Quashed

Shri. Yogesh Mangalsen Bahal v. the Commissioner of Pimpri Chinchwad Municipal Corporation and Ors.

Bombay HC21 Feb 2018WP/9829/2017

Case brief

AI extract

What is this about?

The High Court of Bombay via Article 226 challenge held that a Municipal Corporation's resolution delegating powers under Section 101 and Rule 2 of Schedule D to the Standing Committee and Commissioner was illegal and impugned, as the Act contains no provision authorizing such delegation. The court quashed the resolution to that extent.

What did the court decide?

The impugned Resolution No.42 dated 20th June 2017 to the extent providing for delegation of powers to the Standing Committee and Municipal Commissioner is quashed and set aside.

Shri. Yogesh Mangalsen Bahal Vs the… — Public Procurement and Tenders | Bombay HC (2018)

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IN THE HIGH COURT OF JUDICATURE AT BOMBAY
CIVIL APPELLATE JURISDICTION

¶5

 WRIT PETITION NO.9829 OF 2017

¶6

...Petitioner

¶7

Yogesh Mangalsen Bahal ...Petitioner
vs.
The Commissioner of Pimpri
Chinchwad Municipal Corporation
and others...Respondents

¶8

Mr.Balkrishna Joshi a/w Mr.Virendra Pethe for the
Petitioner
Mr.R.S.Apte, Senior Advocate i/b Mr.Rohit P.
Sakhadeo for the respondent Nos.1 and 2
Ms R.A.Salunkhe, AGP for respondent No.3

¶9

CORAM : A.S.OKA, &
 P.N.DESHMUKH, JJ.
 DATE : FEBRUARY 20 and 21, 2018

¶10

ORAL JUDGMENT: (PER A.S.OKA,J.)

¶11

1By order dated 24th January 2018, notice for
final disposal was issued. Accordingly, on earlier
date the petition was heard and today it is kept for
Judgment. The challenge in this petition under
Article 226 of the Constitution of India is to the
Resolution passed by the second respondentMunicipal
Corporation in its General Body Meeting held on 20th
June 2017. By the said Resolution, the General
Body of the second respondent Municipal Corporation
purported to delegate certain powers of the
Municipal Corporation to the Standing Committee and
to the Municipal Commissioner.

¶12

2The first submission of the learned counsel

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¶14

appearing for the petitioner is that there is no
provisionundertheMaharashtraMunicipal
Corporations Act,1949 (for short `the said Act')
which permits the delegation of powers of the
General Body of the Municipal Corporation either to
theStandingCommitteeortheMunicipal
Commissioner. The second submission is that the
powers of the General Body both under section 101 as
well as under Rule 2 of Chapter VII of Schedule D of
the said Act cannot be delegated either to the
Standing Committee or to the Municipal Commissioner.
He submits that the subject of delegation of powers
in favour of the Standing Committee or the Municipal
Commissioner was not on the agenda of the meeting on
that day. Inviting our attention to the relevant
Rules and in particular, Rules contained in Chapter
II of Schedule D of the said Act, he submitted that
without there being a subject on the agenda, a
resolution providing for delegation could not have
been passed.

¶15

3The learned senior counsel for the Municipal
Corporation firstly submitted that the present
petitioner is an elected Councilor who was present
in the General Body Meeting held on 20th June 2017
and there was no material placed on record to show
that he made an attempt to oppose the passing of the
said resolution by raising the contentions which are
raised in this petition. The second submission is
that non essential functions of the Municipal
Corporation (General Body) have been delegated to
the Standing Committee. He pointed out that as

