JUDGMENT VINOD K. SHARMA, J. 1. Indian Sucrose Limited, a company registered under the Companies Act, has challenged Notification No. 10/17/2001-4 L.G. (3)/8338 dated 13th of June 2005 issued after considering objections received from the affected persons and affording them opportunity of hearing, who were present in person and thereby the area of Municipal Council, Mukerian was extended. A copy of this notification is attached as Annexure P-5 to the writ petition. The petitioner has also challenged the preliminary Notification dated 10-6-2002 and amended notification dated 14-11-2002 attached as Annexures P-1 and P-2 with the writ petition. 2. The case set up by the petitioner is that by way of notifications under challenge huge tracts of agricultural land and the entire area of Gram Panchayat Chak Ala Baksh and a part of area of Gram Panchayat Village Madinpur thereby bringing within its ambit the entire factory of the petitioner have been included in the municipal limits. It is the further case of the petitioner that adjacent to the factory of the petitioner, there is another factory i.e. Paper Mill called the Mukerian Papers Limited, which was previously under the management of Oswal Group of Ludhiana along with the factory of the petitioner. The said factories are situated in the area of more than 150 acres and they collectively employed about 2000 workers and about 150 persons in management. It is averred in the writ petition that the factories have an extensive housing complex of about 125 houses within the factory premises for which arrangements have been made for collection of garbage, its disposal, water and sanitation etc. and therefore all municipal services have been provided by the factory itself. As such, it is entitled to be declared as an ‘industrial township’ under Article 243-Q of the Constitution of India and Section 4 (1) of the Punjab Municipal Act, 1911 ( hereinafter referred to as the ‘Act’) It is also the case of the petitioner that in the present case the notifications did not disclose any reason whatsoever for the inclusion of purely agricultural area within the boundaries of the Municipal Council. It has also been pleaded by the counsel for the petitioner that the notifications under challenge do not give any reason whatsoever in extending the boundaries of the Municipal Council which were mandatory under the provisions of Section 4(1) of the Act. It has also been pleaded by the counsel for the petitioner that the notifications under challenge do not give any reason whatsoever in extending the boundaries of the Municipal Council which were mandatory under the provisions of Section 4(1) of the Act. It is also contended that since the matter regarding extension of boundaries had lapsed, therefore, notifications could not be issued in 2005 after lapse of almost 3 years. Along with the challenge to the notifications, the petitioner has also challenged the vires of Section 83 of the Act as well as the agreement Annexure P- 8 to be ultlra vires to the Constitution of India on the ground that tax collection is a sovereign function of the State and therefore cannot be delegated to a private party. 3. In the written statement filed on behalf of respondent Nos.1 and 2, by a preliminary objection, it has been submitted that the Government is competent to include or exclude any area within or from Municipal limits and they also placed on record a copy of order dated 28-04- 2005 passed by the Principal Secretary to Government, Punjab, Department of Local Government, vide which objections against the extension of Municipal area were considered and rejected and alterations of Municipal limtis of Municipal Council, Mukerian, Distt. Hoshiarpur were approved. The petitioner had not filed any objections. 4. A separate written statement was filed on behalf of respondent No.3, herein it has been stated that boundaries of the Municipal Council were extended due to growth of urbanization around the old/existing boundary/limit of the Municipal Council, Mukerian. The allegation of the petitioner that the copies of the notifications were not supplied to it, was specifically denied. 5. Learned counsel for the petitioner vehemently argued that keeping in view the fact the petitioner was running a sugar mill wherein the workers of the mills were provided with all the requisite facilities, the factory should have been declared as an “industrial township” in view of Article 243-Q of the Constitution and Section 4(1) of the Act. 5. Learned counsel for the petitioner vehemently argued that keeping in view the fact the petitioner was running a sugar mill wherein the workers of the mills were provided with all the requisite facilities, the factory should have been declared as an “industrial township” in view of Article 243-Q of the Constitution and Section 4(1) of the Act. In order to appreciate this argument, it would be appropriate to reproduce