Common Order/Judgment:
1. Accused Nos. 2, 3, 4, 5 and 7 in C.C.No.02/2017 on the files of the Enquiry Commissioner and Special Judge, (Vigilance), Kottayam, have filed Crl. M.C. No.1116/ 2025 and the prayers are as under:
(i) Quash Annexure-E F.I.R. in Crime V.C.1 of 2013 of VACB, Kottayam and Annexure-F, final report and all proceedings in C.C.No.2 of 2017 of Enquiry Commissioner and Special Judge, Kottayam;
(ii) Issue such other orders as may be necessary in the interest of justice.
2. W.P.(C).No.38420/2024 has been filed by the petitioner under Article 226 of the Constitution of India and the prayers are as under:
I. Issue a writ of certiorari or other appropriate writ, order or direction, to quash and set aside the order at Ext.P5 considering the Ext.P2 vigilance Report.
II. Issue a writ or order in mandamus or any other appropriate writ, direction, and order commanding the respondents 1 and 2, to re-allot the Room No.10 and also to sanction an additional room for the said SC/ST community on the basis of Ext.P1 circulars.
III. Issue a writ or order in mandamus or any other appropriate writ, direction, and order commanding the respondents 1 and 2 to take appropriate action against the respondent No.3 & 4 for the unauthorized sub-letting of the Room No.10 reserved for SC/ST community.
IV. To dispense with filing of English translation of documents in Malayalam.
V. To grant such other relief as may be prayed for and as the Court deems fit to grant.”
3. Heard Sri.S.Sreekumar, learned senior counsel appearing for the petitioners in Crl.M.C.No.1116/2025 and for the 4th respondent in W.P.(C)No.38420/2024; Sri.P.Dalbi Emmanuel, learned counsel appearing for the petitioner in W.P.(C)No. 38420/2024; and Sri.Ajit Joy, learned Standing Counsel for Kottayam Municipality appearing for respondent Nos.1 and 2 in W.P.(C)No.38420/2024. Though notice was duly served on the 3rd respondent in W.P.(C)No.38420/2024, there is no appearance on his behalf. Also heard the learned Special Public Prosecutor.
4. First of all, I am inclined to address the contentions raised in the writ petition. The facts leading to the filing of the writ petition are as under:
1. The petitioner belongs to the Scheduled Caste (SC) community. The petitioner is aggrieved by the irregular allotment by the 1st and 2nd respondent, of Room No.10, reserved for SC/ST community in Rajiv Gandhi Shopping Complex, (Complex) Kottayam owned by the respondent No.1 herein. The 3rd respondent is the present licensee of the said room, but the possession and enjoyment of the same for the last so many years is by one Jewellery named Josco Jewellery.
2. That as per circulars of the government, when the Panchayats/ Municipalities/ Development Authorities construct shopping complexes and give the same on rent to the public, 10% of the same ought to be reserved for SC/ST community. The procedure prescribed by the government for allotment of reserved rooms in shopping complexes are as per government circulars bearing No. 15735/C3/90/ LSG dated 08/05/1990, 19217/C2/91/LSG dated 10/05/1991 and 3480/D3/96/LSG dated 12/08/1996. That as per the above circulars the government has very clearly stated the methods /procedure of allotment being as follows:-
(a) 10% of the rooms in all shopping complexes are strictly to be reserved for SC/ST community.
(b) Such reserved rooms should not be allotted by public auction, or by quotations having competitive nature. The rent ought to out fix by taking the average rent received from the other rooms of the complex, and the reserved room be allotted by draw of lots and given to the SC/ST allottee for a fixed period of time.
(c) These procedure ought to be strictly followed in case of new complexes and in case of other complexes when the existing tenant vacates and a new tenant is to be allotted, the above procedure shall be followed.
(d) Further, as per the circulars the government has prescribed that if the total number of rooms in a shopping complex is more than 5 and less than 10, the reserved room will be one and if the total number of rooms is more than 10, the reservation ought to be 10% of the total rooms. It is also prescribed that the security deposit to be taken should not be more than 3 month's rent. The government has also taken note of the fact that the guidelines in the circulars are not being properly complied with by the Panchayats/Municipalities / Development Authorities and therefore has made it clear that the guidelines have to be strictly followed and that the Secretary of the concerned Panchayat/Municipality/ Development Authority shall be held responsible.
