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It said the Chandigarh administration would pay an honorarium to the independent observer.
Punjab advocate general Gurminder Singh, appearing for incumbent mayor Kuldeep Kumar suggested a retired high court judge could be appointed as the independent observer.
Solicitor general Tushar Mehta, representing the Chandigarh administration, said he had no problem with the appointment of an independent observer but it should not become a precedent so that all municipal corporations start approaching the apex court.
The bench said it was only concerned with fairness and transparency of the process while it recorded the submissions and passed the order without naming the observer, who it said would be named later.
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