shall submit to the State Government a statement in the form appended hereto".

Sec. 321 of the Gujarat Panchayats Act empowers the State Government to authorise by notification in the official gazette any officer of the government to exercise any of the powers exercisable by the government under the Act.

By a notification dated June 13, 1963, as amended by a notification dated May 5, 1964, the State government authorised the development commissioner, Gujarat State, to exercise the powers exercisable by the government under s. 9(1) "declaring a loc:il area to be a gram or nagar". Counsel contends that the power to make the inquiry under s. 9(1) was not delegated by the State government to the development commissioner.

There is no force in this contention. The power to make the

'636 SUPREME COUllT llBPOllTS [1967] 2 S.C.ll.

declaration necessarily carries with it the power to make the inquiry preliminary to the declaration. There can be no declaration without any inquiry. The relevant notification sufficiently authorised the development commissioner to issue the declaration after making the prescribed inquiry.

The next contention is that the local area of a municipal borough is not "any local area, comprising a revenue village, or a group of revenue villages or hamlets forming part of a revenue village, or such other administrative unit or part thereof" within the meaning of s. 9 of the Gujarat Panchayats Act 1961, and that consequently the local area of the municipal borough for which the Khambalia municipality was constituted could not he declared to be a nagar.

We cannot accept this contention. Section 307 of the Act shows that a local area co-extensive with or included within the limits of a municipal district or a municipal borough may be declared to be a gram or nagar under s. 9 and on such a declaration, the municipality functioning within the local area or part thereof ceases to exist. On a combined.reading of ss. 9 and 307, it would appear that a municipal borough is an administrative unit within the meaning of s. 9(1) and a local area co-extensive with or included in a municipal borough may be declared to be a gram or nagar.

The next contention is that the notification under s. 9( I) dated June 14, 1965, was made ma/a fide.

Before 'the notification was issued, there was some correspondence in course of which the State Government on the representation of Shri Haribhai :-.lakum MLA, inquired of the Khambalia municipality whether it was willing to include the surrounding vadi areas within its limits.

It was after the municipality indicated its unwillingness to include the vadi areas within its limits that the Development Commissioner issued a notification under s. 9(!). The suggestion is that the State government having failed to impose its opinion regarding the inclusion of the vadi areas upon the municipality, adopted the device of the declaration under s. 9(1) for imposing its opinion at the instance of Shri Nakum as the ruling Congress party was hostile to the majority group in control of the municipality. The High Court rightly rejected this suggestion. Under s. 4(1) (b) of the Gujarat Municipalities Act, 1963, the State government had the power to alter the limits of the municipal borough after consulting the munidpality.

The State government had duly consulted the municipality. If the Government wanted to exercise its powers under the aforesaid s. 4(1) (b), it could do so without the consent of the municipality.

For the purpose of imposing its opinion, it was not necessary for the government to take recourse to the device of a declaration under s. 9(1) of the Gujarat Panchayats Act, 1961. Nor was the surrounding vadi area included in the Khambalia nagar declared by the notification under s. 9(1). It is not shown how Shri Nakum or the ruling party would stand to gain by this notification. The

mAMBALIA MUNICIPALITY v. GUJARAT (Bachawat, 1.) 637

allegation of mala.fides was categorically denied in the affidavit filed on behalf of the State government.

The next contention is thats. 9(1) of the Gujarat Pan cha ya ts Act, 1961 is ultra vires and unconstitutional on the ground of excessive delegation of legislative power to the State government. It is said that the legislature has not sufficiently indicated the policy which is to guide the State government in declaring a local area to be a gram or nagar or in the matter of making an inquiry preliminary to the declaration and the framing of the rules for the inquiry and has given a naked and arbitrary discretion to the State government to declare or not to declare a local area to be a gram or nagar or alter the limits of any nagar or gram or declare that any local area shall cease to be a nagar or a gram. We think that this contention has no merit.

The legislature cannot delegate its essential legislative functions to an administrative agency, see In re. Delhi Laws Act(') and Raj Narain Singh v. The Chairman, Patna Administration Committee(2).

An essential legislative function consists in the determination of a legislative policy and its formulation as a binding rule of conduct.

Having laid down the legislative policy, the legislature may confer discretion on an administrative agency as to the execution of the policy and leave it to the agency to work out the details within the frame work of the policy. Judged by this test, we think thats. 9(1) does not suffer from the vice of excessive delegation.

