IN THE HIGH COURT OF PUNJAB & HARYANA AT CHANDIGARH (1) Civil Writ Petition No.5149 of 2010 Date of decision: October 29, 2010 V.K. Kapoor and others .. Petitioners Vs. State of Haryana and others .. Respondents (2) Civil Writ Petition No. 2493 of 2010 Vijay Bansal Advocate and others .. Petitioners Vs. State of Haryana and others .. Respondents (3) Civil Writ Petition No.5235 of 2010 V.K. Sood and others .. Petitioners Vs. State of Haryana and others .. Respondents Coram: Hon'ble Mr. Justice M.M. Kumar Hon'ble Mr. Justice A.N. Jindal Present: Mr. Amit Jhanji, Advocate for the petitioners in C.W.P. No.2493 and 5149 of 2010. Mr. V.K. Jindal, Advocate for the petitioners in C.W.P. No.5235 of 2010. Mr. Hawa Singh Hooda, Advocate General, Haryana with Mr. Randhir Singh, Addl. Advocate General, Haryana for the respondent-State. Mr. G.S. Hooda, Advocate with Mr. R.K. Saini, Advocate for the respondent Nos. 5, 6 and 7 in CWP No.2493 of 2010. 1. To be referred to the Reporters or not? 2. Whether the judgment should be reported in the digest? A.N. Jindal, J This judgment shall dispose of three connected writ petitions. One of the petition bearing No. 2493 of 2010, has been filed by an advocate Civil Writ Petition No. 2493 of 2010 Civil Writ Petition No. 5149 of 2010 & Civil Writ Petition No. 5235 of 2010 -2- whereas municipal Councilors of Municipal Committee, Pinjore and Panchkula have filed writ petitions bearing Nos.5149 and 5235 of 2010. Since all the three writ petitions involve common questions of law, therefore, the same are taken up together. However, the facts are picked up from Civil Writ Petition No.5149 of 2010. In all the three petitions, the area, where the petitioners are residing, has been merged into the Municipal Corporation, Panchkula. Challenge in the aforesaid three writ petitions is to the order dated 18.01.2010 (Annexure P-6) and notification dated 17.03.2010 (Annexure P-7), issued by the Government of Haryana, Urban Local Bodies Department, vide which a decision has been taken to declare the Panchkula Municipal Council as Municipal Corporation after merging Municipal Committees of Pinjore and Kalka. The principal grounds of challenge are that the order (P-6) and notification (P-7) are violative of principles of natural justice; ultra vires of Article 243-P, 243-Q of the Constitution and also 2-A of the Haryana Municipal Act, 1973 as well as Section 3 of the Haryana Municipal Corporation Act, 1994. A mandamus has also been sought against the respondents not to give effect to the notification dated 17.03.2010 (Annexure P-7). The major posers sought to be raised before this Court are as under:- 1. Whether the constitution of the Municipal Corporation was in violation of mandatory provisions of law like S. 2-A of the Haryana Municipal Act, 1973 various provisions of Municipal Corporation Act, 1994 and Articles 243 P and Civil Writ Petition No. 2493 of 2010 Civil Writ Petition No. 5149 of 2010 & Civil Writ Petition No. 5235 of 2010 -3- 243 Q of the Constitution? 2. Whether the villages, which were not part of the transitional area could be merged into the Municipal Corporation without dissolving the Panchayats of those villages? 3. Whether the residents of the area as well as the three municipalities and village Panchayats were required to be given an opportunity of hearing before including such area in the Municipal Corporation? In the year 2000 vide notification No.18/4/96-2C1 dated 27.07.2000, Municipal Committee of the Panchkula was upgraded to Municipal Council while adding villages known as Bhainsa Tibba, Kharak Mangoli, Majri, Haripur, Budanpur, Abheypur, Raily, Kundi, Fatehapur, Maheshpur, Devi Nagar and Banna Madanpur. The total Population of the said area as per census of 2001 was 1,78,089. By 74th Amendment, Part IX-A was inserted into the Constitution of India w.e.f. 01.06.1993. This part contemplates constitution of Nagar Panchayats, Municipal Council and Municipal Corporation in every state for the purpose of administering 'a transitional area', 'a smaller urban area' and 'a larger urban area' respectively. Article 243 Q contemplates and uses the aforesaid expressions. Article 243 Q (2) empowers the Governor to declare any area of transitional area; smaller urban area; and a larger urban area having regard to the population of the area, the density of the population therein, the revenue generated for local administration, the percentage of employment in non-agricultural activities, the economic importance or such other factors as the Governor may deem Civil Writ Petition No. 2493 of 2010 Civil Writ Petition No. 5149 of 2010 & Civil Writ Petition No. 5235 of 2010 -4- fit, specify by public notification for the purpose of Part IX-A of the Constitution. The petitioners have averred that as per Section 2-A of the Haryana Municipal Act, 1973, (for brevity, 'the 1973 