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2016 DIGILAW 426 (ALL)

ANIL KUMAR GARG v. STATE OF U. P.

2016-02-03

DILIP GUPTA, MUKHTAR AHMAD

body2016
JUDGMENT By the Court.—The petitioner, who was elected as Chairperson of the Nagar Panchayat Tehsil Khairagarh district Agra on 27 June 2012 has filed this petition for quashing the show-cause notice dated 3 August 2015 issued by the Secretary in the Nagar Vikas Anubhag of the State Government to the extent it ceases the financial and administrative powers of the petitioner as Chairperson till his exoneration from the charges levelled in the show-cause notice. The petitioner has also sought the quashing of the consequential order dated 6 August 2015 passed by the District Magistrate, Agra. 2. The show-cause notice dated 3 August 2015 mentions that a communication dated 28 February 2014 was sent by the State Government seeking explanation from the petitioner through the District Magistrate Agra about the alleged illegalities committed by him as President of the Nagar Panchayat. The petitioner submitted an explanation and the District Magistrate also submitted his comments on the explanation offered by the petitioner. The order mentions that the State Government has reason to believe that there has been a failure on the part of the President in performing his duties and that there have been serious illegalities in the performance of his duties and that he had also misused his position. The petitioner was asked to submit a reply as to why he should not be removed from the post of President. The notice also mentions that the petitioner shall cease to exercise, perform and discharge the financial and administrative powers, functions and duties of the President unless he is exonerated of the charges mentioned in the show-cause notice issued to him and the finalization of the proceedings. 3. Sri Shashi Nandan, learned Senior Counsel appearing for the petitioner assisted by Sri K.K. Tiwari, has submitted that the financial and administrative powers of the petitioner could not have been ceased without providing an opportunity of being heard and in support of his contention, learned Senior Counsel has placed reliance upon Paras Jain v. State of U.P. and 5 others, 2016(1) ADJ 1 (FB), of five Hon’ble Judges. 4. Learned Standing Counsel and learned Senior Counsel appearing for the respondents have, however, submitted that adequate opportunity was provided to the petitioner when he was asked to furnish an explanation by the State Government and no further opportunity was required to be given to the petitioner. 5. 4. Learned Standing Counsel and learned Senior Counsel appearing for the respondents have, however, submitted that adequate opportunity was provided to the petitioner when he was asked to furnish an explanation by the State Government and no further opportunity was required to be given to the petitioner. 5. We have considered the submissions advanced by learned counsel for the parties. 6. Section 48 of the Uttar Pradesh Municipalities Act, 1916 (‘the Act’) deals with the removal of the President of a Municipality and is as follows : “48. Removal of President.—(1) ...... 5. We have considered the submissions advanced by learned counsel for the parties. 6. Section 48 of the Uttar Pradesh Municipalities Act, 1916 (‘the Act’) deals with the removal of the President of a Municipality and is as follows : “48. Removal of President.—(1) ...... [omitted] (2) Where the State Government has, at any time, reason to believe that - (a) there has been a failure on the part of the President in performing his duties, or (b) the President has— (i) incurred any of the disqualifications mentioned in Sections 12-D and 43-AA; or (ii) within the meaning of Section 82 knowingly acquired or continued to have, directly or indirectly or by a partner, any share or interest, whether pecuniary or of any other nature, in any contract or employment with, by or on behalf of the Municipality; or (iii) knowingly acted as a President or as a member in a matter other than a matter referred to in Clauses (a) to (g) of sub-section (2) of Section 82, in which he has, directly or indirectly, or by a partner, any share or interest whether pecuniary or of any other nature, or in which he was professionally interested on behalf of a client, principal or other person; or (iv) being a legal practitioner acted or appeared in any suit or other proceeding on behalf of any person against the Municipality or against the State Government in respect of nazul land entrusted to the management of the Municipality or acted or appeared for or on behalf of any person against whom a criminal proceeding has been instituted by or on behalf of the Municipality; or (v) abandoned his ordinary place of residence in the municipal area concerned; or (vi) been guilty of misconduct in the discharge of his duties; or (vii) during the current or the last preceding term of the Municipality, acting as President or as Chairman of a Committee, or as member or in any other capacity whatsoever, whether before or after the commencement of the Uttar Pradesh Urban Local Self-Government Laws (Amendment) Act, 1976, so flagrantly abused his position, or so willfully contravened any of the provisions of this Act or any rule, regulation or bye-laws, or caused such loss or damage to the fund or property of the Municipality as to render him unfit to continue to be President; or (viii) been guilty of any other misconduct whether committed before or after the commencement of the Uttar Pradesh Urban Local Self-Government Laws (Amendment) Act, 1976 whether as President or as member; or (ix) caused loss or damage to any property