Case: Municipal Committee, Amritsar &amp; Ors Vs. State Of Punjab &amp; Anr

wholly void and illegal.11. Under Section 6 of the Act it is only after the local authority has passed a resolution under Section 3 or the State Government has taken over management of the aided schools under Section 5 that Sections 52 and 59 of the Punjab Municipal Act would be deemed to have been amended in the manner specified in the schedule with effect from October 1, 1957, or from the date aided schools are taken over as the case may be. If the notification dated September 26, 1960 could not be given retrospective operation, the amendments in the aforesaid provisions of the Punjab Municipal Act would be effective only after the date of the notification and not for the prior period. Thus even on the assumption that the provisions of the Act are valid the State could not ask for any contribution from the Committee for the period prior to the date of the notification.But the addition of Clause (g) after Clause (f) in sub-section (1) of Section 52 of the Punjab Municipal Act is void and wholly ineffective for the reasons which will be presently noticed.12. Chapter IV of the Punjab Municipal Act relates to municipal fund and property. Section 51 deals with the constitution of the municipal fund. Section 52 provides for the application of the fund. Before the amendment made by the Act sub-section (1) had six clauses containing the provisions for the application of the fund. It is noteworthy that although the State Government has been empowered to require the Committee to make contributions but in each case that is confined to an eventuality or a situation where certain cost has been incurred by the Government which had to be defrayed by the Committee, e.g, Clause (b), (d) and (f). According to Clause (e), however, the Committee may be required by the State Government to contribute towards the maintenance of pauper lunatics or lepers sent from any place in the State to mental has haspitals or public asylums whether in or outside the State. Sub-section (2) says that subject to the charges specified in sub-section (1) the municipal fund shall be applicable to the payable of the matters set out in Clauses (a) to (1). Clause (c) is in these terms:"the constitution, establishment and maintenance of schools, hospitals and dispensaries, and other institutions for the promotion of education or for the benefit of the public health .........."In the context of Section 52 it is difficult to envisage that the municipal fund of a particular Committee could be diverted to such institutions which had no connection with the Committee. We are, however, not called upon to pronounce upon the true scope, ambit and validity of all the provisions in Section 52.Clause (g) which has now been inserted by means of Section 6 of the Act has to be tested by the guarantees in Part III of the Constitution. By asking the Committee to make contribution from its funds to the cost of the schools which have been taken over by the State part of its funds are being compulsorily acquired by the State.This is something which could not be done except in accordance with the provisions contained in Art. 31 (2) of the Constitution. In Writ Petn. No. 295 of 1968, D/- 30-1-1969 = (reported in AIR 1969 SC 1100 ), Municipal Committee, Amritsar v. State of Punjab in which the provisions of the Punjab Cattle Fairs (Regulation) Act, 1968 came up for examination, it was laid down by this Court that the State was incompetent to declare land belonging to the Municipal Committee as falling within the fair area and to take possession of that land in exercise of the power conferred by the Act without providing for payment of compensation guaranteed by Article 31 (2).Clause (g), therefore which has been inserted in Section 52 of the Punjab Municipal Act is void and illegal as it contravenes Article 31 (2) of the Constitution.13. It may be mentioned that the learned Attorney General has also pointed out that the State legislature did not have the competence, under any of the entries in List II of the Seventh Schedule, to enact legislation of the nature embodied in Clause (g) which was inserted in Section 52 relating to compulsory contribution by the Committee to the State Government. Counsel for the State has sought to rely on Entries 5 and 11 in List II which relate to local Government and education. It is unnecessary to decide this matter since it has been held by us that the impugned provisions with regard to contribution contravene Article 31 (2) of the Constitution.14. We may now determine the provisions of the Act which are unconstitutional and invalid. There is nothing in Section 3 (1), 4 and 5 of the Act per se which would bring them into conflict with the constitutional provisions, particularly,in view of Article 31-A (1) (b) under which the management of the schools could be taken over by the State for a limited period in public interest. But the difficulty arises about Sections 3 (2) and 6 which have to be read together. When the State Government makes a direction under Section 3 (2) that the aided schools shall be taken over all rights and interests of the Committee including the rights of maintenance, management and control shall be transferred to and vest in the State Government. This essentially has reference to proprietary and ownership rights apart from the rights pertaining to management and control. Section 6 comes into operation as soon as a local authority has passed a resolution under Section 3 or the State Government has taken over management under Section 5. Then the provisions relating to acquisition of property of the Committee as also of its funds by way of contribution come immediately into operation by virtue of the amendments effected in Section 52 (1) and 59 of Punjab Municipal Act. These provisions are clearly unconstitutional as they contravene Article 31 (2) of the Constitution.

