ORDER
T.S. Doabia, J.
1. The election of Asha Ram present petitioner has been declared null and void. This election was to Nagar Panchayat Phooph conducted under the Madhya Pradesh Municipalities Act, 1961 (hereinafter referred to as the 1961 Act). An election petition was preferred by one Munshilal Under Section 20 of the 1961 Act. Five candidates took part in the process of election. Asha Ram, present petitioner got the highest number of votes. He was declared elected. The break-up of the votes received by Asha Ram by other candidates is as under :
Asha Ram 127 votes
Munshilal 111 votes
Babu Khan 45 votes
Ajmer Khan 5 votes
Hari Prasad 2 votes
2. The election of Asha Ram to the Nagar Panchayat Phooph was challenged on the ground that as he was a Peon in Sewa Sahakari Sanstha Maryadit Phooph and therefore he was holding an office of profit in the “local authority”. It was this ground which prevailed with the Election Court. Not only the election was set aside but a declaration was also made that respondent Munshilal Kushwah would stand declared as elected. It is against the above order passed by the Election Court, the present Revision Petition has been preferred.
3. The learned counsel appearing for the petitioner submits :
(i) that the petitioner did not suffer from disqualification as contemplated by Section 35(c) of the 1961 Act as a co-operative society is not a local authority,
(ii) that in any case the petitioner had submitted his resignation on 15th October, 1994 and this resignation was accepted on 21st October, 1994. He submits that nomination papers were to be filed by 24th October, 1994. It is accordingly submitted that the petitioner could not be treated as an employee of the aforementioned co-operative society and therefore he cannot be treated a person suffering from disqualification mentioned Under Section 35(c) of the 1961 Act.
4. The question to be gone into in this petition is as to whether a Co-operative Society would be a local authority for the purposes of Section 35(c) of 1961 Act. Before dealing the legal and factual position, it would be apt to notice the statutory provision. These are contained in Section 35(c) of the 1961 Act. This section read as under :
35. Disqualification of candidates. – No person shall be eligible for election or nomination as a Councillor if he :-
(c) holds any office of profit under the council or is in the service of any other local authority.
5. The term local authority has been defined in Madhya Pradesh General Clauses Act, 1957. Relevant section is 2(20). This read as under :
2(20) “Local Authority” means a municipal corporation; municipality, local board, Janpad Sabha, Village Panchayat, or other authority legally entitled to or entrusted by the Government with the control or management of a municipal or local fund.
The provision of Central Act i.e. General Clauses Act, 1897 be also noticed. The term local authority stands defined at Section 3(31). This read as under :
3(31) “Local Authority” shall mean a municipal committee, District Board, body of port commissioners or other authority legally entitled to, or entrusted by the Government with the control or management of a municipal or local fund.
6. The learned counsel for the petitioner submits that a perusal of the definition of local authority as occurring in General Clauses Act of 1897 and M.P. General Clauses Act, 1957 makes it apparent that a Co-operative Society is not included within a definition of the term local authority.