5. According to the writ petitioner, he is a member of Scheduled Caste community and he is aggrieved by the irregular allotment of Room No.10, reserved for SC/ST community Rajiv Gandhi Shopping Complex (for short, ‘complex’ hereinafter) owned by the 1st respondent Kottayam Municipality. According to the writ petitioner, as per Exts.P1(a), P1(b) and P1(c) circulars, produced in the writ petition, 10% of the rooms in the complex should be reserved for SC/ST community and for which, the procedure prescribed in Exts.P1(a), P1(b) and P1(c) to be followed. It is contended by the writ petitioner that as per Exts.P1(a), P1(b) and P1(c), the allotment of rooms meant for the SC/ST community should not be made through public auction or by inviting competitive quotations. It has been specifically provided that when multiple applicants compete for the room, the beneficiary shall be selected by bid, after fixing the rent for the room by taking into account the average rent of other rooms in the same complex. Therefore, the contention raised by the writ petitioner is that now the writ petitioner impugns Ext.P5 order, dated 27.03.2023 issued by the Secretary, Kottayam Municipality rejecting the contentions raised by the writ petitioner in view of the directions issued in an earlier writ petition, i.e., W.P.(C).No.4339/2023. The learned counsel for the writ petitioner read out Ext.P1(a) circular, dated 08.05.1990, Ext.P1(b) circular, dated 10.05.1991 and Ext.P1(c) circular, dated 12.08.1996, as per which 10% of the total rooms in the complex, i.e., Room No.10, is reserved for the SC/ST community. It is argued that, while selecting the beneficiary, the Municipality adopted the method of public auction by allotting the room to the highest bidder, instead of following the procedure prescribed in the circulars, which would mandate selection by bid/draw of lots among eligible applicants after fixing the rent based on the average rent of other rooms in the complex. It could be seen that this was done earlier in the year 1995. At present, as could be seen from the records including the records in Crl.M.C.No.1116/2025, initially, the room was allotted to V.Vijayan and in turn, which was transferred to V.R.Krishnankutty and on the strength of a power of attorney in favour of M.R.Sreedharan. Then the room was transferred in the name of Chandran T.A. According to the learned counsel for the writ petitioner, since the selection of V.Vijayan as the beneficiary was made without following the procedure prescribed under Exts.P1(a), P1(b) and P1(c) circulars, the selection at the inception is illegal and therefore, the same is liable to be interfered with, so as to initiate the process of selecting the beneficiary afresh, in accordance with law. In this connection, the learned counsel for the writ petitioner relied on the circulars and also produced Exts.P6 to P10 along with a petition to receive the same. Ext.P6 is the order, dated 27.04.2013 in Crl.M.P.No.514/2013 passed by the Enquiry Commissioner and Special Judge, Kottayam, under Section 202 of the Code of Criminal Procedure (for short, ‘the Cr.P.C.’ hereinafter), deputing the Deputy Superintendent of Police, Vigilance & Anti-Corruption Bureau (VACB), Kottayam Unit, to inspect Room No.10, verify its occupation and usage, and prepare a mahazar in connection with the complaint relating to the illegal occupation of the SC/ST- reserved room. Ext.P7 is the inspection report and mahazar, dated 27.04.2013 prepared by the Deputy Superintendent of Police, VACB, Kottayam Unit, pursuant to Ext.P6, confirming that Room No.10 was illegally occupied by the 4th respondent; that only an extent of 216 sq. ft. was identifiable, though the municipal records show an extent of 560 sq. ft., the remaining area having been merged and absorbed into the premises of Josco Jewellery; and that the room was being used for gold ornament repair work by an 6. employee of Josco Jewellery, thereby indicating structural alteration, subletting, and destruction of the SC/ST reservation facility. Ext.P8 is the order, dated 29.04.2013 in Crl.M.P. No.514/2013 passed by the Enquiry Commissioner and Special Judge, Kottayam, directing registration of FIR and further investigation based on Ext.P7, thereby prima facie noticing the alleged illegality and misuse of Room No.10. Ext.P9 is the statement dated 01.12.2016 recorded under Section 164 of the Cr.P.C. of V.Vijayan, wherein, he had disclosed a conspiracy between municipal officials and private parties, including inducement to apply for the reserved room under the SC/ST quota, receipt of money, and the subsequent integration of Room No.10 into the jewellery establishment, which, according to the writ petitioner, is relevant to the contention that such allegations cannot be brushed aside at the stage of quashing under Section 482 Cr.P.C. Ext.P10 is the sketch prepared by Sri.M.D.Yusuf, Municipal Engineer, Changanacherry, depicting the present physical condition of Room No.10 and showing its integration into the Josco Jewellery building after structural modifications.