the provisions of Article 243-Q and Section 4(1) as also Section 5 of the Act under which the notification has been issued which read as under:- “243-Q Constitution of Municipalities:- (i) These shall be constituted in every State- (a) a Nagar Panchayat ( by whatever name called ) for a transitional area, that is to say an area in transition from a rural area to an urban area: (b) a Municipal Council for a smaller urban area: and (c) a Municipal Corporation for a larger urban area, in accordance with the provisions of this part: Provided that a Municipality under this clause may not be constituted in such urban area or part thereof as the Government may, having regard to the size of the area and their Municipal services being provided or proposed to be provided by an industrial establishment on that area and such other factors as he may deem fit, by public notification, specify to be an industrial township. (2) In this article “a transitional area” , “a smaller urban area” or “a larger urban area” means such area as the Governor may, having regard to the population of the area, the density of the population therein, the revenue generated for local administration, the percentage of employment in non- agricultural activities, the economic importance or such other factors as he may deem fit, specify by public notification for the purposes of this part.” “Punjab Municipal Act, 1911 Section 4(1) Specification of local areas to be smaller urban areas of transitional area and Constitution of Municipal Councils and Nagar Panchayats.- (1) The State Government may, having regard to population of the area the density of the population therein, the revenue generated for local administration, the percentage of employment in non-agricultural activities, the economic importance or such other factors as it may deem fit, specify by notification in the official gazette, any area to be a transitional area or a smaller urban area for the purposes of this Act. Provided that no military cantonment or any part thereof shall be included in such transitional area or a smaller urban area: Provided further that such an urban area or part thereof, as the State Government may having regard to the size of the area and municipal services being provided or proposed to be provided by an industrial establishment in that area and such other factors as it may deem fit, by notification, specify to an industrial township shall not form part of a transitional area or a smaller urban area. Section 5. Alteration of limits of Municipality- (1) The State Government may, from time to time, keeping in view the provisions of sub-section (1) of Section 4 after consultation with the Municipality, by notification in the official gazette, alter the limits specified for any municipal area so as to include therein or to exclude therefrom such area as may be specified in the notification.” Mr. Vivek Bhandari, learned counsel for the petitioner by making reference to the provisions of Article 243-Q of the Constitution and Section 4 of the Act strongly contended that as the petitioner has set up a sugar mill, therefore, it was incumbent on the State Government to have declared it an industrial Township and the same could not be brought within the municipal limits of Mukerian. The basis for the claim is that the petitioner is an industrial establishment and, therefore, should be exempted under Article 243-Q of the Constitution of India read with Section 4(1) of the Act. 6. In order to appreciate this argument it would be appropriate to notice that “industrial establishment” has not been defined either in the Constitution of India or in the Punjab Municipal Act, 1911. However, the word “industrial establishment” has been assigned different meaning under the Industrial Disputes Act, under the Central Security Force Act and under the Payment of Wages Act, which would mean that the word “industrial establishment” has to be interpreted keeping in view the context in which it is used. In the present case, the word “industrial establishment” has to be given a meaning which would be relevant for the purposes of constitution of a local body. 7. The Industrial Disputes Act, defines the word “industrial establishment or undertaking” to mean an establishment or undertaking in which an industry is carried on. 8. In the present case, the word “industrial establishment” has to be given a meaning which would be relevant for the purposes of constitution of a local body. 7. The Industrial Disputes Act, defines the word “industrial establishment or undertaking” to mean an establishment or undertaking in which an industry is carried on. 8. Under the Central Security Force Act, the word “industrial establishment”, has been defined to mean industrial undertaking or a company as defined under Section 3 of the Companies Act, 1956 or a firm registered under Section 59 of the Indian Partnership Act, 1932 which is engaged in any industry or in any trade, business or service. 