Mool Chand Sharma vs State of Uttar Pradesh

Rewritten Version Notice: This is a rewritten version of the original judgment.

Court: Supreme Court of India

Case Number: Civil Appeal No. 401 of 1961

Decision Date: 20 September 1961

Coram: Raghubar Dayal, Bhuvneshwar P. Sinha, P.B. Gajendragadkar

In this case the appellant, who had been serving as President of the Municipal Committee of Pilkhuwa, challenged actions taken under the Uttar Pradesh Municipalities Act of 1916. The dispute originated when nine members of the Municipal Board prepared a written notice expressing their intention to move a motion of no confidence in the President. This notice was served on the District Magistrate pursuant to section 87‑A, sub‑section (2) of the Act. In response, the District Magistrate issued a summons convening a meeting of the Board to consider the motion. Before the meeting could take place, the President filed a writ petition in the Allahabad High Court questioning the legality of the notice. The High Court dismissed this petition in limine, holding that the petition was premature and therefore could not be entertained on its merits.

The convened meeting was held on the date specified in the notice, and all members who were present voted in favour of the motion of no confidence. The presiding Munsif declared that the motion had been carried. Following this outcome, the President filed a second writ petition before the same High Court seeking to have the proceedings of that meeting set aside and to prevent the State and the District Magistrate from giving effect to the resolution of no confidence. The basis of this second petition was that two of the members who had signed the notice and later participated in the meeting and vote were, at that time, disqualified under clause (g) of section 13‑D of the Uttar Pradesh Municipalities Act because they were in arrears of municipal taxes and other dues as defined in section 166 of the Act.

The Supreme Court examined whether the earlier dismissal of the first writ petition, which was decided on the ground of premature filing and not on the merits, could operate as res judicata in the later proceedings. It held that an order dismissing a petition in limine does not have the effect of a substantive decision and therefore cannot be invoked as res judicata in subsequent matters. Moreover, the Court clarified that the mere fact of a Board member incurring disqualification under clause (g) of section 13‑D does not automatically deprive that member of the right to participate in Board proceedings, nor does it suspend or terminate the member’s tenure. A member who is disqualified under the referred provision remains competent to exercise the rights attached to his position on the Municipal Board. The Court referred to the decision in Election Commission of India v. Saka Venkata Subba Rao, [1953] S.C.R. 1144, to support this principle.

Consequently, the Supreme Court concluded that the resolution of no confidence, which had been duly passed at the meeting, could not be set aside on the ground of the alleged disqualification of the two members. The earlier dismissal of the first writ petition was not a bar to the validity of the Board’s actions, and the President’s claim for quashing the meeting proceedings was rejected.

The appeal, taken on special leave, challenged the decision of the Allahabad High Court in Civil Miscellaneous Writ No 846 of 1961, which had dismissed a petition filed by the appellant. The appellant sought a mandamus directing the State of Uttar Pradesh and the District Magistrate of Meerut not to implement a resolution that had been adopted at a Municipal Board meeting in Pilkhuwa on 6 February 1961, and also asked that the proceedings of that meeting be set aside. The appellant had served as President of the Pilkhuwa Municipal Board during the period of January to February 1959. On 4 January 1959, nine board members, including Ram Nath and Kesho Ram Gupta, delivered to the District Magistrate a written notice indicating their intention to move a motion of no confidence against the President, in accordance with sub‑section (2) of section 87‑A of the Uttar Pradesh Municipalities Act, 1916. Acting upon that notice, the District Magistrate convened a board meeting on 6 February 1961. The appellant filed writ petition No 367 of 1961 in the High Court on 2 February 1961, contesting the validity of the notice. The High Court dismissed the petition in limine on the same day, holding that removal of a board member could not occur until an actual order of removal was issued by the State Government, and therefore the application was premature and could not divest a member of the right to participate in the meeting. The board meeting proceeded on 6 February 1961, presided over by Mr Agarwala, Munsif of Meerut, where all ten members present voted in favor of the no‑confidence motion, which the Munsif declared carried. Through his writ petition, the appellant sought to have the meeting’s proceedings declared void and the no‑confidence resolution given no effect by the State and the District Magistrate. The High Court was urged to consider that the notice of motion delivered to the District Magistrate was invalid, rendering the meeting’s proceedings invalid as well. It was further submitted that Ram Nath, Kesho Ram Gupta, and Raghunandan Prasad, who had signed the notice and participated in the meeting and supported the resolution, had become disqualified under section 13‑D(g) of the Act prior to 4 January 1961 because they were in arrears of municipal taxes and other dues.