Act') Municipalities were classified as under :- (i) “Municipal Committee” for a transitional area with population not exceeding fifty thousand. (ii) “Municipal Council” for a smaller urban area with population exceeding fifty thousand but not exceeding three lacs and (iii) “Municipal Corporation” for a larger urban area with population exceeding three lacs, to be governed by a separate Act: Provided that a municipality under this section may not be constituted in such urban areas or part thereof as the State Government may, having regard to the size of the area and the municipal services being provided or proposed to be provided by an industrial establishment in that area and such other factors as it may deem fit, by notification, specify to be an industrial township. xx xx xx” The Haryana Municipal Act further created a bar on declaring the area of military cantonment or part thereof from making it part of the Municipality. The Act further provided that the transitional area (smaller urban area or a larger urban area) means such area as the State Government Civil Writ Petition No. 2493 of 2010 Civil Writ Petition No. 5149 of 2010 & Civil Writ Petition No. 5235 of 2010 -5- may having regard to the population of the area, the density of the population therein, the revenue generated for local administration, the percentage of employment in non-agricultural activities, the economic importance or such other factors as the State Government may deem fit, specify by notification for the purpose of this section. The State Government has been further given the powers to constitute the Municipalities and specify the class thereof in accordance with the provisions of this Section after observing the procedure as laid down in Section 3 of Municipal Act, 1973. It was further provided that the Municipalities already existing on the commencement of the Haryana Municipal (Amendment) Act, 1994 would be deemed to have been constituted and notified as such under and in accordance with the provisions of this Section. A further proviso has been added in Section 2-A of the Haryana Municipal Act, amended in 1994, which reads as under :- “Provided further that the State Government may, after giving a reasonable notice of not less than thirty days of its intention to do so, amend the Schedule, by notification and declare any Municipal Committee as a Municipal Council or any Municipal Council as a Municipal Committee.” It was pleaded that as per Section 2-A of the 1973 Act the State Government was required to issue a reasonable notice of not less than thirty days of its intention to declare a Municipal Committee as Council but with regard to creation of Municipal Corporation, the Haryana Municipal Civil Writ Petition No. 2493 of 2010 Civil Writ Petition No. 5149 of 2010 & Civil Writ Petition No. 5235 of 2010 -6- Corporation Act, 1994 (for brevity, 'the 1994 Act') has been brought on the statute book. Section 3 of the 1994 Act has been relied upon in this regard which reads as under :- “3. Declaration of Municipal area as Corporation - (1) From the 31st of May, 1994, the Municipal Corporation of Faridabad shall be deemed to have been declared as such for the Municipal Area specified in the first schedule appended to this Act. (2) The Government may, from time to time, by notification in the Official Gazette, declare any municipality including area comprising rural area or a part thereof, if any, to be a Corporation known as “the Municipal Corporation of _______________ (name of the Corporation): Provided that no municipality including area, comprising rural area or a part thereof, if any, shall be so declared to be a Corporation unless the population thereof is three lacs or more. (3) The Government may, from time to time after consultation with the Corporation, by notification in the official Gazette, alter the limits of the Municipal area of the Corporation declared under sub-sections (1) and (2) so as to include therein or exclude there from such areas as may be specified in the notification. (4) When the limits of the Municipal areas are altered, so as Civil Writ Petition No. 2493 of 2010 Civil Writ Petition No. 5149 of 2010 & Civil Writ Petition No. 5235 of 2010 -7- to include therein any area, except as the Government may otherwise by notification, direct, all rules, regulation, notifications, bye laws, order, directions and powers issued or conferred and all taxes imposed under this Act; and in force in the Municipal area shall apply to such area. (5) When a local area is excluded from the Corporation under sub-section (3) - (a) this Act, and all notifications, rules, bye-laws, orders, directions and powers issued, made or conferred under this Act, shall cease to apply thereto; and (b) the Government shall after consulting the Corporation, frame a scheme determining what portion of the balance of the