INDRA NARAYAN NANDI Vs. STATE OF WAST BENGAL

JUDGEMENT

(1.) THE petitioner before me is Indra Narayan Nandi who describes himself as the Alderman of the Chandernagore Municipal Corporation. The opposite parties are firstly, the State of West Bengal, secondly, the Chandernagore Electric Supply Co. Ltd. and the third and added opposite party is the Chandernagore Municipal Corporation. The facts are briefly as follows: It is stated that in the year 1938, the Chandernagore Electric Supply Co. Ltd. entered into a contract with the Municipality of Chandernagore for the supply of electric energy for public distribution. It is claimed that the present Municipal Corporation of Chandernagore has inherited the rights under the said contract, one of which is that it would be able to resume the responsibility for supplying electricity, by re-purchasing the undertaking of the said company, after expiry of 15 years. It is stated however that the company has now been granted a license under the Indian Electricity Act (Act IX of 1910) by the opposite party No. 1, and thereby the rights of the said Municipal Corporation have been infringed. It is therefore prayed that the license should be cancelled and the right of the Municipality in that behalf should be declared. As is well-known, the city of Chandernagore in 1938 was a territory belonging to France. It has now merged in the State of West Bengal. Therefore, in order to examine the rights of the parties it is necessary to investigate the constitutional position and particularly whether the present Municipal Corporation of Chandernagore has inherited any rights of the Municipal Council of Chandernagore as it existed in 1938, or whether the Chandernagore Electric Supply Co. Ltd. is subject to any obligations as claimed. Before I proceed to examine the position, it is necessary to state that there has been strong objection to the maintainability of this application by the petitioner who is only one of the Aldermen of the Municipal Corporation of Chandernagore. The Municipal Corporation itself has not made any application nor has it authorised the petitioner to make such an application. However this is a point to which I shall revert later on.

