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Judgment
Sundaram Chetty, J.—These five appeals have been preferred by the Chairman of the Chingleput Municipality and arise out of five suits filed
by him for a declaration that the defendants are liable to take annual licences in respect of their rice mills and for payment of licence fees u/s 249,
Madras District Municipalities Act of 1920. The main plea of the defendants is that the suits are barred by res judicata by reason of the decision in
a batch of former suits filed by them against the Municipal Council, Chingleput, represented by its Chairman, for a declaration that in respect of all
these rice mills no annual license was necessary u/s 249 of the Act and for a permanent injunction restraining the Municipal Council from
compelling the plaintiffs to take out licenses either by threat of prosecution or otherwise. Ex.1 is a certified copy of the judgment in the former suits.
It is clear that the declaration and injunction asked for in those suits have been granted against the Municipal Council, Chingleput. The identical
question raised in the present suits was decided in the former suits, and both the Courts below have held that according to the rule and principle of
res judicata the relief asked for by the Municipal Chairman in the present suits cannot be granted. The correctness of that view is challenged in
these second appeals.
The question for consideration is whether a decision of a civil Court which has become final as against the Municipal Council of Chingleput in
respect of the subject-matter of the present suits will operate as res judicata in these suits and the main contention urged by the learned advocate
for the appellant, is that the former suits having been laid against the Municipal Council and not against the Municipal Chairman, the decision in
those suits would not operate as res judicata in the present suits. The point for consideration is whether there is legal identity of parties in the two
suits having due regard to the whole scheme of the District Municipalities Act and the relevant provisions thereof. The exact relationship between
the Municipal Council and its Chairman is not defined in the Act, but it must be a matter of inference. According to Section 4 of the Act, the Local
Government has the power to constitute any town, village, or other station as a Municipality. The Municipal Council should be a body corporate
and be vested with the capacity of suing or being sued in its corporate name, according to Sub-section 2, Section 6 of the Act. Section 19 says
that the Municipal administration shall vest in the Council and according to Section 22 the Chairman shall be bound to give effect to every
resolution of the Council, unless such resolution is modified, suspended or cancelled by a controlling authority. There seems to be no doubt that the
chairman who is necessarily a member of the Council is its executive head. Certain special functions are assigned to the chairman under the Act,
just as some other functions are assigned to the Municipal Council. The Municipal authorities charged with the carrying out of the provisions of this
Act are stated to be a Council and its Chairman (Section 6, Clause 1).
The functions of the chairman are specified in Section 13. As regards the filing of suits, the whole scheme of the Act clearly indicates that
generally the Council as a corporate body has to sue and to be sued. But the chairman may institute and also prosecute any suit, only with the
approval of the Council (vide Section 351, Clause (g). In spite of the fact that the chairman is invested with certain specific powers under the Act,
there is nothing to show that he is an altogether independent functionary, and any powers which for the sake of convenience are vested in him have
to be exercised on behalf of the Municipal Council which is a body corporate. The chairman as such can have no independent existence apart from
the Council. That is clear from the provisions of Section 41 of the Act. If the Local Government should choose to dissolve or supersede a Council,
the chairman who is a member of the Council could not have any independent locus standi as chairman. It is true that in the matter of demanding
annual licenses to be taken in respect of the rice mills in question, the chairman has got the power u/s 249 of the Act to grant or refuse to grant
such licences; but the foundation for the exercise of that power by the chairman is the resolution of the Council for the publication of a notification
in the District Gazette and by beat of drum, that certain localities should not be used for any of the purposes specified in Sch. 5 without the
chairman''s licence. If a particular rice mill does not come within the place specified in the notification issued by the Council, the chairman has no
power to grant or refuse to grant such licences in respect of it. Looking at the question in issue in the light of the aforesaid sections, it seems to me
that if by a decision of the civil Court the Municipal Council is precluded from declaring that the rice mills of the present defendants are liable for
the payment of the annual licence fees, the chairman as the executive head of the Council cannot demand the taking of a license in respect of such a
mill and levy the annual licence fee. If the distinction in the functions assigned to the Council and its chairman should be an indication for the
absence of legal identity between the two for the purposes of the rule of res judicata, I am constrained to observe that the result would be startling
and anomalous.
Any decision obtained in a suit to which the Municipal Council is a party, which affects the rights of strangers may be ignored by the chairman or
any other officer of the municipality, for the simple reason that the Council and not that particular officer was a party to that suit. It would never be
the intention of the legislature, if regard be had to the whole scheme of the District Municipalities Act, to constitute the chairman, as an independent
entity who would not be bound by any decision affecting the Municipal Council itself. There is a further circumstance adverted to by the learned
District Judge which may also throw some light on this question. Any order of the chairman granting of refusing a licence u/s 249 is subject to
appeal to the Municipal Council. It is the order of the Municipal Council passed in appeal that must be deemed to have been substituted for the
order of the chairman. Having this in view, if the contention of Mr. Ramaswamy Ayyar is to be upheld, the result will be that the Municipal Council
of Chingleput is precluded from ordering that these defendants should obtain annual licence in respect of the rice mills, but the chairman of this
Council is free to enforce the taking of such licences. If the chairman passes such an order the aggrieved party has to appeal to this very Municipal
Council and urge the decision in the former suits as a ground for setting aside the order of the chairman. This anomalous situation will arise by
holding that the previous decision passed against the Municipal Council does not operate as res judicata. It cannot be said that for any act done by
the chairman in pursuance of a'' power vested in him under the Act, a suit could not lie against the Municipal Council. The chairman carries out the
provisions of the Act as a representative of the Municipal Council.
That being so, it does not stand to reason that if there is a binding decision as against the Municipal Council in respect of a matter affecting the
rights of third parties, the chairman can do anything in order to abrogate the benefit which was obtained under such a decision. I have no hesitation
in agreeing with the finding of both the Courts below, that the decision in the former suits obtained against the Municipal Council is binding on its
chairman who is the chief functionary of the Council. For the purpose of applying the principle of res judicata, I do not think that the Municipal
Council and its chairman can be viewed as two independent entities. I hold that there is the legal identity of parties and therefore the bar of res
judicata exists. Mr. Ramaswamy Ayyar, the learned advocate for the appellant, contends that the decision in the former suits was based upon an
erroneous view of law and therefore such a decision cannot operate as res judicata in the present suits. A number of authorities have been cited,
but it is enough to refer to the decision in Mangalathammal v. Narayanaswami Ayyar (1907) 30 Mad 461 where the important qualification with
which the proposition contended for by the appellant should be adopted has been laid down. An erroneous decision on a question of law in a
previous suit would not be a bar in a subsequent suit between the same parties, and a different decision may be given on that question, but the
decision so given should not in any way affect the operation of the former decree or take away any rights acquired by the parties thereunder.
The same view has been upheld in a decision relied upon by Mr. Muthukrishna Ayyar for the respondents, viz., Tarini Charan Bhattacharjee and
Others Vs. Kedar Nath Haldar, . The effect of these pronouncements is that though the former decision may be deemed to have been based on a
wrong view of law, the decision arrived at, i.e., the decree given, can in no way be affected by giving a different finding in a subsequent suit on the
same question. That being so, the circumstance that the previous decision was based on an erroneous view of the law does not help the plaintiff in
these suits. By reason of the declaration and perpetual injunction given in the former suits, it cannot be said that the relief asked for in the present
suits is something not covered by the former decision. If the present suits should be decreed, the result would be the abrogation of the former
decision which has been allowed to become final. The decision of the Courts below is correct and these second appeals are dismissed with costs.