Appeal No 1121 of 1966
Appeal by special leave from the judgment and order dated August 17 1965 of the Punjab High Court in Letters Patent Appeal No I 10 of 1965
203 Janardan Sharma and R N Sachthey for the appellant
The respondent did not appear
The Judgment of the Court was delivered by Sikri J
This appeal by special leave is directed against the judgment of the High Court of Punjab accepting the petition filed by the rate payers of Municipal Committee Rohtak respondents before us and ordering that the State Government shall not proceed with the constitution of the Rohtak Improvement Trust under the notification of August 30 1961
The High Court allowed the petition because it held 1 that sub section
3 of section I of the Punjab Town Improvement Act Punjab Act IV of 1922 here in after referred to as the Act only envisages the creation of a Trust in a Municipal area where a Committee is functioning and so is in a position to hold a special meeting to decide whether or not it considers the creation of a trust desirable and 2 that once a trust ceases to exist under section 103l of the Act in order to recreate the trust the Act has to be applied again and as the Municipal Committee had at a special meeting held on November 9 1962 decided unanimously that the Act should not be applied the Government was bound to give effect to that decision
The learned counsel for the appellant Mr Sachthey contends that the High Court has placed a wrong interpretation on the two provisions mentioned above and somehow section 4 A of the Act was not noticed by the High Court
Before we deal with the interpretation of the provisions mentioned above it is necessary to state a few facts
The Rohtak Municipal Committee was superseded on August 2 1954
The Government purported to extend the provisions of the Act to the whole of the area of the Municipality on May 21 1958
The notification to this effect reads In pursuance of the provisions of sub section of Section I of the Punjab Town Improvement Act 1922 Punjab Act No IV of 1922 the Governor of Punjab proposes to apply the provisions of the said Act to the whole of the area of the municipalities specified below with effect from 9th June 1958 1  2  3
Rohtak  Sub section 3 of section 1 of the Act reads as follows 1
3 This section and section 66 shall come into force at once
The State Government may by notification propose to apply the rest of the Act to the whole or any part of any municipality and to any locality adjacent 204 thereto on such date as may be specified in such notification and the Act shall come into operation after the lapse of three months unless within that period the municipal committee concerned at meeting convened for the purpose of considering the application of the Act resolve by a majority of two thirds that the Act should not be so applied
 In pursuance of this notification a trust was set up
But on August 30 1961 the Government issued a notification in exercise of its powers under sub section
1 of section 103 of the Act and declared that the Rohtak Improvement Trust shall be dissolved with effect from August 30 1961 from which the Chairman and the trustees of the aforesaid Trust ceased to function
Section 1031 of the Act reads as follows  103
1 When all schemes sanctioned under this Act have been executed or have been so far executed as to render the continued existence of the trust in the opinion of the State Government unnecessary or when in the opinion of the State Government it is expedient that the trust shall cease to exist the State Government may by notification declare that the trust shall be dissolved from such date as may be specified in this behalf in such notification and the trust shall be deemed to be dissolved accordingly
 It appears that on the supersession of the Municipality of Rohtak in 1954 an Administration was appointed under section 238 of the Punjab Municipal Act 191 1
This section inter alia provides 238
1  2 When a committee is so superseeded
the following consequences shall ensue a b all powers and duties of the committee may until the committee is reconstituted be exercised and performed by such persons as the State Government may appoint in that behalf Fresh elections of the Municipal Committee Rohtak were held in July 1961 and the Municipal Committee reconstituted on January 10 1962
On October 23 1962 the Government informed the Deputy Commissioner Rohtak that it had decided to reconstitute Rohtak Improvement Trust immediately and asked the Deputy Commissioner to recommend a panel of six names of suitable persons for appointment as trustees and the Government also asked him to call upon the Municipal Committee Rohtak to elect its representatives as trustees
205 This was not to the liking of the Municipal Committee and the Municipal Committee unanimously passed a resolution on November 9 1962 strongly opposing the reconstitution of the Improvement Trust Rohtak
The Government by notification dated January 10 1963 in exercise of powers conferred by sub section
2 of section 4 of the Act appointed one Major section KMehta as Chairman Rohtak Improvement Trust
The Municipal Committee was again requested to send two names of three members of the Municipal Committee to be appointed as trustees as required by cl
b of sub section
 1 of section 4 of the Act
Thereupon 32 rate payers filed the petition under article 226 of the Constitution challenging the reconstitution of the Rohtak Improvement Trust
Coming to the first point decided by the High Court it seems to us that section 4 A to the Act was not brought to its notice and if it had been brought to its notice the High Court may well have come to the contrary conclusion
Section 4 A which was inserted by Punjab Act VIII of 1936 reads  4 A
During the period of supersession of a Municipal Committee under section 238 of the Punjab Municipal Act 191 1 the three seats allotted to the Municipal Committee on the trust under clause b of sub section 1 of section 4 shall be filled by the State Government by appointing any three persons by notification in the Official Gazette