(2.) IN order to investigate the constitutional position, and the legal rights of the parties, it is necessary to examine certain events chronologically. The starting point is the 24th March, 1938 when the then 'municipal Council of Chandernagore', granted a "concession" to one Engineers' Syndicate (Bengal) Ltd. , a company incorporated under the Indian Companies Act, and having its registered office at No. 4, Civile Ghat Street, Calcutta, for the distribution of electric energy in the town of Chandernagore. The said 'concession' was approved by the then Government, being a Government under the sovereignty of France. It was done by a 'decret' of the then Governor of French India, in Privy Council at Pondicherry, dated, the 14th March, 1939 and was governed by terms and conditions contained in a document, called the "cahier Des Charges", a copy whereof in its English translation has been annexed to the petition and marked "a", as also to the counter affidavit filed on behalf of the Opposite party No. 2, and marked with the letter "a". Under article 34 of the said conditions, the Engineers' Syndicate (Bengal) Ltd. , was given the power to assign and/or cede the whole or part of the said "concession" in favour of a third party, with the authorisation resulting from a deliberation of the Municipal Council of Chandernagore and approved by the Governor of Pondicherry. The said Engineers' Syndicate (Bengal) Ltd. and the opposite party No. 2 preferred applications to the Mayor of Chandernagore on the 15th November, 1939 praying for authorisation by the Council of an assignment by the Syndicate in favour of the company. The authorisation was made, and approved by the Governor of Pondicherry on 17th June, 1940. Article 21 of the "concession" lays down that the duration of the "concession" was to be for a period of 25 years from the date when the "concession" was finally approved. Article 22 lays down that during the period fixed for the termination of the contract, the "commune" will have, with a pre notice of 3 years, an option to terminate the rights of the concessionary and take possession of all the landed properties and works of the distributor. It will in that event, pay compensation. Article 23 lays down that on the expiry of the period of 15 years, beginning from the date of the final approval of the concession, the "commune" will have the right to repurchase the whole contract with a pre-notice of 2 years. In that event, the concessionary was to be indemnified in accordance with the principles laid down in the said article. From these facts it will be seen that the "concession" was not a contract in terms of the Indian Contract Act. It was a "concession" granted by the public authorities, under the law of France, which is no longer applicable. On the 7th of November, 1947 the Government of France enacted a 'decret' being Decret No. 47-2121 abrogating the previous Decret and creating the free town of Chandernagore. The Decret No. 47-2121 of 7th November, 1947 recites that the enacting authority had seen numerous earlier Decrets ranging from 1880 to 1947 and enacted that Chandernagore was to be set up as a free town vested with financial and administrative autonomy. The town was placed under the direction of a "council of Administration". Its proper interests were to be administered by an elected assembly known as the "municipal Assembly". The Municipal Assembly was to regulate by its deliberations, all affairs regarding the financial and administrative management of the free town of Chandernagore. There would be an "administrative Council" composed of the President and the Vice-President of the Municipal Assembly. It was to ensure the execution of the resolutions of the Municipal Assembly. It will be seen that the "municipal Assembly" was not merely a body having municipal duties. It was also to carry on the administration. There is nothing in the Decret to show that it was the successor of the Municipal Council which existed in 1938, and in any event it has not been laid down that it had inherited any of the rights and liabilities under the "concession" of 1938. In 1948. letters were exchanged between the Government of India and the Government of France regarding the future of French possessions in India. In June, 1949 the Government of France consulted the people of the free town of Chandernagore, and decided to accept the request of the Government of India for the appointment of an Indian Administrator, as a provisional measure. On the 2nd May, 1950 an Indian Administrator was appointed. In 1950 came into operation the 'chandernagore (Application of Laws) Order of 1950' passed under the Foreign Jurisdiction Act, 1947. Under the Order, certain Indian laws were made applicable to Chandernagore. On the 9th June, 1952 the Treaty of cession of Chandernagore came into existence. This was a treaty by which the French Republic confirmed the cession of the territory of the free town of Chandernagore to the Government of India. Under article VII of the said Treaty, the Government of India succeeded to the rights and obligations resulting from the acts done by France for public purposes concerning the administration of Chandernagore. From this it will appear that if the "concession" mentioned above be taken as an administrative measure, the rights and obligations under it devolved on the Government of India and not on the Municipal Corporation of Chandernagore. On the 30th June, 1952 was promulgated the 'chandernagore (Administration) Regulation. 1952 (Regulation I of 1952)'. This was done under Article 243 (2) of the Constitution of India. Under clause 15 of this Regulation, the Decret No. 47-2121 dated 7th November, 1947 creating Chandernagore as a free town and the subsequent texts modifying the same were repealed, and the Municipal Assembly and the Administrative Council set up thereunder were dissolved. Under clause 7 of the Regulation, all rights, liabilities and obligations of the Government of the French Republic or the Municipal Assembly or the Administrative Council, in relation to Chandernagore, was from the appointed day, to be the rights, liabilities and obligations of the Central Government. The appointed day was the 9th June, 1952 being the day on which the free town of Chandernagore was transferred in full sovereignty to India under the Treaty of cession of Chandernagore. Under the Regulation, an 'administrator' was appointed by the Central Government, as a head of the administration. The Centra Government was given the power to appoint an Advisory Council. Under clause 6 it was declared that all property and assets within Chandernagore which before the appointed day vested in the Government of the French Republic or the Municipal Assembly or the Administrative Council, vested on the appointed day in the Central Government. Thus, it will be seen that under the Regulation of 1952, the Municipal Assembly was abolished and all its rights and obligations vested in the Central Government. The rights and obligations did not vest in the Municipal Corporation of Chandernagore, which indeed, at that time had not come into existence at all. On the 30th June, 1952 an Administrator was appointed for the city of Chandernagore under clause 3 of the Regulation of 1952. On the 4th September, 1953 by a notification under clause 11 of the said Regulation, the Central Government applied the Indian Electricity Act, 1910 which modifications to Chandernagore. Upto this time, the position was that the French Republic had ceded the city of Chandernagone to the Indian Union. On the 2nd of October, 1954 was passed the 'chandernagore (Merger) Act of 1954' being an Act of Parliament, No. 36 of 1954. Under section 3 of the said Act, as from 'the appointed day', Chandernagore became part of the State of West Bengal and the boundaries of that State were to be so altered as to comprise within them the territory of Chandernagore. Under section 13, all property and assets within Chandernagore which, immediately before the appointed day, were vested in the Central Government for the purposes of the administration of Chandernagore, as from that day, vested in the State Government, unless the purposes for which such property or assets' were held immediately before that day, were Union purposes. Under section 14, all rights, liabilities and obligations of the Central Government arising out of, or in relation to, the administration of Chandernagore, as from the appointed day, were to be the rights, liabilities and obligations of the State Government, unless such rights, liabilities and obligations were relatable to Union purposes. Under section 17, all laws, which immediately before the appointed day extended to, or were in force, in the State of West Bengal, generally extended to or came into force in Chandernagore. Under section 18, any law in force in Chandernagore immediately before the appointed day stood repealed.

(3.) ON the very same day, that is to say, the 2nd day of October, 1954 came into operation, the ' Chandernagore (Assimilation of laws) Ordinance, ly54', being West Bengal Ordinance No. IX of 1954. By section 3 of the said Ordinance, all laws which, immediately before the appointed day extended to or were in force in the State of West Bengal, generally extended to or came into force in, Chandernagore. Under section 4, the corresponding laws in force in Chandernagore were repealed. Thus, the Indian Electricity Act, 1910, came into operation in the same way as it did in the rest of the State. It Would be observed that under neither of them the Municipal Corporation of Chandernagore inherit any rights, liabilities or obligations of the old Municipal Assembly. On the 21st March, 1955, the Ordinance above-named was replaced by the 'chandernagore (Assimilation of Laws) Act, 1955'. Finally, we come to a piece of legislation, which for our purpose is the most important. This is the 'chandernagore Municipal Act, 1955', being the West Bengal Act XVIII of 1955. It is dated 11th June, 1955 and was to come into force on such day as the State Government might by notification in the Official Gazette appoint. Under sub-section (1) of section 2, "the Administrator of Chandernagore" means the person who immediately before the day of the commencement of the Act had been in charge of the municipal affairs of Chandernagore. Under sub-section (2) of section 2 of this Act, "chandernagore" mean "chandernagore" as defined in Chandernagore (Merger, Act, 1954 and includes any contiguous area which had been added thereto by the State Government by notification in the Official Gazette. Under sub-section (3), 'bengal Act' means Bengal Municipal Act of 1932 as applied to Chandernagore under section 6 and schedule I. Under sub-section (4), "corporation" means Municipal Corporation of Chandernagore established under section 4. Section 4 of the Act is important and must be set out:-