of the Municipality; or (x) misappropriated or misused Municipal fund; or (xi) acted against the interest of the Municipality; or (xii) contravened the provisions of this Act or the rules made thereunder; or (xiii) created an obstacle in a meeting of the Municipality in such manner that it becomes impossible for the Municipality to conduct its business in the meeting or instigated someone to do so; or (xiv) willfully contravened any order or direction of the State Government given under this Act; or (xv) misbehaved without any lawful justification with the officers or employees of the Municipality; or (xvi) disposed of any property belonging to the Municipality at a price less than its market value; or (xvii) encroached, or assisted or instigated any other person to encroach upon the land, building or any other immovable property of the Municipality; it may call upon him to show-cause within the time to be specified in the notice why he should not be removed from office. Provided that where the State Government has reason to believe that the allegations do not appear to be groundless and the President is prima facie guilty on any of the grounds of this sub-section resulting in the issuance of the show-cause notice and proceedings under this sub-section he shall, from the date of issuance of the show-cause notice containing charges, cease to exercise, perform and discharge the financial and administrative powers, functions and duties of the President until he is exonerated of the charges mentioned in the show-cause notice issued to him under this sub-section and finalization of the proceedings under sub-section (2-A) and the said powers, functions and duties of the President during the period of such ceasing, shall be exercised, performed and discharged by the District Magistrate or an officer nominated by him not below the rank of Deputy Collector.” 7. Sub-section (2) of Section 48 enables the State Government to issue a notice to show-cause to the President of a municipality to explain why he should not be removed from office where the State Government has “reason to believe” that any of the provisions of clauses (a) or (b) are attracted. Broadly speaking, the reason to believe relates to any one of the breaches specified in clause (a) or in sub-clauses (i) to (xvii) of clause (b) of sub-section (2). Each of them has a bearing on the discharge or the failure to discharge duties on the part of the President of a municipality or conduct of a nature which is proscribed therein. In the event that the State Government has reason to believe that any of those stipulations is attracted, it is empowered to call upon the President to show-cause why he should not be removed from office. 8. The proviso to Section 48 (2) entails that where its conditions are fulfilled, the President of a municipality shall cease to exercise, perform and discharge the financial and administrative powers, functions and duties of the President until he is exonerated of the charges mentioned in the notice to show-cause and the finalization of the proceedings under sub-section (2-A). In order that the proviso be attracted, several stipulations have to be fulfilled. In order that the proviso be attracted, several stipulations have to be fulfilled. These stipulations are - firstly, that the State Government must have reason to believe that the allegations do not appear to be groundless; secondly, the State Government must have reason to believe that the President is prima facie guilty of any of the grounds contained in the sub-section resulting in the issuance of the notice to show-cause and proceedings thereunder; and thirdly, that the notice to show-cause must contain the charges against the President of the municipality. Where these three conditions have been fulfilled, the consequence entailed by the proviso to sub-section (2) comes into being and the President shall cease to exercise, perform and discharge the financial and administrative powers, functions and duties of the President until exonerated of the charges mentioned in the notice to show-cause and finalization of the proceedings under sub-section (2-A). 9. The Full Bench noted that though the substantive part of sub-section (2) of Section 48 empowers the State Government to issue notice to show-cause to the President of the Municipality as to why he should not be removed from the office where it has reason to believe that the requirements of Clause (a) or Clause (b) have been fulfilled but the proviso to sub-section (2) does not stipulates that mere issuance of a notice to show-cause under the substantive part of sub-section (2) would result in the President ceasing to exercise the financial and administrative powers, functions and duties of the office. On the contrary, the proviso stipulates, firstly, that the State Government must have reason to believe that the allegations do not appear to be groundless; secondly, there must be a reason to believe on the part of the State Government that the President is prima facie guilty on any of the grounds set out in the sub-section resulting in the issuance of the show-cause notice and proceedings there-under; and thirdly, the show-cause notice must contain the charges which have been levelled against the President of the municipality. In other words, this threefold requirement has to be fulfilled before the cessation of financial and administrative powers, functions and duties takes effect. In other words, this threefold requirement has to be fulfilled before the cessation of financial and administrative powers, functions and duties takes effect. The Full Bench thereafter observed that the formation of a reason to believe within the meaning of the proviso must be on objective considerations which have a rational connection or link to the material before the State Government and fairness requires that this be disclosed to the President of the Municipality before the consequences in the proviso ensue. The President must, therefore, have an opportunity to explain. 