The preamble to the Gujarat Panchayats Act, 1961 shows that it is an Act to consolidate and amend the law relating to village panchayats and district local authorities in the State of Gujarat with a view to reorganize the administration pertaining to local government in furtherance of the object of the democratic decentralisation of powers in favour of different classes of panchayats. The Act extends to the whole of the State of Gujarat (s. 1(2).) It makes special provision for the district of Dang having regard to the sparsity of its population and other peculiar features (ss. 311 to 314). In other districts the Act seeks to introduce a three tier panchayat organization in the State for the purpose of securing a greater measure of participation by the people of the State in local and governmental functions (ss. 3, 8 and 287). At the summit of the panchayat organization is the district panchayat. Below the district panchayat and subordinate to it is the taluka panchayat.

For each district as constituted from time to time under the Land Revenue Code, there is a district panchayat, and for each taluka or a mahal as constituted from time to time under the Land Revenue Code, there is a taluka panc!:ayat (ss. 3 and 10). A district panchayat and subject to the authority of the district panchayat, a taluka panchayat has authority over the area for which it is constituted except that portion of the area which for the time

(I) [19511 S.C.R. 747.

(2) [19551 I S.C.R. 290.

6.18 SUPREME COUllT REPORTS

(1967) 2 S.C.R.

being is within the limits of a city municipal borough, municipal district, notified area or cantonment constituted under any law for the time being in force.

Below the taluka panchayat and the district panchayat and subordinate to them are the gram and nagar panchayats. For each gram, there is a gram panchayat and for each nagar there is a nagar panchayat. Sec. 9(1) provides for the constitu tion of grams and nagars. The State government may declare a local area comprising a group of revenue villages or a revenue village or part of it or such other administrative unit or part of it to be a gr:im if the population does not exceed 10,000 or a nagar if the population exceeds 10,000 hut docs not exceed 30,000.

Before making the declaration it is necessary to find out whether the local area can be conveniC'lltly constituted into a gram or nagar. The necessary inquiries to be made arc prescribed by the Gujarat Pan chayats (declaration of nagar or gram) Inquiry Rules, 1962. Obviously the State legislature cannot make th~ necessary inquiry as to whether a village or a part of it or two or more villages grouped together or an administrative unit or part of it is a viable unit fit to be constituted as a separate gram or nagar. The inquiry and the framing of proper rules with regard to the inquiry are subordinate or ancillary matters which were properly left to an administrative agency.

It is the policy of the Act that panchayats should be established within a reasonable time in all local areas with populations not exceeding 30,000 and not included in a notified area or a cantonment. This policy guides and controls the discretionary power of the State government under s. 9( l ). Having regard to this policy s. 9(1) cannot be said to suffer from the vice of excessive delegation of legislative power to the State government.

Pursuant to this policy the Gujarat government has established panchayats in all villages witJiin the State. The table at p. 4 of the "Panchayat Raj at a glance as on March 31, 1966" published by the Ministry of Food, Agriculture, Community Development and Cooperation (Department of Community Development) Government of India, New Delhi, shows that in the State of Gujarat there are 11, 785 Panchayats, covering 18,247 villages and that 100 per cent of the villages and all the rural population are now included ln the panchayats.

Section 9 (I) read withs. 307 shows that a local area co-extensive with or included within the limits of a municipal borough or a municipal district with a population not exceeding 30,000 may be declared to a gram or nagar. The democratic decentra lisation committe set up under the government resolution dated July 15, 1960 recom mended .in paragraph 4 6 of its report that the life of towns with populations over 30,000 is different from that of villages . They are helter served by municipalities. For this reason they are excluded from the purview puvw of s. 9( 1 ).

On behalf of the appellant, it is contended that even a municipal borough with a population over 30,000 is at the mercy of the State

JrnAMBALIA MUNICIPALITY v. GUJARAT (Bachawat, 1.) 639 government under s. 9(1). It is said that out of such a municipal borough, .small fragments with populations less than 30,000 may be carved out and may be separately declared to be grams and nagars and by adopting this method, the government may convert the entire municipal borough into several grams and nagars. We are not impressed with this argument. Under s. 9(1) read with s. 307, the government has no power to declare a municipal borough with a population exceeding 30,000 as a gram or nagar. It will be an abuse of the power under s. 9(1) if by declaring small fragments of such a municipal borough into separate grams or nagars, the government seeks to achieve indirectly what it cannot do directly.

If the government abuses the power vested in it bys. 9(1), its action will be struck down. But s. 9(1) cannot be held unconstitutional because of the possibility that it may be unfaithfully administered by those who are charged with its execution.

The Act envisages that gram and nagar panchayats should be established in all local areas having population not exceeding 30,000.

But it appears that on February 12, 1963, the Gujarat government arrived at the following policy decision:

"(a) The Municipalities whose population does not exceed 10,000 may be converted into Gram Panchaytas.

(b) Those with a population exceeding 10,000 but not exceeding 20,000 may be converted into Nagar Panchayat.