Corporation fund and other property vesting in the municipal Corporation shall vest in the Government and in what manner the liabilities of the Corporation shall be apportioned between the Corporation and the Government, and, on the scheme, being notified, the property and liabilities shall vest and be apportioned accordingly.” The petitioners have averred that though the Government, from time to time, could declare any Municipality including the area comprising of rural area or part thereof to be Corporation known as Municipal Corporation, but it could not have joined two or more than two Civil Writ Petition No. 2493 of 2010 Civil Writ Petition No. 5149 of 2010 & Civil Writ Petition No. 5235 of 2010 -8- Municipalities. They have also asserted that the villages could also not be clubbed because they could not be termed as rural area as defined under the provision of the 1994 Act. In this regard reference has been made to the definition of the Rural Area as mentioned in Section 2 (51) of the 1994 Act which reads as under :- “Rural area” means the part of the Municipal area which immediately before their inclusion within the limits of the Municipal area were situated within the local limits of Gram Panchayat but shall not include such portion thereof as may, by virtue of a notification under section 413 ceases to be included in the rural areas as herein defined.” By referring to the aforesaid section, the petitioners have urged that the area of 42 villages which is being added now to clear the eligibility test with regard to population for converting the Municipal Council into Corporation would not be considered as rural area. They further urged that the village Panchayats could only be dissolved by specific notification and in the absence of such notification they could still work and do not cease to be village Panchayats and area cannot be termed as merged in the Municipal Corporation. The petitioners further urged that a Municipality could be upgraded to make it a Municipal Corporation but a number of Municipalities could not be dumped altogether to create a Municipal Corporation, but only the Metropolitan area as defined under Article 243(P) (c) of the Constitution could include two or more Municipalities. In this Civil Writ Petition No. 2493 of 2010 Civil Writ Petition No. 5149 of 2010 & Civil Writ Petition No. 5235 of 2010 -9- regard, they have referred to Section 2 (29) of the 1994 Act which is reproduced as under :- “2 (29) “Metropolitan area” means an area having a population of ten lakhs or more, comprised in one or more districts and constituting of two or more municipalities or panchayats or other contiguous areas, specified by the Government by notification in the Official Gazette to be the metropolitan area for the purposes of this Act.” Thus, the areas have been segregated and named differently for the purposes of administration on population basis. The Municipal Corporation could be declared for the area having population of three lacs or more whereas, the Metropolitan area could be declared having population of more than ten lacs. Thus, it was urged by the learned counsel for the petitiones that on combined reading of Section 3 of 1994 Act, the Government could declare any Municipality including the area comprising in rural area or part thereof to be a Corporation. In this regard, the Government though could propose to declare an area as a Municipal Corporation but for altering the limits of the Municipal area of the Corporation, the Government was to consult the Municipal Corporation and then to declare by the notification with regard to alteration of its limits. Thereafter, the Government after deciding the objections invited by it, is required to issue second notification for declaring an area as Municipal Corporation. The notification also required to specify the applicability of all the rules and regulations in force including the bye-laws, orders, Civil Writ Petition No. 2493 of 2010 Civil Writ Petition No. 5149 of 2010 & Civil Writ Petition No. 5235 of 2010 -10- directions as also powers conferred and all taxes imposed under the 1994 Act. It has been agitated by the petitioners that the population was the sole basis to upgrade the Municipal Committee to Municipal Council and from Municipal Council as Corporation and from Municipal Corporation to Metropolitan area. The Article 243P (g) of part IX (a) of the Constitution further envisages to make the population of the preceding census as the basis for making such declaration. Under Article 243P (g), the word “population” has been defined as under :- “population” means the population as ascertained in the last preceding census of which the relevant figures have been published.” While referring to the last census conducted in the year 2001, the learned counsel for the petitioners has referred to the Statistical Abstract