IMPORTANT POINT
Under the provisions of the Mumbai Provincial Municipal Corporation Act, with a view to bona fide performing its statutory functions, if the Standing Committee is unable to approve such proposal on the basis of the documents supplied to it is entitled to ask for the relevant documents.

Headnote:Mumbai Provincial Municipal Corporation Act, 1949-Sections 73(c), 20, 21, 36 and 451-Grant of approval of contract-Entitlement of Standing Committee to ask for relevant documents from the Commissioner, Municipal Corporation-A Statutory Committee should not be denied access to the documents-Appellant, Chairman of the Standing Committee of Respondent-Municipal Corporation filed a writ petition for directing respondents to ensure that whenever a proposal for grant of approval of contract in terms of Section 73 is placed before the Standing Committee, the same should contain tender forms and other documents submitted by the contractor as well as other documents-Whether High Court was justified in dismissing the writ petition-(No)-First Respondent directed to place before the Standing Committee all materials sought for from the appellant-First respondent held not justified in invoking power in terms of proviso appended to clause (c) of Section 73 of the Act holding such approval of the Standing Committee would be deemed to have been granted.
       Held : Although the Commissioner is entitled to execute contracts on behalf of the Corporation but a statutory embargo is placed thereupon by reason of Clause (c) of Section 73 of the Act. A contract which may be entered into by the Commissioner requires prior approval of the Standing Committee. It is, thus, not a case where an action taken by a statutory authority requires approval which may be granted at a later stage. The approval of the Standing Committee, a bare perusal of Clause (c) would show, is required to be granted before any contract is entered into. The approval of a contract and that too with previous approval by the Standing Committee cannot, thus, said to be an empty formality. (Para 17)
       The Standing Committee is required to perform its functions in terms of the provisions of the said Act. A statutory authority has also a duty to act in public interest as also fairly and in a reasonable manner. With a view to bona fide performing its statutory functions, if the Standing Committee is unable to approve such proposal on the basis of the documents supplied to it, it is entitled to ask for the relevant documents from the Commissioner. Clause (c) of Section 73 is couched in the negative language and, therefore, is imperative in character. (Paras 17 and 18)
       The proviso appended to Section 73 carves out an exception to the general rule which evidently has been enacted for the purpose of avoiding any delay and would apply in a situation where despite meeting, the Standing Committee deliberately or otherwise refuses or fails to take any decision. No doubt a legal fiction has been created but the same cannot be given effect to in vacuum. It is to be applied having regard to the legislative intent and a restricted meaning is to be attributed thereto in a situation of this nature. A statute, it is also well-known, must be read in such a manner whereby it is made workable. (Para 19)
       The functions of the Standing Committee must be exercised in public interest and, thus, cannot be said to be a formal ones. The members of the Standing Committee must apply their mind to the proposal of the Commissioner wherefor they must have before them the relevant records. The Commissioner who is a statutory authority is bound to comply with the said request unless there exist strong and cogent reasons for not doing so. It is relevant to notice that the First Respondent in his letter dated 9.5.2001 which incidentally was issued 14 days after the resolution adopted by the Standing Committee i.e. a day just prior to the expiry of 15 days did not raise any contention that the relevant records were not required nor did he say that the purpose of such approval, the informations disclosed in the prescribed form would subserve the purpose. He further did not say that for one reason or the other, which has now been contended in the Counter Affidavit, that such documents should not be disclosed. A statutory authority, as is well known, when acts in terms of a statute, is bound by his action. He cannot supplement or supplant the reason later on by way of Affidavit. (Para 20 & 21)

JUDGMENT

S.B. Sinha, J.-Leave granted.

INTRODUCTION :

2. The Appellant herein, Chairman of the Standing Committee of the Second Respondent-Municipal Corporation of City of Kalyan and Dombivali (hereinafter referred to as the Corporation ) had filed a writ petition before the Bombay High Court praying for issuance of a writ of or in the nature of mandamus directing the respondents to ensure that whenever a proposal for grant of approval of the contract in terms of Section 73 of the Mumbai Provincial Municipal Corporation Act, 1949 (hereinafter referred to as the Act ) is placed before the Standing Committee, the same should contain the tender forms and other documents submitted by the contractor as well as other documents, if any, containing the records of negotiations made by the Commissioner of the Corporation after the tenders are opened or placed before it. The said writ petition was dismissed by the High Court on an interpretation of clause (c) of Section 73 of the Act as also the locus of the Appellant.

THE ACT VIS-A-VIS THE PARTIES :

3. The Respondent-Corporation has been constituted under the provisions of the said Act. The First Respondent herein is the Commissioner of the said Corporation appointed in terms of Section 36 of the Act. The State is also a statutory authority under the Act and may in a given situation exercise its revisional jurisdiction in terms of Section 451 thereof. A Standing Committee is constituted under Section 20 of the said Act. The Chairman of the Standing Committee is elected in terms of Section 21 thereof. The Standing Committee exercises various powers with which we are not concerned at present. Section 73 empowers the Commissioner to execute contracts on behalf of the Corporation but clause (c) thereof restricts the said power in the following terms:

"(c) no contract which will involve an expenditure (ten lakh rupees) or such higher amount as the Corporation may, with the approval of the (State) Government, from time to time prescribe, shall be made by the Commissioner unless the same is previously approved by the Standing Committee:

Provided that, where the previous approval of the Standing Committee is sought by the Commissioner for any contract the Standing Committee shall consider and dispose of the proposal made by the Commissioner in that behalf within fifteen days from the date on which the item is first included in the agenda of any meeting of that Committee, failing which, the approval to such contract shall be deemed to have been given by the Committee, and a report to that effect shall be made by the Commissioner to the Corporation."

BACKGROUND FACTS :

4. In exercise of the said power the First Respondent issued notices inviting tender for supply of various materials, pursuant whereto or in furtherance whereof, contractors submitted their tenders. He forwarded summaries of three separate tenders, which according to the Standing Committee of the Corporation did not disclose any material whereby it could assess the merits or demerits thereof. The matter was placed before the Standing Committee on 26.4.2001 whence the following resolution was passed:

"Considering the administrative proposal of supplying Bleaching Powder Grade-2 and Hydrated Lime to Twelfth Water Treatment Plant, it is essential to obtain relevant documents to provide detailed information to the members of the Standing Committee. Therefore, this Standing Committee resolves that, as per rules the administration should submit brief of the said case in office of the Secretary for the information of the Standing Committee. Similarly, in future briefs of each proposal from administration, which is placed before the Standing Committee should be submitted in Secretary s office along with profile from time to time for the perusal of the Standing Committee."

5. Curiously the First Respondent did not respond thereto directly to the Standing Committee; but by a letter dated 9.5.2001 addressed to the Secretary of the Corporation posed a

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2004 Supreme(SC) 1328

Cases Referred (5)