The Court observed that a person who has failed to pay municipal tax and other dues for a period exceeding one year becomes disqualified under section 166 of the Act, and that such a person also incurs disqualification under clause (g) of section 13‑D of the same Act. The appellant contended that, because Ram Nath, Kesho Ram Gupta and Raghunandan Prasad had incurred the said disqualification, they were no longer qualified to be members of the Municipal Board and therefore could not exercise any rights of a Board member. The High Court examined the evidence and held that Ram Nath was indeed in arrears in the payment of house tax on 6 February 1961. By contrast, the Court found that Kesho Ram Gupta was not in arrears in payment of the Tehbzarai tax for the year 1959‑60, and that Raghunandan Prasad was not in arrears in house tax. The Court further held that the occurrence of a disqualification under section 13‑D(g) does not terminate a person’s membership in the Board; rather, it merely suspends his right to act as a member. The learned Judges quoted: “During the continuance of the disqualification the person’s right to act as a member falls into a state of suspension. On removal of the disqualification the state of suspension disappears and his right to exercise office as a member of the Board revives unless he has been removed by the Government from membership of the Board under section 40 of the Act during the continuance of the disqualification.”

Applying this principle, the Court held that the resolution of no confidence was valid because it had been passed by the vote of nine members, which constituted a majority of more than half of the total seventeen members of the Board. The Court noted that the nine members who voted were qualified and duly elected, and therefore Ram Nath’s participation in the meeting did not vitiate the proceedings in view of sub‑section (2) of section 113 of the Act. Consequently, the writ petition was dismissed. The Court further stated that it did not examine the merit of the notice of motion, as it considered the order in writ petition No. 397 of 1961 to operate as res judicata. However, the Court observed that, had Ram Nath’s name been omitted from the list of signatories, the notice would have contained only eight signatures, which would have fallen short of the number required by sub‑section (2) of section 87‑A of the Act, rendering the notice invalid and consequently the meeting held pursuant to a defective notice also invalid. The learned Attorney General, appearing for the appellant, raised two contentions: (i) that the order dismissing writ petition No. 397 of 1961 could not operate as res judicata because that order had been dismissed on the ground of being premature rather than on the merits; and (ii) that a member who incurs a disqualification under section 13‑D ceases to be a member of the Board for the duration of the disqualification and therefore cannot act as a member for any purpose.

The appellant also advanced the following points. First, it was argued that the resolution passed by the Board on 6 February 1961, which declared that no Tehbazari tax was payable by Kesho Ram Gupta and ordered the refund of the amount he had deposited under protest on 9 February 1961, exceeded the Board’s authority because the Board possessed no power to review or amend the assessment of tax. Second, the appellant contended that the disqualifications incurred by both Ram Nath and Kesho Ram Gupta rendered the notice of motion of no confidence and the subsequent meeting invalid, since, once the signatures and votes of those two members were excluded, the number of signatories to the notice and the number of members participating in the meeting fell below half of the total membership of the Board. Third, the appellant submitted that even if only Ram Nath, a disqualified member, had taken part in the meeting, the proceedings would still be vitiated and could not be saved by the provisions of subsection (2) of section 113, because the meeting was convened under the authority of section 87‑A of the Act and therefore did not constitute a “meeting of the Board” to which subsection (2) of section 113 could apply.

