SHIVPRASAD UMASHANKER Vs. MUNICIPALITY OF PALITANA

JUDGEMENT

(1.) This Letters Patent Appeal raises an interesting question affecting the relationship of a Municipality and its Chief Officer under the provisions of the Gujarat Municipalities Act, 1963. The facts giving rise to the appeal are few and may be briefly stated as follows. Prior to the coming into force of the Gujarat Municipalities Act, 1963, Palitana Municipality was governed by the Bombay District Municipal Act, 1901. The petitioner was appointed Chief Officer of the Palitana Municipality in January 1959 and this appointment was approved by the Collector by an order, dated 20th February 1965. Though in the appointment the petitioner was designated as Chief Officer, there was no statutory office of Chief Officer under the Bombay District Municipal Act, 1901. It was only under the Gujarat Municipalities Act, 1963, that a statutory office of Chief Officer was created for the first time. Palitana Municipality, therefore, on the coming into force of the Gujarat Municipalities Act, 1963, passed a resolution, dated 22nd April 1965 appointing the petitioner as Chief Officer under Sec. 47 of the Act. The pay-scale of the Chief Officer was thereafter revised by Palitana Municipality with the approval of the State Government obtained under clause (a) of the proviso to Sec. 271 and a fresh resolution was passed by Palitana Municipality on 10th June 1963 confirming the petitioner as Chief Officer in the revised pay-scale with effect from 2nd January 1967. The petitioner continued to occupy the office of Chief Officer until 31st July 1969 when his service was terminated pursuant to a resolution, dated 30th July 1969 passed by the General Board of Palitana Municipality. The resolution came to be passed in following circumstances. Palitana Municipality consists of 25 Councillors. Out of them, 16 Councillors sent a requisition, dated 25th July 1969 to the President requiring him to call a meeting of the General Board for the purpose of considering and passing a resolution that the service of the petitioner as Chief Officer be terminated forthwith or at any rate from 31st July 1969. Pursuant to the requisition the President convened a meeting of the General Board on 30th July 1969. The meeting was accordingly held at the Municipal Office on 30th July 1969 and at the meeting a resolution was passed unanimously by all 24 members present, without any discussion whatsoever, that the service of the petitioner as Chief Officer be terminated with effect from 31st July 1969. Though the petitioner was present at the meeting in his capacity as Chief Officer, he was not informed as to what were the reasons for which his service was sought to be terminated nor was any opportunity given to him to show cause against the proposed termination of his service. The resolution did not show on the face of it what was the source of the power in exercise of which the service of the petitioner was terminated but pursuant to the resolution and with a view to giving effect to it, an office order was passed by the President of the Palitana Municipality on the same day, namely, 30th July 1969 in which it was clearly recited that the resolution terminating the service of the petitioner was passed by more than two-third of the members of the General Body of the Palitana Municipality under Sec. 48 of the Gujarat Municipalities Act, 1963. The office order directed that the service of the petitioner was terminated with effect from 31st July 1969 and that the petitioner would be paid three months' notice pay from 1st August 1969 to 31st October 1969. The President of Palitana Municipality also addressed a letter, dated 30th July 1969 to the petitioner intimating to him that his service as Chief Officer was terminated with effect from 31st July 1969 under Sec. 48 and that he would be paid three months' salary in lieu of notice. The petitioner thereupon preferred the present petition challenging the validity of the resolution passed by the General Board of the Palitana Municipality as also the office order issued by the President in pursuance of the resolution and seeking a direction that the respondent should treat the petitioner as continuing in service as if the resolution and the office order had not been made at all.