6. The learned counsel for the writ petitioner would contend that, prior to the substitution of Section 214 of the Kerala Municipality Act, 1994 by Section 215, the provision stood as follows:
214. Procedure for acquisition of immovable property under the Land Acquisition Act.— (1) Any immovable property which a Municipality is authorised by this Act to acquire may be acquired in accordance with the provisions of the Land Acquisition Act for the time being in force, and on payment of the compensation awarded under the said Act in respect of such property and of any other charges incurred in acquiring it, the said property shall vest in the Municipality:
Provided that nothing contained in this section shall be deemed to prevent any Municipality from acquiring immovable property either through private purchase or any free surrender.
(2) The Municipality shall implead in all Court proceedings relating to the acquisition of land for the Municipality.
The learned counsel would further submit that Section 215 was subsequently introduced in substitution of Section 214, which reads as follows:
215. Power of Municipality to acquire and dispose of property.- (1) A Municipality may, in the manner prescribed, acquire any property such as land or building within or outside its Municipal area or dispose of any of its properties with the prior approval of the Government for providing any arrangement or facility for a public purpose.
(2)(a) A Municipality may construct commercial or other buildings and let them out to the public who need them on licence and may charge such fees as it may fix for the use and occupation of the same in the manner prescribed.
(b) [x x x]
Provided that after the said period, a licence may be renewed subject to such terms and conditions as may be fixed at that time.
(c) In all cases except renewal of licence or rehabilitation of a licensee, licence shall be granted only by public auction or tender.
7. It is pointed out by the learned counsel for the writ petitioner that Section 214(1) of the Kerala Municipality Act, 1994 which was in force at the time of allotment of Room No.10 to V.Vijayan (in 1995) mandated the manner in which municipal properties are to be dealt with. It was provided that “as may be prescribed”. It is contended that, in the absence of statutory rules, Exts.P1(a), P1(b) and P1(c) circulars constituted the prescribed procedure and the same should have been followed. It is further contended that, in the present case, it is evident from Ext.P7 enquiry report of the Vigilance that the said procedure was not followed. A statement has been filed by Sri.Ajit Joy, learned Standing Counsel for Kottayam Municipality appearing for respondent Nos.1 and 2 in W.P.(C).No.38420/2024. In paragraph No.7, it has been stated as under:
“7. However, records reveal that a quotation from the SC/ST category was invited on 28.06.1995, and the quotation of Shri N. Vijayan, who had quoted the highest amount, was accepted. Accordingly, a contract agreement was executed for the period 29.01.1996 to 28.01.1999. Subsequently, due to financial difficulties faced by the licensee, the name was changed to Shri Krishnankutty V.R. Vattaparambil, as per CR No. 64 dated 17.03.1998, with a 15% increase in rent as mutually agreed.”
Thus, it is discernible that, at the time when Room No.10 was allotted to V.Vijayan, the procedure prescribed in Exts.P1(a), P1(b) and P1(c) was not complied with. Thereafter, a vigilance enquiry was ordered and the same culminated its finality, which is under challenge by accused Nos.2, 3, 4, 5 and 7 in Crl.M.C.No.1116/2025.
8. The learned senior counsel, Sri.S.Sreekumar, argued that, by way of the amendment introduced with effect from 24.03.1999, Section 214 of the Kerala Municipality Act, 1994 was substituted by incorporating Section 215. It is further argued that, in terms of the proviso to sub-section 2(a) of Section 215 of the Kerala Municipality (Amendment) Act, 1999, a licence may be renewed subject to such terms and conditions “as may be fixed at that time”. It is conceded by both sides that the use of the phrase “in the manner prescribed” in Section 215 of the Kerala Municipality (Amendment) Act, 1999, led to the framing of the Kerala Municipality Rules, 2000, and that Rules 10, 11 and 12 would govern the exercise of power under Section 215.
