SCA/15403/2006 1/63 JUDGMENT IN THE HIGH COURT OF GUJARAT AT AHMEDABAD SPECIAL CIVIL APPLICATION Nos. 15403 to 15405 of 2006 With SPECIAL CIVIL APPLICATION Nos. 16146 to 16156 of 2006 With SPECIAL CIVIL APPLICATION Nos. 18395 to 18403 of 2006 With SPECIAL CIVIL APPLICATION Nos. 18385 to 18394 of 2006 with CIVIL APPLICATION Nos.9107 to 9109 of 2006 For Approval and Signature: HONOURABLE MR.JUSTICE JAYANT PATEL ========================================================= 1 Whether Reporters of Local Papers may be allowed to see the judgment ? 2 To be referred to the Reporter or not ? 3 Whether their Lordships wish to see the fair copy of the judgment ? 4 Whether this case involves a substantial question of law as to the interpretation of the constitution of India, 1950 or any order made thereunder ? 5 Whether it is to be circulated to the civil judge ? ========================================================= VITHALBHAI HANSARAJBHAI RADADIYA & 11 - Petitioner(s) Versus STATE OF GUJARAT & 4 - Respondent(s) ========================================================= Appearance : M/S THAKKAR ASSOC. for Petitioner(s) : 1 - 12. GOVERNMENT PLEADER for Respondent(s) : 1, RULE NOT RECD BACK for Respondent(s) : 1 - 5. ========================================================= CORAM : HONOURABLE MR.JUSTICE JAYANT PATEL SCA/15403/2006 2/63 JUDGMENT Date : 28/09/2006 COMMON ORAL JUDGMENT 1. As all matters are interconnected and common questions arise for consideration and hence, they are being considered by this common judgment. 2. I have heard the learned counsels appearing for petitioners Mr. S.N. Shelat with Mr. Champaner, Mr. P.M. Thakkar with Mr. Pahwa, Mr. N.D. Nanavati with Mr. Rawal, as well as Mr. Mihir Joshi, learned Additional Advocate General with Mr. Sunit Shah, learned Government Pleader and Mr. Mengdey, learned AGP for State Authorities, for final disposal. I have also heard Mr. Tushar Mehta for the applicant of Civil Application No. 9107 to 9109 of 2006. 3. Special Civil Application No. 15404 of 2006 and the petitions connected therewith is a group of petitions preferred by the Cooperative Societies through its Chairman, Sarpanchs of Gram SCA/15403/2006 3/63 JUDGMENT Panchayats situated in Lodhika Taluka for challenging the action of the State Government by the notification dated 24.07.2006, whereby the APMC Rajkot, which was formerly comprising of the market area of three revenue Taluks viz. Rajkot Taluka, Lodhika Taluka and Paddhari Taluka is divided into APMC Rajkot-Lodhika and APMC Paddhari and by the said notification, the order is also passed by the State Government for nominating various persons as per Schedule-A in APMC Rajkot-Lodhika and as per Schedule-II in APMC Paddhari. 4. Special Civil Application No. 15403 of 2006 and connected petitions are preferred by the elected member of APMC Rajkot for challenging the very notification of the State Government dated 24.07.2006 for division of the Market Committee and for nomination of various persons in APMC, Rajkot-Lodhika and APMC Paddhari. 5. Special Civil Application No. 15405 and connected petitions are preferred by various SCA/15403/2006 4/63 JUDGMENT Cooperative Societies through its Chairman/President and Sarpanchs of the Gram Panchayats situated in various villages of Paddhari Taluka of Rajkot District challenging the very notification of the State Government for division of APMC Rajkot into APMC Rajkot- Lodhika and APMC Paddhari and the nomination of certain persons as members in APMC Rajkot- Lodhika and APMC Paddhari. 6. The short facts relevant for the petitions are as under: 7. In January 2004, the election of the APMC Rajkot was held. However, it is the case of the petitioners that as the ruling party at the State Government level did not succeed in procuring the majority, the first meeting of the Market Committee so as to enable the duly elected member to assume the office, was not held and the said meeting was stayed at the dictate of the ruling political party. Thereafter, on 20.03.2004, the first meeting of SCA/15403/2006 5/63 JUDGMENT APMC Rajkot was held and the election of Chairman and Vice Chairman was held at the said meeting. The statutory term of the Market Committee as per the provisions of the Gujarat Agricultural Produce Markets Act, 1963 (hereinafter referred to as 'the Act'), is 4 years coupled with the power of extension of 1 year with the State Government. Therefore, if the period of 4 years is counted, the statutory term would expire on 19th March, 2008. It is the case of the petitioners in these petitions that the Chairman of the APMC Rajkot, is belonging to a Congress Party, the rival group and is also sitting MLA of the Jamkandorna constitutency in Rajkot district. It is further the case of the petitioners that the Chairman of APMC Rajkot was also the Chairman of Rajkot District Cooperative Bank Ltd., a District level Cooperative Bank in Rajkot district. It is further the case of the petitioners