B.K. Chaturvedi, J.
1. An issue has been framed about the necessity of a notice under Section 80, Civil Procedure Code, before the filing of the present suit. It is not disputed that the Municipality had been superseded and an Administrator appointed. Probably the attention of the Court below was not drawn to Tikaram Vithoba v. Municipal Committee, Sindi, 1954 Nag LJ 683 (A) which lays down that after supersession of a Municipal Committee under Section 57 (2) of the C. P. and Berar Municipalities Act, the committee is wholly out of picture and Section 48 of the Municipalities Act does not apply to a Municipal Committee which is rendered dormant by its supersession; but that Section 80 of the Civil Procedure Code will apply as the property of the Committee vests in the State. This ruling was binding on the Court below.
2. The above decision of Mndholkar J. seeks to extend the principle enunciated in the Division Bench decision reported in Damodar Tukaram Mangalmoorti v. Municipal Committee, Nagpur, ILR (1951) Nag 81] : (AIR 1951 Nag 47 (2)) (B); but, with great respect, I feel doubtful if it could have been stretched to that extent. In Mohammad Shafi v. Sialkot Municipality, AIR 1940 Lah 451 (C), which has been referred to in Tikaram Vithoba v. Municipal Committee, Sindi (A) (supra), I do not find any concluded opinion on the point canvassed in the present case. Then a reference has been made to the observation of Varadachariar J. in Administrator, Lahore Municipality v. Daulat Ram Kapur, 1942 FCR 31 : (AIR 1942 FC 14) (D), which, to my mind, is not apt In that case the view put forth in arguments that the Administrator should take proceedings only in the name of the committee was not repelled.
No opinion, in fact, was expressed on the point in that case. If the Administrator is substituted in place of the Municipality, howsoever dormant the latter may have been, the Administrator has to perform all the duties conferred and imposed by the Municipalities Act on the Municipal Committee. In fact, the Administrator comes in place of the Municipal Committee and he cannot say that as the property of the Municipal Committee has vested in the State, he cannot be governed by the provisions of the Municipalities Act, I do not think that Section 48 of the C. P. and Berar Municipalities Act, 1922, can be deemed to be abrogated from the statute book during the period of suspension of the Municipality. There is no such provision in the said Act from which it could be inferred.
3. In Ahmedabad Municipality v. Mulchand, AIR 1946 Bom 154 (E), it was held by a Division Bench that the State Government would not be a necessary party to a suit filed or continued by the Administrator of a superseded Municipality.
4. A notice under Section 48 of the Municipalities Act has, no doubt, been served on the Municipality in the instant case, and I think that this was sufficient. I do not think that two notices, one under S 48 of the Municipalities Act, and another under Section 80, Civil Procedure Code, will be necessary in such cases.
5. As, however, I am doubtful about the ruling of Mudholkar J. which has since then been reported in the official reporter ILR (1955) Nag 276 (A), I think that this case be referred to a Division Bench, as the point involved is not free from difficulty.
6. The papers be placed before the Chief Justice for constituting a Division Bench for the determination of the question :
"Whether the ruling reported in Tikaram v. Municipal Committee, Sindi (A), (Supra) lays down correct law "
T. P. Naik & B.K. Chaturvedi, JJ.
7. This order will also govern Civil Revision No. 376 of 1956.
8. The question referred to this Bench is : "Whether the ruling reported in ILR (1955) Nag 276 (A), lays down correct law?"
In the above mentioned case a learned Single Judge (Mudholkar J.) laid down that ---
(1) Section 48 of the Central Provinces and Berar Municipalities Act, 1922 (II of 1922) does not in terms apply to a suit instituted after the Municipal Committee had been superseded;
(2) when the Committee is superseded, the powers and duties of the Committee vest in the officer appointed by the Government and the Committee becomes dormant;
and (3) where a claim is made against the property, which has vested in the State because of Section 57 (2) of the Act, then it is obligatory under Section 80, Civil Procedure Code, to serve a notice on the State or on the Collector.