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regards the delegated powers in respect of the
budget, the said powers are formal in nature such as
payment of income tax collected by the Corporation,
refund deposits etc. He would therefore submit that
by no stretch of imagination any illegality has been
committed. He also invited our attention to various
provisions of the said Act. He relied upon section
67 of the said Act. He submitted that there is no
prohibition on making such delegation. He also
invited our attention to section 88 of the said Act
which deals with the municipal funds. Our attention
was also invited to section 86 on the same issue. He
submitted that as regards the powers of the
Municipal Corporation which were delegated to the
Standing Committee, the said Committee has not
exercised said powers. He also invited our
attention to sections 101 and 103 of the said Act.
He pointed out the provisions of Chapter VII of
Schedule D which deal with the budget. He also
invited our attention to Rule 2 of Chapter VII. He
submitted that in any case, no interference is
called for at the instance of the petitioner who was
present in the meeting. The learned counsel for the
petitioner pointed out the averments made in the
petition for showing the manner in which the meeting
was conducted.

¶18

4We have given careful consideration to the
submissions. Firstly, we must note what are the
contents of the impugned resolution No.42. The
first part of the impugned resolution which is
objected to by the petitioner provides that the

¶19

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¶20

powers of the Municipal Corporation under section
101 and Rule 2 of Chapter VII in Schedule D of the
said Act in relation to accounts head are conferred
on the Standing Committee. It records that the
approval has been granted to confer powers on the
Standing Committee. The second part of the
resolution which is objected to is that the
authority as regards the third part of the budget
has been conferred on the Municipal Commissioner.

¶21

5Thus, the resolution purports to delegate
certain powers of the Municipal Corporation to the
Standing Committee as well as to the Municipal
Commissioner.

¶22

6Chapter II of the said Act provides for various
municipal authorities in the said Act. The said
authorities are the Corporation constituted under
section 5 of the said Act, Standing Committee,
Transport Committee, Wards Committee, Special and
Adhoc Committees, Joint Committee, Municipal
Commissioner and the Transport Manager. As far as
the Corporation is concerned, section 5 provides
that each Corporation shall consist of elected
councilors as well as nominated councilors. This
body is popularly referred as General Body. Thus,
the Corporation, the Standing Committee and the
Municipal Commissioner are the different authorities
under the said Act. It is in this context that the
submissions canvassed across the bar are required to
be considered. Section 67 lays down the functions of
the several municipal authorities. Section 67 reads

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thus:

“ 67 Functions of the several municipal authorities

¶28

(1)The respective functions of the several
municipal authorities shall be such as are
specifically prescribed by or under this Act.
(2)Except as otherwise expressly provided
in this Act, the municipal government of the
City vests in the Corporation.

¶29

(3)Subject, whenever it is in this Act
expressly so directed to the approval or
sanction of the Corporation or the Standing
Committee and subject also to all other
restrictions, limitations and conditions
imposed by this Act or by any other law for
the time being in force, the entire executive
power for the purpose of carrying out the
provisions of this Act and of any other Act
for the time being in force which imposes any
duty or confers any powers on the
Corporations vests in the Commissioner, who
shall also,

¶30

(a)perform all the duties and exercise
all the powers specifically imposed or
conferred upon him by this Act or by any
other law for the time being in force;

¶31

(b)prescribe the duties of, and exercise
supervision and control over, the acts
and proceedings of all municipal officers
and servants, other than the Municipal
Secretary and the Municipal Chief Auditor

¶32

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and the municipal officers and servants
immediately subordinate to them, and
subject to the regulations, dispose of
all questions relating to the service of
the said officers and servants and their
pay, privileges and allowances;

¶35

(c)in any emergency, take such immediate
action for the service of safety of the
public or the protection of the property
of the Corporation as the emergency shall
appear to him to justify or to require
notwithstanding that such action cannot
be taken under this Act without the
sanction, approval or authority of some
other municipal authority or of the
[State] Government:

¶36

Provided that the Commissioner shall
report forthwith to the Standing
Committee and to the Corporation the
action he has taken and his reasons for
taking the same and the amount of cost,
if any, incurred or likely to be incurred
in consequence of such action which is
not covered by the current budgetgrant
under the provisions of this Act;

¶37

(d)perform the duties and exercise the
powers imposed or conferred upon the
Transport Manager by this Act in his
absence or on failure by him to perform
or exercise the same.”