in these petitions that when the election of Rajkot District Cooperative Bank was ensued, the President of the ruling political party of Rajkot and former MLA of the ruling SCA/15403/2006 6/63 JUDGMENT political party requested for sharing of the seats in the Managing Committee of the Bank to the Chairman of the APMC. However, as per the petitioners, since the Chairman of APMC, Rajkot refused to oblige, the Chairman of APMC Rajkot was threatened that the Government would take appropriate action against APMC Rajkot as well as against the District Cooperative Bank with a view to see that the elected persons are out by abusing the process of law. It is the case of the petitioners in these petitions that out of such ill-motive, there was initiation of the process for bifurcation of APMC Rajkot. 8. On 08.06.2006, a preliminary notification was published to declare the intention of the Government to bifurcate APMC Rajkot, creating separate Market Committees for each Taluka. At that stage, as per the petitioners, as an outcome of the political vendetta, the action was also initiated by the Director, Agricultural Marketing, under Section 47 of the Act. As per the petitioners, there are also various actions SCA/15403/2006 7/63 JUDGMENT taken in connection with the elections of the District Cooperative Bank, which is subject matter of the other petitions before this Court and as per petitioners, this Court in the said petitions has granted protection against the illegal exercise of power by the State Authorities at the dictate of the ruling political party. The petitioners had challenged the action of the State Government declaring its intention to bifurcate APMC, Rajkot. However, as final notification was yet to be published after consideration of the matter by the State Government, such petitions were withdrawn. It is further case of the petitioners in these petitions that in the process of consideration of the matter by the State Government for bifurcation of the Market Committee, 47 Gram Panchayats out of 57 Gram Panchayat of Paddhari Taluka objected to the division of the Market Committee. Even 24 Cooperative Societies of Paddhari Taluka out of 29 objected to the division of the Market Committee and there are two sales and purchase Union in Paddhari Taluka, SCA/15403/2006 8/63 JUDGMENT who objected to the bifurcation of the Market Committee. As per the petitioners, even for Lodhika Taluka, out of 38 Gram Panchayats, 35 Gram Panchayts objected to the bifurcation and 18 Cooperative Societies also objected bifurcation. For Rajkot Taluka, out of 94 Gram Panchayats, 57 Gram Panchayats objected to the bifurcation and 33 Cooperative Societies out of 38 Cooperative Societies objected to the bifurcation and one sales and purchase Union in Rajkot Taluka also objected to such bifurcation. As per the petitioners, inspite of such objections and resistance by more than majority of the persons who are concerned with the function of the Market Committee, as the State Government was to exercise the power with political vendetta, the decision is taken for bifurcation of the Market Committee, consequently resulting into ousting the elected member from power and inducting the persons who are political supporters of the ruling party, though they are not holding the basic qualification or eligibility to be appointed as SCA/15403/2006 9/63 JUDGMENT a member of the Market Committee. It is further case of the petitioners that out of the persons who are nominated by the State Government, though are belonging to the ruling party, are such persons who have contested the election and lost at the election of the market committee and the attempt on the part of the Government is to usurp the power by executive fiat and to induct the persons who are not having the mandate of voters. The contention of the petitioners on facts is that there is no bonafide purpose at all in exercising the power of bifurcation by the State Government and the same is nothing but an out product of the political vendetta on the part of the ruling party at the State level. 9. On the questions of law, the petitioners have raised various contentions inter alia that even for exercising of the power under Section 52 of the Act, it is required for the State Government to exercise the power objectively and at that stage, since the procedure required under Section 5 of declaration of the intention SCA/15403/2006 10/63 JUDGMENT inviting objections and its consideration thereof, are mandatory requirement. It was required for the State Government to exercise the power by holding necessary inquiry also, if required, and thereafter, only the decision could be taken. However, the submission on the part of the petitioners is that such mandatory procedure of consideration of the objections filed by the majority of the persons who were to be affected by the bifurcation are not considered nor any inquiry whatsoever is held by the State Government before