(c) Municipalities having a population exceeding 20,000 but not exceeding 25,000 may be given option to be converted into Nagar Panchayats.

(d) There are certain Muncipalities in respect of which disciplinary and such other actions are either pending or is proposed to be initiated. To enable such actions to proceed legally uninterrupted, under the relevant Municipal Act, it is decided that such Municipalities should not be converted either into Gram or Nagar Panchayats, irrespective of their population. The question of converting such Muncipalities may be considered only after the finalisation of such disciplinary or other proceedings under the Municipal Act."

Now the classification of municipalities on the basis of population between 10,000 and 20,000, 20,000 and 25,000 and 25,000and 30,000 is not justified by s. 9(1) which places all local areas with population between I 0,000 and 30,000 on the same footing. Counsel for the respondent was unable to justify the classification. The policy decision in so far as it makes this classification is not lawful and is liable to be struck down. From the statement filed by counsel for the State of Gujarat before us it appears that

uo SUPIBMI! COUllT IBPOITS [1967) 2 S.C.ll.

the State government has so far not converted into grams or naprs eight municipalities in Saurashtra and thirteen municipalities in Gujarat, having populations between 20,000 and 30,000.

If and in so far this non-conversion is based solely on the policy decision, it cannot be justified and it will be the duty of the State government to establish panchayats in those municipalities as soon as possible. The appellant particularly complained in the writ petition that the State had not converted the municipalities of Bagasra and Wadhawan into nagar panchayats.

Counsel for the State conceded that their non-conversion could not be supported on the ground that their population was between 20,000 and 30,000. It appears, however, that on July 12, 196S, during the pendency of the writ petit; ion, the Bagasra area was declared to be a nagar. With regard to Wadhawan municipality, counsel for the State stated that the question of its amalgamation with Surendra.nagar municipality was under consideration by the State government and that is the reason why the Wadhawan municipality was not so far converted into a nagar panchayat. We have no reason to doubt that appropriate steps will be taken by the State government with regard to the Wadhawan area. But the nonconversion of any of these municipalities into nagar panchayats does not vitiate the notification of June 14, 1965. This notification is lawful and is justified by s. 9(1). Khambalia has a population of 12,249 and was rightly declared to be a nagar. Having regard to the policy of the Act, it was the duty of the State government to declare it to be a nagar and the government has carried out its duty.

Counsel for the appellant contended that s. 9(2) also suffers Crom the vice of excessive delegation. We are unable to accept this contention. For the purpose of reorganizing the local areas, it may be necessary to include within or exclude from any nagar or gram any local area or otherwise alter the limits of any nagar or gram or to declare that any local area shall cease to be a nagar or gram, and this is provided by s. 9(2) of the Act. Action under s. 9(2) can be taken only after consultation with the taluka panchayat, the district panchayat and the nagar or gram panchayat concerned (if already constituted). The Act makes incidental provisions for the establishment and reconstitution of the panchayat• consequential upon the alteration of the area of a gram or nagar (ss. 298, 299), for amalgamation or division of grams consequential upon an area ceasing to be a gram (ss. 309, 310), and for special cases where an area excluded from a gram or nagar ceasing to be 11 gram or nagar is not merged in an area having local self-government (ss. 300, 301). Having regard to the policy of the Act, it is plain that the discretionary power under s. 9(2) is vested in the State government for the purpose of reorganizing the local areas into new units of local self-government. For such purposes, It may be necessary

ICHAMBALIA MUNICIPALITY v. GUJARAT (She/at, /.) 8' t

to establish new panchayats, reconstitute old panchayats, amalgamate or divide existing grams and pending such reorganization it may sometimes be even necessary that an area should cease to be a gram or nagar. It is impossible to visualise all the contingencies when action under s. 9(2) should be taken and the necessary discretion was

properly left to the State government. We arc satisfied that s. 9(2} cannot be held unconstitutional on the ground of excessive delegation.

We may add that no action has been taken against the appellant under s. 9(2).

In the result the appeal is dismissed without cost.

Shelat, J. The appellant municipality of Khambalia 1s m Jamnagar District which prior to 1956 formed part of the then

State of Saurashtra. The State had adopted the Bombay District Municipal Act, 1901 and had thereunder constituted the appellantmunicipality. On the merger of Saurashtra with the State of Bombay in 1956, Jamnagar District became part of the then Bombay State. But on bifurcation of the Bombay State the District of Jamnagar became part of the new State of Gujarat.

