1. ' MAMOON KAZI, J.---The petitioner is aggrieved by the order dated 30-6-1992 issued by the respondent No,1..
2. ' Briefly stated the facts of the case are that after the expiry of the previous contract for octroi and parking on 30-6-1992, the respondent No,2 advertised for auction of such rights through the newspapeRs, The auction was fixed on 12-3-1992 in the office of the Town Committee, Guddu when the petitioner deposited Rs,50,000 and Rs,665,000 for the bids for the two auctions 'respectively. The case of the petitioner is that four persons participated in the said auction and the petitioner's bids of Rs,66,5000 and Rs,33,25,000, being the highest bids, were accepted by the respondent Nod. By a letter dated 18-3-1992 the Housing and Town Planning and Local Government Sindh confirmed the petitioner's bid. After confirmation of the bids the petitioner deposited on 14-3-1992 and 28-3-1992 11% of the amount of bid. Thereafter the petitioner was issued a letter to start the work of collection of octroi from mid-night of 30-6-1992. The petitioner was also required to deposit a further amount of Rs,50,000 as the first instalment of the contract and the same amount was deposited by the petitioner by cheque dated 29-6-1992. However, on 30-6-1992 the petitioner was informed by the respondent No,2 by a letter that his contract for collection of octroi and parking for the year 1992- 93 had been cancelled by the Addl. Chief Secretary of the respondent No,l. The petitioner made enquiries from the Town Committee, Guddu and it was informed that a letter had been received from the respondent No,1 cancelling the said contract and directing that the rights to collect octroi and parking fee be re-auctioned.
3. ' Although no counter-affidavit has been filed on behalf of the respondents but parawise comments have been filed by the respondent No,2. According to the said comments the petitioner was required to furnish two solvent sureties upto the close of office hours on 30-6-1992 but he had failed to do the same. Thus para No,7 of the agreement had been violated by the petitioner. It has further been averred that the petitioner had also failed to furnish solvency certificates of his sureties. Further, according to the parawise comments, the petitioner was required to deposit an advance instalment to the tune of Rs,55,858 but it made part payment of only Rs,50,000 which tantamounted to the violation of clause 5 of the contract.
4. ' We have heard Mr.Abdul Hafeez Pirzada, learned counsel for the petitioner, and Mr. Abdul Ghafoor Mangi, Additional Advocate-General, Sindh. The only contention of Mr. Abdul Hafeez Pirzada before us has been that the action taken by the respondents is clearly without lawful authority as no show-cause notice had been served on the petitioner prior to the taking of the impugned action.
5. Although the learned AA.-G. Has not been able to show that such a notice had been issued to the petitioner prior to the taking of the impugned action by the respondents but the learned AA.-G. Has invited our -attention to section 53 of the Sindh Local Government Ordinance, 1979 which provides as follows: "53.--(1) Government shall exercise general supervision and control over the councils to ensure that their activities conform to the purposes and provisions of this Ordinance.
(2) Government may, at any time, call for any paper, document, register or record from any council to see that the activities of the council are in conformity with the provisions of this Ordinance, and may make any order it deems necessary to bring it in such conformity.
(3) If, in the opinion of Government, anything done or intended to be done by or on behalf of a council is not in conformity with the law, Government may by order-
(a) quash the proceedings;
(b) suspend the execution of any resolution passed or order made by the council;
(c) prohibit the doing of anything proposed to be done; and
(d) require the council to take such action as may be specified.
(4) Where an order under subsection (2) or subsection (3) is made by Government, the council concerned may, within thirty days of the receipt of the order, represent against it in the prescribed manner, and the order made on such representation shall be final."
6. ' As would appear from the provisions of section 53, it vests the Government with powers of exercising general supervision and control over the councils to ensure that their activities conform to the purpose and provisions of the said 'Ordinance. No doubt subsection (3) of section 53 vests the Government with powers to quash any proceedings or to suspend execution of any resolution passed or order made by the council or to prohibit doing of any thing proposed to be done or to require the council to take such action as may be specified by the Government but the learned A.A.-G. Has not been able to offer a satisfactory explanation as to how the Government is empowered to cancel a valid contract entered into by it with another party without serving upon it a show-cause notice prior to taking of such action. The principle enshrined in the maxim audi alteram partem is to be read in every Statute unless the requirements of notice have been expressly excluded by the Statute itself. Mr. Abdul Hafeez Pirzada has invited our attention to section 45 of the Sindh Local Government Ordinance, 1979 which governs execution of contracts by a Local Council. The said section does not vest the Government or the Council with power to cancel any contract unilaterly without affording any opportunity of hearing to a party. The circumstances just enumerated by us clearly show that the action taken by the respondents was not warranted by law. Once the council had entered into a valid contract with the petitioner, vested rights were created in favour of the petitioner and the same could not be taken away without observance of due formalities of law. Mr. Abdul Ghafoor Mangi has argued that some irregularities had been committed by the council while awarding the contract to the petitioner but nothing has been placed before us from which the same can be spelled out. We have therefore no doubt that the action taken against the petitioner was opposed to the law and hence of no legal effect.
7. ' In the result, we accept this petition and quash the impugned order. We would however like to clarify that if the respondents have intention to take any action against the petitioner the same can be taken after observing due formalities of law.
8. ' Mr. Abdul Hafeez Pirzada has invited our attention to the interim order passed by a Division Bench of this Court dated 9-7-1992 whereby a representative of the petitioner was permitted to supervise the collection of octroi tax by the staff of the Town Committee during the pendency of this petition.
9. Mr. Abdul Hafeez Pirzada therefore requests that directions may be given to the effect that the petitioner shall be allowed to collect the octroi collected by the Town Committee during the intervening period or for the remaining period of the contract. Although no such directions should be required to be given in view of the order passed by us but we nevertheless clarify that the Town Committee, Guddu would be liable to pay octroi collected by it during the intervening period to the petitioner. The parties are left to bear their own costs.