issuing the final notification for bifurcation of APMC Rajkot. It is also the contention on the part of the petitioners that though there are powers with the State Government under Section 52 of the Act, such powers can be exercised, even if having quasi legislative character, by a procedure provided by the legislature and if such procedure is not followed, even such legislative action can be struck-down. 10.It was also submitted on behalf of the SCA/15403/2006 11/63 JUDGMENT petitioners that the intention of the State Government is apparent from the simultaneous conduct of exercise of the executive power in the very notification by excluding the elected representative of the dissolved market committee and by nominated persons, who are politically supporters of the ruling party. It was submitted that as per the requirement of Section 54, and more particularly Section 54(2) of the Act, there is a legislative mandate to consider and to nominate the elected member of the dissolved market committee as far as practicable and neither in the notification nor in the record of the Government, there is consideration of such aspects by the Government. It was also submitted on behalf of the petitioners that it is only when the Government finds that it is not practicable to nominate the elected member of the dissolved market committee then only the other persons can be nominated. However, such persons who are to be nominated must hold the basic eligibility criteria for being elected and they should not be the persons who had lost at SCA/15403/2006 12/63 JUDGMENT the election of the market committee or who are not even holding the general license or who are only supporters of the ruling political party having no other qualification whatsoever. It has been submitted on behalf of the petitioners that the persons who are nominated includes the supporters of the ruling party and one of the person is an ex-MLA of the ruling political party and therefore, it was submitted that the aforesaid totality of the circumstance goes to show that the power is not exercised with any bonafide intention but is with malafide purpose of ousting the elected member belonging to opposite political party and to usurp the power by executive fiat and to induct the persons who are sympathizer or supporter of the ruling political party. Therefore, it was submitted that the whole exercise of bifurcation and of nomination is illegal and deserves to be struck- down by this Court. 11.On behalf of the State Government and other State Authorities, affidavit-in-reply is filed SCA/15403/2006 13/63 JUDGMENT by Shri A.M. Patel, Deputy Secretary, Agricultural and Cooperation Department. In para 6 of the affidavit-in-reply, it has been stated that the notification dated 08.06.2006 inviting suggestions and objections as contemplated under Section 5 of the Act qua the said bifurcation was declared and therefore, the requirement under Section 5 of the Act was fulfilled. It has been further stated that the State Government has in exercise of the powers under Section 52 of the Act, vide notification dated 24.07.2006, resolved to bifurcate the earlier Rajkot Agricultural Produce Market Committee into APMC Rajkot and APMC Paddhari. In para 8 of the affidavit in reply, it has been stated that it is not correct on the part of the petitioner to contend that the State Government has exercised the power under Section 52 of the Act with malafide intention and with extraneous motives of capturing the power of the earlier Rajkot APMC. It is further stated that it is not correct that such exercise is carried out with ulterior motive or those who have been SCA/15403/2006 14/63 JUDGMENT defeated by the electorate to capture power in the market by misusing the official machinery. In para 13 of the affidavit-in-reply, it has been stated that if the State Government forms an opinion that it is practicable to nominate the members of the market committee in the newly constituted market committee, then the State Government is required to appoint such persons as members of newly constituted market committee. It is further stated that as serious complaints are received by the Directors of very serious financial irregularities, alleged to have been committed by the members and office bearers of the dissolved market committee and pursuant to the said complaint, the Director has instructed the Deputy Director and the District Registrar, Rajkot for looking into the said matter and as the District Registrar has initiated inquiry under Section 47 read with Section 44 of the Act, and also submitted his preliminary report dated 14.06.2006 to the Director, according to which, it is found that there is substance in the complaint made against SCA/15403/2006 15/63 JUDGMENT the members of the dissolved market committee. It is further stated that one member of the dissolved market committee viz. Popatbhai Tolia, who was nominated member of the Rajkot APMC, has also submitted