Sarjoo Prosad,c. J. - (1.)THIS writ petition is directed against an order of the Director of Local Bodies dated 6th January, 1960. The petitioner has moved that the order in question is without jurisdiction and ought to be set aside.
(2.)THE petitioner was elected on the 14th of November, 1958, a member of the Municipal Board, Sikar. In the Revised Second Five Year Plan the Government of India made a provision for a scheme of water supply to the State of Rajasthan and the State of Rajasthan in its turn prepared a scheme for water supply in Sikar. Accordingly, the Director of Local Bodies was informed on the 28th of December, 1955, that the water supply scheme for Sikar town should be prepared by the Superintending Engineer in con-sultation with the Chairman of the Municipal Board. THE Superintending Engineer got into touch with the Municipal Board about the details of the water supply scheme and informed the Chairman of the Board that the execution of the work would be taken up on the acceptance by the Board of the scheme in question. Of course the execution of the work had to be done by the Public Works Department; but the expenditure incurred for the scheme was to be treated as a loan against the Municipal Board, Sikar, for which the Board was required to execute a bond accepting the loan in question. On the 12th of July, 1959, the Municipal Board by its resolution accepted the proposed scheme sent to it by the Superintending Engineer, and thereafter the officers of the Public Works Department proceeded to execute the scheme. THE Executive Engineer, Water Works, then invited tenders for construction of clear water reservoir and pump house etc. THE petitioner, who was also an approved contractor working under the District Board, submitted his tenders for those constructions and his tenders in due course were accepted by the Executive Engineer, Water Works, Jaipur. THEreafter on the 30th of September, 1959, the Chairman, Municipal Board Sikar, served a notice on the petitioner alleging that in view of the fact that he had obtained the contract in question, he was disqualified under sec. 12 (3) (a) of the Rajasthan Town Municipalities Act, 1951, (Act No. XXIII of 1951 - hereinafter called "the old Acts) to be a member of the Municipal Board, Sikar. THE petitioner, however, took the stand that he had incurred no such disqualification as the contract in question was not a contract on behalf of the Municipal Board of Sikar but was a contract granted by the Executive Engineer, Water Works, Jaipur, on behalf of the Government of Rajasthan. On the 8th of October, 1959, the Chairman held that the petitioner had incurred the disqualification in question and could no longer continue as a member of the Municipal Board. In consequence a dispute arose between the petitioner on the one hand and the Chairman of the Municipal Board on the other and on the 12th of October, 1959, the matter was referred to the Director of Local Bodies under sec. 12 (5) of the old Act. It may be mentioned here that although under sec. 19 (5) of the Act the State Government enjoyed the power to decide any dispute as to whether a vacancy bad or had not occurred within the meaning of sec. 12, under sec. 207 of the Act the Government had been authorised to delegate the power to the Director of Local Bodies, which it had done by virtue of a Notification dated 9th of May, 1957. Accordingly the Director or Local Bodies, came to have seisin of the matter when the dispute was referred to him for decision on the 12th of October, 1959. THE Director of Local Bodies by the order in question before us held that the contract taken by the petitioner for the constructions aforesaid was a contract on behalf of the Municipal Board and as such the petitionee stood disqualified from the membership of the Board and his seat should be deemed to have fallen vacant.
Mr. Rastogi for the petitioner has challenged this order on two grounds. He contends firstly that the Director of Local Bodies was patently in error in assuming that on account of the petitioner having undertaken to execute the contract for the construction of certain works in connection with the irrigation scheme, the petitioner had incurred any disqualification under sec. 12 (1) (viii) of the Act. That section provides that - " (1) No person may be a member of a Municipal Board - (viii) who, save as hereinafter provided, has directly or indirectly, by himself or his partner, employer or employee, any share or interest in any work done by order of such municipal board, or in any contract or employment with or under or by or on behalf of such municipal board. " Sub-sec. (2) of sec. 12 further says that "if any person elected or nominated as a member is subject to any of the disqualifications specified in sub-sec. (1) his seat shall be deemed to be vacant;" and then we come to sub-sec. (5) under which, in case of any dispute, the matter has to be decided by the State Government, whose decision is final. The whole argument of the petitioner depends upon the meaning of the expression "any share or interest in any work done by order of, or in any contract by or on behalf of, such municipal board. "