Section 80 of the Code of Civil Procedure provides that:
"No suit shall be instituted against the Government or against a public officer in respect of any act purporting to be done by such public officer in his official capacity, until the expiration of two months next after notice in writing has been delivered to or left at the office of etc."
9. The section is explicit and mandatory and admits of no implications or exceptions; Bhagchand v. Secretary of State, 54 Ind App 338: (AIR 1927 PC 176) (F). But the section will be applicable only where the Municipality is regarded as a Government Department or oven a public officer. The question, therefore, is: Whether the supersession of the Municipality so extinguishes its existence as a body corporate that it loses the fundamental characteristics of a corporation and is transformed into a Department of the State. Section 37 of the Central Provinces and Berar Municipalities Act, 1922, specifically says that every committee shall have a perpetual succession and a common seal and in such name shall sue and be sued. This provision regarding "perpetual succession", according to Dr. S. C. Bagchi's "Law of Corporations" (T.L.L. 1914), has this important consequence that
"the supersession and re-establishment of a corporation by the local Government has not the effect of extinguishing the old corporation (Mahamohopadyaya Rangachariar v. Municipal Council of Kumbakonam, ILR 29 Mad 539 (G)) and creating a new one but simply the temporary suspension and revival of the old corporation."
10. The effect of the supersession of a Municipal Committee has been elaborately discussed and considered in Mahamahopadyaya Rangachariar v. Municipal Council of Kumbakonam (G) (cit. sup.) In that case, the provision under Section 4-B (I) (b) of District Municipalities Act (Madras Act IV of 1884), analogous to that found in the Central Provinces and Berar Municipalities Act, came up for consideration before a Division Bench (comprising of Subrahmania Ayyar and Miller, JJ.). The learned Judges quoted several extracts from "Grant on Corporations" and came to the conclusion that
"supersession is nothing more than the dismissal of incompetent Councillors, followed only by the appointment of, to borrow the language of the English law, a customs for the discharge of the functions of the Council pending the nomination or election of other persons who would resume work in the normal way. In a word, supersession is but a suspension of the Council."
Thereafter, it was observed :
"The only reasonable view then is that he (the draftsman) took it that the provision that the property shall vest in the Governor in Council during supersession only, implied, as it undoubtedly does, that thereafter it devolves by operation of law on the resuscitated Council as the rightful successor of the superseded council."
11. This decision was referred to by the Federal Court in 1942 FCR 31: (AIR 1942 FC 14) (D) which was an appeal arising out of certain proceedings taken by the respondent to challenge the validity of an octroi duty on salt imposed by the municipal administration of Lahore. A preliminary objection was taken to the form of the appeal. It was contended that only a party to the proceedings in the Court below could appeal to that Court (Federal Court) and that the Municipal Committee, and not the Administrator, was the party in the High Court.
It was also urged that as the Municipal Committee had been constituted by Section 18 of the Punjab Municipal Act, 1911 (No. III of 1911) a body corporate with perpetual succession, its supersession did not put an end to the corporation and that all legal proceedings by or, against the corporation must be instituted only in the name of the corporation. Their Lordships of the Federal Court repelled these contentions, and observed :
"The provisions of Section 18 of the Punjab Municipal Act relating to the corporate character of the Committee and the manner of suing must be read subject to the provisions of Section 238 (2) which lays down the consequences of a supersession. It may be (as held in ILR 29 Mad 539 (G), that a supersession has not the effect of a dissolution and that when another Committee is constituted in the place of the superseded Committee, it is a revival of the old corporation and not the creation of a new one. But during the period when the order of supersession is in force, the statute makes it clear that all the members of the Committee vacate their seats and that all the powers and duties of the Committee are to be exercised and performed by the Administrator. It seems to us that we should be carrying the legal fiction to a needless length if we insisted that, even in this state of facts, proceedings must be taken only in the name of the dormant corporation. It has not been disputed that the person competent to take proceedings is the Administrator and even if the true view should be that he should take proceedings in the name of the Committee, the defect is one purely of a formal character which can be cured by amendment."
It will be seen from the above extract that the Federal Court did not finally decide the question whether the Administrator should take proceedings in the name of the Committee, or in his own name. Consequently, this decision of the Federal Court cannot help us to solve the question canvassed before us in the instant case.
