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1967 (2) TMI 111

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..... ity according to the census of 1961 was 12,249. By a notification dated Aug 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 Provisions and reconversion of certain local areas into municipal districts) Act, 1962 the Khambaha municipality and other municipalities converted into nagar panchayats by notifications under s. 9(1) of the Nagar Panchayats Act 1961 stood revived. On February 7, 1963, the Gujarat Panchayat Laws (Amendment) Ordinance 1963 repealed s. 3 of the Gujarat Panchayats (suspension of provisions and reconversion of certain local areas into municipal districts) Act 1962 and all the provisions of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 D .....

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..... ar 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 nagar or gram) Inquiry Rules, 1962, prescribes the inquiry to be made by the State Government under s. 9 (1) it reads: 2. Inquiry by' State Government.-(1) 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 be, 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 .....

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..... 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(1). 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 municipality. 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 total 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 nag .....

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..... ate 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 panchyat. 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 panchayat (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 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 constitution of grams and nagars. The State government may declare .....

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..... unicipalities. For this reason they are excluded from the purview 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 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 by s. 9(1), its action will be struck down. But s. 9(1) cannot be held unconstitutional bemuse of the possibility that it may be unfaithfully administered by those who are charged with its execution envisages that gram and nagar pan .....

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..... hat on July 12, 1965, during the pendency of the writ petition, 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 non- conversion 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 from 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 an .....

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..... anchayats 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, .....

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..... State Government may, by like notification, at any time- (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. 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.-(1) Before declaring any local area to be a nagar or gram under sub-sec. (1) of sec. 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 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; .....

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..... t 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 is 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 ([1961] 1 S.C.R. 341 at 346) 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 delegat .....

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..... 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 sub-sec. 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 (1) 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 the 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 (1), may or may not declare a local area to be a nagar or a gram. The only fetter is that where it .....

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..... 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(1) 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 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 I 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 area is to be declared a gram or a nagar or not and to alter its area by adding or subtracting there from part or p .....

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..... 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 25,000 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 where under '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 demons- trates 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. (1) and sub-sec. 2 both as regards declaration and alteration of local areas without laying down any criterion which should govern and guide the go .....

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..... on 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 from exc .....

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