9. Whereas under the Payment of Wages Act, any factory as defined in clause (m) of Section 2 of the Factories Act, and a railway as defined in the Indian Railways Act, have been declared to be an “industrial establishment”. 10. It is not in doubt that the definition given above, would include the establishment of the petitioner under the definition of industrial establishment. However, merely because the petitioner is running an industrial establishment does not entitle to it to challenge the extension of municipal limits as proviso to Article 243-Q of the Constitution of India leaves it to the subjective satisfaction of the State Government to declare an “industrial township” keeping in view the size of the area and the municipal services being provided or proposed to be provided by an “industrial establishment” in that area or other factors as it may deem necessary. 11. The facts brought on record do not justify that the industrial establishment of the petitioner be declared as “industrial township” so as to bring it out of the purview of the municipal limits as it sought to be contended by the counsel for the petitioner. 12. In any case, the provisions of Article 243-Q of the Constitution as well as the provisions of Section 4(1) of the Act leave it to the State Government to declare an industrial township by taking into consideration the different factors provided therein. Therefore, we do not agree with the contention of the learned counsel for the petitioner that the notifications under challenge can be set aside under the provisions of Article 243-Q or Section 4(1) of the Act. 13. Therefore, we do not agree with the contention of the learned counsel for the petitioner that the notifications under challenge can be set aside under the provisions of Article 243-Q or Section 4(1) of the Act. 13. The petitioner admittedly did not file any objections to the preliminary notification and there was hardly any occasion for the State Government to give it personal hearing. However, all the persons, who filed objections, were given personal hearing and the relevant matters were considered by the Principal Secretary before issuing notification Annexure P-5 as would be clear from the relevant portion of the order passed by the Principal Secretary to Govt. Punjab, Department of Local Government, dated 28-4-2005 which reads as under:- “Govt. as such is empowered to issue notification with regard to alteration (inclusion or exclusion) of municipal limits after taking into consideration, the following factors:- i) Consultation with the Municipality concerned. ii) Previous publication of proposal - for inviting objections. iii) Revenue to be generated & economic importance. iv) Activities in the area- other than Agriculture sector. v) Contiguity with the existing limits. vi) Population & its density of area to be included/excluded. It may be seen that in the present case, the Municipal Council of their own have passed resolution bearing No.43 dated 26.8.02 proposing the extension in Municipal limits and then a request was made to Govt. for approval of proposal, therefore no.1) above stands complied with. Similarly (II) stands complied with the publication of notification dated 14.11.02. It is categorically stated in the proposal that area proposed to be included in Municipal Council limits has due economic importance as large number of industrial/commercial units already stood established and the ara alongside the main roads and adjoining areas has potential for further growth. Further apart from Paper and Sugar mill and Petrol pumps, there is large number of industrial and commercial units, therefore, Municipal council is expected to generate approx. 75 lacs from the collection of various taxes such as octroi , House Tax, Licence Fee, Water Supply charges and Tehbazari charges etc. These facts leave no doubt that area in question has economic importance and Council will also generate sufficient revenue to discharge its liabilities. The various reports on record prove that substantial percentage of population of villages to be included within the Municipal council limits are engaged in activities other than Agriculture. These facts leave no doubt that area in question has economic importance and Council will also generate sufficient revenue to discharge its liabilities. The various reports on record prove that substantial percentage of population of villages to be included within the Municipal council limits are engaged in activities other than Agriculture. As per reports, there are 849 voters in the village Ram Nagar Colony and all are engaged in non- agriculture activities. Similarly village Bagowal has 762 voters and substantially they are engaged in commercial activities and are running shops etc. because a Cinema, Hotels, Auto Mobile workshop/showroom, furniture houses, saw mills and number of shops are situated in this village. In village Ala Baksh & Kala Manj, there also exists large number of commercial establishment and substantial number of these villagers are engaged in commercial activities or are employed in Industrial/Commercial uni9ts such as Sugar and Paper Mill situated in the area. These facts require no clarification to arrive at just conclusion that villagers are engaged in activities other than Agriculture. Only approx. 