10. In this context, the Full Bench observed : “If a mere issuance of a notice to show-cause was intended to necessarily result in the consequence of the cessation of financial and administrative powers as envisaged in the proviso, the legislature would have made a provision to that effect. On the contrary, the legislature has carefully crafted a statutory provision, in the form of a proviso which ensures that it is only upon the State Government having a reason to believe that the allegations do not appear to be groundless and that the President is prima facie guilty on any of the grounds contained in the sub-section, that the cessation of the financial and administrative powers would follow from the date of the issuance of the notice to show-cause containing the charges. The cessation of financial and administrative powers of an elected head of a municipality is a matter of significance and is replete with serious consequences. The effect of the financial and administrative powers, functions and duties being ceased, has a direct impact upon the authority of the elected head. It erodes authority and impacts upon the ability of the President to effectively discharge the functions of the office by preventing the discharge of financial and administrative authority. Bereft of financial and administrative powers, functions and duties, the office of the President of a municipality is reduced to a cipher. In fact, the proviso envisages that upon the powers being ceased, they shall be exercised by the District Magistrate or an officer nominated, not below the rank of a Deputy Collector. This consequence is serious enough to warrant the Court to read a compliance with the principles of natural justice into the provision so as to ensure a fair procedure and safeguard against an unfair recourse to its power by the State Government. This consequence is serious enough to warrant the Court to read a compliance with the principles of natural justice into the provision so as to ensure a fair procedure and safeguard against an unfair recourse to its power by the State Government. The principles of natural justice, as we have noted above, are required to be observed as a matter of first principle when a decision - administrative, quas-judicial or judicial - adversely affects the rights of parties. The principle of reading into the statutory provision a requirement of complying with the principles of natural justice is a mandate of Article 14 because it would be an anathema to a fair procedure for the State Government to issue dictats that abrogate the financial and administrative powers of an elected head of a local self-governing institution without complying with the principles of natural justice. The requirement of observing the principles of natural justice, as a matter of first principle, must be weighed in together with the additional factors present in the proviso to Section 48(2) that lead to the conclusion that a decision to cease financial and administrative powers must be preceded by adherence to a fair procedure. The first of the three indicia in the proviso is the existence of a reason to believe on the part of the State that the allegations do not appear to be groundless. The second indicia is the requirement of the formation of the reason to believe that the President of a municipality is prima facie guilty on any of the grounds mentioned in the sub-section, resulting in the notice to show-cause. Arriving at a determination in regard to the prima facie guilt of a person, as the statute mandates, must be upon due observance of the principles of natural justice. The third indicia is that the notice to show-cause has to contain the charges against the person. Hence, even though the proviso to sub-section (2) of Section 48 does not contain an explicit requirement of observing the principles of natural justice, nonetheless such a requirement must necessarily be read into the provision.” 11. In the present case, it is more than apparent that the principles of natural justice have not been complied with as no opportunity was provided to the petitioner before cessation of the financial and administrative powers. In the present case, it is more than apparent that the principles of natural justice have not been complied with as no opportunity was provided to the petitioner before cessation of the financial and administrative powers. An opportunity was required to be given to the President to respond to the notice issued by the State Government indicating the formation of a reason to believe that the charges do not appear to be groundless and that the President is prima facie guilty of any of the ground mentioned in sub-section(2) of Section 48. 12. Such being the position, the impugned notice dated 3 August 2015 issued by the Secretary in the Nagar Vikas Anubhag of the State Government to the extent it ceases the financial and administrative powers of the petitioner as Chairperson and the consequential order dated 6 August 2015 passed by the District Magistrate, Agra cannot be sustained and are, accordingly, set aside. It shall, however, be open to the respondents to issue a fresh notice in accordance with law and in accordance with the observations made by the Full Bench in Paras Jain (supra). 13. The petition is allowed to the extent indicated above. ———————