his complaint against the earlier body on various occasions to the State Government as well as to the Director and other authorities and the tenor of the affidavit shows that as serious complaints are received against the elected members of the dissolved market committee and is being investigated and as there is also preliminary report, the Government has decided not to nominate such persons as members of the newly constituted market committee. In paragraph 15 of the affidavit-in-reply, it has been stated that the answering respondent has nominated the members of the newly constituted market committee subject to their fulfilling the criteria for such nomination and if after due scrutiny it is found by the respondent that any of the nominated member does not qualify for being nominated as such will be replaced by the qualified person in due process. In support of SCA/15403/2006 16/63 JUDGMENT the affidavit-in-reply, which is filed on 02.08.2006, the complaint received against the elected member of the APMC Rajkot, the orders passed under Section 44 of the Act, the preliminary report etc. are produced. 12.The contention as sought to be canvassed on behalf of the respondent State Authorities is that when the exercise of the power is as quasi legislative action, the scope of judicial scrutiny would be limited and the Court may not be in a position to examine the adequacy of the material before the State Government while exercising the power, which is having the character of quasi legislative action. It was submitted that it is not a matter where the State Government has exercised the power of bifurcation without there being any material whatsoever. The allegations of malafide are without there being any basis and therefore, the same may not be taken into consideration and the contention on the part of the State Authority is that the action by the State SCA/15403/2006 17/63 JUDGMENT Government of bifurcation and of excluding the nomination of the elected member of the dissolved market committee and of nomination of other persons as per the notification is legal and valid. 13.Before the Court proceeds to consider the matter further, certain developments pending the petition deserves to be recorded and the same inter alia is that when the matters came to be considered for the first time on 28.07.2006, this Court had passed the following order: “2. The learned Counsel appearing for the petitioners undertake that one-page petition for removal office objections shall be filed latest by Monday, the 31st July, 2006 and they also pray that they may be permitted to implead the parties against whom the allegations of political malafides are made. Permission granted. 3. Heard Mr.Shelat, learned Counsel appearing with Mr.Champaneri, learned Counsel, Mr.Prakash Thakkar, learned Counsel appearing with Mr.Pahwa, learned Counsel, Mr.Nanavati, learned Counsel appearing with Mr.Samir Bundela, learned Counsel for Mr.H.P.Raval, and Mr.Mihir Joshi, learned Additional Advocate General appearing with Mr.Mengdey, learned AGP. 4. Notice returnable on 3.8.2006. SCA/15403/2006 18/63 JUDGMENT Mr.Joshi, learned Additional Advocate General seeks time to file reply on behalf of the respondent State. S O to 3.8.2006. 5. The learned Counsel appearing for the petitioners press for ad-interim relief at this stage, restraining the nominated members from functioning. 6. I would have recorded the reasons for considering the matter for ad-interim relief, however, Mr.Joshi, learned Additional Advocate General has not invited the reasons and, therefore, I find it proper not to record the reasons at this stage. Suffice it to say that until further orders, the nominated members of the Market Committee in question shall not be permitted to assume office and the Administrator, who is holding the charge, as on today, shall continue to hold the charge of the Market Committee.” 14.Thereafter, the State Government filed the reply. Not only that but the original file was made available to the Court for perusal and at the admission stage, after hearing the learned counsel appearing for both the sides at length, this Court had on 11.08.2006, passed the following order: “1. Upon hearing Mr. Shelat with Mr. Champaneri, Mr. P.M. Thakkar with Mr. Pahwa, Mr. N.D. Nanavati with Mr. Rawal for the petitioners and Mr. Mihir Joshi, learned Additional Advocate General with Mr. Mengdey, learned AGP on behalf of the State SCA/15403/2006 19/63 JUDGMENT Authorities and Mr. Ketan Shah for the applicants of Civil Application Nos. 9107 of 2006, 9108 of 2006 and 9109 of 2006, it prima facie appears that the purported exercise of the power is under Section 52 of the Gujarat Agricultural Produce Market Act (hereinafter referred to as the 'the Act') for division of APMC Rajkot into APMC Rajkot-Lodhika and APMC Padadhari. It does appear that the exercise of the power by the State Government is essentially a subordinate legislative function and therefore, as