The Gujarat Panchayats Act,1961 was enacted on November 24

1962. At that time the population of Khambaliam unicipality accord ing to the census report of 1961 stood at 12,249. ya notification dated August 17, 1962 issued under section 9 of the Panchayats Act the Government of Gujarat declared the local area comprised in Khambalia municipality as a nagar. Consequently the appellant municipality ceased to exist and a Nagar Panchayat was set up in its stead. On account of emergency declared by the President the State Legislature passed the Gujarat Panchayats (Suspension of Provisions and Reconversion of certain local areas into municipal districts) Act, 1962, which was published on February 5, 1963.

The effect of this Act was that the appellant municipality and certain other municipalities which were converted into nagar Panchayats stood revived. This result was however short lived because on February 7, 1963 the State Government promulgated the Gujarat Panchayat Laws (Amendment) Ordinance, 1963 repealing s. 3 of the Suspension Act. In April 1963 the Government once again converted some of the municipalities into nagar or gram panchayats.

Not so the appellant municipality as the Government, it is said, desired to supersede it under section 179 of the Bombay District Municipal Act, 1901. As soon as the Government took action under that Act the appellant municipality filed a suit challenging that action.

On December 23, 1964 the Gujarat Municipalities Act, 1963 (Act XXXIV of 1964) was enacted and under itfi provisions the appellant municipality was deemed to be a municipality constituted .thereunder. On June 14, 1965 the Development Commissioner

SUPREME COURT REPORTS

(1967) 2 S.C.R.

undr powers delegated to him under sec. 321 of the Panchayats Act issued the impugned notification under sec. 9(1) thereof declaring the area comprised in .the appellant municipality to be a nagar. Counsel for the Municipality chaUenged the legality of this notification under five heads, viz ..

(l) that sec. 9 of the Panchayats Act did not apply to a municipal district as it is not a local area or such other administrative unit or part thereof:

(2) that tne notification was invalid as no inquiry as prescribed by Rule 2 of the Gujarat Panchayats (declaration of nagar or gram) Inquiry Rules, 1962 was in fact made:

(3) that the inquiry, if any. could be held by the State Government and not by. the Development Commissioner because though the Government's power under sec. 9 was delegated the obligation to hold such an inquiry was not and could not be delegated;

(4) that the notification was issued in ma/a fide exercise of power; and

(5) that sec. 9 of the Act is ultra vires by reason of excessive delegation of legislative power in favour of the State Government.

I have had the advantage of perusing the judgment prepared by my brother Bachawat J. and while I am prepared to go along with him so far as his conclusions on contentions I to 4 are concerned, I regret I cannot concur with his conclusion as regards the fifth contention which challenges the validity of sec. 9 and the notification.

To appreciate the challenge to sec. 9 it is necessary to recite that section. The section reads as follows:-

"(9) (I) After making such inquiries as may be prescribed, the State Government may by notification in the Official Gazette, declare any local area, comprising a revenue village, or a group of revenue villages or hamlets forming part of a revenue village, or such other administrative unit or part thereof,-

(a) to be a nagar, if the population of such local area exceeds 10,000 but does not exceed 30,000 and

(b) to be a gram, if the population of such local area docs not exceed 10,000.

(2) After consultation with the taluka panchayat, the district panchayat and the nagar or gram panchayat concerned (if already constituted) the State Government may, by like notification, at any time-

XHAMIALIA MUNICIPALITY V. GUJARAT (Shelat, J.) 643

(a) include within, or exclude :from, any nagar or gram, any local area or otherwise alter the limits of any nagar or gram; or

(b) declare that any local area shall cease to be a nagar or gram; and thereupon the local area shall be so included or excluded or the limits of the nagar or gram so altered or as the case may be, the local area shall cease to be a nagar or gram. M

The inquiries to be made under the section are dealt with by Rule 2 of the Inquiry Rules, 1962. Rule 2 is as follows:-

"2. Inquiry by State Government.-(!) Before declaring any local area to be a nagar or gram under sub-sec. (I) of sec. 9 of the Act, the State Government shaH make inquiries as to-

(!) the population and the ordinary land revenue of the revenue village or each of the revenue villages or hamlets, or as the case may be, any other administrative

unit or part thereof, comprised in the local area.

(2) whether the revenue villages or hamlets or other administrative units or parts thereof can be conveniently grouped so as to form a gram or nagar, as the case may be."

Thus the inquiry involves consideration of two factors only; (I) population and the ordinary land revenue and (2) whether the revenue villages or hamlets or other units or parts thereof can be conveniently grouped together to form a gram or a nagar.