Decision (1 = appeal accepted, 0 = rejected): 1

Explanation:
1[ds]7. Under the above Article it is only the management of any property which can be taken over for a limited period either in the public interest or in order to secure its properall deference to the High Court we have not been able to properly appreciate the decision on this point given in the paragraph extracted above. The High Court did not consider the true import and effect of the amendment made in Section 59 of the Punjab Municipal Act by virtue of which all rights and interests in the lands, buildings, playgrounds, hostels of the schools as also in the movable property like furniture, books, apparatus, maps and equipment pertaining thereto shall be deemed to have been transferred to the State Government with effect from October 1, 1957. We are, therefore, unable to uphold the view which leads to the result that property can be acquired while taking over management and control under Article 31-A (1) (b) in complete negation and contravention of Article 31 (2) of the Constitution.As regards the notification having retrospective operation we are unable to agree with the High Court that any such effect could be given to it. There is nothing to indicate in the notification that it was intended to operate retrospectively.The mere fact that the Act in terms was retrospective would not make the notification issued under the proviso to Section 5 retrospective in the absence of express words or appropriate language from which retrospectively would be implied. All that the notification says is that the Governor of Punjab is taking over for a period of 10 years the management of the schools of the Committee in exercise of the powers conferred by the proviso to Section 5 of the Act. This clearly means that the management is taken were from the date of the notification and not from any prior date. It would follow that whatever was done before the date of the notification regarding the assumption of management and vesting of the Committees properties was wholly void and illegal.11. Under Section 6 of the Act it is only after the local authority has passed a resolution under Section 3 or the State Government has taken over management of the aided schools under Section 5 that Sections 52 and 59 of the Punjab Municipal Act would be deemed to have been amended in the manner specified in the schedule with effect from October 1, 1957, or from the date aided schools are taken over as the case may be. If the notification dated September 26, 1960 could not be given retrospective operation, the amendments in the aforesaid provisions of the Punjab Municipal Act would be effective only after the date of the notification and not for the prior period. Thus even on the assumption that the provisions of the Act are valid the State could not ask for any contribution from the Committee for the period prior to the date of the notification.But the addition of Clause (g) after Clause (f) in sub-section (1) of Section 52 of the Punjab Municipal Act is void and wholly ineffective for the reasons which will be presently noticed.12. Chapter IV of the Punjab Municipal Act relates to municipal fund and property. Section 51 deals with the constitution of the municipal fund. Section 52 provides for the application of the fund. Before the amendment made by the Act sub-section (1) had six clauses containing the provisions for the application of the fund. It is noteworthy that although the State Government has been empowered to require the Committee to make contributions but in each case that is confined to an eventuality or a situation where certain cost has been incurred by the Government which had to be defrayed by the Committee, e.g, Clause (b), (d) and (f). According to Clause (e), however, the Committee may be required by the State Government to contribute towards the maintenance of pauper lunatics or lepers sent from any place in the State to mental has haspitals or public asylums whether in or outside the State. Sub-section (2) says that subject to the charges specified in sub-section (1) the municipal fund shall be applicable to the payable of the matters set out in Clauses (a) tothe context of Section 52 it is difficult to envisage that the municipal fund of a particular Committee could be diverted to such institutions which had no connection with the Committee. We are, however, not called upon to pronounce upon the true scope, ambit and validity of all the provisions in Section 52.Clause (g) which has now been inserted by means of Section 6 of the Act has to be tested by the guarantees in Part III of the Constitution. By asking the Committee to make contribution from its funds to the cost of the schools which have been taken over by the State part of its funds are being compulsorily acquired by the State.This is something which could not be done except in accordance with the provisions contained in Art. 31 (2) of the(g), therefore which has been inserted in Section 52 of the Punjab Municipal Act is void and illegal as it contravenes Article 31 (2) of the Constitution.Constitution.14. We may now determine the provisions of the Act which are unconstitutional and invalid. There is nothing in Section 3 (1), 4 and 5 of the Act per se which would bring them into conflict with the constitutional provisions, particularly,in view of Article 31-A (1) (b) under which the management of the schools could be taken over by the State for a limited period in public interest. But the difficulty arises about Sections 3 (2) and 6 which have to be read together. When the State Government makes a direction under Section 3 (2) that the aided schools shall be taken over all rights and interests of the Committee including the rights of maintenance, management and control shall be transferred to and vest in the State Government. This essentially has reference to proprietary and ownership rights apart from the rights pertaining to management and control. Section 6 comes into operation as soon as a local authority has passed a resolution under Section 3 or the State Government has taken over management under Section 5. Then the provisions relating to acquisition of property of the Committee as also of its funds by way of contribution come immediately into operation by virtue of the amendments effected in Section 52 (1) and 59 of Punjab Municipal Act. These provisions are clearly unconstitutional as they contravene Article 31 (2) of the Constitution.The next question iswhether there was due compliance with the provisions of the proviso to Section 5 of the Act.In the notification which was issued on September 26, 1960 there is no indication that the management of the schools was being taken over because of certain emergency having arisen. If any emergency existed it was the creation of the government itself which had proceeded to take over the management and control of the aided schools along with the properties pertaining to them without any authority of law prior to the enactment of the Act. That was the reason why the Act had to be given retrospective operation. According to the High Court the moment the State Government was satisfied that it was in the interest of the students to take over the management of the schools it became a case of emergency. It also relied on the principle that it was not necessary to mention the actual emergency which had arisen in the notification itself or to make a recital that an emergency had arisen.The State could not show by placing material before the Court that it was a case of emergency justifying the action under the proviso to Section 5 because no foundation in this behalf had been laid in the writ petition. The third point pressed by the learned Attorney General, therefore, cannot be acceded to.