12. In AIR 1940 Lah 451 (C), the plaintiff had filed a suit for an injunction restraining the municipality from demolishing building on the ground that the land under the building belonged to him, and not to the municipality. Sanction to construct certain building had been granted to him by the Municipality, but it was superseded under Section
238. Punjab Municipal Act, and the sanction was suspended by the Deputy Commissioner, Sialkot. The plaintiff, then, served a notice on the Secretary of State for India in Council, through the Deputy Commissioner, describing it as a notice under Section 80, Civil Procedure Code, and Section 49, Punjab Municipal Act. The Deputy Commissioner occupied a dual capacity as Collector of the District as well as the Administrator of the Municipal Committee.
The question was whether the notice served in this way was valid and proper. It was urged on behalf of the respondents (i.e. the Municipality) that no notice was sent to the Collector of the District as required by Section 80, Civil Procedure Code, and that the notice sent by the plaintiff was really one under Section 49, Punjab Municipal Act. It was urged that a notice to the Collector was necessary inasmuch as the committee having been superseded under Section 238, Municipal Act, all property, which was vested in the Committee became vested in His Majesty. Din Mohammad J. repelled this contention and observed :
"The plaintiff, although faced with a complicated situation on account of the supersession of the committee did serve a notice on the Secretary of State for India in Council through the Deputy Commissioner, Sialkot, and further made it clear that the notice was both under Section 80, Civil Procedure Code, and Section 49, Punjab Municipal Act. The Deputy Commissioner occupied a dual capacity then: he was the Collector of the District as well as the Administrator of the Municipal Committee. Notice having gone to him in the capacity of Deputy Commissioner, it cannot be urged that the Collector had not been informed of the intention of the plaintiff to institute a suit against the Secretary of State for India in Council, if he was not listened to.
It is significant that the Executive Officer laboured under no misapprehension as regards the authority who had been notified, inasmuch as in his reply while referring to the notice, he described it as a notice addressed to the Secretary of State through the Collector, Sialkot. Moreover, this is a highly technical matter and in a place like the Punjab where people are not used to hair-splitting, such technicalities should not be allowed to defeat justice. It is further doubtful whether a notice was at all necessary under Section 49, Municipal Act, in the circumstances of the case. On the grounds stated above, I have no hesitation in holding that the notice served on the Deputy Commissioner was valid and proper."
It will be obvious from the above that the question whether in such cases a notice under Section 80, Civil Procedure Code, served on the Government is necessary or not was not raised in that case. It was taken for granted by both the parties, and the question that was decided was merely about the validity of the notice already given.
13. In AIR 1946 Bom 154 (E), the question directly canvassed was whether the Provincial Government is a necessary party to a suit filed or continued by the Administrator of a superseded Municipality. It was held by a Division Bench (Lokur and Weston, JJ.) that the Administrator has the right to continue the suit instituted by the Municipality prior to its supersession, and that he sufficiently represents the superseded Municipality and any liability arising out of a proceeding to which he is a party will have to be met out of the Municipal fund created under Section 65 of the Act which is held and applied by the Municipality as a trustee.
Hence even after the fund has vested in the Provincial Government, it shall be liable to pay the expenses of any civil proceeding prosecuted or defended by the Administrator, although the Provincial Government may not be a party to the proceeding. It was, therefore, held that the Provincial Government is not a necessary party to a suit filed or continued by the Administrator of a superseded Municipality. This decision placed reliance both on ILR 29 Mad 539 (G) and 1942 FCR 31: (AIR 1942 FC 14) (D).
