Rameshwar Prasad Agarwal vs A.K. Sinha And Ors. on 14 May, 1965

Patna High Court
Rameshwar Prasad Agarwal vs A.K. Sinha And Ors. on 14 May, 1965
Equivalent citations: AIR 1966 Pat 6
Author: Mahapatra
Bench: U Sinha, H Mahapatra, A Sinha


Mahapatra, J.

1. The Chairman of the Arrah Municipality has sought, by this application under Article 226 of the Constitution, to quash by a writ in the nature of certiorari, the proceedings of and the resolution passed in the special meeting of the Commissioner of that Municipality held on the 8th February 1964, and a for direction to the respondents, the Commissioners, restraining them from giving effect to that resolution. The impugned resolution reads as follows :

“Whereas Sri Rameshwar Prasad Agarwal, Chairman who has been authorised under Section 76 (it should be 75) of the Bihar and Orissa Municipal Act is not acting impartially in making various legal payments to contractors and others according to budget, it is resolved that in supersession of the resolution passed on the subject in the meeting held on 31-3-1983, the Finance Committee be authorised to pass orders for all payments to be made on behalf of the Municipality and that the Vice Chairman be authorised to make all payments on behalf of the Finance Committee and sign cheques, etc.

Resolved further that under Section 49 Clause (3), (it should be Clause 4), the Board delegated all its powers and functions pertaining to Finance to Finance Committee and that the decision of the Committee shall be final.”

This resolution was passed by sixteen members present voting for it and fourteen against it. A point of order was raised in respect of the resolution which was ruled out. The meeting where the resolution was passed was a special meeting under Section 44 (2) of the Bihar and Orissa Municipal Act, held on 8th February 1964 at 3 p. m. in the municipal office. Annexure A to the petition is a notice convening that meeting, which stated :

“Whereas the Chairman, Arrah Municipality has failed to call a Special Meeting on our requisition under Section 44 (1) of the Bihar and Orissa Municipal Act within fifteen days from 24-8-63 (the date appears to be misprint), we the requisitionists hereby call the Special Meeting of the Board under Section 44 (2) of the Bihar and Orissa Municipal Act on Saturday the 8th February 1964 at 3 p. m. in the Municipal Office to consider the following Resolution.”

The resolution was quoted in that notice, which is in the form in which it was passed, which I have reproduced above. Five Commissioners had given first, the requisition to the Chairman and then they gave the notice themselves for the special meeting.

2. The resolution of the 31st March 1983 of the meeting of the Commissioners in supersession of which the impugned resolution was passed has not been produced by the petitioner, nor called for from the respondents. Both sides proceeded on the basis that that resolution was under Section 75 of the Bihar and Orissa Municipal Act (which shall be referred hereafter as the Act). That section is as follows :

“75. Disbursement of expenditure sanctioned in budget estimates–(1) After the budget estimates of the municipality for the year have been sanctioned under Section 73, the Commissioners at a meeting may, subject to the prescribed restrictions from time to time, by a general or special resolution, authorise the expenditure of any sum provided in such estimates, or any part of such sum, for the purpose to which it has been assigned in such estimates,

2. No order for the payment of money from the municipal fund shall issue unless the expenditure thereof has been authorised by the Commissioners so provided in Sub-section (1).”

Under Sub-section (1), the Commissioners at a meeting either by a general or special resolution, have to authorize the expenditure of the money provided in the estimates of the annual budget before that can be spent. The provision does not speak of any particular person to be so authorised to incur the expenditure. It imposes a legal requisition over the Commissioners again to give their thoughts, at a meeting in respect of any particular item or items of the budget estimates, when the occasion arises for incurring expenditures in that respect. Deficit budgeting has become a common practice in the present day in all institutions and local bodies, particularly where there is an expectation of receiving grants from the Government or from some other source. The authorisation as contemplated under Section 75 (1), is necessarily related to a particular year’s budget. There cannot be a general authorisation to incur expenditures in respect of all years’ budget. The opening words of the section : ”After the budget estimates of the municipality for the year have been sanctioned under Section 73″ leave no doubt about this. In absence of the actual context of the previous resolution of the 3lst March 1963, one can take it from the context that it was an authorisation under Section 75 (1) to incur expenditure in favour of the Chairman of the Municipality. The special meeting, in place of that resolution wanted to authorise the Finance Committee to incur the expenditure. Section 71 of the Act prescribes for preparation, in detail, budget estimates showing probable receipts and expenditures during the ensuing year, at least two months before the close of the current year. Such budget estimates are required to be published as provided under Section 72 and fourteen days thereafter, those estimates are to receive the final sanction from the Commissioners at a meeting and to be then sent to the State Government. The resolution of the 31st March 1963, would have been, therefore, in relation to the budget estimates for the year 1983-64 (April 1963 to March, 1964). The impugned resolution also speaks of authorization having been given previously to the Chairman under Section 75 (mistakenly mentioned as Section 78 in the proceeding). By the 8th February 1964, when the special meeting was held, one month and twenty days were left of the year 1963-64, and for that remainder period, the authorisation was sought to be changed from the Chairman to the Finance Committee, Thus the force of that resolution was to come to an end by the 31st March 1964. In that view, the present application has already become infructuous and no effective and useful writ of certiorari can or should issue in respect of that resolution.