¶38

7Subsection 1 of section 67 provides that

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respective functions of the several municipal
authorities shall be as are specifically prescribed
by or under the said Act. On conjoint reading of
subsection 1 and 2, it is crystal clear that if the
said Act specifically provide that a particular
function shall be exercised by a particular
municipal authority, the same shall be performed by
the same municipal authority. Only when the said
Act is silent as to which municipal authority shall
perform a particular function, it is the municipal
Corporation which will have to discharge the said
function.

¶41

8Subsection 1 of section 69 specifically
confers a power to delegate the exercise of power,
duty or functions vested in the Commissioner or
Transport Manager or any other Officer. Thus, in
the provisions of the said Act, wherever the
legislature intended, it has specifically provided
for a power of delegation. In fact, there is a
specific provision to delegate power of the
Commissioner to the Additional Commissioner.

¶42

9Before we deal with the relevant provisions
regarding budget, we must deal with the argument
that what has been delegated did not constitute
essential functions. As far as delegation of powers
is concerned, the law is well settled. In paragraph
20 of its decision in the case of Marathwada
University vs. Seshrao Balwant Rao Chavan1, the Apex
Court has reiterated the well settled legal

¶43

1 (1989) 3 SCC 132

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position. The Apex Court held that when the Act
prescribes a particular body will exercise a
particular power, the same must be exercised only
by that body. The Apex Court observed that the said
power cannot be exercised by another body unless it
is delegated to it and that the law must also
provide for such delegation.

¶46

10It is not the case of the respondents that the
powers of the Corporation have been delegated to
Standing Committee or the Commissioner, as the case
may be, under the specific statutory provision which
is a part of the said Act. Therefore, the
distinction which is sought to be made between
essential functions and non essential functions is
not relevant at all for considering the issue of
validity of the delegation.

¶47

11Now, firstly we come to section 101 of the said
Act which reads thus:

¶48

“101(1) On the recommendation of the Standing
Committee in the case of expenditure from the
Municipal Fund and the Transport Committee in
the case of expenditure from the Transport
Fund, the Corporation may from time to time
during an official year increase the amount
of any budget grant, or make an additional
budget grant from the purpose of meeting any
special or unforeseen requirement arising
during the said year, but not so that the
estimated cash balance at the close of the

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year exclusive of the balance, if any, of any
special fund shall be reduced below one lakh
of rupees or such other amount as may have
been fixed for the time being by the
Corporation in the case of either the
Municipal Fund or the Transport Fund.

¶52

 (2)Such increased or additional budget
grants shall be deemed to be included in the
budget estimates adopted by the Corporation
for the year in which they are made.”

¶53

12Subsection 1 of section 101 provides for
increasing amount of budgetary grant and to make
additional grant. Subsection 1 vests the said
power in the Corporation which could be exercised on
the recommendation of the Standing Committee or the
Transport Committee. Section 103 of the said Act
reads thus:

¶54

“103Reduction in and transfers from one
budget head to another or within a budget
head shall be made in accordance with the
rules.”

¶55

13In view of section 103 that Rule 2 of Chapter
VII comes into picture. Rule 2 of Chapter VII reads
thus:

¶56

“2 Reductions or transfers

¶57

(1) Subject to the provisions of subsection (1) of section 101, the Corporation may, on the recommendation of the Standing Committee

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from time to time during an official year,
sanction the transfer of any amount from one
budget grant to another.

¶62

(2)The Standing Committee may at any time
during an official year

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(a) reduce the amount of a budget grant;

¶64

(b) sanction the transfer of any amount
within a budget grant for one minor head
to another or from a subordinate head
under one minor head to a subordinate head
under another minor head; or

¶65

(c)sanction the transfer of any amount
exceeding rupees five thousand within a
minor head from one subordinate head to
another or from one primary unit to
another.

