Case: STATE OF RAJASTHAN Vs. ASHOK KHETOLIYA &amp; ANR

with the constitutional provisions or without committing a breach thereof, the courts cannot interfere with the same. We may, in this connection, refer to a decision of this Court in Hingir-Rampur Coal Co. Ltd. v. State of Orissa [(1961) 2 SCR 537 : AIR 1961 SC 459] . In this case, the petitioner-mineowners, had among others, challenged the method prescribed by the legislature for recovering the cess under the Orissa Mining Areas Development Fund Act, 1952 on the ground that it was unconstitutional. The majority of the Bench held that the method is a matter of convenience and, though relevant, has to be tested in the light of other relevant circumstances. It is not permissible to challenge the vires of a statute solely on the ground that the method adopted for the recovery of the impost can and generally is adopted in levying a duty of excise. 16. Since the local Government falls in entry 5 of List II of the Seventh Schedule, therefore, it is the State Legislature alone which is competent to legislate in respect of the municipalities with only one limitation that the provisions of the State Act cannot be inconsistent with the mandate of the Scheme of Part IXA of the Constitution. The scheme of Part IXA of the Municipalities Act does not contemplate a separate notification under Article 243Q of the Constitution and thereafter under Section 5 of the Municipalities Act. As Section 5 of the Municipalities Act is not inconsistent with any provisions of Article 243Q of the Constitution, therefore, two notifications are not contemplated or warranted under the Scheme of Part IXA or the Municipalities Act as reproduced in the table above. 17. The State Government is competent to divide the Municipalities in the State into classes according to their income or other factors like population or importance of the local area and other circumstances as provided under Section 329 of the Municipalities Act. In terms of Section 329, a notification was issued on 30.4.2012 determining the category of the Municipal Corporation/Municipal Council/Municipal Board. The said notification reads as under: No. P .8 (Ga) ( ) Rule/Category/LSG/12/3825 Dated 30/4/12 :- Notification:- In connection with the partition of the category of municipalities and superseding all the notifications issued earlier in relation to the categorization of Municipal Councils by exercising the powers rendered in Section 329 read with Section 337 of Rajasthan Municipal Act, 2009 (Act No. 18 of year 2009), the State Government hem by determines the category of all the Municipal Corporation/Councils/Board which follows as under:- (1) Greater Urbanized area (Municipal Corporation) - Urbanized area of population of 5 lacs (2) Small urbanized area (Municipal Council) - All urbanized area and all district headquarters (except Municipal Corporation) having population of more than 1 lac and less than 5 lacs. (3) Transitional area (Municipality Board) - Urbanized area of 1 lac population But State Government would have right to convert any municipal council into any category keeping in view its historical/religious/archaeological importance or in any special circumstances. As per order of Governor Sd. Deputy Government Secretary. 18. Thereafter, the impugned notification dated 12.8.2014 was issued in exercise of the powers conferred on the State Government under Section 3 read with Section 329 of the Municipalities Act. The said notification reads thus: No.F.10(ka)Est./Category( )/DLB/14/2591 Dated 12/8/14 :- Notification:- State Government by exercising its power U/S 3 read with Section 329 of Rajasthan Municipal Act 2009 (Act No.18 year 2009) and Notification No.P.8(.G)()Rule/Category/LSG/12/3825- 4090 dated 30/4/12 hereby declares all the following Gram Panchayat areas into fourth class Municipal Councils with immediate effect. S. No. District Name of Gram Panchayat Newly constituted forth class Municipal Councils 1 Bharatpur Roopbas Municipal Board Roopbas Existing Boundaries of the said Gram Panchyat (Barbar -in the north, Gram Samahad in the south, Bhidyani and Rudh Roopwas in the east and Dorda in the west) would remain the local boundaries of newly constituted Municipal Board. As per order of Governor Sd. Government Deputy Secretary. 19. The above notifications would show that the State Government had exercised powers to establish Municipality in terms of Section 5 of the Municipalities Act. Such notifications cannot be said to be illegal or arbitrary in any manner and were rightly issued in exercise of the statutory powers conferred on the State by the Legislature. 20. The argument of Ms. Yadav is that the notification is arbitrary and unreasonable, therefore, the High Court has rightly struck down the notification. Reliance is placed on the judgment reported as Pune Municipal Corporation to support such contention. In the said case, the notification amending the Development Control Rules sanctioned by the State Government under Section 37 of the Maharashtra Regional and Town Planning Act, 1966 was the subject matter of challenge. The High Court had struck down the notification amending the Development Control Rules. It was held that the Development Control Rules were legislative function, therefore, Section 36 has to be viewed as repository of legislative powers for effecting amendments to Development Control Rules. It was observed that such Rules can be challenged on the ground of it being arbitrary or unreasonable. We do not find that the said judgment in any way support the arguments raised by the learned counsel. 21. In MGR Industries Association, the appellant was claiming to be part of the industrial township so as to be exempt from the jurisdiction of Zila Panchayat. This Court examined that there has to be a notification under Section 12-A of the U.P. Industrial Area Development Act, 1976 before it is excluded from Panchayat area. Therefore, two notifications were required, one to constitute an industrial township under Section 12-A of the 1976 Act and then exclusion of Panchayat area under the Uttar Pradesh Kshettra Panchayats and Zila Panchayats Adhiniyam, 1961. The said judgment is again not helpful for the arguments raised. 22. In fact, the High Court has struck down the notification only for the reason that the notification under Article 243Q(2) was not published. Such reasoning is not tenable.