9. The learned Standing Counsel for the Municipality also supported the points urged by the learned senior counsel Sri.S.Sreekumar. According to the learned senior counsel, the Kerala Municipality Act, as it stood prior to 24.03.1999, got amended on that date by introducing Section 215, including the proviso to Section 215(2). It is submitted that, consequent to the said amendment, Exts.P1(a), P1(b) and P1(c) circulars no longer have any legal force, notwithstanding the fact that they were taken into consideration at the time of allotment of Room No.10 to V.Vijayan. According to the learned senior counsel and the learned Standing Counsel for the Municipality, the challenge against the said decision raised in the year 2025, is hopelessly barred by delay and laches. Both of them submitted that this is evident from Annexures L and M produced in Crl.M.C. No.1116/ 2025. Thereafter, the Municipality, in terms of the proviso to sub-section 2(a) of Section 215 executed agreements by imposing conditions and the licence has been renewed and at present, Sri.Chandran T.A. has been in occupation of the building and the allegation that the 6th accused viz., Sri.P.A.Jose has been occupying the building is absolutely incorrect.
10. While addressing this argument, it is pertinent to consider certain specific inputs now brought out. That is to say, Ext.P7 is the inspection report and mahazar, dated 27.04.2013 prepared by the Deputy Superintendent of Police, VACB, Kottayam Unit, pursuant to Ext.P6, confirming that Room No.10 was illegally occupied by the 4th respondent; that only an extent of 216 sq. ft. was identifiable, though the municipal records show an extent of 560 sq. ft., the remaining area having been merged and absorbed into the premises of Josco Jewellery; and that the room was being used for gold ornament repair work by an employee of Josco Jewellery, thereby indicating structural alteration, subletting, and destruction of the SC/ST reservation facility. Ext.P9 is the statement dated 01.12.2016 recorded under Section 164 of the Cr.P.C. of V.Vijayan, wherein, he had disclosed a conspiracy between municipal officials and private parties, including inducement to apply for the reserved room under the SC/ST quota, receipt of money, and the subsequent integration of Room No.10 into the jewellery establishment, which, according to the writ petitioner, is relevant to the contention that such allegations cannot be brushed aside at the stage of quashing under Section 482 Cr.P.C. Ext.P10 is the sketch prepared by Sri.M.D.Yusuf, Municipal Engineer, Changanacherry, depicting the present physical condition of Room No.10 and showing its integration into the Josco Jewellery building after structural modifications. Thus, it is discernible from the prosecution records that room No.10 has been in possession of the 6th accused though the licence being renewed/issued in the name of the 7th accused.
11. At this juncture, a significant aspect that remains is that the 6th accused had approached this Court by filing Crl.M.C.No.2362/2017. The learned Single Judge of this Court considered the prayer for quashing the final report in C.C.No. 02/2017 and, for the reasons stated in paragraph Nos.8, 9, 10 and 11, quashed the final report insofar as the 6th accused is concerned. Paragraph Nos. 8 to 11 read as under:
“8. Having heard the learned counsel appearing for the respective parties, this Court will address the points raised in detail herebelow:
This Court will first take note of the prosecution case as revealed from Annexure-F Final Report, the relevant contents of which are extracted herebelow:
“A1 who was the Secretary of the Kottayam Municipality for the period from 1994-1997 entered into criminal conspiracy with A2, who was the Municipal councilor during 1988-1995, and as a part of the said conspiracy, A2 issued a note to the Municipal council Kottayam for tendering the room reserved for Scheduled Caste and Scheduled Tribe in Rajiv Gandhi Municipal Shopping Complex against the existing procedure of awarding room by taking lot from the applicants without saving the interest of the public, A2 entered into criminal conspiracy with A3 Vijayan and obtained Caste Certificate and application. A3 submitted application and allotted the room in his name and in continuation A3 entered into conspiracy with A4 Krishnan Kutty and A5 Sreedharan. Further A3, got an application on 15.01.1997 and in continuation of conspiracy A5 entered into conspiracy with A6 and permitted to use the said room for the business purpose of A6 and later in continuation of this conspiracy A5 transferred the room to A7. A7 in conspiracy with A6, facilitated the enjoyment of the said room to A6 and the acts of A1, A2, A3, A4, A5 and A7 has caused pecuniary advantage to A6 in the form of exclusive possession of room which he still enjoys and these acts were without public interest and thereby committed offences punishable U/s 13(1)(d) R/w 13(2) of Prevention of Corruption Act 1988 and 120B of IPC.”