9 Acres of land of village Pawar has been taken within Municipal limits and on this land only rice Sheller and Godowns of cement/marble exists . However, there is nothing to substantiate that the area of Village Pawar proposed to be included within the Municipal Council limits is developing. Merely that a Rice Sheller is situated in the area is no ground to take only the part of village. Above all, on inclusion of this area of app. 9 Acres of Village Pawar, the boundary of Municipal Council cannot be fairly defined. Therefore, I find substance in the arguments of the Counsel for the owners of Rice Sheller that the area has not acquired the character of “developing” or “developed” therefore, inclusion in Municipal Council limits is not in the interest of the general public. The site plan fairly shows that on exclusion of the area of village Pawar, the boundary becomes contiguous to the existing limits and this contiguity has not been broken at any point. Lastly, the population of the area proposed to be included in Municipal limits is app.4300 only thereby the existing population registered in the census 2001 to 21740 will go up to app. 25000 only. Lastly, the population of the area proposed to be included in Municipal limits is app.4300 only thereby the existing population registered in the census 2001 to 21740 will go up to app. 25000 only. As per draft notification dated 14- 11-02 the area falling in villages of Vadda and Chotta Bagowal, Ram Nagar Col,ony, Kala Manj and Chak Alla Baksh & part of the area of village Pawar i.e. App. 9 Acres only is proposed to be included in Municipal Council limits. The boundaries of Municipal Council as per the notification datd 14- 11-02 are spread over 1514 Acres in all. Therefore, the density of population works out to be 160 persons per Acre, which is within the prescribed limits. The village Panchayats were held, the newly elected Sarpanch has raised objection on the ground that Panchayat owns 4 Acres of land, the income of which is utilized for the welfare of village community and on inclusion, the Panchayat will have no control over this land. The Executive Officer in his report dated 24-10-03 has already reported that though the area has attained the character of Urban area as apart a Cinema Hall more than 50 shops exists in the area yet the population of app. 900 of this village has been deprived of basic civil amenities likewise roads/streets are not pucca, there is no arrangement of water supply/sewerage and street light, therefore, inclusion of area within limits is in the best interest of residents. However, the Executive Officer in his communication dated 05.04. 05 has again intimated Govt. that Sarpanch of Badda Bagowal along with its residents has given an affidavit as well as in writing that they have no objection if their village is also included in Municipal limits, therefore, the objection earlier filed by the residents of this area has become redundant. The record establishes that a drain bisects the boundary of Village Ram Nagar Colony and Kala Manj and Village Panchayat of Village Kala Manj has requested for inclusion of their village in Municipal Council limits, therefore, the objection of residents of Village Nagar Colony has no merit especially when the area has already attained Urban character and large number of commercial units have come in the area. There is an objection of Dashmesh Public School situated in village-Chak Ala-Baksh. The Village Panchayat of Chak-Ala-Baksh has not opposed the proposal of extension of Municipal Council limits. There is an objection of Dashmesh Public School situated in village-Chak Ala-Baksh. The Village Panchayat of Chak-Ala-Baksh has not opposed the proposal of extension of Municipal Council limits. There is otherwise no substance in the objection petition of objector when considered in the light of the fact that area is rapidly developing but Civil amenities are yet to be provided therein and as such inclusion of area is per se in the interest of residents thereof.” 