The Allahabad High Court has termed the investigation by the committee constituted by the District Magistrate into misappropriation of funds of the Gram Panchayat as an infringement of jurisdiction and has said that according to Section 27(2) of the Panchayat Raj Act, such complaint should be made to the Chief Audit Officer or the District Audit Officer only has a legal right to investigate.
A Single Bench of Justice Saurabh Srivastava passed this order while hearing a petition filed by Smt Pinki Devi.
The petition has been filed seeking the following reliefs:-
“i) Issue a writ, order or direction in the nature of certiorari to quash the order dated 29.08.2022 passed by respondent no 3 as well as order dated 06.03.2023 passed by the respondent no 2.
ii) Issue a writ, order or direction in the nature of mandamus commanding/directing the respondent no 3 not to take any action in pursuance of the impugned orders.”
It is the case of the petitioner that inquiry has been conducted with regard to certain loss, misappropriation and misuse of the funds which has to be utilized for the public cause under the supervision of Gram Vikas Adhikari, Block Bahadurpur, District- Basti and the petitioner was rendering her services over the same post.
The said inquiry has been conducted by the Committee comprises of District Horticulture Officer, Tehsildar, Sadar, District Basti and Assistant Engineer, D.R.D.A for ascertaining the fact which is specifically with regard to the irregularities while performing the public work under the supervision of the petitioner as well as Gram Pradhan of the concerned Village.
On the basis of inquiry report as submitted by the Inquiry Committee, the District Magistrate i.e respondent no 3, determined the loss of Rs 3,52,083/- and the same has been fastened in equal proportion to be recovered from the petitioner, Ex-Gram Pradhan along with Assistant Engineer, Bahadurpur, District-Basti vide order dated 29.08.2022.
The Court noted that,
Having being aggrieved by the order dated 29.08.2022 passed by the respondent no 3, the petitioner challenged the same before the respondent no 2 who has been designated as Appellate Authority in pursuance to the judgment and order dated 06.12.2022 and as such, the same has been adjudicated by the respondent no 2 under the strict compliance of the directions passed in Civil Misc Writ Petition.
While preferring the Appeal before the respondent no 2, the specific stand taken up by the petitioner regarding the competency of the Committee constituted by the District Magistrate for Enquiry as well as the respondent no 3 being the District Magistrate which is contrary to the Section 27(2) wherein the prescribed authority who is competent to fix the amount of the surcharge according to the procedure has been defined only in the case where the responsibility is fastened against the Pradhan or other member of the Gram Panchayat or Joint Committee or any other Committee constituted under this Act and as such, being the Village Development Officer/Village Secretary, the respondent no 3 proceeded against the petitioner under the statutory provisions as defined under the Uttar Pradesh Panchayati Raj Act, 1947, for better appreciation of legal issues defined under Section 27 of the Act of 1947 and the Rules 256 and 257 of the U.P Panchayat Raj Rules, 1947.
Counsel for the petitioners submitted that a perusal of Section 27 of the Act of 1947 read with Rule 256 of the Rules of 1947 clearly shows that surcharge was leviable on an enquiry which was conducted by the Chief Audit Officer and which had to be forwarded to the District Magistrate in the case of Pradhan, Up- Pradhan and Members of Gram Panchayat and to the District Panchayat Raj Officer in the cases of officers and servants of the Gaon Sabha.
Counsel for the petitioners, therefore, submitted that it was the Chief Audit Officer of the Cooperative Societies and Panchayat who was the officer authorized to conduct the enquiry for the purposes of the imposition of surcharge.
He further submitted that after the report was submitted to the District Magistrate, the order ought to have been passed by the Competent Authority and the counsel for the petitioners submitted that since there was yet no competent authority appointed, the order of the District Magistrate was also beyond jurisdiction.
He further submitted that when there was no Prescribed Authority as has been referred to in Section 27(2) of the Panchayat Raj Act then the District Magistrate had no jurisdiction to impose the surcharge.
Per contra, Standing Counsel vehemently opposed the prayer as made in the petition and supported the order dated 06.03.2023 passed by the respondent no 2 by way of raising his argument that the prescribed authority as defined under the Act of 1947 is not defined, but the same has been answered in the verdict pronounced by the Court.
Counsel for the petitioner while making the submissions very fairly conceded that as far as the jurisdiction with the Deputy Director (Agriculture), Basti, was concerned, it was only the Chief Audit Officer who was authorized to conduct the enquiry.
He, however, submitted and also placed a written submission that now when the Panchayat had attained constitutional status and as per Article 243, 243(A) to 243(0) of the Constitution of India there were provisions in the Constitution to provide for a three tier Panchayat system such as the Village Panchayat, Kshetra Panchayat and the District Panchayat instead of the Chief Audit Officer, some more powerful body should be brought into existence.
He further submitted that further since as per Article 243(1) of the Constitution, a Finance Commission to review the financial position of Panchayats had been formed, on which there was the duty to enquire into the financial deals of the Panchayat then the finances of a gram panchayat should be monitored by a much more powerful body.
“It is undisputed fact that the inquiry as conducted which initiated the entire proceedings against the petitioner whereupon the respondent no 3 relied upon and the entire determination has been fastened against the petitioner has been conducted by the authorities other than the Chief Audit Officer or by the District Audit Officers, and as such, the respondent no 3 exceeded its jurisdiction specifically with regard to determining the liability against the petitioner.
It is apparent from the order which impugned the petition that inspite of taking the specific grounds at the time of preferring the Appeal before the respondent no 2 there is hardly any discussion available with regard to the competency of the respondent no 3 while determining the loss which has been attributed to the petitioner and as such, the same is liable to be set aside.
The matter is hereby decided without calling the counter affidavit from the respondents since the action of the responding authorities are contrary to the settled provisions of the U.P Panchayati Raj Act, 1947 which has been broadly discussed in the judgment dated 16.12.2022 passed in Writ C No 28230 of 2022 (Dinesh Kumar And 4 Others versus State of U.P. And 3 Others) and after footing the action of the respondents in the litmus of the judgment as mentioned above, the same seems to be illegal”, the Court observed while allowing the petition.
“In the above mentioned facts and circumstances, the orders dated 29.08.2022 and 06.03.2023 passed by the respondent nos 3 and 2 respectively is hereby quashed and set aside”, the Court ordered.