¶66

(3)The Commissioner may, at any time during an
official year, sanction the transfer of any
amount not exceeding rupees five thousand within
a minor head from one subordinate head to
another or from one primary unit to another, if
such transfer does not involve a recurring
liability.

¶67

Provided that every transfer of an amount
exceeding rupees five hundred made under sub
rule (3) shall be reported forthwith by the
Commissioner to the Standing Committee.

¶68

(4)When making any transfer under subrules
(1), (2) and (3) due regard shall be had to
all the requirements of this Act.

¶69

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(5) If any such reduction as is referred to
in clause (a) of subrule (2) is of an amount
exceedingfivehundredrupees,the
Corporation may pass with regard thereto such
orders as if may think fit and it shall be
incumbent on the Standing Committee and the
Commissioner to give effect to such order.

¶72

(6)For the purpose of expenditure from the
Transport Fund, the provisions of this rule
shall apply as if for the word “Standing
Committee” the words “Transport Committee”
and for the word “Commissioner” the words
“Transport Manager” had been substituted.”

¶73

14Under subrule 1 of Rule 2, the power is vested
in the Corporation which could be exercised by
recommendation of the Standing Committee. SubRules
(2) and (3) of Rule 2 deals with the powers of the
Standing Committee and the Commissioner. Thus, the
Corporation (General Body) has purported to delegate
powers of the Corporation both under sections 101
and 103 read with Rule 2 of Chapter VII of Schedule
D of the said Act. On the face of it, the said
delegation is completely illegal as it is not
supported by the provisions of the said Act.

¶74

15Now we come to the second part of the
delegation. The second part purports to provide that
the Municipal Commissioner has been conferred power
to do the needful in terms of section 3 of part 2 of
the budget for the year 20172018. On page 289 to

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¶76

page 299 of the budget document the receipts are
shown. The expenditure has been set out from page
300 onwards which involves different kinds of
expenditure such as payment of taxes, refund of
security deposit etc. The second item in the
expenditure is refund of octroi. The provision made
in the budget for the said item is for Rs.40 crores.
Item 15 is of disbursement of vehicle loans to the
employees. The amount provided in the budget under
this head is of Rs.2 crores. Item No.16 is as
regards grant of housing loan and loan for repairs
to the houses of the employees of the Municipal
Corporation. The amount sanctioned in the budget
for this head is of Rs.35 crores. There are several
amounts which runs into crores.

¶77

16On this aspect, it will be necessary to
make a reference to various provisions of the said
Act. Section 86 imposes restrictions on the
expenditure of municipal funds. Section 86 of the
said Act reads thus:

¶78

“Section 86 (1) Except as hereinafter
provided, no payment of any sum shall be
made by the Commissioner out of the
Municipal Fund, unless the expenditure of
the same is covered by a current budget
grant, and sufficient balance of such
budgetgrantisstillavailable,
notwithstanding any reduction or transfer
thereof which may have been made under the
rules.

¶79

(2) The following items shall be excepted
from the prohibition in subsection (1),
namely :—

¶80

( a) sums of which the expenditure has been

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sanctioned by the Standing Committee under
section 102;

¶85

( b) temporary payments under section 90
for works urgently required in the public
service;

¶86

(c) refunds of taxes and other moneys which
the Commissioner is by or under this Act
authorized to make;

¶87

(d) repayments of moneys belonging to
contractors or other persons held in
deposit and of moneys collected or credited
to the Municipal Fund by mistake;

¶88

(e) sums which under any provision of this
Act or any other enactment are payable by
way of compensation;

¶89

(f) sums payable in any of the
circumstances mentioned in clause (h) of
section 88;

¶90

(g) expenses incurred by the Commissioner
in the exercise of the powers conferred
upon him by section 319;

¶91

(h) costs incurred by the Commissioner
under clause (c) of subsection (3) of
section 67.