Now it is clear from the preamble of the Act that the object of the Act is to set up a Panchayat Raj througl!out the State of Gujarat with a three-tiered organisation ranging from the village to the district level. To achieve this the Act provides for a gram or a nagar panchayat, a taluka panchayat and a district pan;; hayat in each of the districts. It is also clear from several provisions of the Act that though the policy was to set up such a Panchayat Raj it was considered that a panchayat would not be suitable for local areas with populations exceeding 30,000 and that such areas would be best served by municipalities. Therefore the Act leaves out certain urban areas and their municipalities untouched.

Jn. deed it was bocause the legislature knew that such urban areas should be-left out from the scope of the Act that it passed a comprehensive statute, the Gujarat Municipalities Act, 1963, which gD'Verns all municipalities including the existing ones constituted either under the Bombay District Municipal Act 1901 or the Bombay M2Sup. C. 1/67-12

SUPREME COURT REPORTS (1967]2 s.c R.

Municipal Boroughs Act, 1925. Though the policy was that it is only local areas with populations exceeding 30,000 which should be left out from the purview of the Act and all the areas with popula. tions below 30,000 should be brought under the panchayat system, the Gujarat Municipalities Act, 1963 curiously enough does not lay down any minimum limit as to population for a municipality to be set up. Prima facie the State Government under that Act can consti tute or permit an existing municipality to continue even if its population is less than 30,000. The effect of this gap in the implementation of the avowed legislative policy in the Panchayats Act will be easily perceived hereafter.

A declaration under sec. 9(1) that a local area shall be a nagar or a gram is a legislative function. As stated on several occasions by this Court an essential legislative function consists in the determination of the legislative policy and its formulation as a binding

rule of conduct. (Cf. Raj Narain Singh v. Chairman, Patna Admi11is- 1ratio11 Committee(') and Delhi Lall'S Act case.(2)). Such a function cannot be surrendered or delegated in favour of another authority or agency for the Constitution entrusts the legislative function to the legislatures. In view however of the diverse activities of a modern state it is recognised that a legislature cannot be expected to work out all the details of a complex statute such as the instant Act.

It i; therefore competent for a legislature to delegate in suitable cases some of its ancillary legislative powers to the executive or any other authority to work out such details. But there is an inherent danger in such delegation. As observed in Vasantlal Maganbhai v. State of BombaY(3)-

"although the power of delegation is a constituent element of the legislative power, it is well settled that the legislature cannot delegate its essential legislative functions in any case and before it can delegate any subsidiary or ancillary power, to a delegate of its choice, it must lay down the legislative policy and principles so as to afford the delegate proper guidance in implementing the same."

If, therefore. a statute is challenged on the ground of excessive delegation it has to be established that the legislature has delegated its essential legislative power or function and that it has not laid down its policy or principle for the guidance of its delegate. Even if a policy is declared it may, however, be couched in such vague

terms that it may not set down a definite standard or. criterion for the guidance of the delegate. The consequence would be to confer an arbitrary or uncanalised power to change or modify the declared policy without reserving to itself any control over the subordinate legislation. Such an effacement or abdication of power in favour

(I) {19SSJ 1 S.C.R. 290.

(2) {1951) s.c.R. 747.

(3) {1961J I s.c.R. 341 at 346.

KHAMBALIA MUNICIPALITY v. GUJARAT (She/at, J,) 645

of another agency either in whole or in part is beyond the permissible limits of delegation. In Hamdard Dawakilana's case,(1) clause (d) of sec. 3 of the Drugs and Magic Remedies (Objectionable Advertisements) Act, 1954 which gave power to the Central Government to add to the diseases falling within the mischief of sec. 3 was struck down on the ground of its conferring such uncanalised power to include any disease it thought fit.

Let me now examine the provisions of sec. 9 in the background of these principles. As aforesaid, the object of the Act is to set up the Panchayat system throughout the State except of course in those local areas where the population exceeds 30,000. It is to implement this object that the Act provides a three-tier organisation consisting of a gram or nagar panchayat, a taluka panchayat and a district panchayat in each district. What section 9(1) does is to delegate to the government the power to declare, after making such inquiries as may be prescribed, a local area or a part thereof to be a nagar, if its population is between 10,000 to 30,000 or a gram, if its population is less than 10,000.

Sub-section 2 authorises the government after consultation with the taluka, the district and the nagar or gram panchayat concerned to alter the limits of any nagar or gram by including or excluding any area or declare that any local area shall cease to be a nagar or a gram and thereupon the local area shall be so included or excluded etc. The Government thus is empowered {I) to declare a local area to be a nagar or a gram depending upon its population; (2) after such a nagar or gram has been constituted to alter its area either by including other area or areas or excluding an area or areas therefrom; (3) by doing so to convert a gram into a nagar and vice versa and (4) or to declare any such local area as having ceased to be a nagar or a gram. It will at once be noticed that the word "or" between clauses (a) and (b) in subsec. 2 indicates that the power to declare that a local area has ceased to be a nagar or a gram can be exercised either after such inclusion or exclusion or even without such inclusion or exclusion. It. follows therefore that even where a nagar or a gram panchayat is constituted, the government can declare at any time that it shall cease to be a nagar or a gram either as a result of the alteration of its local area or without such alteration. It will also be noticed that sub-section (I) by the use of the word 'may' therein confers an absolute discretion to make the declaration thereunder or not.