14. Learned counsel thereafter contended that the notification did not indicate with sufficient accuracy the area intended to be notified and also whether the administrative provision was proposed to be implemented for all purposes or only for some of them and, therefore, it was not possible for the objectors to raise such objections. He made reference to the notice issued in the newspaper, the punjabi translation of which reads as under:- “Secretary,Punjab Government Local Government Department, Punjab, Chandigarh for the proposal of increasing the present boundaries of Municipal Council, Mukerian which have been shown in the Punjab Government Notification No.1743-1-C111- 75/1689 dated 15 January 1976 has issued a Notification No.10/17/2001-4 LG3/14422 dated 14-11-2002. The copies of this notice have been pasted on the Notice Board of the office of Deputy Commissioner, Hoshiarpur, Sub Divisional Magistrate, Mukerian, Tehsil Office, Block Development and Panchayat Officer and office of Municipal Council, Mukerian. Besides it a copy of this notice has been forwarded to the concerned Gram Panchayats. In case any person have any objection regarding the increase of boundaries of Municipal Council, Mukerian, he can submit his objection in writing within 6 weeks of the publication of this Notification to the Secretary, Punjab Government, Local Government Department, Chandigarh through Executive Officer, Municipal Council, Mukerian (Hoshiarpur). Any other information regarding increase of these boundaries can be obtained from the office of Municipal Council, Mukerian on any working days.” 15. The petitioner relied upon the reproduction of para in judgment of the Hon’ble Supreme Court in the case of Baldev Singh and othes v. State of Himachal Pradesh and others reported as (1987) 2 SCC 510, which was reproduction of para from the judgment in the case of Sridhar Kumar Malik’s case. However,this contention cannot be accepted as the notice referred to above clearly gave an option to the petitioner and other affected persons to have nformation regarding the increase of boundaries from the office of Municipal Council, Mukerian. However,this contention cannot be accepted as the notice referred to above clearly gave an option to the petitioner and other affected persons to have nformation regarding the increase of boundaries from the office of Municipal Council, Mukerian. It is not in dispute that the notifications Annexures P-1 and P-2 gave the detailed boundaries which were sought to be included. 16. The challenge to the extension of municipal limits is liable to be rejected firstly for the reason that judgment of the Hon’ble Supreme Court in Baldev Singh’s case (supra) was considered by the Apex Court in the case of Sundarjas Kanyalal Bhatija and others Vs. Collector Thane, Maharashtra, (1989) 3 SCC 396, wherein the Hon’ble Supreme court was pleased to hold that the personal hearing to the residents was not required to be given and consideration of objection was sufficient compliance. The Apex Court was further pleased to hold that issuance of notification is a legislative process and, therefore, such decision of the State Government with regard to extension of municipal limits could not be vitiated on the violation of principle of natural justice, arbitrariness or discrimination. 17. The contention of petitioner’s counsel that the notification does not disclose whether the administrative provision is proposed for implementation of all acts or only for some of them, having not mentioned in the notification, is also devoid of any force as the present case was not for constitution of notified area of the Municipal Committee or the Municipal Council, but was only for extension of municipal limits and all administrative functions performed by the Municipal Council, Mukerian, would automatically stand extended to the area so notified. It is pertinent to add here that this Court in the case of Balbir Singh Chauhan & others Vs. State of Haryana and others , 1991 PLJ 127 and in the case of Bhupinder Singh Vs. Union of India , 1995 PLJ 366 was pleased to hold that creation and abolition of Municipal committee is neither an executive nor administrative function, but it is a legislative process. State of Haryana and others , 1991 PLJ 127 and in the case of Bhupinder Singh Vs. Union of India , 1995 PLJ 366 was pleased to hold that creation and abolition of Municipal committee is neither an executive nor administrative function, but it is a legislative process. Therefore, keeping in view the authoritative decisions of Hon’ble the Supreme Court and the law laid down by this Court, we feel that the function which the State Government performs being legislative in nature, is not required to be interfered on the grounds raised by the counsel for the petitioner especially when all the factors have been taken into consideration by the State Government before approving the extension of municipal limits. 