The court affirmed that Section 263 of the Gujarat Municipalities Act, allowing dissolution of municipalities under specific conditions, is constitutional and compliant with Article 243U of the Constitution.

1. In this petition, the petitioners have challenged constitutional validity of S.263 of the Gujarat Municipalities Act , 1963, as amended by the Amendment Act of 1993 (Gujarat Act 17 of 1993). It is the say of the petitioners that the provisions of S.263 are unconstitutional and ultra vires Part III as also Art. 243 U of the Constitution of India . A writ of mandamus is also sought for quashing and setting aside a notice dated January 27,1999 Annexure A to the petition. A prayer is made for a writ of prohibition restraining the respondent authorities from proceeding with the notice Annexure A to the petition.

2. The case of the petitioner in that the petitioner No. 1 Anjar Municipality was constituted under the provisions of the Gujarat Municipalities Act , 1963 (hereinafter referred to as "the Act") and petitioner Nos. 2 to 16 were duly elected Councillors of petitioners No. 1 Municipality. All the Councillors are nationals and citizens of India and are entitled to protection of Fundamental Rights guaranteed in Part III of the Constitution. It is alleged in the petition that as the respondent No. 1 Municipality and the majority of the Councillors belong to the party which is not in power at the State level, the State Government and the persons having political influence, in exercise of arbitrary powers got a notice issued on January 27, 1999 calling upon the petitioner No. 1 to show cause why the municipality should not be dissolved under sub-section (1) of S.263 of the Act. The said action is beyond jurisdiction, without authority of law and has been taken in colourable exercise of power and under the political pressure of certain members of Legislature Assembly, including respondent No. 4 , who is a sitting member of Legislature Assembly belonging to Bharatiya Janata Party (BJP) which is in power. It was stated that similar notices have been issued to several municipalities and corporations where the majority councillors are from the party order than the party in power at the State level. The exercise of power is, therefore, vitiated and since the issuance of notice is a male fide action on the part of the respondent authorities, they should be permanently restrained from proceeding with the said notice.

3. We have heard Mr. K.G. Vakharia, learned Senior Advocate instructed by Mr. Tushar Mehta, for the petitioners, and Mr. S.N. Shelat, learned Additional Advocate General instructed by Mr. S.R. Divetia, learned AGP for the respondents. As per roster, if an action of issuance of notice is challenged, the petition would have been placed before a single Judge dealing with such matters. It is, however, placed before this Court, since the constitutional validity of a statutory provision is challenged. The question is whether a prima facie case has been made out by the learned Counsel for the petitioners that the provisions of S.263 of the Act, as amended by Gujarat Act 17 of 1993, are ultra vires or unconstitutional.

4. S.263 before the amended of 1993 read as under :
263. (1) If, in the opinion of the State Government a Municipality is not competent to perform or deliberately makes default in the performance of the duties imposed on it by or under this Act, or otherwise by law or exceeds or abuses its powers, the State Government may, after giving the municipality an opportunity to render an explanation, by an order published, with the reasons therefor, in the Official Gazette declare the municipality to be incompetent or in default, or to have exceeded or abused its powers, as the case may be and may dissolve such municipality, or supersede it for such period not exceeding two year