14. In ILR 1951 Nag 811: (AIR 1951 Nag 47 (2)) (B), the question was whether the whole of the procedure laid down in the Central Provinces and Berar Municipalities Act, 1922, for the imposition and revision of taxes should be followed, in its entirety, by the Administrator appointed by the Provincial Government to carry out the functions of the Municipality, and whether the failure to fellow the entire procedure renders the levy of the tax illegal. It was held that it is enough that the Administrator carries out his functions in a reasonable and equitable manner, keeping an eye, as far as possible, on the provisions of the Municipalities Act. He is not bound by them with the same strictness as the elected Municipality would be. In this connection it was observed :
"The vacating of offices under Sub-clause (a) of Section 57 (3) of the Central Provinces and Berar Municipalities Act for the period of supersession does not operate to dissolve the Municipal Committee but only to suspend it and the committee is reconstituted under Section 57 (4) on the expiry of that period. Supersession is nothing more than dismissal of councillors followed by the appointment of an officer-in-charge to discharge all the powers and duties of the committee till the reconstitution of the committee. Thus the Municipal Committee is dormant during the period of its supersession and the officer-in-charge appointed by the Provincial Government is empowered to exercise all the powers and to perform all the duties conferred and imposed by the Act on the Municipal Committee including the power of imposition, revision, assessment and collection of taxes."
It is nowhere laid down in the judgment that the Municipality, after its supersession, becomes a Government Department so as to necessitate a notice to it under Section 80 of the Civil Procedure Code. It is apparent that the Federal Court did not lay down this; principle, nor can it be deduced from D. T. Mangal-moorti v. Municipal Committee, Nagpur (B) (cit. sup.). It was not canvassed in the Lahore ruling and the Bombay case is an authority for indirectly negativing it The learned Single Judge in Tikaram's case (A), then, seems to have been impressed by the wording of Section 57 (3) of the Central Provinces and Berar Municipalities Act, 1922, which is reproduced below :
"57 (3): If a committee is so dissolved or superseded the following consequences shall ensue :
(a) all members of the committee shall, as from the date of the order, vacate their offices as such members;
(b) all powers and duties of the committee may, until the committee is reconstituted, be exercised and performed by such person or persons as the Provincial Government may appoint in that behalf;
(c) all property vested in it shall, until the committee is reconstituted, vest in the State for the purposes of the Province."
The words "all property vested in the Municipality shall vest in the State" are important. The question is: Whether the vesting of that property in the State which was vested in the Municipality can transform the latter into a Government Department?
15. The word "vest" is susceptible of several shades of meaning. In Wharton's Law Lexicon (Fourteenth Edition) two meanings are assigned to it:
"(1) Either to place in possession, to make Possessor of, or, to give an absolute interest in property when a named period or event occurs, (2) (of a right or interest). Its coming into the possession of any one; ensuring to the benefit of any one."
16. The word "vest" will thus take its meaning according to the context. In the absence of the context it is usually taken to mean "vest in interest rather than vest in possession" (per Romer, J., in Re Lord's Settlement 1948 L.J.R. 207 (H).
17. The word "vest" occurring in Section 57 (3) (c) has to be compared with the word "vest" occurring in Section 38 of the Act. For example, all public streets, not being open spaces or lands owned by the State, and the pavements, stones and other materials thereof, vest in the Committee under Section 38 of the Act.
18. In several English cases the questions of the extent of property and the nature of the right, title and interest possessed by urban authorities in streets vested in them under the Metropolis Local Management Act, 1855, the Public Health Act. 1875, and similar enactments were considered and settled. The meaning of the word "vest'' was considered by the Court of Appeal in Coverdale v. Charlton, (1878) 4 QBD 104 (I). Bramwell, L. J. at pages 116-118 said:
"The word "vest" may have two meanings; it may mean that a man acquires the property 'usque ad coelum' and to the centre of the earth, but I do not think that to be its meaning here. One construction of the word "vest" here is that it gives the property in the soil, the free-hold, the surface, and all above and below it; but that would be such a monostrous thing to say to be necessary for the Proper control of the streets by the local board, that I cannot suppose it to mean such a thing ,......What then is the meaning of the word "vest" in this section? The legislature might have used the expression "transferred'' or "conveyed", but they have used the word "vest".
The meaning I should like to put upon it is that the street vests in the local board qua street; not that any soil or any right to the soil or surface vests, but that it vests qua street .... The meaning I put upon the word "vest"' is, the space and the street itself, so far as it is ordinarily used in the way that streets are used, shall vest in the local board - - - ....... That would show that "street" comprehends what we may call the surface, that is to say not a surface bit of no reasonable thickness, but a surface of such a thickness as the local board may require for the purpose of doing to the street that which is necessary for it as a street, and also of doing those things which commonly are done in or under the streets and to that extent they had a property in it".