of Haryana Gazette published in 2005-06 issued by the Economic and Statistical Adviser, Planning Department, Government of Haryana, according to which, the rural and urban population of Panchkula, Kalka and Pinjore is as under :- City Population within Municipal Committee Councils/Corporations Limits (Census, 2001) Kalka : 30887 Pinjore : 29766 Panchkula : 140992 Total 201645 Civil Writ Petition No. 2493 of 2010 Civil Writ Petition No. 5149 of 2010 & Civil Writ Petition No. 5235 of 2010 -11- Thus, It has been averred that according to the last census of three towns, their total population comes to 201645 and at best population of 42 villages, which is 80328, could be added to bring the Corporation into existence. But these villages do not form the part of the rural area as defined under Section 2 (51) of the 1994 Act. It is averred that the creation of the Corporation is in violation of the Government of India instructions dated 22.9.2009 (Annexure P-1) issued to all the State Governments wherein it was clearly stated that there should not be any change in the boundaries of administrative blocks after 1.1.2010 for conducting census for the next decade i.e. 2010-11. The said instructions were forwarded to the Government of Haryana vide memo dated 24.11.2009 (Annexure P-2) issued by the Financial Commissioner-cum-Principal Secretary, Government of Haryana to the Director Urban Local Bodies, Haryana wherein it is clearly mentioned that there should not be any change in the boundaries of administrative blocks after 1.1.2010. They have referred before us a copy of the said memo dated 24.11.2009 (Annexure P-2). They have further asserted that the Government of Haryana issued notification dated 12.1.2010 conveying its decision freezing all the boundaries of all the Districts, Towns, Tehsils, Villages etc. from 1.1.2010 till 31.3.2011 to facilitate the Haryana Government to undertake census operations. The notification in this regard has been referred as Annexure P-3. It is further asserted that the guidelines and the criteria issued by the Government of Haryana for the formation of the Municipal Corporation has been formulated keeping in view Section 12 of the 1994 Civil Writ Petition No. 2493 of 2010 Civil Writ Petition No. 5149 of 2010 & Civil Writ Petition No. 5235 of 2010 -12- Act as well as Article 243 (u) of the Constitution of India. The relevant guidelines, as referred, indicate as under :- “The Government while forming the Municipal Corporation should keep in mind the urban character of the area : (a) The people of the area to be included should predominantly be engaged in non agricultural activities to the extent of 60%. (b) The said character can be determined only on the basis of the population determined as per the last census which in the present case was conducted in the year 2001. Thus, in the absence of assessment by the authorities, regarding the involvement of 60% of the population of the area in non agricultural activities, such an area could not be added in the Municipal Corporation. It was next submitted that in order to constitute the Municipal Corporation, Gram Panchayats to be inducted in the Corporation were also required to pass resolution to that effect followed by recommendation of the concerned Divisional Commissioner. According to the learned counsel this is true interpretation of Section 12 of the 1994 Act as well as guidelines issued under Article 243(U) of the Constitution. The other submission made by the petitioners is that neither any opportunity of hearing to the residents of the area which is to be added was afforded nor any resolution till date has been passed by the municipalities as well as gram panchayats (except few of them) submitting themselves to be a part of the Municipal Corporation, but the State Government has straightway issued a notification without following the procedure as well as Civil Writ Petition No. 2493 of 2010 Civil Writ Petition No. 5149 of 2010 & Civil Writ Petition No. 5235 of 2010 -13- guidelines issued by it on 1.1.2010 vide order dated 18.1.2010. It has also been submitted that vide notification dated 17.3.2010 the State Government not only declared the Panchkula Municipal Council as Corporation but also combined two other Municipal Committees i.e. Pinjore, Kalka and 42 other villages so also the reserved and protected forest area was made part of the urban area, which has been challenged in another writ petition No.3097 of 2009 Vijay Bansal vs. State of Haryana. The Union of India in the said case has already submitted its reply and has clearly taken the stand that no clearance has been taken by the State of Haryana before declaring the Panchkula, Pinjore and Kalka as Urban Complex. The petitioners are actually not averse to the formation of the Panchkula Municipal Corporation up to the extent that it should be done