Karnataka State Pollution Control Board vs B. Heera Naik & Ors. etc.

48 – Prosecution of Municipal Commissioner of City Municipal Council and Chief Officer of City Municipal Council – When an offence is committed by City Municipal Council or Corporation, whether they can be prosecuted under the Act, 1974 and what is the procedure for initiating proceeding for prosecution of such bodies – Held: s.47 contains a heading “offences by companies” – The definition of company is contained in the Companies Act, 1956 in s.3 – The definition of company as contained in the Companies Act, 1956 is clearly not borrowed in the expression of company as used in s.47 of Act, 1974 – The company has been defined in s.47 of Act, 1974 in a very wide and inclusive manner – Explanation to s.47 states that “company” means “any body corporate” – Thus, all body corporates are included within the definition of company as per s.47 – There cannot be any dispute that City Municipal Council is a body corporate, which has been clearly provided under s.10 of Act, 1964 – Looking at the purpose and object of the Act, s.47 can be resorted to for offences by body corporate – s.49 embraces cognizance of all offences under the Act – Whether the offences are covered by ss.47 or 48 has no bearing on the power of the Court to take cognizance of an offence – Karnataka State Pollution Control Board filed complaint for taking cognizance specifically referring to s.49 of the Act, 1974 – Thus, in event any offence is committed by anyone, its cognizance can be taken under s.49 – However, offences by a body corporate are to be covered by s.47, since in event offences by body corporates are not covered by s.47, the benefit of s.47(1) proviso shall not be available to those body corporates, which cannot be the intention of the Legislature – Thus, offences by body corporate like City Municipal Council are covered under s.49 treating it to be offence as by company as provided in s.47 – Complaint against Municipal Commissioner of City Municipal Council and Chief Officer of City Municipal Council by appellant-Board was maintainable – Companies Act, 1956 – s.3.

Water (Prevention and Control of Pollution) Act, 1974: Legislative intent of enactment – The Act, 1974 was enacted by the Parliament to provide for the prevention and control of water pollution and the maintaining or restoring of wholesomeness of water.

Municipalities: Duties of Municipal Council/Corporation – Held: City Municipal Council and City Municipal Corporation are created or incorporated by the State and entrusted with the Municipal functions – One of the main functions entrusted to the Corporation is to ensure clean environment to the residents, to control pollution in a Municipal area, which is one of the duties of the Municipal Council and the Corporation.

Allowing the appeals, the Court

HELD: 1.1 The Act, 1974 was enacted by the Parliament to provide for the prevention and control of water pollution and the maintaining or restoring of wholesomeness of water, for the establishment, with a view to carrying out the purposes aforesaid, of Boards for the prevention and control of water pollution, for conferring on and assigning to such Boards powers and functions relating thereto and for matters connected therewith. [Para 7] [313-H; 314-A-B]

1.2 Section 48 of the Act, 1974 is attracted where the offence is committed by any Department of Government. The provisions of Act, 1974 as well as the Karnataka Municipalities Act, 1964 have to be looked into to find out as to whether Commissioner of City Municipal Council or Chief Officer of City Municipal Council constituted under the Karnataka Municipalities Act, 1964 can be treated to be the Head of the Department of any Department of Government. The City Municipal Council is a Council, incorporated under Section 10 of the Karnataka Municipalities Act, 1964. City and Town Municipal Councils as per Section 10 is “a body corporate”. Similarly, under the Karnataka Municipal Corporations Act, 1976, the Municipal Corporations are constituted as Corporation by virtue of Section 10. The concept of creating body corporate and corporation to carry out the functions of the Government is a modern concept of the Government. The modern Governments have undertaken on themselves large functions touching the life of its citizens, inhabitants. The Scheme underlying the Constitution of India entrust and oblige the Governments to carry out different functions for achieving the constitutional objectives to secure justice, liberty equality and fraternity. [Paras 11, 12, 13] [316-E-G; 317-C-E]

1.3 The Municipal City Council and Municipal Corporation, which have been created by State enactments are controlled by the Government, which bodies also receive financial assistance from the Government. It is well settled that Municipal Corporations are instrumentality or agency of the Government. The question is whether City Municipal Council constituted under the Municipalities Act can be treated as Department of Government. Under Act, 1974, the State Government has been defined in Section 2(i). In constitution of the State Boards, the State Government nominates members of the local authorities functioning within the State, members to represent the companies or corporations owned, controlled or managed by the State Government as well as officials to represent that Government. [Para 14] [318-B-D]

