RAMESH CHANDRA SAMANTRAY Vs. STATE OF ORISSA

JUDGEMENT

(1.) Petitioner No. 1 is the Chair Person and Petitioners 2 to 8 are the Councillors of the Paradeep Notified Area Council with effect from 22-4-2000. Paradeep Notified Area Council (for short, the Paradeep N.A.C.) is presently a Municipality. By a notice dated 26-12-2001, the Director, Municipal Administration and Ex-Officio Additional Secretary to Government of Orissa, Housing and Urban Development Department intimated the petitioners that a special audit was conducted during the period from 15-1-2001 to 20-2-2001 and an inspection was conducted by the Under Secretary to Government, Housing and Urban Development Department on 9-7-2001 and it has come to the notice of the Government that the Council of Paradeep N.A.C. has shown incompetency in performance of the duties imposed on it by law, has exceeded and abused its power and has acted in the manner prejudicial to the interest of the inhabitants of the Paradeep N.A.C. In the said notice dated 26-12-2001, instances of the irregularities alleged to have been committed by the Council of Paradeep N.A.C. were detailed and the petitioners were asked to show cause as to why the Government should not dissolve the Council of Paradeep N.A.C. on the grounds mentioned therein. The petitioners submitted their replies to the aforesaid show cause notice and were heard by the Director, Municipal Administration on 29-6-2002 in support of the replies. But by a notification, dated 27-8-2002 of the Government of Orissa, Housing and Urban Development Department issued by the Director, Municipal Administration and Ex-Officio Additional Secretary to Government, the Notified Area Council of Paradeep was dissolved with immediate effect by the State Government in exercise of its powers conferred by subsection (1) of Section 401 of the Orissa Municipal Act, 1950. Aggrieved, the petitioners have filed this writ petition under Article 226 of the Constitution for quashing the said notification.

(2.) Mr. Indrajit Mohanty, learned counsel for the petitioners, submitted that the proviso to Clause (1) of Article 243U of the Constitution makes it clear that where a Municipality is to be dissolved before the term of five years from the date for its first meeting, the Municipality Has to be given a reasonable opportunity of being heard before its dissolution. He submitted that under Section 401 of the Orissa Municipal Act, if in the opinion of the State Government a Municipality is incompetent to perform or persistently makes default in performing the duties imposed on it by law or exceeds or abuses its powers, the State Government can dissolve the Municipality. According to Mr. Mohanty, if the said Section 401 is read with the proviso to Article 243U (1) of the Constitution, the State Government will have to grant reasonable opportunity of hearing to the Paradeep Municipality before forming an opinion that the Municipality should be dissolved. Mr. Mohanty submitted that the petitioners have not been heard by the State Government but by the Director of Municipal Administration on 29-6-2002 and on this ground alone the impugned notification is liable to be quashed. Mr. Mohanty next submitted that the irregularities referred to in the show cause notice dated 26-12-2001 relate to the period prior to 22-4-2000 when the petitioners were not holding office of the Chairperson and Councillors of Paradeep N.A.C. and the present Paradeep Municipality cannot be dissolved for irregularities of the Councillors of the Paradeep N.A.C. who were in office prior to 22-4-2000. He, however, submitted that only one irregularity, namely, engagement of NMR/DLR in violation of Governments instruction mentioned in the show cause dated 26-12-2001 under item-4 of the show cause notice related to the period after 22-4-2000 but explained that the engagement of NMRs/ DLRs by the Paradeep N.A.C. was pursuant to the directions of the Court. Mr. Mohanty next submitted that sub-section (2) of Section 401 empowered the State Government to communicate to the Municipality the ground on which they propose to dissolve the Municipality fixing a reasonable period for the Municipality to show cause against such proposal, but the State Government in this case has not communicated the petitioners the grounds on which the dissolution of the Paradeep Municipality was proposed and instead, the Director, Municipal Administration by his notice dated 26-12-2001 has communicated the grounds. Mr. Mohanty vehemently argued that although Section 408 of the Orissa Municipal Act empowers the State Government to delegate its power under the Act to any person or authority, no such delegation has been made by the State Government in favour of the Director of Municipal Administration to exercise the power of the Government under Section 401 of the Act.

(3.) Mr. A. Routray, learned Add 1. Government advocate and Mr. B. M. Patnaik, learned counsel appearing for the State Government and the Executive Officer, Paradeep Municipality respectively submitted that reasonable opportunity of hearing had been given to the petitioners before the impugned notification was issued dissolving the Paradeep Municipality. They referred to the notification in Annexure-8 series to show that the Director, Municipal Administration, named therein, has been empowered under Section 408 of the Orissa Municipal Act to exercise all the powers of the State Government and submitted that the Director of Municipal Administration had thus the power to Issue notice to show cause to the petitioners and hear the petitioners.