only after taking census already under process 2011 and in that case only area of Panchkula Municipal Council and surrounding areas falling in the vicinity of Panchkula Municipal Council, could serve to declare the Municipal Corporation. It is also submitted that an anomalous situation has been created by virtue of notification dated 17.1.2010 while adding two urban areas namely Pinjore and Kalka and 42 other villages and also had disturbed the census process. Learned counsel has brought to our notice that the increasing trend of population i.e. 50.91% as per census of 2001 addition of two Municipalities and villages was not warranted by law because merger of the area of Panchkula town and surrounding areas around it, would itself be sufficient to form as Municipal Corporation without further merging other urban areas of Kalka and Pinjore in the year 2011. Ultimately while impugning the aforesaid two notifications, the learned Civil Writ Petition No. 2493 of 2010 Civil Writ Petition No. 5149 of 2010 & Civil Writ Petition No. 5235 of 2010 -14- counsel has submitted that the same be declared illegal and void. Replies to the writ petitions have been filed wherein the legal provisions as incorporated under the 1973 Act as well as the 1994 Act have not been disputed. However, it was submitted that total population of the area to be added comes to 3.18 lacs. As per present population the estimated growth is 4.66 lacs, therefore, the State Government was fully competent to constitute the aforesaid Corporation. It has further been asserted that provisions of Article 243(P) (g) of the Constitution, Section 2(a) of the 1973 Act and also Section 4 of the 1994 Act have been fully complied with by the Government before issuing notification concerning declaration of the Panchkula Municipal Corporation. As regards the violation of the orders issued vide notification dated 22.9.2009 and the subsequent letter issued by the State Government on 24.11.2009, it has been stated that these instructions were issued to facilitate the census work and it has nothing to do with the notification in question. It has been further explained that the matter has been discussed with the Director General-cum-Census Commissioner of India who has agreed that the Census Department has no objection to the formation of the Corporation if the census operations are carried out smoothly. The Census Department has been assured that no boundaries were to be changed by formation of Corporation and the work would go on smoothly. It has also been submitted that the formation of the Corporation does not violate any provisions of the Constitution. After formation of the Municipal Corporation, Panchkula, it would be feasible to undertake larger number of development works which would be in the larger interest of the public as some of the schemes which can only be Civil Writ Petition No. 2493 of 2010 Civil Writ Petition No. 5149 of 2010 & Civil Writ Petition No. 5235 of 2010 -15- executed in the larger urban area i.e. Municipal Corporation, as the funding of the Municipal Corporation is better than the Municipal Council or the Committee. The Government of India has desired to introduce city development plan under JNNURM Scheme for Panchkula City. With the indication of the said scheme huge funds would be drained out for development of the Panchkula city which would be fruitful for greater development of the infrastructure and also to serve the public interest. It has also been mentioned that the Haryana Urban Development Authority in its Panchkula extension scheme has also extended residential/commercial sectors adjoining to the Pinjore town. With regard to the population, as per census 2001, the respondents have submitted that while adding the population of 42 villages i.e. 80328, it comes to 314657 as per census 2001 which is required for creating the Municipal Corporation, Panchkula.. As such, there is no bar on the creation of the corporation at Panchkula. In reply to para No.10 of the writ petition it is submitted that guidelines issued vide letter dated 1.1.2010 had been duly complied with and the factors of non agricultural activities to the extent of 60% has already been determined on the basis of the last census 2001. Accordingly, notification for formation of Municipal Corporation, Panchkula has been issued strictly as per the relevant provisions of law. The respondents have also placed on record the details of the total population as per census of 2001 for Panchkula Municipal Council as well as Pinjore and Kalka Municipal Committees and also 42 Panchayats. A rejoinder to the written statement has also been filed wherein the petitioners have reiterated the allegations while further adding that Civil Writ Petition No. 2493 of 2010 Civil Writ Petition No. 5149 of 2010 & Civil Writ Petition No. 5235 of 2010 -16- before constituting