M. P. CHANDRAKANTARAJ, J. ( 1 ) THE petitioners in the three petitions are tenants of the 1st respondent, the City Municipal Council, Gadag. , in the market premises known as G. G. Market i. e. , the Grain Grocery Market. On 16-1-1985, the Finance Standing Committee of the 1st respondent - Town Municipal Council passed a resolution, by which the rents for the shops in the G. G. Market area were revised classifying the entire market mainly into three types of shops. They are exterior shops, the interior shops and the extreme interior shops. The special classification made for exterior shops and some other accommodation may be ignored. The tenants of the exterior shops were required to pay Rs. 225/- per mensem w. e. f. 1-4-1984, while the tenants of interior shops were required to pay Rs. 150/- and the tenants of extreme interior shops were required to pay Rs. 100/- per mensem. The tenants of the premises in G. G. market were informed of the proposed change inviting their objections. The Association of tenants on 18-12-1984 made a representation complaining inter alia that the rent fixed was very high. It was in pursuance of office report that on 16-1-1985 the Finance Standing Committee resolved to overrule the objections of the tenants' Association and decide to charge from 25-6-1984 the rent at the rates proposed to which I have adverted to above. The resolution of the Standing Committee came to be confirmed by the Town Municipal Council by majority of votes on 30-3-1985. ( 2 ) ON 3rd Sept. 1985, the shop keepers tenants of G. G. market made a representation to the Divisional Commissioner calling upon him to exercise the revisional powers and set aside the resolution and suspend the same. The Divisional Commissioner by his endorsement dated 3-10-1985 rejected the petition stating that under Sec. 309 of the Karnataka Municipalities Act 1964 (Act for short) he had no occasion to invoke the powers thereunder. That endorsement is at Annexure-'f'. The Divisional Commissioner by his endorsement dated 3-10-1985 rejected the petition stating that under Sec. 309 of the Karnataka Municipalities Act 1964 (Act for short) he had no occasion to invoke the powers thereunder. That endorsement is at Annexure-'f'. It is in that circumstance, the petitioners being aggrieved, by the resolution as well as by the endorsement of the Divisional Commissioner, have approached this Court under Art. 226 of the Constitution praying for quashing the resolution of the Municipal Council affirming the resolution of the standing Committee of finance in the matter of enhancement of rent w. e. f. 1-4-1984 for the shops in the G. G. market of the 1st respondent - Municipal Council inter alia contending that the enhancement of the rent is arbitrary and therefore, violative of Art. 14 of the Constitution and that the Divisional Commissioner erred in declining to exercise his jurisdiction under Sec. 309 of the Act. ( 3 ) SRI U. L. Narayana Rao, learned Counsel for the petitioners strenuously contended in regard to several documents produced along with writ petition, that the rent fixed is far in excess of what the tenants were paying earlier and that in any event the prevailing rent in the area just away from G. G. market is far less than what the Municipal Council has fixed. ( 4 ) THERE is no clear prima facie material produced to substantiate this argument. But, assuming that to be the position, still the question is, having regard to Annexure-'d' produced by the petitioners whether this court could examine the arbitrary nature of the exercise of power by the Municipal Council in confirming the enhancement recommended by the Finance Standing Committee. That the Municipality is the owner of the building in the G. G. market is not in dispute. That it has leased out the shops to the petitioners among others is also not in dispute. That most of the shopkeepers in the petitions have been tenants for a long time is also not in dispute. Annexure-'d' clearly brings out three facts which cannot be disputed. That the annual income of the Municipal Council from the G. G. market till the enhancement by the impugned resolution was Rs. 60,692/ -. After the enhancement it will be Rs. 1,67,700/ -. Annexure-'d' clearly brings out three facts which cannot be disputed. That the annual income of the Municipal Council from the G. G. market till the enhancement by the impugned resolution was Rs. 60,692/ -. After the enhancement it will be Rs. 1,67,700/ -. If the proposal of the tenants' association of the G. G. market was accepted by the Municipal Council, the annual income of the Municipal Council would be Rs. 1,03,750/ -. The object of the revision of rent is obviously to augment the income of the Municipal Council. The difference between the enhancement now made and the enhancement proposed by the Association of tenants of G. G. market is only Rs. 64,000/- approximately. Therefore, the tenants themselves were prepared to augment the income of the Municipal Council by about Rs. 40,000/ -. That gives a rough indication to this Court as to the potential value of the property and the trade carried on in the property. No material is placed before the Court as to any earlier enhancement made by the Municipal Council. The Municipality has suffered a serious set back in its income, having