19. James, L. J., explained the principle of the above decision thus in Rolls v. Vestry of St, George The Martyr, Southwark, (1880) 14 Ch. D 785 (J)
"What that case decided, and all that it was necessary to decide in that case, was that some thing more than an easement passed to the local board, and that they had some right of property in and on and in respect of the soil which would enable them as owners to bring a possessory action against trespassers. Now what was that something more? It is impossible to read any of the three judgments delivered on that occasion without seeing that in the view of the learned Judges the soil and freehold in the ordinary sense of the words "soil and freehold", that is to say, the soil from the centre of the earth up to an unlimited extent into space, did not pass, and that no stratum or portion of the soil, defined or ascertainable like a vein of coal, or stratum of iron stone, or any thing of that kind, passed, but that the board had only the surface, and with the surface such right below the surface as was essential to the maintenance, and occupation, and exclusive possession of the street, and the making and maintaining the street for the use of the public".
20. In Tunbridge Wells Corpn. v. Baird, 1896 AC 434 (K) the House of Lords held that the Public Health Act, 1875, which by Section 149 vests certain streets in the urban authority, does not vest in subsoil. Therefore, where a local Act authorized the urban authority to erect and maintain "in any street or public place" lavatories for the use of the public, the urban authority had no power to excavate the soil and erect lavatories below the surface of a street which had vested in them.
21. There are other cases; e.g. Wandsworth Board of Works v. United Telephone Co., (1894) 13 QBD 904 (L), which bear upon the extent to which the urban authority has a right in the air space over the surface of a street. In regard to the drain which is also vested in the municipality the extent of air space above the drain to which the Municipal Council may be entitled will not be the same as in the case of the street (Birkenbead Corpn. v. London and North Western Railway Co. (1885) 15 QBD 572 (M)).
22. These English cases have been followed in Courts in India, ,and reference has been made to them on page 647 in Sundaram Ayyar v. Municipal Council of Madura and Secy, of State, ILR 25 Mad 635 (N).
23. In a recent decision of the Supreme Court in Fruit and Vegetable Merchants Union v. Delhi Improvement Trust, 1957 SCR 1: ((S)AIR 1957 SC 344) (O), their Lordships have considered the various meanings given to the word "vest" in several English cases. Their Lordships also came to the conclusion that the word "vest" is a word of variable import as is amply shown by provisions of Indian statutes also. Then their Lordships observed:
"It would thus appear that the word 'vest' has not got a fixed connotation, meaning in all cases that the property is owned by the person or the authority in whom it vests. It may vest in title, or it may vest in possession, or it may vest in a limited sense, as indicated in the context in which it may have been used in a particular piece of legislation".
24. In several Indian cases it has been held that in spite of the vesting of public streets in the Municipal Committees the Government have some interest in the sub-soil of and in the column of air above the public streets : Gunendra Mohan Ghosh v. Corporation of Calcutta, ILR 44 Cal 689: (AIR 1917 Cal 95) (P); ILR 25 Mad 635 (supra) (N) and G. I. P. Railway Company v. The Municipal Corporation of the City of Bombay, ILR 38 Bom 565 at p. 573: (AIR 1914 Bom 104 at p. 106) (Q). The question was raised that as the Government have some interest in the public streets vested in the Municipalities, in civil suit about a street, the Government must be considered to be a necessary party.
In S. S. Sundaram Ayyar v. The Municipal Council of Madura and the Secretary of State for India in Council (N) (cit, supra), the learned Judges considered it desirable in second appeal when certain issues were sent down for findings that the Government might be added as a party. However, the question was not decided in that case, whether the Government can be considered to be a necessary party at all. In Krishnayya v. Bellary Municipal Council. ILR 15 Mad 292 (R) such a contention was clearly repelled; and in Bai Parwati v. The Nadiad Municipality, ILR 47 Bom 315: (AIR 1923 Bom 459) (S) it was laid down that the mere fact that Government would have some interest in all public streets vested in Municipalities was not any reason for holding that Government was a necessary party in a suit of this nature.