3. Learned Counsel for the petitioner urged that Section 75 could not be taken as the basis of the impugned resolution as the resolution itself speaks of authorising the Finance Committee “to pass orders for all payments to be made on behalf of the municipality” and not authorising expenditure of any sum provided in the estimates of the budget. There may be some apparent force in this contention but on scrutiny it wilt not stand. The resolution refers to Section 75 of the Act, and in that context, it authorises passing orders for all payments. Though the proper words should have been authorisation of expenditure, yet there cannot be any doubt that the resolution meant that. Even assuming that on a strict interpretation, the resolution was not in compliance with the provisions of Section 75 (1), there will be little purpose in quashing that resolution for that defect at this belated stage, since it has already long spent its force.

4. Next, it was contended that neither the Chairman nor the Finance Committee could have been authorised either to incur the expenditure or to pass orders for payments under Section 75. This is the correct position; yet, if the Commissioners at a meeting not only authorised the expenditure but also authorised someone else to incur the expenditure, that will not be an invalid authorisation as far as the expenditure is concerned. The particular person or the particular committee which is also authorised to incur the expenditure may not be clothed with such authority on account of a resolution under Section 75 (1), but such authority to a particular person or to a committee cannot be ruled out from the competency of the Commissioners at a meeting. If they combine both the things in one resolution, there will be hardly any invalidity in it.

5. Learned Counsel also pressed that authorising the Vice-Chairman to make all payments on behalf of the Finance Committee and to sign cheques was beyond the scope of Section 75. It is so. That will also be outside the ambit of Section 49. If this part of the resolution would not have related to the year 1963-64 along with the authorisation of expenditure for the same year, there would have been the necessity of quashing it. But, as I have already said, the whole resolution has spent its force after the 31st March 1964, and in that view, no further action is called for in the present proceedings.

6. On a reference to the order passed by a Bench of this Court on the 4th of March 1965, as a result of which the case was referred to this Full Bench, we find that the learned Judges who passed that order were inclined to take a view different from that expressed in Ashwani Kumar Sinha v. Rameshwar Prasad Agarwal, 1964 B L J R 114, to the effect that Section 24 is cut down by the provisions of Section 49 of the Act. The latter section provides for powers for the Commissioners at a meeting to appoint committees to assist them in the discharge of their duties and to delegate to such Committee or Committees any of their powers and duties and direct, if necessary, that the decision of the Committee or Committees shall be final. The scope and function of such Committee will be in respect of the powers and duties that have been conferred or enjoined upon the Commissioners at a meeting under the Act. In Section 24 the Chairman has been restricted from exercising any powers which are directed to be exercised by the Commissioners at a meeting. The two sections thus do not appear to come in clash with each other. In the present case it is not necessary to examine that question in any detail as it does not fall to be decided.

7. Learned Counsel for the respondents contended that the present case was barred by the principle of res judicata inasmuch as in the case of 1964 BLJR 114, the question relating to Sections 24 and 49 of the Act vis-a-vis the powers of the Chairman and the powers of delegation by the Commissioners at a meeting, was concluded between the same parties. In the present case, there are parties like Jugeshwar Nath Pandey, respondent No. 32, who were not parties to the previous case. But in the view that I have taken of the infructuous character of the present application at this date, neither this point nor other points raised on ground of notice of the special meeting need be considered.

8. The result is that the application fails and is dismissed but, in the circumstances of the case, without any costs.

U.N. Sinha, J.

9. I agree.

A.B.N. Sinha, J.

10. I agree.

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