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

Explanation:
0[ds]8. We find that the High Court has misread the scope of Part IXA of the Constitution and Article 243Q of the Constitution contemplating that the transitional area has to be notified under such provision. The scheme of the Constitutional Amendment is not to take away legislative competence of the State Legislatures to legislate on the subject of local Government but it is more to ensure that the three tiers of governance are strengthened as part of democratic set up.11. This Court in Tulsipur Sugar Co. Ltd. held as under:7. We are concerned in the present case with the power of the State Government to make a declaration constituting a geographical area into a town area under Section 3 of the Act which does not require the State Government to make such declaration after giving notice of its intention so to do to the members of the public and inviting their representations regarding such action. The power of the State Government to make a declaration under Section 3 of the Act is legislative in character because the application of the rest of the provisions of the Act to the geographical area which is declared as a town area is dependent upon such declaration. Section 3 of the Act is in the nature of a conditional legislation. Dealing with the nature of functions of a non-judicial authority, Prof. S.A. De Smith in Judicial Review of Administrative Action (3rd Edn.) observes at p. 163:However, the analytical classification of a function may be a conclusive factor in excluding the operation of the audi alteram partem rule. It is generally assumed that in English law the making of a subordinate legislative instrument need not be preceded by notice or hearing unless the parent Act so provides.xx xx xx9. We are, therefore, of the view that the maxim audi alteram partem does not become applicable to the case by necessary implication.xx xx xx17. We are, therefore, of the view that a notification issued under Section 3 of the Act which has the effect of making the Act applicable to a geographical area is in the nature of a conditional legislation and that it cannot be characterised as a piece of subordinate legislation. In view of the foregoing, we hold that the contention of the plaintiff that the declaration made by the State Government under Section 3 of the Act declaring the area in which the sugar factory of the plaintiff is situated as a part of the Tulsipur town area is invalid is not tenable.12. In Sundarjas Kanyalal Bhatija, a draft notification proposed the formation of a Kalyan Corporation by merging municipal areas of Kalyan, Ambarnath, Dombivali and Ulhasnagar. The State Government issued a notification excluding Ulhasnagar from the proposed corporation. The High Court found that the decision to exclude Ulhasnagar was taken by the Government abruptly and in an irrational manner. This Court held as under:27. Reverting to the case, we find that the conclusion of the High Court as to the need to reconsider the proposal to form the Corporation has neither the attraction of logic nor the support of law. It must be noted that the function of the Government in establishing a Corporation under the Act is neither executive nor administrative. Counsel for the appellants was right in his submission that it is legislative process indeed. No judicial duty is laid on the Government in discharge of the statutory duties. The only question to be examined is whether the statutory provisions have been complied with. If they are complied with, then, the court could say no more. In the present case the Government did publish the proposal by a draft notification and also considered the representations received. It was only thereafter, a decision was taken to exclude Ulhasnagar for the time being. That decision became final when it was notified under Section 3(2). The court cannot sit in judgment over such decision. It cannot lay down norms for the exercise of that power. It cannot substitute even its juster will for theirs.14. We find that such judgment is not in tune with the scheme of the Constitution and is contrary to a three-Judge Bench judgment of this Court reported as Parmar Samantsinh Umedsinh v. State of Gujarat & Ors. 2021 SCC OnLine SC 138 wherein the vires of the Gujarat Provincial Municipal Corporation Act, 1949 were subject matter of challenge on the ground that the State law has provided more than one representative from a single Ward and, thus, this provision is inconsistent with the provisions of Article 243R and Article 243S of the Constitution. This Court held as under:19. The power of competent Legislature, i.e., State Legislature in the light of enabling provisions provided in the Constitution with regard to framing of laws concerning Legislature cannot be whittled down by way of restrictive interpretation as contended by the appellants. The State Legislature in federal set up specially in the matter of local Government are to enable enough seats to adopt the reservation based on local body.35. The ratio which can be culled out from the above judgment is that power of the State to legislate within its legislative competence is plenary and the same cannot be curtailed in the absence of an express limitation placed on such power in the Constitution itself.36. Article 243ZF provides that any law relating to municipalities in force in a State immediately before the commencement of the Constitution (Seventy-fourth Amendment) Act, 1992, which is inconsistent with the provisions of Part