25. From the cases, referred to above, and all the discussion therein it will be clear that the word "vest" in Section 38 of the Central Provinces and Berar Municipalities Act, 1922, has only a limited effect. So far as public town-walls, gates, public streams, springs, public sewers, drains, public streets and roads etc., within the area of the Municipality, are concerned, the vesting section (Section 38) must, be so construed as to give to the Municipality the least interest in the property that is compatible with the proper exercise of the powers in relation to these things given to the Municipality under the Act.
26. There is no doubt that there will be some property acquired by the Municipality as owner thereof. It cannot be contended with any force that such property, on the supersession of the Municipality vests absolutely in the State. The words "shall, until the committee is reconstituted, vest in the State" are significant. The intention of the legislature is clear that the Municipal Committee will be reconstituted, but till its reconstitution, its property would vest in the State. That only means that there will he "vesting in equity" or "belonging in equity". Though it will pass an interest in the property, that interest will not be greater than is requisite to enable the State Government to control or maintain the functions of the Municipality.
27. Sub-clause (b) of Clause (3) of Section 57 of the Act is also significant. It says that all powers and duties of the committee may, until the committee is reconstituted, be exercised and performed by such person or persons as the Provincial Government may appoint in that behalf. It means that the person, who is appointed by the Government, will exercise only those powers and will perform those duties which a Municipal Committee has to exercise and perform under the Central Provinces and Berar Municipalities Act, 1922, Such person cannot ignore the provisions of the Act. It follows that the legislature means to keep alive the personality of the Municipal Committee and does not want that, during the period of suspension, the Municipality should cease to exist for any purpose whatsoever. In his "Municipal Corporations in British India," Vol. III (First Edn.), P. D. Aiyangar observes at page 13' thus:
"In a word, supersession is but a suspension of the council. The municipal councillors holding office at the time of the supersession cease to do so altogether. But the Municipality itself is left intact, the management of its affairs being provided for by the appointment of a person or persons to be chosen by the Government and the property itself is vested in the Government only in trust for the Purposes of the municipality concerned. And the reconstitution of such a council is but the revival of the old corporation and not the creation of a fresh one, and all the rights and liabilities of the superseded council will devolve on the council so reconstituted as its rightful successor".
28. The learned author, however, states some consequences that would follow if the Municipal Committee is dissolved. He says that dissolution is the annihilation of the corporation. The author, then, observes:
"And the primary effect of the dissolution of a corporation without provision for re-incorporation is to destroy the corporation altogether. Its life is ended, its franchise is withdrawn, its powers abrogated and its functions cease. It is no longer a public institution. All offices are destroyed and the Public property may be disposed of by the legislature as State property. But it should be observed that the rights of third parties either as creditors or as hold-ling contract obligations cannot be impaired or destroyed either by supersession or dissolution. The duty of their payment or performance devolves upon the territory succeeding to the old corporation."
29. This dissolution, however, is different from the dissolution envisaged in sub-clause (3) of section 57 of the Act. Such a dissolution as is referred to in Aiyangar's book (Vol. III) was provided for in section 3 of the English Municipal Corporation Act, 1883, (46 and 47 Vict. C. 18) and may usefully be reproduced below:
"3. Future abolition of corporations, except as provided by new charter or by scheme under 40 & 41 Vict C. 69 (C) ....(a) The following provisions shall (subject to the savings for vested interests and other provisions contained in this Act) (b) apply to each of the places mentioned in the Schedules to this Act......... .(a); that is to say,
(a) The place shall not be a corporate town or borough, and any municipal or other corporation thereof existing under any charter or grant or prescription shall be dissolved:
(b) All property of any corporation in the place which is dissolved by this Act, or of any person as member or officer thereof, or of any court or judge whose jurisdiction is abolished by this Act, shall be applied for the public benefit of the inhabitants of the place in such manner as may be for the time being provided by a scheme of the Charity Commissioners (d), or, in a case where a scheme is made by the (Minister of Health) (e) by that scheme, and shall vest in such persons or body corporate as may be specified in such scheme".
