Dwivedi, J. - (1.) AS he then wAS to a larger Bench for consideration and its opinion : "Whether the members and chairman of the Town Area Committee elected under the Town AreAS Act will become the members and chairman of the Municipality created on the extinction of the Town Area by virtue of clause (viii) Sec. 333-A of the Municipalities Act."
(2.) THE petitioners of the writ petition reside within the jurisdiction of the Notified Area of Sherkot. On 31st January, 1970 the State Government issued a notification u/Sec. 3 (1) (d) of the Town Areas Act cancelling with effect from 3rd February, 1970 all previous notifications relating to the creation of the Town Area, Sherkot. On the same day the State Government issued another notification u/Sec. 337 (1) of the U.P. Municipalities Act hereinafter referred to as the Act creating a Notified Area in Sherkot. On 20th February, 1969 the Town Area Committee, Sherkot decided to prepare a list of persons who would be assessed to tax on their circumstance and property for the assessment year 1969-70. On 28th May, 1969 the Town Area Committee approved the assessment of an amount of Rs. 15,721.50 P. as tax on circumstance and property. THE list was forwarded to the District Magistrate, Bijnor, for sanction. On 25th February, 1970 the Sub-Divisional Magistrate, Dhampur notified the total assessment of Rs. 55,764.00 as tax on circumstance and property. Another list for the assessment year 1970-71 assessing Rs. 88,044.00 as tax on circumstance and property was published by the Notified Area Committee. THE petitioners of Writ Petition No. 3681 of 1970 who are some of the persons on whom the tax had been assessed in the aforesaid two lists questioned the assessments. It was contended before Dwivedi, J. on behalf of the petitioners that the District Magistrate, Bijnor, and the Sub-Divisional Magistrate, Dhampur had no power to prepare the assessment lists. It was urged that on the creation of the Notified Area the members and chairman of the Sherkot Town Area Committee automatically became the members and chairman of the Notified Area. It was submitted that the members and chairman alone were entitled to prepare the assessment lists. Learned counsel for the petitioners relied upon the decision of this Court in State of Uttar Pradesh v. Town Area, Chhibra Mau, 1972 AWR 359 in support of his contention. In that decision to which one of us (Satish Chandra, J.) was a party, the view was taken that when by means of a notification the State Government cancels an earlier notification creating a town area or a notified area and by another notification issued on the same day u/Sec. 3 of the Act creates a municipal board in their stead, Sec. 333 of the Act has no application and u/Sec. 333-A (viii) of the Act the chairman and the members of the erstwhile town area or notified area, as the case might be, continue as chairman and members of the municipal board. The learned Judges drew a distinction between boards created in an erstwhile vacant area and those brought into existence by transforming pre-existing town or notified areas. To the former class, it was held Sec. 333 of the Act applies and the concerned District Magistrate or officer appointed by him in that behalf may until a board is established exercises its powers and perform its duties and functions. On the other hand, it was held, that to a municipality of the latter class, Sec. 333-A (viii) applies and under it the chairman and members of the local body made extinct continue to function as its chairman and members till the constitution of the board. Dwivedi, J. for reasons given by him in detail in his referring order found difficulty in subscribing to the view expressed in State of Uttar Pradesh v. Town Area, Chhibra Man (supra). He has expressed the opinion that whenever a notified area or municipality is created for the first time, irrespective of the question as to whether it has been brought into existence on virgin soil or to borrow his words has arisen "on the ahses of a town area or notified area" it is the District Magistrate who exercises the powers of the notified area or the municipality till the constitution of the committee or the board as might be the case. It will be noticed from the facts narrated above that in the case before Dwivedi, J. it was a notified area that had been created and not a municipal board. The question framed by Dwivedi, J. is thus not quite appropriate in the circumstances of the case. We consequently have reframed the question arising for consideration as follows :- "Whether the members and chairman of the town area committee elected or nominated under the Town Areas Act will become members and chairman of the notified area created on the extinction of the town area by virtue of clause (viii) of Sec. 333-A of the Act as made applicable to notified areas." In the connected Writ Petitions Nos. 7727 and 8039 of 1972 a question identical to the one that came up for consideration before Dwivedi, J. arose. K. N. Singh, J. who heard the two petitions consequently directed the above-mentioned two writ petitions to be connected with Writ Petition No. 3681 of 1970 and referred a question to a larger Bench in the form as reframed by us above.