9. The room in question was initially allotted to Vijayan and thereafter, to Krishnan Kutty, both persons belonging to the Scheduled Caste community. As a matter of fact, the room allotted to Krishnan Kutty was pursuant to a joint application submitted by accused nos.3 and 4, and based on a decision taken by the Municipal council in this regard. It appears that, a power of attorney has been executed by A4, in favour of A5 Sreedharan, who in turn made an application before the Municipality to transfer the lease to A7 Chandran, who is also a member of the Scheduled Caste community. It is in respect of this, Annexure-K notice was issued, followed by Annexure-L licence agreement. In short, room no.10 which is earmarked for members of SC and ST community was always given to the members of the same community. The transfers, which were effected pursuant to the request of A3 Vijayan, A4 Krishnan Kutty acting through A5 Sreedharan, so as to allot the room ultimately to A7 cannot be found fault with, as the same is permissible going by Section 215 (4) of the Kerala Municipality Act, 1994.
10. The transfer effected in favour of A7 Chandran was pursuant to a municipal resolution dated 19.06.2005 (as stated in page no.2 of Annexure-L license deed), wherefore, the liability cannot be fastened on A1 and A2 who were not holding the offices of Secretary and Councilor respectively at the relevant time. Therefore, the conspiracy theory propounded by the prosecution that there was conspiracy between the accused persons from the very beginning crumbles to the ground. Unless and until, there exists conspiracy from the time of initial allotment in favour of A3 Vijayan, upto the final allotment to A7 Chandran, liability cannot be fastened on A1 and A2. There is no allegation of any corruption as against the person, who is the signatory to Annexure-L license deed; nor is there any allegation with respect to the allotment of the room to A7 Chandran. If that be so, the charges of corruption against A1 and A2, who were not officiating at the time cannot be countenanced.
11. This Court would endorse the submissions made by the learned Senior Counsel that the conspiracy as alleged above in the final report is not inter-linked or having continuity with each other. At any rate, petitioner/A6 was not in picture at the time when the initial conspiracy was allegedly hatched between accused nos. 1 and 2; and thereafter, between accused nos. 2 and 3. The specific allegation is that, pursuant to a conspiracy, A2 obtained an application from A3 and got the room allotted to him. What benefit A2 had obtained by such allotment is not decipherable. Secondly, the conspiracy alleged by and between the various accused persons should extend till it reaches the petitioner/A6, failing which, A6 cannot be roped in to the crime. Admittedly, the petitioner/A6 was not in picture at the first two phases of conspiracy. The third phase is allegedly between accused no.3 on the one hand and accused nos.4 and 5 on the other. Yet another conspiracy is alleged between accused nos. 5 and the petitioner/A6, as per which, A6 was put in possession of the property and ultimately, the room was transferred in the name of A7, is the allegation levelled. This Court notice that the 1st accused is no more and the prosecution case as against him stands abated. 2nd accused was in service only from 1988 to 1995. The alleged conspiracy between A3 and A4 can take place only in the year 1997, inasmuch as an application to transfer of the room in favour of A4 was made only on 15.01.1997, at which point of time A2 was not in service. If that be so, no offence under the P.C. Act is maintainable against A2. In short, if the prosecution case is completely believed, an offence under the P.C. Act can be inferred only in respect of the first two phases of the conspiracy between accused nos. 1, 2 and3. As regards the third and fourth phases of conspiracy, there is no role for the public servants. If that be so, an offence under the P.C. Act can hardly lie as against the petitioner/A6. If at all there is a conspiracy constituting any offence, the same can only be under the general penal law; and not under the provisions of the Prevention of Corruption Act. On the top of all, none of the witnesses have given any statement alleging conspiracy between the accused persons.”
12. Coming to the prayers in the writ petition, it is discernible that the initial allotment in favour of V.Vijayan was made without following the procedure prescribed in Exts.P1(a), P1(b) and P1(c). By virtue of the amendment to Section 214 of the Kerala Municipality (Amendment) Act, 1999 with effect from 24.03.1999, by introducing Section 215, the Municipality was vested with the power to deal with its properties, and the grant of licence in respect of municipal properties is governed by Section 215 of the Kerala Municipality (Amendment) Act, 1999, as amended with effect from 24.03.1999. In view of the above, Exts.P1(a), P1(b) and P1(c) have no legal effect in terms of Section 215 of the Kerala Municipality (Amendment) Act, 1999 after 24.03.1999. Rules 6, 7, 8, 9, 10, 11 and 12 of the Kerala Municipality Rules, 2000 provide as under:
6. Transfer of Municipality's own property.- The transfer of Municipality's own property shall be in accordance with sub-Section (1) of section 215 and Form II in Schedule II appended to these rules.