(2.) Before we set out the ground of challenge against the validity of the impugned resolution and office order, it would be convenient at this stage to refer to the relevant provisions of the Gujarat Municipalities Act, 1963, which have a bearing on the determination of the controversy between the parties. The statutory office of Chief Officer of a Municipality is created for the first time by Sec. 47 sub-sec. (1) and this sub-section provides that the Chief Officer shall be appointed by the Municipality. Section 48 confers protection inter alia on the Chief Officer and since a considerable part of the controversy has turned round the true scope and ambit of this section, it would be desirable to set it out in extenso. It reads :-

(3.) The main ground on which the validity of the impugned resolution and office order was challenged on behalf of the petitioner was that the termination of service of the petitioner was null and void since it was effected without informing the petitioner of what was alleged against him and giving him an opportunity to show cause why his service should not be determined. The petitioner contended that by virtue of Rule 28 of the Rules made by the Palitana Municipality under Sec. 46 of the Bombay District Municipal Act, 1901, which Rules were continued in force after repeal of the Bombay District Municipal Act, 1901, by Sec. 279 sub-sec. (2) clause (vi) of the Gujarat Municipalities Act, 1963, the petitioner was entitled to continue in service as Chief Officer until the age of superannuation which was 55 years and the termination of his service prior to the age of superannuation constituted removal from service which could be effected only under Sec. 48 after holding an inquiry and giving an opportunity to the petitioner to make his defence in regard to the misconduct alleged against him. The petitioner also urged that, in any event, even if Rule 28 had no application to the office of the Chief Officer and the petitioner was accordingly not entitled to a tenure of service up to the age of superannuation, the termination of his service was effected by the Palitana Municipality in exercise of the power conferred under Sec. 48 and this power being a disciplinary power exercisable by way of punishment, the Palitana Municipality was under a duty to act judicially in exercising it and it could not validly terminate the service of the petitioner without complying with the principles of natural justice. The respondents sought to meet this contention of the petitioner by a three -fold argument. The first contention urged on behalf of the respondents was that Rule 28 had no application to the office of Chief Officer and even if it applied, it did not confer a right on the Chief Officer to continue in service up to the age of 55 years; it merely prescribed an age limit beyond which the Chief Officer could not be continued in service by the Palitana Municipality. The petitioner was, therefore, not entitled to continue in service as Chief Officer until he reached the age of 55 years and termination of his service prior to that date could not per se be regarded as removal from service by way of punishment so as to attract the observance of the principles of natural justice. The respondents also urged that the termination of service of the petitioner was not effected under Sec. 48 but it was in exercise of the power which an employer possesses under the general law of master and servant to terminate the service of his employee on giving reasonable notice or at any rate in exercise of the power implicit under Sec. 16 of the Bombay General Clauses Act, 1904 and there was accordingly no question of giving show- cause notice to the petitioner and holding an inquiry for the purpose of determining whether his service should be terminated. The words "removable from office" in Sec. 48, according to the respondents, carried the same meaning as "discontinuance in office" in Sec. 50 : both referred to removal from service by way of punishment and, therefore, in the absence of any express provision in regard to termination of service of Chief Officer, the inherent power of the Municipality as a master to terminate the service on giving reasonable notice under the general law of master and servant as also the power of the Municipality to terminate the service under Sec. 16 of the Bombay General Clauses Act, 1904, remained unaffected and could be exercised by the Municipality without any fetter. The respondents also contended in the alternative that, in any event, the words "removable from office" in Sec. 48 and "discontinuance in office" in Sec. 50 meant termination of service simpliciter; in one case the service of the Chief Officer could be terminated by the Municipality while in the other, it could be terminated by the State Government. The Municipality could, in exercise of the power conferred under Sec. 48, terminate the service, if its action was supported by a majority of at least two-thirds of the total number of Councillors but if two-thirds majority was not available and termination was desired only by a bare majority, the Municipality had no power to terminate the service but it could, by a resolution passed by an ordinary majority of the Councillors present at the special general meeting called for the purpose, recommend to the State Government that Chief Officer be discontinued in office and the State Government would then, in its discretion make an order of discontinuance in office of the Chief Officer after complying with the procedure set out Sec. 50. There were thus two modes of termination of service of the Chief Officer provided by the statute; one by twothirds majority of the Councillors under Sec. 48 and the other by the State Government on the recommendation of an ordinary majority of the Councillors under Sec. 50. The termination of service of the petitioner in the present case was effected by a unanimous resolution passed by all the Councillors of the Palitana Municipality and, therefore, it was a valid exercise of power under Sec. 48 and being termination simpliciter, it did not require observance of the principle of natural justice. These were the different contentions urged on behalf of the parties and we shall now proceed to examine them.