IXA, shall not continue beyond expiration of one year from commencement of the constitutional amendment. Thus, Part IXA of the Constitution categorically contemplated that any law made by State Legislature, which is inconsistent with the provisions of Part IXA shall cease to operate on the expiration of one year or till amended or repealed by a competent Legislature, whichever is earlier. The Constitution provisions, thus, mandates that any law of the State, which is inconsistent, cannot continue. Thus, this limitation shall also govern any law made after enforcement of Constitution (Seventyfourth Amendment) Act. Thus, a law, which is inconsistent with Part IXA cannot be framed by the State Legislature.38. One of the meanings of expression inconsistent as approved by this Court is mutually repugnant or contradictory. Article 254 of the Constitution contains a heading inconsistency between laws made by the Parliament and the laws made by the Legislature of the State whereas under Article 254(1) and Article 254(2) the words used are repugnant. The Constitution itself, thus, has used the words inconsistency and repugnancy interchangeably. To find out as to whether a law made by State Legislature is inconsistent with provisions of Part IXA of the Constitution, the principles which have been laid down by this Court to determine the repugnancy between the law made by the Legislature of a State and law made by Parliament can be profitably relied on. We, thus, need to notice the principles on which the repugnancy of law made by State and law made by the Parliament is found out.50. Thus, the Legislature of a State may by law has to provide all matters relating to or in connection with election to the Municipalities, which includes filling of the seats in the Municipality by person chosen by direct election. Articles 243R and 243ZA does not give any indication as to whether from territorial constituency, i.e., the Wards, whether only one member has to be elected in the Municipality or it can be multiple member constituency. The constitutional provisions of Article 243R, which provides for composition of Municipalities and that of Article 243ZA does not give any indication to the above. The provisions of Article 243ZG, which deals with bar to interference by courts in electoral matters throws some light…59. We have analysed the provisions of Article 243R, 243S and have come to the definite conclusion that no limitation in Article 243S can be found of which contains any prohibition of having more than one member for a Ward.63. We, in the present case, after analysing the relevant provisions of Part IXA of the Constitution has come to the conclusion that there is no prohibition or limitation in Part IXA of the Constitution prohibiting the State Legislature from making a law providing for election of more than one member from one territorial constituency, i.e., Ward.16. Since the local Government falls in entry 5 of List II of the Seventh Schedule, therefore, it is the State Legislature alone which is competent to legislate in respect of the municipalities with only one limitation that the provisions of the State Act cannot be inconsistent with the mandate of the Scheme of Part IXA of the Constitution. The scheme of Part IXA of the Municipalities Act does not contemplate a separate notification under Article 243Q of the Constitution and thereafter under Section 5 of the Municipalities Act. As Section 5 of the Municipalities Act is not inconsistent with any provisions of Article 243Q of the Constitution, therefore, two notifications are not contemplated or warranted under the Scheme of Part IXA or the Municipalities Act as reproduced in the table above.19. The above notifications would show that the State Government had exercised powers to establish Municipality in terms of Section 5 of the Municipalities Act. Such notifications cannot be said to be illegal or arbitrary in any manner and were rightly issued in exercise of the statutory powers conferred on the State by the Legislature.In the said case, the notification amending the Development Control Rules sanctioned by the State Government under Section 37 of the Maharashtra Regional and Town Planning Act, 1966 was the subject matter of challenge. The High Court had struck down the notification amending the Development Control Rules. It was held that the Development Control Rules were legislative function, therefore, Section 36 has to be viewed as repository of legislative powers for effecting amendments to Development Control Rules. It was observed that such Rules can be challenged on the ground of it being arbitrary or unreasonable. We do not find that the said judgment in any way support the arguments raised by the learned counsel.21. In MGR Industries Association, the appellant was claiming to be part of the industrial township so as to be exempt from the jurisdiction of Zila Panchayat. This Court examined that there has to be a notification under Section 12-A of the U.P. Industrial Area Development Act, 1976 before it is excluded from Panchayat area. Therefore, two notifications were required, one to constitute an industrial township under Section 12-A of the 1976 Act and then exclusion of Panchayat area under the Uttar Pradesh Kshettra Panchayats and Zila Panchayats Adhiniyam, 1961. The said judgment is again not helpful for the arguments raised.22. In fact, the High Court has struck down the notification only for the reason that the notification under Article 243Q(2) was not published. Such reasoning is not tenable.