Indeed, Counsel for the State insisted that th, e word 'may' there does not mean 'shall' and therefore that provision is not mandatory, It follows therefore that in spite of the avowed policy of the Act to set up Panchayat Raj throughout the State the Government by virtue of the power to declare being discretionary under sub-section (I), may or may not declare a local area to be a nagar or a gram.

(I} [19601 2 s.c.R. 671.

646 SUPltBMI! COURT ltl!PORTS !196i] 2 S.C.R.

The only fetter is that where it desires to make a declaration in respect of any particular local area it can do so after making a:n inquiry as prescribed. But neither sec. 9 nor any other provision in the Act lays down that even if the inquiry ends in a particular conclusion the Government must make the declaration.

What the requisite result of such an inquiry for a declaration should be is also not prescribed in the Act and the government is left to decide its course of action after such an inquiry.

Similarly sub-sec. 2 confers a discretionary power on the government to alter by inclusion or exclusion any area or areas from a nagar or a gram panchayat and convert one from the other.

The only restriction on such power is the necessity to consult the district, the taluka, and the nagar or the gram panchayats as the case may be. The restriction is consultation but not the consent of the concerned panchayats. Sub-sec. 2 does not require even an inquiry as sub-section I does at the time of the declaration.

Nor docs it lay down any principle or criterion as to when and in .what circumstances the Government can launch upon such altera

tion of the local limits. Thus the Government can modify at any time the structure and the nature of a panchayat from a nagar to a gram panchayat and vice versa by simply altering its area after a mere consultation and even if the panchayats concerned are against such alteration. Under this power the Government can also transfer a portion or portions of a nagar or gram panchayat after formally going through the process of consultation and join it or them with another panchayat even if the people concerned were to be unwilling to such a transfer.

It is true t!iat sec. 9(1) c0::t?ins one criterion, viz., of population, that is, if the population is betwce11 10,000 to 30,000 the local area would be a nagar and if it is less than I0,000 it would be a gram.

Even so, by reason of the absolute discretion left with the government it is not as if it is incumbent on the government to make the declaration under section 9( I) even if the local area has the necessary population and revenue to make it a viable unit. The government, even in such a case, may decline to make a declaration in the absence of any provision requiring it to do so or under sub-section 2 divide the area and join such divided portions with other panchayats.

The inquiry under sub-section I is not regulated under the Act but under Rules made by the government. Neither the Act nor the Rules provide that the government has to act under sec. 9( I) if the inquiry ends in a particular result. In other words there is no provision that the government has to act in a particular way after such an inquiry. Consequently, it is not necessary for the government to make a declaration even if it is satisfied as regards the population or the land revenue of the local area.

Furthermore, the section does not lay down any principles to guide the Government

KHAMBAL!A MUNICIPALin '"il'JAJ>~T (Shelat, J.) 647

as to when a single revenue village should be constituted a gram panchayat or when it should be grouped with other such villages to constitute a gram or a nagar panchayat. Neither section 9 nor Rule 2 provides as to what should follow after an inquiry is held.

Thus neither sec. 9 nor the Rules provide any principle or criterion on the basis of which the power of declaration and alteration under sub-section l or sub-section 2 of sec. 9 is to be exercised and it is left entirely to the sweet will of the government whether a particular Mea is to be declared a gram or a nagar or not and to alter its area by adding or subtracting therefrom part or parts so that it may be reduced to a gram or augmented into a nagar regardless of the willingness either of the people or the panchayat concerned.

Another result ensuing from the government's power to alter the limits which can be easily visualised is that even where a local area has a population exceeding 30,000 and has a duly constituted municipality, if the government for one reason or the other desires w do away with such a municipality it has simply to reducelits limits which it can do since a municipal area is a local area within the meaning of sec. 9(1) and convert it into a gram or a nagar depending upon how much of its area is carved out. Since under sub-sec. 2 such a power can be exercised even without an inquiry or consent of the municipality concerned every municipality would be entirely at the mercy of the government for its continuance.

The consequences flowing from such a power are far more far reaching than even those from exercise of power of supersession of a municipality under the Gujarat Municipalities Act. If the government supersedes a municipality it does not become extinct.