2.1 The Scheme of the Act indicate that there are separate members to represent the Government in the Board, separate members to represent the local authorities functioning in the State and separate members to represent the companies or corporations owned, controlled or managed by the State Government. The Government, local authorities and companies or corporations owned, controlled or managed by the State Government are all different expressions used in the Act. Whether an institution is a corporation or a Department of the Government has to be found out from the Scheme under which it has been created. One of the tests to find out as to whether an institution is a Corporation or a Department of the Government is to enquire whether the undertaking functions as a responsible independent organisation and not as part of any Department of the State. Second test would be to see whether it is endowed with the capacity to contract obligations and of suing and being sued. Further, the power to possess, use and change a seal is incidental to a corporation and a corporation aggregate can, as a general rule, only act or express its will by deed under its common seal. The Karnataka Municipalities Act, 1964 provides for a Town and City Municipal Councils as a body corporate. The control of the State Government on the Municipality is provided in a separate chapter, i.e., Chapter XII. The Scheme of constitution of Municipal area and other provisions of Act, 1964 clearly indicate that Municipalities are not a Department of the Government. [Para 15] [319-G-H; 320A-D]

2.2 Article 243P sub-clause (e) defines “Municipality” as an institution of self- Government constituted under Article 243Q. The Constitution also envisages Municipality as a body of self-Government. The provisions of the Act, 1964 and Act, 1974 makes it clear that City Municipal Council cannot be treated as Department of the State Government. After having found that City Municipal Council is not Department of the Government – the question is whether they are immuned from prosecution under Act, 1974. City Municipal Council and City Municipal Corporation are created or incorporated by the State and entrusted with the Municipal functions. One of the main functions entrusted to the Corporation is to ensure clean environment to the residents, to control pollution in a Municipal area, which is one of the duties of the Municipal Council and the Corporation. [Paras 16, 18] [320-E-F; 321-A]

When an offence is committed by City Municipal Council or Corporation, whether they can be prosecuted under the Act, 1974 and what is the procedure for initiating proceeding for prosecution of such `bodies?

3.1 Section 47 contains a heading “offences by companies”. Section 47(1) is similar to Section 48. The definition of company is contained in the Companies Act, 1956 in Section 3. The definition of company as contained in the Companies Act, 1956 is clearly not borrowed in the expression of company as used in Section 47 of Act, 1974. The company has been defined in Section 47 of Act, 1974 in a very wide and inclusive manner. Explanation states that “company” means “any body corporate”. Thus, all body corporates are included within the definition of company as per Section 47. There cannot be any dispute that City Municipal Council is a body corporate, which has been clearly provided under Section 10 of Act, 1964. [Paras 19, 20] [321-C-E-G]

3.2 Section 47 can be resorted to for offences by body corporate and Karnataka State Pollution Control Board by filing a complaint before the Magistrate for taking cognizance of offence under Section 49 did not commit an error. Section 49 embraces cognizance of all offences under the Act. Whether the offences are covered by Section 47 or 48 has no bearing on the power of the Court to take cognizance of an offence. Karnataka State Pollution Control Board has filed complaint for taking cognizance specifically referring to Section 49 of the Act, 1974. Thus, in event any offence is committed by anyone, its cognizance can be taken under Section 49. However, offences by a body corporate are to be covered by Section 47, since in event offences by body corporates are not covered by Section 47, the benefit of Section 47(1) proviso shall not be available to those body corporates, which cannot be the intention of the Legislature. Thus, offences by body corporate like City Municipal Council are covered under Section 49 treating it to be offence as by company as provided in Section 47. [Paras 29, 31] [328-G-H; 329-G-H; 330-A]

V.C. Chinnappa Goudar v. Karnataka State Pollution Control Board & Anr. [2015] 3 SCR 652 ; Shri D.H. Raya v. Karnataka State Pollution Control Board Criminal Petition No.831 of 2007 – distinguished. Hakam Singh v. M/s. Gammon (India) Ltd., (1971) 1 SCC 286 : [1971] 3 SCR 314 - relied on.

Ramana Dayaram Shetty v. International Airport Authority of India and Others, (1979) 3 SCC 489 : [1979] 3 SCR 1014 ; Subhash Chandra v. Gulab Bai and Others, (2016) 4 SCC 750 ; Ranjit Narayan Haksar v. Surendra Verma, 1995 MPLJ 21 ; Aneeta Hada v. Godfather Travels and Tours Private Limited, (2012) 5 SCC 661 : [2012] 5 SCR 503 ; Arun Kumar Singh v. The State of Bihar and Ors. [2006] 2 SCR 1058 – referred to.