7. Grant of Municipality's own property on lease.-(1) The Municipality may, subject to the conditions mentioned in section 215 of the Act, on licence basis for periods as fixed by the Council, give on rent or lease, its own buildings.
(2) The transfer under sub-rule (1) shall be in accordance with Form No. III in Schedule III to these rules.
8. Transfer of property vested in the Municipality.-(1) Property of the Municipality not owned but vested in it may be granted on lease without violating the terms on which it was vested in it.
(2) The disposal under sub-rule (1) shall be in accordance with the Form in Schedule III to these rules.
9. Grant on lease of the sides of roads and streets.-(1) The Municipality shall have the power to lease out the sides of roads and streets vested in it, subject to the term fixed by the Municipality and subject to the restrictions and limitations that may be fixed by the Government under Section 368 (5).
(2) The grant of a lease under sub-rule (1) shall be in accordance with the Form in Schedule III to these rules.
10. Reservation for Scheduled Caste/Scheduled Tribe categories.-(1) The Municipality shall reserve for persons belonging to Scheduled Caste/Scheduled Tribe Categories, ten per cent of each item of the shoprooms, bunks, stalls etc. granted on rent or lease upon licence and the same shall be granted by inviting applications by Notification from such categories alone.
(2) Where there are no applicants from the category concerned even after inviting applications by notification, for the shoprooms, bunks etc. reserved under sub-rule (1), the same may be allotted to other categories, provided steps are taken to allot the next arising vacant space for persons belonging to such category.
11. Transfers to be either in public auction or through Tenders.- The transfer of the property of the Municipality, through sale, except renewal of licences, rehabilitation of licensees, granting of lease, letting out on rent, shall be either in public auction or by inviting tenders.
12. The Municipalities not to dispose of property transferred to them by Government.- Notwithstanding anything contained in Rule 8, the Municipalities shall not sell, transfer, alienate, create any encumbrance on, or otherwise dispose of, any property transferred to them by Government under sub-section (3) of Section 30 of the Act.”
13. Today, when the order is about to be pronounced, the learned counsel for the writ petitioner produced a Division Bench judgment in W.A.No.306/2024 dated 09.07.2025 where the judgment of the learned Single Judge of this Court in W.P. (c).No.3835/2023 was set aside. The learned counsel for the writ petitioner would submit that in paragraph No.7 of the writ appeal judgment, the Division Bench held as under:
“7. No doubt, the learned Single Judge relied upon the provisions of Section 575 of the Act, which is also extracted herein below; the repeal of the earlier Acts does not in any manner affect the promulgation of the circular.
575. Repeal and saving.
(1) With effect on and from the commencement of this Act the Kerala Municipalities Act, 1960 (14 of 1961), the Kerala Municipal Corporations Act, 1961 (30 of 1961), the Guruvayur Township Act, 1961 (43 of 1961), the Kerala Municipalities Ordinance, 1994 (2 of 1994) and the provisions of the Kerala Local Authorities (Constitution and Preparation of Electoral Rolls) Act, 1994 (4 of 1994), in so far as they relate to Municipalities, shall stand repealed.
(2) Notwithstanding such repeal-
(i) the committees in office at the commencement of this Act appointed by the Government to exercise the powers perform the functions of the municipal Councils; the Chairman of the Standing Committees under the Kerala Municipalities Act 1960 (14 of 1960) and the Collectors appointed by the Government to exercise the powers and perform the functions of the Councils, the Mayors and the Standing Committees under the Municipal Corporation Act, 1961 (30 of 1961) in office at such commencement and the Guruvayoor Township Committee constituted under the Guruvayoor Township Act, 1961 (43 of 1961) shall continue, as if it were the Municipal Councils or Corporation Councils or Township Committees constituted, respectively, under the said enactments, till corresponding Municipalities constituted under this Act; or they are dissolved by the Government, whichever occurs earlier:
(ii)any appointment, rules, including rules in the Schedules to the repealed Acts, bye-laws, regulations or forms made, notifications, notice, order, scheme or direction issued, tax fee or fine or other penalty, imposed, licence, permission or exemption granted under the repealed enactments and in force at such commencement shall, in so far as they are not inconsistent with the provisions of this Act, continue to be in force as if made, issued, imposed or granted as the case may be by the corresponding Municipalities under the provisions of this Act until superseded, amended or modified by any appointment, rules, bye-laws or regulations, notifications, notice, order, scheme, direction, tax, fee, fine or other penalty, licence, permission or exemption, made, issued, imposed or granted as the case may be under this Act;”
According to the learned counsel, in view of the judgment of the learned Single Judge as well as the judgment in the writ appeal, Exts.P1(a), P1(b) and P1(c) circulars shall continue in operation, since its operation was saved by Section 575 of the Kerala Municipality Act, 1994.