The respondents’ counsel acknowledged that the order dismissing writ petition No. 397 of 1961 could not operate as res judicata in the present proceedings on the issue of whether the notice of no confidence was valid. The Court, however, declined to accept the appellant’s second contention and also rejected the view expressed by the learned judges that a person who incurs disqualification under clause (g) of section 13‑D of the Act becomes disqualified to hold office and to act as a member. Section 13‑C of the Act enumerates the qualifications for membership of the Board, while section 13‑D sets out the disqualifications. Of the ten clauses contained in section 13‑D, clause (g) is pertinent. Clause (g) provides: “A person, notwithstanding that he is otherwise qualified, shall be disqualified for being chosen as, and for being, a member of a Board if he is in arrears in the payment of municipal tax or other dues in excess of one year’s demand to which section 166 applies.” The second proviso to that section adds: “Provided further that in the case of (g), the disqualification shall cease as soon as the arrears are paid.” Consequently, when a Board member falls into arrears in municipal tax, that member incurs the disqualification. The provisions of section 13‑D therefore apply to members who become disqualified during their tenure and are not limited to the period preceding election; otherwise the phrase “and for being” would be unnecessary. That interpretation has been endorsed in the decision of Election Commission, India v. Saka Venkata Subba Rao, where the Court examined the analogous language of Article 191 of the Constitution, which imposes the same set of disqualifications for election and for continued membership.

In this case, the Court reproduced the wording that an individual would be disqualified “for being chosen as, and for being, a member of the Legislative Assembly or Legislative Council of a State.” The Court then referred to a passage on page 1157 of a previous judgment which explained that Article 191, which sets out the same list of disqualifications for election as for continuing in office, and Article 193, which prescribes the penalty for sitting and voting while disqualified, are deliberately phrased in breadth enough to cover both disqualifications that existed before election and those that arise afterwards. The Court observed that nothing in section 13‑D or any other provision of the Act expressly provides for the suspension or termination of the membership of a duly elected member merely because he incurs any disqualification listed in section 13‑D. By contrast, the Court noted that the language of section 40 of the Act suggests that a member who becomes disqualified under section 13‑D remains entitled to participate in the Board’s proceedings and to perform the duties of a member, unless a separate order of suspension is made. Section 40 deals with the removal of members and authorises the State Government, in the case of a city, or the prescribed authority otherwise, to remove a board member on any of the grounds specified in clauses (a) to (f) of sub‑section (1). One of those grounds, clause (b), is that a member has incurred any disqualification mentioned in sections 12‑D and 13‑D.

The Court then read the relevant subsections of section 40. Sub‑section (3) empowers the State Government to remove a member who, in its judgment, has flagrantly abused his position to the extent that his continued presence would be detrimental to the public interest. Sub‑section (4) provides that, before taking action under the foregoing provisions, the member must be given an opportunity to explain himself and that the reasons for any action taken must be placed on record. Sub‑section (5) states that the State Government may place a member under suspension when proceedings under sub‑section (4) have been commenced, and that a suspended member, for the duration of the suspension order, is not entitled to take part in any Board proceedings or to perform any duties of a member. Accordingly, the Court concluded that the power to suspend applies only to a member against whom removal proceedings have been initiated under the grounds listed in clauses (a) to (f) of sub‑section (1). In the absence of such a suspension order, a member who has merely incurred a disqualification under section 13‑D retains the right to attend Board meetings and to fulfil his functions as a member, and his membership does not automatically cease.

A member who had incurred any of the disqualifications specified in section 13‑D, and even if the Government had commenced proceedings against that member, remained entitled to take part in the Municipal Board’s proceedings and to perform the duties of a member, provided that the Government did not place him under suspension. The Court therefore held that the mere occurrence of a disqualification under section 13‑D does not automatically place a Municipal Board member under suspension, nor does it strip the member of the right to participate in Board business, nor does it cause the member to lose his seat on the Board. The Court warned that any alternative view would create an unstable situation, because it would render the validity of the Board’s actions uncertain; one could not predict at any given time which members had incurred a disqualification, since such a determination depends primarily on proof of the allegations. The Court observed that such instability could not have been the intention of the Legislature. The Court noted that both Kesho Ram Gupta and Ragbunandan Prasad had incurred a disqualification under clause (g) of section 13‑D, yet they were not incompetent to exercise their rights as Board members. Consequently, they were lawfully able to sign the notice of motion of no confidence and to participate in the meeting conducted under the provisions of section 87‑A on 6 February 1961. As a result, the Court concluded that the proceedings of that meeting and the resolution adopted on that date were valid, and that the High Court’s order dismissing the appellant’s writ petition was correct, albeit for different reasons. In view of this finding, the Court saw no need to consider the appellant’s other contentions. The appeal was therefore dismissed with costs, and the dismissal was recorded.