The second contention of Mr. Rastogi, which, in our opinion, has assumed greater importance for the disposal of this writ application, is that after the dispute had been referred to the Director of Local Bodies the law on the point underwent a change. On the 17th of October, 1959, the Rajasthan Municipalities Act (Act No. 38 of 1959 - hereinafter called "the new Act) came into force. Under this Act there was an analogous provision for disqualification of a member as contained in sec. 12 (1) (viii) of the old Act, in sec. 26 (xii) of the new Act The consequence, however, of any disqualification under the new Act was not only to declare the seat of the disqualified member as having fallen vacant, but also to direct his removal under sec. 63 of the new Act. It may be pointed out that there was also a provision for removal under sec. 14 of the old Act and action for removal could be taken under that section even in cases where the disqualified member had become incapable of performing his duties as a member. Mr. Rastogi contends that since the new Act had come into operation, it was necessary to follow the procedure laid down in sec. 63 of the Act. Under sec. 63, sub-sec. (2), it was obligatory on the part of the State Government before directing the removal of a member to draw up a statement setting out distinctly the charge against the member and to send the same for inquiry and findings by a judicial officer of the rank of a District Judge appointed by the Slate Government for the purpose. The judicial officer so appointed would then proceed to inquire into the charge in the prescribed manner, hear the member concerned if he makes appearance, record his findings on each matter embodied in the statement as well as on every other matter he considers relevant to the charge and send the record along with such findings to the State Government, which should thereupon pass orders in conformity with those findings. The contention of the learned counsel is that this wholesome and mandatory procedure laid down in sec. 63 of the new Act has been completely ignored. When this new Act came into operation it was imperative that this procedure should have been followed before any order disqualifying the petitioner or directing his removal as would be the natural incident of his disqualification could be made by the State Government. The learned Deputy Government Advocate, however, submits that on the 12th of October, 1959, the Director of Local Bodies was already in seisin of the matter, and, therefore, that officer had jurisdiction to decide the matter under the old Act where no such procedure was laid down as is now contemplated by the new Act. Mr. Rastogi, however, rightly points out that the fact that the dispute was pending before the Director of Local Bodies did not improve the position. The Director of Local Bodies was nothing more than a delegate of the State Government and it must be assumed, therefore, that under the law the proceeding was pending before the State Govt. Even under sec. 299 of the new Act it is open to the State Government to delegate certain powers to the Director of Local Bodies subject to the exceptions provided therein and since there was no exception provided in regard to the powers exercisable by the. State Government under sec. 63 of the Act, there could be no delegation of this power in favour of the Director of Local Bodies. He submits, therefore, that under sec. 2 (b) of the new Act, the appointment of the Director of Local Bodies as a delegate of the State Government under the old Act should be taken to enure also under the new Act. The petitioner does not challenge any of the steps which had been taken earlier upto the stage of reference of the dispute to the Director of Local Bodies; but he says that after the new Act came into operation and since the matter had not been disposed of earlier, the Government had no option but to follow the procedure laid down under sec. 63 of the new Act before imposing any penalties as contemplated by the law.

We have given our anxious consideration to the matter and we think that the writ application must succeed on this ground. The Director of Local Bodies did not dispose of the matter before introduction of the new Act. If he had done so the matter would have ended. The Legislature for good reasons provided certain safeguards under the new Act; and when the new Act came into operation we are bound to observe that the procedure laid down in this Act was the right procedure to follow. Therefore, the Director of Local Bodies or for the matter of that the State Government had to refer the charges against the petitioner for enquiry to a judicial officer of the rank of a District Judge and then on submission of his report pass orders in conformity with his findings. In the view which we have taken on this point, we would like to say as little as possible in regard to the first contention of the petitioner lest our observations might prejudice his case. It would be for the judicial officer mentioned in sec. 63 of the Act to come to a finding whether on the materials disclosed a disqualification had been incurred by the petitioner in undertaking the contracts in question so that he could no longer continue to be a member of Municipal Board. The learned Deputy Government Advocate has very strenuously contended that the order of the Director of Local Bodies on the point was thoroughly justified and that the contracts in question could not but be "on behalf of the Municipal Board. " According to him the mere fact that the Public Works Department was executing the contracts did not matter because the payment had to be made by the Municipal Board and the liability for the execution of the contracts was the liability of the Municipal Board itself. It was with the consent of the Board that the scheme for supply of water was taken up and it is in pursuance of that scheme that the contracts in question were given. These are, however matters which have to be decided by the judicial officer appointed for the purpose under sec. 63 of the new Act and we would not like to anticipate his decision on the point.

We accordingly allow this application and set aside the order of the Director of Local Bodies; but in the circumstances of the case we would make no order as to costs of this application. .

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