7. This question came to be considered in Union of India v. R. C. Jain, AIR 1981 SC 951. Chinnappa Reddy, J. dealt with the matter in following manner :
“Let us therefore, concentrate and confine our attention and enquiry to the definition of ‘Local Authority’ in Section 3(31) of the General Clauses Act. A proper and careful scrutiny of the language of Section 3(31) suggests that an authority in order to be a local authority, must be of like nature and character as a Municipal Committee, District Board or Body of Port Commissioners, possessing, therefore, may, if not all, of the distinctive attributes and characteristics of a Municipal Committee, District Board, or Body of Port Commissioners, but possessing one essential feature, namely, that it is legally entitled to or entrusted by the Government with, the control and management of a municipal or local fund. What then are the distinctive attributes and characteristics, all or many of which a Municipal Committee, District Board or Body of Port Commissioners shares with any other local authority? First, the authorities must have separate legal existence as Corporate bodies. They must not be mere Governmental agencies but must be legally independent entities. Next, they must function in a defined area and must ordinarily wholly or partly, directly or indirectly, be elected by the inhabitants of the area. Next, they must enjoy a certain degree of autonomy with freedom to decide for themselves questions of policy affecting the area administered by them. The autonomy may not be complete and the. degree of the dependence may vary considerably but, an appreciable measure of autonomy there must be. Next, they must be entrusted by Statute with such Governmental functions and duties as are usually entrusted to municipal bodies, such as those connected with providing amenities to the inhabitants of the locality, like health and education services, water and sewerage, town planning and development, roads, markets, transportation, social welfare services etc. etc. Broadly we may say that they may be entrusted with the performance of civic duties and functions which would otherwise be Governmental duties and functions. Finally, they must have the power to raise funds for the furtherance of their activities and the fulfilment of their projects by levying taxes, rates, charges, or fees. This may be in addition to moneys provided by Government or obtained by borrowing or otherwise. What is essential is that control or management of the fund must vest in the authority.”
Two earlier decisions were noticed in paras 3 and 4. These paras are also quoted :
(3) In Municipal Corporation of Delhi v. Birla Cotton Spinning and Weaving Mills, Delhi, (1968) 3 SCR 251 at p. 288 = AIR 1968 SC 1232, Hidayatullah, J., described some of the attributes of local bodies in this manner :
“Local bodies are subordinate branches of Government activity. They are democratic institutions managed by the representatives of the people. They function for public purposes and take away a part ofthe Government affairs in local areas. They are political sub-divisions and agencies which exercise a part of State functions. As they are intended to carry on local self-government the power of taxation is a necessary adjunct to their other powers. They function under the supervision of the Government.”
(4) “In Valjibhai Muljibhai Soneji v. State of Bombay, (Now Gujarat), (1964) 3 SCR 686 = AIR 1963 SC 1890, one of the questions was whether the State Trading Corporation was a local Authority as defined by Section 3(31) of the General Clauses Act, 1897. It was held that it was not, because it was not an authority legally entitled to or entrusted by the Government with, control or management of a local fund. It was observed that though the Corporation was furnished with funds by the Government for commencing its business that would not make the funds of the Corporation ‘local funds’.”
8. Thus, judicial precedent is available to come to the conclusion that the institution incorporated under the Co-operative Society Act would not be a local authority. Reference in this regard be also made to the V Edition of the AIR Manual Vol. 25. Cases stands annotated at page 837. This specifically deals the status of Co-operative Marketing Society. Serial No. 21 is relevant. It reads as under :
“A co-operative marketing society is not a local authority within the meaning of Section 6(5)(g) of the Punjab Gram Panchayats Act (4 of 1953) and its salaried manager is not disqualified from contesting an election for the office of Sarpanch of a gram panchayat (1972) 74 Pun LR 444 = 1972 Punj.LJ 20(25) (1994) 2 BUR 287 (289) (Pat) (Central Co-operative Bank is not a ‘Local Authority’ within the meaning of Section 3(31) of the General Clauses Act).”
I am of the view that the co-operative society would not fall within the definition of the term local authority. This is more so in the present case. There is no evidence on the record that the co-operative society was entrusted by the Government with the control or management of any local funds. It has no power to levy tax and it exercises no State function. Unless and until it is established that some local fund is made available to the authority it would not come within the definition of the term local authority. In this view it is not proposed to go into the further question as to whether the resignation of the petitioner was accepted before date of election or after the date of election. Precisely for this reason the other argument raised by the learned counsel for the petitioner that respondent Munshilal could not be declared elected as there were other candidates also contesting the election is also not being gone into. As a conclusion has been arrived that the co-operative society is not a local authority, the result would be that the nomination papers of the petitioner Asha Ram would be deemed to have been validly presented and these were validly accepted. He obtained largest number of votes. He was rightly declared elected.
This petition is thus allowed. The order passed in the Election Court which is under challenge is set aside. There would be no order as to cost.