It will be clear that such a dissolution can be brought about only by legislation or by operation of law.
30. It will thus be manifest that till the municipality's life is ended, the Legislature intends that it would remain alive, and, whosoever may come to manage its functions, it will remain as a municipality. Under these circumstances, the Government cannot be deemed to be a necessary party in suits instituted against the municipality. It follows that no question of a notice under Section 80 of the Code of Civil Procedure arises,
31. It may, however, be stated here that the municipality is a creature of statute i.e. municipal corporations exist only by statute or express legislative enactment. They can have no other source than the sovereign power. It was, therefore, correctly stated in an English case that it is the sovereign will expressed in a solemn act of legislation that speaks the Municipal microcosm into being and gives it life and power. In an American case, William Barnes v. The District of Columbia, (1878) 91 Under Section 540 (T), Mr. Justice Hunt, delivering the opinion of the Supreme Court of the United States of America ob served thus:
"A Municipal corporation, in the exercise of all its duties, including those most strictly local or internal, is but a department of the State. The Legislature may give it all the powers such a being is capable of receiving, making it a miniature State within its locality. Again, it may strip it of every power, leaving it a corporation in name only; and it may create and recreate these changes as often as it chooses, or it may itself exercise directly within the locality any or all the Powers usually committed to a municipality. We do not regard its acts as sometimes those of an agency of the State, and at others those of a municipality; that, its character and nature remaining at all times the same it is great or small according as the Legislature shall extend or contract the sphere of its action".
32. The municipal corporation is regarded as nothing but an agent of the State and the State Government reserves to itself sufficient powers to intervene, whenever necessary. Municipal Corporations, it is said, are designed for no other end but the welfare of the public and especially of the communities where they are established, and to this end, their functions must be exercised. The State Government is, therefore, bound to see that their function are properly exercised. The Legislature has not divested itself of any of its controlling powers. It may, if it sees fit, abolish all the Municipalities in the State and revert to direct control of local affairs, or it may make a new sub-division of the State, in whole or in part, or it may leave the Municipal Corporation which it has created in existence, but with, their powers substantially added to or taken away.
In other words, the people of a particular portion of a State, by enjoying the privilege of self-government, acquire no vested right therein as against the legislature representing the people of the whole State. The legislature' has, therefore, full control over the revenues of a municipality derived from taxation. The statute creating the municipality, then reserves powers to the Government and to the Collector or Commissioner in several matters. In many matters, the previous sanction of local Government is necessary, and if the municipal corporation does any such thing without obtaining sanction as is required by the statute, such an act will be void.
33. A perusal of the scheme of the Central Provinces and Berar Municipalities Act, 1922 (II of 1922) will also make it clear that the powers of a Municipal Committee are hedged in with limitations-on all sides, and the Committee cannot function properly without the support of the State Government, whose interference and control can be expected at any stage. Some of the important provisions by means of which the State Government exercises its control over the Municipal Committee may be mentioned here:
(1) A municipal committee cannot, without the previous sanction of the Provincial Government, transfer any land which has been acquired for and vest in the committee or divert such land to a purpose other than the purpose for which it has been acquired. (Section 40).
(2) No officer or servant appointed or employed by a committee shall, without the written permission of the Deputy Commissioner, in any way be connected or interested in any bargain or contract made with the committee (Section 44-A and Section 45).
(3) The Deputy Commissioner of a district has power to examine the proceedings of any committee, sub-committee or joint committee, and can himself enter on and inspect or authorize any other person to enter on and inspect any immovable property, or any work' in progress under the direction of the committee, call for, and, inspect any document which may be in its possession, or, require a committee, sub-committee or joint committee to furnish such statements, accounts and reports as he may think fit. (Section 52).
(4) If the Deputy Commissioner thinks that the execution of any order or resolution of a committee is likely to cause injury or annoyance to the public, or to any class of body of persons or to lead to a breach of the peace, he may suspend the execution or prohibit the performance thereof within the district. (Section 53).
(5) The Provincial Government may appoint any executive officer of the committee under certain circumstances. (Section 53-A).