regard to its own commitment and the escalated costs of materials which are required to maintain the roads within the municipal limits provide increase of staff facilities, increase in salaries of staff, all of which cannot be given only by the taxes which it is empowered to impose subject to the restrictions provided in the Act itself. Therefore, like any other property owner the Municipality ought to be conceded the power to raise its income if and when found necessary. ( 5 ) MR. U. L. Narayana Rao contended that there has been periodic enhancement of rents in five years. If that were so, then, at least for the last five years preceding 1-4-1984, there has been no revision. ( 6 ) HE next relied upon a decision of Supreme Court in A. L. Kalra v. Project and Equipment Corpn. of India, Ltd. , AIR 1984 SC 1361 . I do not think the passage relied upon by him is of any assistance to the petitioners herein. Adverting to the ruling of Bagwati, J. (as he then was) in Royappa's case ( AIR 1974 SC 555 ), the Supreme Court held that the action of the State of Tamil Nadu was liable to be struck down as it violated Arts. Adverting to the ruling of Bagwati, J. (as he then was) in Royappa's case ( AIR 1974 SC 555 ), the Supreme Court held that the action of the State of Tamil Nadu was liable to be struck down as it violated Arts. 14 and 16 of the Constitution. But, the observation of Bagwati, J. in Royappa's case was made in connection with the service conditions under the service of the State. Not in connection with the powers of the State as owner of property and its intention or action to put the property in a manner most advantageous to the State financially. Like any other owner, the State also must have the rights of owner to derive the maximum income from the property which it owns. More so, when that additional income is to be expended on the welfare of the citizens of the State or the Municipal Council. Therefore, unilateral fixation itself cannot be termed arbitrary. In fact, in the instant case, though the raise was unilaterally proposed, it was retained as such only after consulting the tenants and obtaining their views and their willingness to pay enhanced rents. Therefore, the procedure followed by the standing Committee cannot be said to be arbitrary either. ( 7 ) ON the other hand, the provisions of Karnataka Municipalities (Guidance of Officers, Grant of Copies and Miscellaneous Provisions) Rules, 1966, at R. 39 has been held to be mandatory by this Court in the case of Jaichand v. Town Municipality, Robert Sonpet, (1976) 1 Kant LJ 30 which provides for the manner and procedure to lease, sell or auction any movable and immovable property of the Municipality. One of the essential ingredients of the said rule is that whenever the Municipal Council intends to lease, it has to publish the same in four modes prescribed thereunder and thereafter only lease the premises. In the instant case, the petitioners have enjoyed the lease in their favour for considerable time in which others had no opportunity to compete with them. In that event, they have been fortunate and they should not be unduly anxious about paying higher rents for the current period of lease. ( 8 ) THIS only leaves the question of the correctness of the order of the Divisional Commissioner. In that event, they have been fortunate and they should not be unduly anxious about paying higher rents for the current period of lease. ( 8 ) THIS only leaves the question of the correctness of the order of the Divisional Commissioner. Rule 306 provides that in certain contingencies the Deputy Commissioner may suspend the resolution of a Municipal Council and submit a report in respect thereof to the Govt. , forthwith which in turn may act as it decides in the best interest of the Municipality. That power conferred specifically on the Deputy Commissioner under Sec. 306 of the Act shall be exercisable by the Divisional Commissioner in respect of the City Municipalities under Sec. 309 of the Act. Therefore, the key Section is really 306 and that provides three contingencies in which the Deputy Commissioner may exercise the power and those contingencies are (1) the execution of any order or resolution of a Town Municipal Council, or the doing of anything which is about to be done or is being done by or on behalf of the Town Municipal Council is unlawful (2) is causing or is likely to cause injury or annoyance to the public (3) lead to breach of peace, he may by order in writing under his signature, suspend the execution or prohibit the doing thereof. ( 9 ) I have already held that the unilateral raise of the rent w. e. f. 1-4-1984 is not arbitrary nor unlawful in the sense that such act is beyond the competence of the Town Municipal Council, nor is there any apprehension of breach of public peace nor public annoyance. Therefore, the Divisional Commissioner rightly came to the conclusion that he had no competence to entertain the petition presented by the shopkeepers - tenants of the G. G. Market of the 1st respondent - Municipal Council by his order dated 3-10-1985. Therefore, that order does not call for interference. ( 10 ) IN the result, these writ petitions are rejected. But, in the circumstances of the case, there will be no order as to costs. Petitions dismissed. --- *** --- .