14. Whereas, it is submitted by the learned senior counsel for the 4th respondent that in view of Rule 11 of the Kerala Municipality Rules, 2000, all modes of transfers provided under Rules 6 to 11 shall be by public auction or through tenders. According to the learned senior counsel, Section 215(2)(c) of the Kerala Municipality (Amendment) Act, 1999 came into force w.e.f. 24.03.1999, provides that, in all cases except renewal of licence or rehabilitation of a licensee, licence shall be granted only by public auction or tender. Therefore, the procedure laid down under Exts.P1(a), P1(b) and P1(c) circulars by selecting the beneficiary for SC/ST community Municipality is no more available and in such cases, Rule 11 shall be applied.
15. Reading Section 215 of the Kerala Municipality (Amendment) Act, 1999 deals with power of Municipality to acquire and dispose of property, Section 215 provides that a Municipality may, in the manner prescribed, acquire any property such as land or building within or outside its Municipal area or dispose of any of its properties with the prior approval of the Government for providing any arrangement or facility for a public purpose.
16. On perusal of Exts.P1(a), P1(b) and P1(c), it is emphatically clear that the same have two parts. The first part is ensuring reservation of 10% room to SC/ST community and the second part is pertaining to the mode of allotment and the same is by taking lot among the number of applicants, who applied for, when more than one applicant, as already discussed. According to the learned counsel for the writ petitioner, as Rule 10 does not specify the mode of selection of SC/ST community beneficiaries, the procedure indicated in the second part of Exts.P1(a), P1(b), and P1(c) circulars would have to be followed, and the same is valid in view of Section 575 of the Kerala Municipality Act, 1994.
17. In the instant case, reading Section 215(2)(c), along with Rules 6 to 10 of the Kerala Municipality Rules, 2000, it is discernible that as per Rule 6, transfer of Municipality's own property is addressed. Similarly, as per Rule 7, grant of Municipality's own property on lease has been dealt with. Similarly, Rules 8 and 9 deal with transfer of property vested in the Municipality and grant of licence on the sides of roads and streets. Then, comes Rule 10, which, in fact, legally recognized the first part of Exts.P1(a), P1(b) and P1(c) circulars, whereby 10% reservation to the SC/ST categories has given statutory recognition. After Rules 7 to 10, Rule 11 is introduced, the same is in parity with Section 215(2)(c) of the Kerala Municipality (Amendment) Act, 1999, which provides that the transfer of the property of the Municipality, through sale, except renewal of licences, rehabilitation of licensees, granting of lease, letting out on rent, shall be either in public auction or by inviting tenders. If so, it is not safe to hold that after the introduction of Kerala Municipality Rules, 2000 after amendment of the Kerala Municipality Act, w.e.f. 24.03.1999, the second part of Exts.P1(a), P1(b) and P1(c) should regulate procedure for allotment and the procedure shall be in accordance with Rule 11. Even though the Single Bench decision in W.P.(C).No.3835/2023 held the view that Exts.P1(a), P1(b) and P1(c) are still in force, the Division Bench set aside the said judgment on the said finding. The judgment of the Division Bench is not so specific as to whether the circulars are still in operation.
18. As per Rule 11, it has been specifically stated that the transfer of the property of the Municipality, through sale, except renewal of licences, rehabilitation of licensees, granting of lease, letting out on rent, shall be either in public auction or by inviting tenders. Therefore, at present, the procedures contemplated under Exts.P1(a), P1(b) and P1(c) circulars were superseded by the statutory provisions, and the procedures prescribed under Rules 10 and 11 are required to be followed. It is decipherable from the records that during the initial allotment of Room No.10, the Municipality should have followed the procedure in Exts.P1(a), P1(b) and P1(c), but the same was not followed and thus, the selection of V.Vijayan as the beneficiary in violation of the procedure by selecting the applicants by way of lot instead of calling competitive bids, is found to be absolutely illegal. Be it so, the renewal of the licence periodically in continuation of the said illegality is also illegal.