(6) In the case of emergency the Provincial Government, on receipt of a report made under section 52, may provide for the execution of any work, or the performance of any act, which a committee, sub-committee or joint committee is empowered to execute or perform, and the immediate execution or performance of which is necessary for the service or safety of the public. (Section 54).
(7) The Provincial Government, if satisfied that a committee has made default in performing any duty imposed on it, may, by an order in writing, fix a period for the performance of that duty. In case that duty is not performed within the period so fixed, the Provincial Government may appoint some person to perform it. (Section 55).
(8) In any case, the Provincial Government, if satisfied that the committee has made default in the payment, of any sum, may direct the person having the custody of the municipal fund to make such payment, (Section 56).
(9) The Provincial Government can call for and examine any record oi: any case pending before any officer of the municipal committee and can pass such order as it thinks fit. (Section 58).
(10) In all matters connected with the Municipalities Act, if a committee makes default in carrying out any order made by the Provincial Government, the Provincial Government have all the powers necessary for the enforcement of such order at the cost of the committee. (Section 58-A).
(11) The Provincial Government may, by general or special order, appoint any officer of the Education, Public Works, Medical, Sanitary and other technical departments to attend any meeting of the municipal committee and address it on any matter affecting the work of his department. (Section 59).
(12) If there is any dispute between a municipal committee and some other local body, such dispute must be referred to the Provincial Government whose decision shall be final. (Section 60).
34. It will thus be seen that at every stage and i n every sort of work the Government can control the municipal committee. The supersession of a municipal committee under section 57 of the Act is only the apex of the Government's controlling machinery. Whether there is President at the helm of affairs in the municipality or it is the Administrator will not" be material. , The functions are, after all, to be controlled by the Government. Even after this supersession, it has been observed above that the Legislature intends to keep the municipality alive. So long is it is allowed to live, the municipality must be deemed to continue to have capacity to sue and be sued its own name. It is only the dissolution of a municipality which terminates its capacity to sue and be sued. Such a dissolution, as stated above, can be brought about only by legislation.
Thus, the supersession of a municipality under Section 57 of the Act and the vesting of its property, in the State are only to tighten more closely the Government's control over it which had been there from its very inception. They do not so transform it into a Government Department as to necessitate in a suit against it a notice to the Government under Section 80 of the Code of Civil Procedure. So long as the suit is instituted against the Municipality (and it should be so, as long as its personality does not become extinct), there would be no need to file a suit against the Administrator or of a notice to him under Section 80 of the Code of Civil Procedure; for the provisions of the Municipalities Act alone have to be compiled with.
35. It may also be mentioned here that a party filing a suit against the Municipality is not expected to know whether it is normally functioning or an Administrator is at the helm of its affairs. Even after a notice against the Administrator under Section 80, it may so happen that by the time the suit is filed, the committee may be reconstituted and then it will necessitate amendment of the plaint. A lay litigant against the Municipality will, therefore, always be exposed to the risk of his losing his case on the mere technicalities of procedure, if Government is to be held necessary party during the time of its supersession under Section 57.
36. For reasons stated above, we are of opinion that the ruling reported in ILR (1955) Nag 276 (A) does not lay down correct statement of law. We answer the reference accordingly.
37. Let the case be sent to the Single Bench for disposing of the revision on other points.
B.K. Chaturvedi, J.
38. Shri A. H. Saifi, who is present here on behalf of Shri A. P. Sen, urges that no other point required adjudication in this revision. The only point that was important was; Whether a notice under Section 80, Civil Procedure Code, is necessary in a suit against the Municipal Committee which had been superseded and an Administrator had been appointed to manage its affairs under Section 57(2) of the Central Provinces and Berar Municipalities Act, 1922 (II of 1922)?
39. The question was referred to a Division Bench: Whether the ruling reported in ILR (1955) Nag 276 (A) lays down correct law? The file has come back from the Division Bench which has overruled Tikaram v. Municipal Committee, Sindi (A) (cited supra) as it does not lay down correct statement of law.
40. This was the only point of substance that was raised by Shri A. P. Sen in this revision. The revision is, therefore, dismissed with costs.