The term of office of every trustee so appointed shall be three years or until the Trust is dissolved whichever period is less provided that if the Municipal Committee is reconstituted three members of the Municipal Committee shall be elected or appointed in accordance with the provisions of section 4 and on their election or appointment the three trustees appointed by the State Government under this section shall cease to be members of the Trust
 Reading section 13 and section 4A of the Act and section 238 of the Punjab Municipal Act 191 1 together it seems to us that the true meaning of the latter portion of sub section 3 of section 1 is that when the Government applies the section and the Municipal Committee has been superseded before that date it is the Administrator who would exercise the powers given under the latter part of that sub section in other words the Administrator would be competent to say to the Government that the Act shall not come into operation
The words of section 238 of the Punjab Municipal Act are very wide and it is difficult to limit the expression all powers and duties of the committee in any manner
The Municipality exercised powers by resolution passed by majority and the fact that this particular resolution had to be by two third majority does not lead 206 to the conclusion that the power to oppose the application of the Act vesting in the Municipal Committee cannot be exercised by the Administrator under section 238 Punjab Municipal Act
Section 4A of the Act clearly proceeds on the basis that while the Municipal Committee stands superseded the appointment of trustees which was originally to be made by the Municipal Committee would be made by the State Government
As the High Court did not have section 4 A before it had relied on the anomaly that where a Municipal Committee was suspended the Government could nominate some members of the suspended Committee as members of the Trust or otherwise fill these vacancies and the High Court felt that it could not believe that it was the intention of the Legislature
Coming to the second point
made by the High Court it seems that the High Court has wrongly held that once the Act has been applied it is necessary that it should be applied again when the Municipal Committee is reconstituted
There is nothing in the words of sub section
3 of section I to warrant this conclusion
Once the Act has come into operation in accordance with the provisions of sub section
3 of section 1 there is no provision by which the Act can cease to apply
The only point that remains is when a trust has been dis solved under section 103 of the Act can it be reconstituted under the Act  The only provisions under which a trust can be reconstituted under the Act are sections 3 and 4
Section 3 reads  3
The duty of carrying out the provisions of this  Act in any local area shall subject to the conditions and limitations hereinafter contained be vested in a board to be called The name of town Improvement Trust hereinafter referred to as the The Trust and every such board shall be a body corporate and have perpetual succession and common seal and shall by the said name sue and be sued
 Section 4 reads 4
1 The trust shall consist of seven trustees namely The other sub sections of section 4 provide how the trustees are to be appointed
It seems to us that if the trust could originally be created under sections 3 and 4 reading sections 3 and 4 and section 12 of the General Clauses Act the Government has the power to create a view trust or reconstitute a new trust
We may mention that section 12 of the Gene 207 ral Clauses Punjab Act 1898 provides that where by any Punjab Act any power is conferred then that power may be exercised from time to time as occasion requires
 In the result the judgment of the High Court is set aside the appeal allowed and the writ petition dismissed
There will be no order as to costs throughout
YP Appeal allowed


Summary:
The Rohtak Municipal Committee was superseded in August 1954 and an Administrator was appointed under section 238 of the Punjab Municipal Act 1911
In June 1958 the provisions of the Punjab Town Improvement Act 1922 were extended to the Municipality and the Rohtak Improvement Trust was set up under the Act
In August 1961 the Government issued a notification under section 103 1 of the 1922 Act dissolving the Trust
The Municipal Committee was reconstituted in January 1962 and in October 1962 the Government decided to reconstitute the Trust
The Municipal Committee thereupon passed a resolution opposing the reconstitution of the Trust
In January 1963 however the Government re constituted the Trust and the Municipal Committee was asked to name its representatives to be appointed as trustees
The rate payers filed a writ petition challenging the reconstitution of the trust and the High Court allowed the petition
In appeal to this Court HELD  1 The attention of the High Court was not drawn to section 4A of the 1922 Act and therefore it erred in holding that the Trust could not be set up in 1958 because under section 13 of the 1922 Act a Trust cannot be created in a Municipal area unless the committee was functioning
Under section 4A where the Municipal Committee was superseded the State Government could appoint the trustees and there was no anomaly in the Government nominating the trustees because the Administrator who had all the powers and duties of the Committee under section 238 of the 1911 Act was competent to say to the Government that the 1922 Act should not be applied to the Municipality
205 C D 206 B 2 Once the 1922 Act had come into operation under section 13 it continues to apply and it was not necessary to apply it again when the Municipal Committee was reconstituted in 1962
206 D 3 Under sections 3 and 4 of the 1922 Act and the General Clauses Punjab Act 1898 Government has the power to create a new trust or reconstitute a Trust which was dissolved
206 H