18. Faced with this situation, learned counsel for the petitioner has challenged the provisions of Section 83 of the Act on the ground that tax collection being a sovereign function of the State Government, the same cannot be delegated to a 3rd party. In support of his contention, he placed reliance on the judgment of the Madhya Pradesh High Court in Indore Nagar Nigam Karamchari Congress Indore, Vs State of Madhya Pradesh and others , AIR 1994 M.P.84, wherein the High Court was pleased to hold as under:- “ The action of the Municipal Corporation in auctioning the right to recover a Municipal Tax is ultra vires the Corporation Act, illegal and void. It cannot be said that under the scheme of Sections 86,87 and 88 of the Corporations Act auctioning of a right to realise a tax is permissible. It cannot also be said that the deposit of entire amount realised from the contractor who obtains the contract to collect a municipal tax at an auction to the credit of the ‘Municipal Fund’ is sufficient compliance with the provisions of Section 87 of the Corporation Act. It ais obvious that bidders at auction give bids keeping in view a margin of profit for themselves apart from the expenses they will have to incur in collecting the tax. It is also obvious that every paisa collected from the public as municipal tax is received as the amount of tax and the proportion of expense incurred in realising the tax to the total tax collected cannot be known before hand. At the end of the period of contract, the contractor is either left with a profit or with a loss. At the end of the period of contract, the contractor is either left with a profit or with a loss. In case he makes profit, which normally is expected of him, the contractor keeps to himself a sizable amount of money collected as municipal tax from the public. There is clearly violative of Section 87 of the Act which enjoins that all the money raised by any tax must be credited to the ‘Municipal Fund’. Moreover, if an auction is permitted and the recovery is effected by a contractor and his agents, against any arbitrary recovery, the person from which such recovery is effected becomes remediless. If the recovery is by a Municipal Officer or a servant, the person who complains against illegal recovery has regular remedies under the Corporations Act. Because of the contract the Municipal Authorities even if approached with the complaints would be utterly helpless in the matter. In practice, the contractor not armed with statutory powers of recovery of tax, is bound to use muscle power to effect recovery according to his own decisions as to the liability of the person to pay the tax as also its quantum. The legislature cannot be said to have intended this when it has taken care to make copious provisions regulating the imposition, levy, and collection of tax. Further, in such a case, it would be the case not of delegation but actually of surrender and abdication of statutory functions by the Municipal Corporations to the contractors who are totally strangers to the scheme of imposition, levy and recovery of municipal taxes under the Corporations Act.” 19. A reading of the judgment referred to above, does not support the stand of the petitioner that in the said judgment it was nowhere laid down that the power of collection of octroi cannot be delegated. The Hon’ble M.P.High Court on interpretation of Sections 86,87 & 88 of Municipal Corporation Act came to the conclusion that there were no provisions in the Act authorising the Municipal Corporations in auctioning the right to recover the municipal tax. However, under the Punjab Municipal Act, 1911, Section 83 gives powers to lease the collection of octroi or tolls. The Hon’ble M.P.High Court on interpretation of Sections 86,87 & 88 of Municipal Corporation Act came to the conclusion that there were no provisions in the Act authorising the Municipal Corporations in auctioning the right to recover the municipal tax. However, under the Punjab Municipal Act, 1911, Section 83 gives powers to lease the collection of octroi or tolls. Section 83 is reproduced as under:- “Section 83 Powers to lease the collection of octroi or tolls:- The collection of any octroi ( or terminal tax) or toll may be leased by the committee, with the previous sanction of the Deputy Commissioner for any period not exceeding one year; and the lessee and all persons employed by him in the management and collection of the octroi or terminal tax or toll shall in respect thereof - a) be bound by any orders made by the committee for their guidance; b) have such powers exercisable by officers of a committee under this Act, as the Committee, may from time, confer upon them; and c) be entitled to the same remedies and be subject to the same responsibilities as if they were employed by the committee for the management and collection of the octroi or toll”. 20. The Legislature in its wisdom has made the provisions for lease out the collection of octroi and nothing has been shown as to how the same can be said to be ultra vires to the Constitution. As already referred to above, the judgment of the Madhya Pradesh High Court is not on this point. Thus the reliance by the learned counsel is misconceived. Therefore, finding no merit in this writ petition, the same is dismissed in limine.