per the settled legal position, one of the judicial scrutiny shall be restricted to the procedure to be followed for such legislative action as provided in the statute itself. If Section 5 is read with Section 6 of the Act, it provides for declaration of the intention of inviting objections and consideration of the suggestions and also inquiry as may be necessary, but all by the State Government. It prima facie appears that in the affidavit-in-reply, except bare statement that all objections including the objections and suggestions of the local authority were duly considered before issuing the final notification, no other details are mentioned. There are serious allegations of political malafides and as there are allegations that the action is tainted with the political malafides, this Court had directed to the State Government to make available the original file and the record of the original file prima facie shows that the proposal for division of APMC Rajkot- Lodhika and APMC Padadhari was moved long back and initially, in the month of March 1999, the decision was taken not to divide the Market Committee. Thereafter, it appears that once again, the matter was considered by the State Government and on 19.06.2002, the decision was taken to close the division for the present of the Market Committee. Not only that, but thereafter, the term of the elected Body as then was SCA/15403/2006 20/63 JUDGMENT holding the charge was extended by the State Government and the election also came to be declared. It is not in dispute that the last election was held somewhere in the year 2004 and the statutory term of the elected Body of APMC Rajkot comprising of three talukas viz. Rajkot, Lodhika and Padadhari was to expire in the year 2008, had the division not been there. 2. It prima facie appears that again somewhere in the month of March 2006, at the instance of Shri Haribhai Patel, Member of Parliament, Porbandar Constituency, the State Government once again considered the matter as the letter was addressed by the said MP to the State Government and the intention for division was declared thereafter. It is the contention of the petitioners that out of 57 Gram Panchayat of Padadhari Taluka, 47 Gram Panchayat opposed to the division. It is also the contention of the petitioners that out of 29 Cooperative Societies of Padadhari Taluka, 24 objected to the division. It is also the contention of the petitioners that for Lodhika Taluka, out of 38 Gram Panchayats, 25 objected to the division and out of 18 Cooperative Societies, all objected. Similarly, for Rajkot Taluka, out of 94 Gram Panchayats, 57 objected to the division and out of 38 Cooperative Societies, 37 objected to the division and one Sales and Purchase Union of Rajkot Taluka also objected to the division. 3. The original file shows that the objections were filed. However, the file also shows that many persons, including the Gram Panchayat and Cooperative Societies supported the division. To what extent it may have the bearing to the decision or whether the decision of the Government would be vitiated on account of not accepting the objections would be an aspect, which may be considered by the Court at the time of final SCA/15403/2006 21/63 JUDGMENT disposal. However, prima facie it appears that the exercise of power for division is not without consideration of the material on record. If the State Government has exercised the power for division of Market Committee after the aforesaid consideration, prima facie, it cannot be said that the exercise of power for division of the Market Committee of separating the Padadhari Taluka from Rajkot-Lodhika is without following the statutory requirement for such legislative action. It is true that the original file of the State Government does contain the letter of the Shri Haribhai Patel, Member of Parliament, Porbandar constituency dated 01.02.2006, the letter of Hon'ble Chief Minister dated 23.02.2006, forwarding of the letter of the said Member of Parliament to the Secretary of the Co-operation Department, the forwarding letter of the concerned Minister for Cooperation Department dated 01.03.2006, the letter dated 01.02.2006 of Shri Mohanbhai Kandaria,MLA, 14-Tankara-Padadhari Constituency, the copy of the letter dated 30.06.2006 of Shri Vithalbhai H. Radadia, who is one of the petitioner herein and MLA of Dhoraji-Jamkandorna, addressed to Hon'ble Governor of the Gujarat State objecting to the division of the Market Committee and the letter dated 24.07.2006 of the concerned Minister for Cooperation Department for appointment of certain persons as nominated member of the new Market Committee. Therefore, it prima facie appears that even if the action for division is moved or supported by the persons belonging to the ruling party in the State or objected by one of the petitioner belonging to the political party in opposition in the State, it is not a matter where the exercise of the power by the