Only the existing body of the members would be superseded but a fresh election has to take place and a new body of members woulcl constitute the municipality. Where government acts under this Act and so alters the local area constituting the municipality as to reduce its population below 30,000 the government can on such alteration bring about the extinction of the municipality and convert it into a nagar or even a gram panchayat. It is easy to perceive in the provisions of Sec. 9 an uncanalised power to do all these things without any principle or criterion laid down therein to govern or control the actions of the government.

The fact that sub-section (1) is not mandatory and confers discretionary power has also other significance. Inspite of the provision in it that where the population of a local area is between

10,000 to 30,000 it should be a nagar panchayat the State Government made a policy decision on Feb. 12, 1963. That decision was:-

"(a) The Municipalities whose population does not exceed 10,000 may be converted into gram panchayats.

648 SllBMB COUil T llBPOll TS

(1967) 2 S.C.R.

(b) Those with a population exceeding 10,000 but not exceeding 20,000 may be converted into Nagar Panchayats.

(c) Municipalities having a population exceeding 20,000 but not exceeding 25,000 may be given option to be converted into Nagar Panchayats.

The effect of the decision is that municipalities having a population between 20,000 to 30,000 are left out from the purview of sec. 9(1).

Municipalities with populations between 20,000 to 25,<XX> are given an option whether to convert themselves into nagar panchayats; municipalities with populations between 25,000 to 30,000 are not to be converted into nagar panchayats. It is obvious that the policy decision is defective of the object of the Act. It is also obvious that the government could make such a policy decision only because sec. 9 confers an absolute discretion wheryunder it leaves it to the government to declare or not to declare local areas as grams or nagars as the case may be.

The fact that such a policy decision could be made demonstrates that the legislature did not reserve to itself any power to control the implementation by the government of its objective. It is therefore clear that sec. 9 delegates to the Government an uncontrolled power under sub-sec. (I) and sub-sec. 2 both as regards declaration and alteration of local areas without laying down any criterion which should govern and guide the government in the exercise of its

power. Such a power leaves every panchayat whether it be a nagar or a gram panchayat or a local area where there is a municipality duly constituted at the mercy of the government for its continuance as such panchayat or municipality.

The complaint of the appellant-municipality is that it is because of such an arbitmry power that the government has been able to declare the appellant municipality to be nagar while allowing at least two municipalities of Bagasra and Wadhawan though similarly situated to continue as municipalities. It was only after the appellant-mun:cipality filed its writ petition in the High Court

that the government declared Bagasra a nagar. Wadhawan Municipality however is still allowed to contin.ue. During the course of the hearing of this appeal, we asked Counsel for the State if the government was agreeable to convert Wadhawan into a nagar. He asked for time to obtain instructions and subsequently filed a statement.

The only reason given in the statement is that there is a proposal before the government to amalgamate Wadhawan with the nearby Surenderanagar and to have one municipality for both. It is strange that even after nearly four years since the passing of the Act the government has yet not been able to make up its mind and

KHAMBALIA MUNICIPALITY v. GUJAltAT (She/at, /.) 649

the alleged proposal for amalgamation is still said to be under its consideration. But these are not the only two municipalities to which the government did not apply the Act. In answer to the said statement the appellant municipality has drawn our attention to the fact that the Act has not been applied to eight municipalities in Saurashtra and thirteen municipalities in Gujarat having populations between 20,000 and 30,000 presumably acting under the said policy decision. The above figures are not disputable as they are taken from a government publication. No doubt the appellant municipality has a population of 12,000 and odd and is therefore liable to be converted iato a nagar. But so also the aforesaid twenty one municipalities under the very same provisions of the Act. The only reason why these other municipalities have not been converted into nagars is the decision of the government based perhaps on a consideration that areas. with populations between twenty and thirty thousand are urban areas which would be better served by municipalities. That can be the only explanation for the said policy decision. But the decision is contrary to the legislative decision contained in s. 9(1) that such areas are fit to be converted into nagar panchayats. Such a decision became possible because the legislature left an uncontrolled power in the government enabling it to modify and even defeat the legislative policy without reserving to itself any control over the implementation of the Act by its delegate. Such a delegation amounts to an effacement and is not within the permissible limits of delegation.

Realising this difficulty, Counsel for the State conceded that the policy decision was illegal. But such a concession by Counsel cannot be of any assistance, for the simple reason that as Sec. 9(1) stands the power delegated to the government is discretionary and the government can therefore decide whether a particular local area or a class of local areas should be declared as nagars or grams or not and it is in exercise of that power that the policy decision was made and implemented, contrary though it is to the aim and object of the Act to set up panchayats in all local areas except those having populations over 30,000.