19. As already observed, in the instant case, allotting a room specifically mentioned for SC/ST community in favour of V.Vijayan by calling competitive tenders among the applicants of the said community without following the procedure prescribed under Exts.P1(a), P1(b) and P1(c), is illegal. Though there was a challenge regarding the same allotment, according to the learned counsel for the petitioners, it could be seen that the writ petition filed in the year 2023 is the one this Court to take notice of.
20. An illegality is the base on which subsequent transactions including change of licence and renewal thereof taken place; be it so, such transactions are also to be reckoned as illegal. Anyhow, at present, a procedure for selecting the beneficiary is in terms of Rule 11 of the Kerala Municipality Rules in terms of Section 215 of the Kerala Municipality (Amendment) Act, 1999 came into force w.e.f. 24.03.1999. Taking all these aspects into consideration, this Court is of the view that the continuation of possession of the property, as reflected from the criminal court records, by the 6th accused on the premise of possession of the same by the 7th accused is the result of the illegal allotment made in favour of V.Vijayan. Since a considerable period has elapsed after the initial allotment, I am of the view that the writ petition can be disposed of, directing the Municipality to consider the allotment of this room afresh in accordance with the procedure laid down in Rule 11 of the Kerala Municipality Rules, after the expiry of the current period of renewal of the licence in favour of the 7th accused, without fail.
21. Coming to the contention raised in the Crl.M.C. seeking quashment of the case against accused Nos.2, 3, 4, 5 and 7 on the ground of quashment of the case against the 6th accused, as per Annexure N order, whether the prosecution challenged the said order, could not be found from records. Here, the prosecution records would show that the 6th accused has been in possession of the room after effecting alterations and making the same as part of their jewellery business after getting the same in custody from the 7th accused, who got possession over the same starting from V.Vijayan. V.Vijayan, in his statement, acknowledged that the initial allotment of Room No.10 was not by following the procedures prescribed under Exts.P1(a), P1(b), and P1(c), thereby confirming the illegality in the allotment process, although he was the recipient of the allotment. The prosecution records would reveal that at present also the room has been in possession of the 6th accused. Thus, the prosecution records would clearly show prima facie that the accused persons obtained pecuniary advantage either for themselves or for the present occupier (the jewellery owner). In such a case, quashment of this case would necessarily fail. Therefore, this Court is inclined to take a different view from the view taken by the learned Single Judge, who passed Annexure N order and I am of the view that, when there is an illegality in the initial allotment in favour of V.Vijayan, any subsequent allotments to other persons, even if they are members of the SC/ST community and irrespective of the methodology adopted, could not justify or validate the initial illegal allotment to V.Vijayan. When the initial allotment in respect of Room No.10 which is meant for SC/ST community member, now in possession of the 6th accused, is illegal, the prosecution allegations in C.C.No.02/2017 that the petitioners herein committed offences punishable under Sections 13(1)(d) r/w 13(2) of the Prevention of Corruption Act, 1988 and under Section 120B of the Indian Penal Code by the petitioners, who are accused Nos.2, 3, 4, 5 and 7, are discernible from the prosecution records, prima facie. Therefore, the quashment of the case against the petitioners in Crl.M.C.No. 1116/2025 is liable to fail.
In the result, Crl.M.C.No.1116/2025 is dismissed.
W.P.(C).No.38420/2024 stands disposed of as under:
The 1st respondent, Kottayam Municipality, is directed to re- allot Room No.10 to a member of the SC/ST community in terms of Rule 11 of the Kerala Municipality Rules, on the date of expiry of the present agreement, under which the 7th accused was given possession of the room, and which, according to the prosecution, is now in the possession of the 6th accused, without granting any renewal in favour of the 7th accused, thereafter.
The 1st respondent, Kottayam Municipality is further directed to restore Room No.10 to its original position and ensure possession and use of the same by a member of SC/ST community and not by any other and to allot the same by fresh procedure within a period of one month from the date of expiry of the present agreement, without fail.
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