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Rajasthan High Court
Wanchoo C.J. & Modi, J.
Sahlot Brothers - Appellant
Versus
The State Of Rajasthan - Respondents
Civi Writ No, 155 of 1955
Decided On : February 22, 1956
The effect of secs. 5 and 7 clearly is that before a municipality can be said to have legal sanction behind it, it must have been brought into existence by a notification under sec. 5 preceded by a prior notification under sec.7.It is further clear that what is declared as a municipality is a local area, and it is, therefore, implicit that such local area, must be defined as regards its geographical limits without which it would be impossible to know which area has been made the subject matter of the notification. In fact sub-sec. (2) of sec. 5 makes it abundantly clear that every notification constituting a new municipality (or altering the limits of an existing town municipality)shall clearly set forth the local limits of the area to be included in the municipality. It is on the basis of its geographical limits that it is in due course divided into certain constituencies which are charged with the duty of electing members who then constitute a municipal board. Where therefore the territorial limits of a municipality are not defined according to law, and in precise terms, it would be impossible to hold that a municipality or a particular municipal board governing it at any particular time has been effectively brought into existence or that it can function effectually and compel submission without which all government is rendered futile. (Para 1)
A municipality is a delegate from the State and its authority to function is dependent upon the limits of the authority delegated and therefore, it can only tax persons or property strictly within its own limits and not outside them and these limits must therefore be certain and require to be defined. It is essential for a properly constituted municipality to come into existence that its limits must be clearly defined by or under competent authority and such limits must be duly published in accordance with law and in the absence of such delimitation, it would not be possible for it in law to levy and recover any taxes and further the very existence of its governing body would become open to a vital defect and its ability to function legally and effectively would stand impaired and destroyed. Apart from the question of defining the boundaries of a local area so as to invest it with the status of a municipality, what is of paramount importance is that the State Government must make a declaration that it is constituting a particular area is a municipality. A municipality can not come into existence without any such declaration by mere acquiescence of implication. This preliminary proclamation is a condition precedent to finally declaring such area to be a municipality. It must be remembered, however, that it is this final step which is the decisive step and without it no municipality can come into existence in accordance with law. This last requirement is not a more technicality but is a matter of vital substance. (Paras 7 and 8)
2. The petitioners are residents of two towns named Rajnagar and Kankroli (Tehsil Rajsamand) which together are said to constitute the Rajsamand Municipality. According to the petitioners, this municipality, has been functioning as such since 1952, having been apparently established under the Rajasthan Municipalities Act, (No. XXIII) of 1951 (hereinafter referred to as the Rajasthan Act). The case of the petitioners is that the Municipal Board Rajsamand has introduced the octroi tax (see the Octroi Schedule and the By-laws Ex. 3) with effect from the 1st October, 1955, and with a view to achieving this result, the Board passed certain by-laws and rules including the schedule of octroi to be levied on various articles entering into this municipality. The contentions of the petitioners briefly put are that the preliminary steps taken and the procedure adopted for the passing of the rules and the by-laws and the schedule of taxes are open to objections in essential respects and the relevant provisions of the Rajasthan Act have been disregarded. We refrain from stating their case in detail in the above respects in view of a more vital objection. That objection is that the limits of the Rajsamand Municipality were never defined by the State in accordance with law and that this latter defect goes to the very root of the matter. This objection was argued before us from a two-fold angle. Firstly, from the view point of area; and it was contended that as the boundaries of this municipality had not been laid down according to law, the local area over which this organisation was to function remained uncertain and indefinite and, therefore,any levy or collection of taxes therein was not a practical proposition. In the second place, it was contended that a municipality which is to be governed by an elected board but the limits whereof are not prescribed according to law, cannot be considered to be properly constituted or brought into valid existence for the important reason that owing to the lack of such definition of limits, the entire structure of the board is thereby inevitably affected and a body which springs out of such imperfect and uncertain source cannot be held to be a properly constituted body. The prayer of the petitioners, therefore, is that the opposite parties be restrained from levying or collecting the octroi and that the rules and by-laws framed by the board be declared to be void and of no effect, and lastly that the Board be directed to refund the moneys collected by way of octroi from the petitioners. We may also state here that an application for an interim stay came before us on the 23rd January, 1956, and we agreed not to pass a stay order because the learned Government Advocate gave an undertaking before us that if the decision went against the municipality, the letter will refund to the petitioners all moneys collected from that date i.e. 23rd January, 1956 up to the date of our decision by way of octroi from the petitioners, and the case was directed to be posted for hearing at an early date.
3. This applicant on is opposed by the municipal board and the State but the latter did not file any written reply and only the board submitted its reply in writing. It appears from the reply of the board that it was during the regime of the former State of Mewar that Rajnagar was declared to be a town area. Thereafter when the State of former Rajasthan was formed, that State published a notice No. 927/Mu of 1949 dated the 2nd March, 1949, declaring its intention to constitute Rajnagar as a municipality. It is said that this notice was issued in accordance with sub-sec. (2) of sec. 3 and sec. 4 of the U. P. Municipalities Act (No 11) of 1916 (hereinafter referred to as the U. P. Ac
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