Section 9 in my view suffers fom excessive delegation and therefore is invalid. The impugned notification issued thereunder must fall along with it.

I would, therefore, allow the appeal with costs.

ORDER

H In accordance with the opinion of the majority tb.e appeal is dismissed without costs.

Y.P.

KHAMBALIA MUNICIPALITY & ANR

STATE OF GUJARAT

February 16, 1967

K. N. WANCHOO

R. S. BACHAWAT

s. 9(1)

s. 9( I)

Gujarat Panchayats Act, 1961

s. 9(1)

s. 9(1)

s. 9

s. 9(1)

s. 9

s. 9

Section 307

s. 9

ss. 9 and 307

s. 9( 1)

s. 4(1 )(b)

Gujarat Municipalities Act, 1963

s. 4(l)(b)

s. 9( I)

s. 9( 1)

PN Wanchoo

Bachawat

Section 9(l)

s. 9( 1)

s. 9(2)

s. 9(1)

s. 9( 1)

s. 9(1)

s. 9(1)

1955] 1 S.C.R. 290

Shelat

Section 9

s. 9( 1)

s. 9

section 2

section 2

Gujarat High Court

Ravinder Narain

N. S. Bindra

K. L. Hathi

S. P. Nayvar

R. H. Dhebar

WANCHOO

BACHAWAT

s. 9(1)

Gujarat Panchayats Act, 1961

Jamnagar district

Bombay

Khambalia

State of Bombay

Jamnagar

Gujarat Panchayats Act 1961

February 24, 1962

Khambalia municipality

s. 9

Gujarat Panchayats Act 1961

February 5, 1963

s. 9(1)

Panchayats Act 1961

February 7, 1963

s. 3

Gujarat Panchayats Act 1961

Khambalia municipality

s. 179

Bombay District Municipal Act, 1901

December 23, 1964

Gujarat Municipalities Act, 1963

June 14, 1965

Gujarat State

s. 9

Gujarat Panchayats Act, 1961

s. 9(1)

June 22. 1965

High Court of Gujarat

s. 9

Gujarat Panchayats Act, 1961

s. 9

Inquiry Rules, 1962

s. 9

section 9

Sec. 321

s. 9(1)

s. 9(1)

s. 9

Gujarat Panchayats Act 1961

Section 307

s. 9

ss. 9 and 307

s. 9(1)

s. 9( I)

Haribhai

s. 9(!)

s. 9(1)

Nakum

s. 4(1)

Gujarat Municipalities Act, 1963

s. 4(1)

s. 9(1)

Gujarat Panchayats Act, 1961

s. 9(1)

Gujarat Pan cha ya ts Act, 1961

Delhi Laws Act

State of Gujarat

s. 1(2)

Dang

ss. 311 to 314

ss. 3, 8 and 287

ss. 3 and 10

SUPREME COUllT REPORTS

(1967) 2 S.C.R.

Sec. 9(1)

Inquiry Rules, 1962

s. 9( l )

s. 9(1)

Gujarat government

March 31, 1966

Section 9

July 15, 1960

s. 9( 1 )

s. 9(1)

s. 9(1)

s. 307

s. 9(1)

s. 9(1)

February 12, 1963

s. 9(1)

Saurashtra

Bagasra

Wadhawan

July 12, 196S

Wadhawan municipality

Surendra.nagar municipality

s. 9(1)

s. 9(2)

s. 9(2)

s. 9(2)

ss. 298, 299

ss. 309, 310

ss. 300, 301

s. 9(2)

s. 9(2)

Jamnagar District

Gujarat Panchayats Act,1961

November 24

1962

Khambaliam

August 17, 1962

section 9

Government of Gujarat

s. 3

section 179

Bombay District Municipal Act, 1901

Gujarat Municipalities Act, 1963

sec. 321

sec. 9(1)

sec. 9

Inquiry Rules, 1962

sec. 9

sec. 9

sec. 9

sec. 9

Inquiry Rules, 1962

sec. 9

Gujarat Municipalities Act, 1963

Municipal Boroughs Act, 1925

Gujarat Municipalities Act, 1963

sec. 9(1)

Hamdard Dawakilana

sec. 3

Central Government

sec. 3

sec. 9

section 9(1)

section 2

sec. 9

sec. 2

sec. 2

sec. 9(1)

section 9( I)

section 2

sec. 9( I)

KHAMBAL!A MUNICIPALin

section 9

sec. 9

section 2

sec. 9

sec. 9(1)

sec. 2

Sec. 9

Feb. 12, 1963

sec. 9(1)

sec. 9

sec. 9

sec. 2

Wadhawan Municipality

Surenderanagar

s. 9(1)

Sec. 9(1)

Section 9