(3.) SEC. 3 of the U. P. Town Areas Act (U.P. Act No. II of 1914) empowers the State Government inter alia to cancel by means of a notification at any time any notification by which it has created a town area. A town area committee is, like a notified area committee or a municipal board, a corporate body. As soon as by means of a notification issued u/SEC. 3 (1) (d) of Act II of 1914, any notification creating a town area is cancelled, the town area as a body administering local self government comes to an end and the town area committee as a corporate body ceases to exist. The consequence of a notification issued u/SEC. 3 (1) (d) of Act II of 1914 is that the chairman of the town area committee and its members cease to be the members and chairman of the committee on its extinction. Notified areas are not governed by any separate enactment. Under Sec. 337 of the Act the State Government is empowered to create a notified area. Sec. 337 itself imposes a restriction on the power of the State Government by providing that notification under that section cannot be issued in respect of a local area at the moment included within a municipality, town area or agricultural village. Thus if the State Government desires to bring into existence a notified area in a local area covered by an existing town area, it must first abolish that town area by publishing a notification under Sec. 3 (1) (d) of U. P. Act II of 1914 cancelling the earlier notification issued u/Sec. 3 (1) (a) thereof. When a notified area is created by means of a notification issued u/Sec. 337 of the Act, Sec. 338 (1) (a) thereof empowers the State Government to apply or adapt to such a notified area the provisions of any section of the Act or of any Act, which might be applied to a municipality, or part of such section, or any rule, regulation or bye-law in force or which can be imposed in a municipality under the provisions of the Act or any other Act subject to such restrictions and modifications, if any, as it may think fit. In exercise of powers u/Sec. 338 (1) (b) of the Act, the State Government may by notification impose in the whole or a part of such area, any tax which might be imposed therein under the provisions of the Act or any other Act as if the said area were a municipality. Clause (c) of sub-Sec. (1) of Sec. 338 enables the State Government to fix the number of persons who shall form a committee for the purposes of the assessment and recovery of a tax imposed under clause (b) and in order to arrange for the due expenditure of the proceeds of such tax, and for the preparation and maintain-ance of proper accounts, and generally for enforcing the provisions of any Section or rule, regulations or bye-laws applied or adopted under sub-clause (a). The relevant provisions of the Act which have a bearing on the question before us and their legislative history may now be usefully surveyed. Before the coming into force of the United Provinces Municipalities (Amendment) Ordinance, 1949 (U. P. Ordinance No. Ill of 1949) hereinafter to be mentioned as the 1949 Ordinance, Sec. 333 of the Act stood as follows := "When a new municipality is created under this Act, the District Magistrate, or other officer appointed by him in this behalf, shall, until a board is established, exercise the powers of a board for the purposes of making preliminary arrangements for the holding of first elections or otherwise and, generally of expediting the assumption by the board of its duties when established". By a notification dated 22-3-1949, Sec. 333 in this form was extended to apply to notified areas with appropriate verbal alterations having no material effect on the question under consideration. In 1949 U. P. Ordinance No. Ill of 1949 was promulgated. Though it was published in the Gazettee on 13-9-1949 by reason of Sec. 1 (2) thereof, it was deemed to have come into force with effect from 1-6-1949. Sec. 333 of the Act as it then existed was substituted in the following form : "When a new municipality is created under this Act, the Distiict Magistrate, or other officer appointed by him in this behalf, may, until a board is established, exercise the powers and perform the duties and functions of the board, and, he shall for the purposes aforesaid be deemed to be the board. Provided always that the District Magistrate or such other officer shall, as early as possible, make preliminary arrangements for the holding of first elections and generally of expediting the assumption by the board of its duties when constituted". ;