M/S NOORULLA GHAZANFARULLA versus L. THE MUNICIPAL BOARD OF ALIGARH, ALIGARH 2. THE STATE OF UTIAR PRADESH, LUCKNOW 3. SH. R.N. MATHUR, OFFICER-ON-SPECIAL DUTY, NAGAR PALIKA, ALIGARH.

Citation: [1995] 1 S.C.R. 978 · Decided: 07-02-1995 · Supreme Court of India · Bench: P.B. SAWANT · Disposal: Disposed off

Judgment (excerpt)

B 
c 
MIS. NOQRULLA GHAZANFARULLA 
v. 
l. THE MUNICIPAL BOARD OF ALIGARH, ALIGARH 
2. THE STATE OF UTIAR PRADESH, LUCKNOW 
3. SH. R.N. MATHUR, OFFICER-ON-SPECIAL DUTY, NAGAR 
PALIKA, AUGARH. · 
FEBRUARY 7, 1995 
[P.B. SAWANT AND N. VENKATACHALA, JJ.] 
Municipalities: U.P. Municipalities Act, 1916; Sections 224-B, 224-C ' 
·(As substituted by Act 45 of 1975) and Sections 224-A and 224-B Municipal 
Boahl--Water Supply Licence-Revocation of-property of licensee-Vesting 
of in Municipal Board-Held permissible only after sale is effected in terms 
of the Ac~ayment for property· of licensee-Determination by Municipal 
D Board under Section 224-C-Held under Proviso to Section 224-C Licensee 
is also entitled to prescribed rate of interest from the date of revocation of 
licence till date of payment. 
The appellant, who was granted a licence on 10.10.1935 under Sec· 
tlons 224-C and 224-A of the U.P. Municipalities Act, 1916 for providing 
· E water supply to certain areas of Aligarh, requested the Respondent-Board 
to revoke the licence by having recourse to Section 224-B(2)(a) of the Act 
so .as to enable the Municipal Board to purchase the water works as 
provided for under Section 224-C of the Act. The Respondent-Board 
passed an order dated 1.4.1975 stating that (i) the appellant's licence was 
p 
revoked with effect from 1st april, 1975 and the Management of the Aligarh 
Water Works will be taken over by the Municipal Board with effect from 
the same date; (ii) all property belonging to the appellant water-works 
sbail vest 1n. the respondent-Board with effect from lst April, 1975 and (iii) 
that the value of the property belonging to the licensee shall be determined 
by the State Government in accorclance with the provisions of the Act. The 
G appeilant decided to hand over the water works·"ut disputed the statement 
of transfer and vesting of all. water works in the Respondent-Board on the 
.ground thatvesting of appellant's propertY in the respondent~Board. could 
take. pla~ only after the same was effected under Section 224-C of the Act. 
· In the meanwhile Sections 224·8 and 224~c were substituted by new 
H Sections by Act. 45 of 1975. The appellant filed a· writ petitiOn before the 
978 
't .... 
N. GHAZANFARULLA v. MUNICIPAL BD. OF ALIGARH 
979 
High Court for directions to the respondents to pay fair market value for A 
the property of the appellant as computed under the new Section 224-C 
which \vas dismissed. The High Court also rejected the appellant's conten· 
tion that the new Section 224-C was violative of articles 19(1)(1) and 31 of 
the Constitution. The appellant preferred an appeal before· this Court. 
Disposing the appeal, this Court 
B 
HELD: 1. The provisions in Section 224-C of the U.P. Municipalities 
Act stood before they were substituted by new Section und.er Act 45 of 1975, 
if had only empowered the Board to revoke the licence of the licensee of 
water works from a date to be specified by It and direct the licensee to sell C 
the water works after the value or such water works was determined either 
by mutual agreement or by the valuer to be appointed by both, there is no 
escape from the conclusi()n that the Board had no power t.o appropriate 
water works to itself before the taking of such sale by unilaterally stating 
that the properties or water works had vested In it on the date or revoca- D 
tlon. Accordingly, the respondent-Board was not empowered under section 
224-C or the Act to get the ownership of the Allgarh Water Works or 
property therein transferred to Itself from the appellant from the date 
specified for revocation or licence or the appellant. Thus, when neither the 
· Allgarh Water Works nor Its property stood transferred to and vested In 
the respondent-Board so as to make it the owner thereof, the mere fact E 
that on 1.4.1975, the Administrator or respondent-1, who made an order 
revoking the licence of the appellant In respect or the water works, stated 
In his order that from 1.4.1975, the date or revocation of the licence, the 
property therein vested In the respondent Board, did not inake the appel· 
lant lose the ownership or It and make respondent-1 get the Ownership p 
thereof. [988-H, 989-A·B, 990·8] 
2. Besides, when the provisions In Section 224-C of the Act, as they 
stood before they were amended by a new Section, substituted by Act 45 of 
1975 empowered the Board to obtain sale of water works from the licensee G 
only after the price or value of such water w

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