¶92

17Subsection (1) specifically provides that
no payment of any sum shall be made out of
municipal funds unless the expenditure of the same
is covered by the current budget grant and
sufficient balance of such amount is still
available. Subsection (2) carves out exceptions to
subsection (1) of section 86 of the said Act.
Section 88 of the said Act provides for the purposes
for which the municipal funds have to be applied.
Section 88 does not confer any power on the
Municipal Commissioner. Sub section (1) of section
86, as noted earlier, permits the Commissioner to
make payment of amounts out of the municipal funds
provided the same is covered by the current budget
grant and sufficient balance of such budget grant is

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¶95

still available. Thus, when amount can be spent by
the Municipal Commissioner from the municipal funds
is laid down in section 86.

¶96

18In view of subsection (1) of section 67
the Commissioner can exercise powers as regards the
municipal funds provided it is covered by section
86. Subsection 2 of section 67 of the said Act
makes provisions as regards who can make
expenditure. The power is of the Municipal
Corporation to spend the municipal funds.

¶97

19As held earlier, whenever the legislature
intended there is a specific provision made for
delegation in the said Act. Therefore, there cannot
be any delegation which is not permitted by the
provisions of the said Act. The impugned resolution
means that even the power to spend money out of the
municipal funds or the power to disburse municipal
funds which is not expressly vested in the Municipal
Commissioner can be exercised by him.

¶98

20Looking from any angle, the impugned part
of the resolution which provides for delegation in
favour of the Standing Committee and the Municipal
Commissioner is completely illegal being in breach
of the provisions of the said Act. An argument was
canvassed that non essential functions have been
delegated. The question is whether the statute
authorizes delegation. Whether the functions are
essential or not is irrelevant.

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¶100

21Another submission canvassed by the learned
Senior counsel for the Respondent Nos.1 and 2 is
that the Petitioner is an elected councilor and the
leader of the opposition and therefore, the
Petitioner ought to have made a grievance during the
course of the meeting. In paragraph 7 of the
petition, there are specific allegations made by the
Petitioner as to what transpired in the meeting
dated 20th June 2017. The allegation is that after
amendment was suggested and was seconded, the same
was passed in a hasty manner and contrary to the
provisions of law. There is a reply filed by the
Respondent No.2. The said reply does not
specifically deal with the averment made in
paragraph 7.

¶101

22Even assuming that the Petitioner is a
party to the resolution which is impugned in the
petition, if the said resolution is completely
illegal, the petitioner being an elected councilor
can always challenge the same in accordance with
law.

¶102

23We must note here that the present petition
was filed on 23rd August 2017 and notice was issued
for final disposal on 8th September 2017. However,
there was no restraint order passed by this Court.
Therefore, this order/judgment shall not be
construed to mean that this Court intended to set
aside the actions/decisions taken prior to the
judgment on the basis of the impugned delegation.
The Judgment does not prevent the Commissioner from

¶103

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¶105

spending amounts/disbursing the amounts as permitted
under the express provisions of the said Act such as
section 86.

¶106

24Hence, the petition is allowed and the
following order is passed:

¶107

ORDER

¶108

i)The impugned Resolution No.42 dated 20th June
2017 to the extent to which it provides for
delegation of the powers in favour of the Standing
Committee and the Municipal Commissioner is hereby
quashed and set aside;

¶109

ii)We further make it clear that the rest of
the resolution is not disturbed;

¶110

iii)The petition is accordingly disposed of on
the above terms.

¶111

.At this stage, the learned Senior counsel
appearing for the Municipal Corporation prays for
stay of this order. The said prayer is rejected.

Shri. Yogesh Mangalsen Bahal v. the Commissioner of Pimpri Chinchwad Municipal Corporation and Ors.

Case brief

What is this about?

What did the court decide?

Shri. Yogesh Mangalsen Bahal v. the Commissioner of Pimpri Chinchwad Municipal Corporation and Ors.

Case brief

What is this about?

What did the court decide?

What the court decided

A compact analysis

Issues for consideration

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