Punjab-Haryana High Court
Gurdev Singh vs State Of Punjab And Others on 10 July, 2012
Author: Ranjit Singh
Bench: Ranjit Singh
CIVIL WRIT PETITION NO.23260 OF 2010 :{ 1 }:
IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH
DATE OF DECISION: JULY 10, 2012
Gurdev Singh
.....Petitioner
VERSUS
State of Punjab and others
....Respondents
CORAM:- HON'BLE MR.JUSTICE RANJIT SINGH
1. Whether Reporters of local papers may be allowed to see the judgement?
2. To be referred to the Reporters or not?
3. Whether the judgment should be reported in the Digest?
Present: Mr. N.P.S.Mann, Advocate,
for the petitioner.
(In CWP No.23260 of 2010)
Mr. Rajinder Sharma, Advocate,
for the petitioner.
(In CWP No.4920 of 2011)
Mr. B.B.S.Teji, Addl.A.G., Punjab,
for the State.
*****
RANJIT SINGH, J.
The issue involved in these two Civil Writ Petition Nos.23260 of 2010 (Gurdev Singh Vs. State of Punjab and others) and 4920 of 2011 (Swinder Singh Vs. State of Punjab and others) relates to limitation for liability of a Member of Panchayat to make up the loss, waste or misappropriation of money or property belonging to the Panchayat because of his neglect and misconduct.
The petitioners in both the petitions were elected CIVIL WRIT PETITION NO.23260 OF 2010 :{ 2 }:
Sarpanches of the Gram Panchayats and have now been fastened with the liability to pay different amounts, which they have challenged in the respective writ petitions filed by them. The common plea raised in these two writ petitions relates to the bar of limitation on the part of the respondents to recover this amount, liability for which is created under Section 216 of the Punjab Panchayati Raj Act (hereinafter referred to as "the Act"). Since this common issue arises in these two writ petitions, the same are being disposed of together, though there is nothing common in facts in these two writ petitions.
First the facts in Civil Writ Petition No.23260 of 2010 filed by petitioner, Gurdev Singh, may be noticed.
Petitioner, Gurdev Singh was elected as a Sarpanch for Gram Panchayat Dhukli in June 1998. He completed his five years term in June 2003. A complaint was made against the petitioner in the year 2002 by the residents of the Village, alleging that the petitioner had misappropriated the grants and funds of the Panchayat. This complaint was enquired into by respondent No.4, who gave his report against the petitioner on 17.9.2002, holding that sum of Rs.5,20,000/- had not been accounted for in the Gram Panchayat funds, which was received as an income from sieve installed for gravel from the rivulet in the village. Further finding is that a sum of Rs.62,480/- was spent less by the petitioner on the development work and so the recommendation was made for placing the petitioner under suspension.
Respondent No.2 then marked a regular enquiry to be conducted by Additional Deputy Commissioner (Development), CIVIL WRIT PETITION NO.23260 OF 2010 :{ 3 }:
respondent No.3. Notice was issued to the petitioner, which he evaded and in the meantime his term expired on 18.6.2003. The petitioner claims that no due certificate was issued to him. Respondent No.3, however, after enquiry submitted his report, holding that the allegation against the petitioner were proved but still no action was taken against him. Primarily, this could be due to the reason that the petitioner was no more a Sarpanch and so action under Section 20 of the Act was not possible. A new Sarpanch was elected, who also completed his tenure in 2008. During the elections held in 2008, the petitioner again contested for the post of Panch and thereafter was elected as a Sarpanch in an indirect election held on 26.5.2008.
On 4.6.2009, Block Development Panchayat Officer issued show cause notice to the petitioner under Section 216 of the Act, calling upon him as to why he should not make good the loss caused by him to the Gram Panchayat during his earlier tenure from 1998 to June 2002. The petitioner filed a detailed reply, mainly urging that no proceedings could be initiated against him after expiry of four years and in this regard relied upon sub-section (4) of Section 216 of the Act, which inter-alia provides that no person can be called upon to explain to make good the loss etc. after the expiry of four years from the occurrence or loss etc. and expiry of two years from his seizing to be a Member, whichever is later. As per the petitioner, the Block Development and Panchayat Officer, without considering this legal issue, has assessed the amount of Rs.6,27,880/- against the petitioner and required him to deposit the same within 30 days in the CIVIL WRIT PETITION NO.23260 OF 2010 :{ 4 }:
accounts of the Panchayat.
The petitioner appealed against this order before District Development and Panchayat Officer, which is dismissed on 30.9.2009 with an observations that recovery proceedings have been rightly initiated. It appears that plea of limitation is not pressed by the petitioner before the Appellate Authority. The petitioner filed a revision against this order, which is also dismissed on 12.10.2010, whereafter the petitioner has filed the present petition. In revision, the petitioner did raise a plea of limitation.
Notice in this case was issued and status-quo as existing on the date qua recovery of the amount found due against the petitioner was directed to be maintained till next date of hearing. This interim order has continued thereafter till date.
Reply has been filed on behalf of respondent Nos.1 to 4. The facts, as noticed above, does not appear to be in serious dispute. However, the respondents have averred that it is proved in a regular enquiry that the petitioner had embezzled an amount of Rs.6,27,880/-, for which the proceedings were initiated against him under Section 216 of the Act. As per the respondents, they have the power to recover this amount after issuing notice as per Section 216 of the Act. Plea is that first notice was issued to the petitioner on 14.4.2005, which was well within the period prescribed in Section 216 (4) of the Act for right of the respondents to recover the embezzled amount and accordingly the bar now pleaded by the petitioner would not be attracted in this case. Instead of paying this embezzled amount, the petitioner had then served a legal notice to respondent CIVIL WRIT PETITION NO.23260 OF 2010 :{ 5 }:
No.4 to withdraw this show cause notice and had also demanded a fresh assessment for which the proceedings went on. As per the respondents, the first notice having been issued within a period of four years of the loss, the impugned order passed can not be held to be illegal or unjustified.
The facts in Civil Writ Petition No.4920 of 2011 are slightly different.
The term of the petitioner Sarpanch in this case has come to an end in May 2008 as he was elected Sarpanch from June 2003 to March 2008. During this period, the Gram Panchayat had received various grants from the Government, which were utilized for the purpose of development in the village. The petitioner states that all the income and expenditure is accounted for in the cash books and various payments were made through cheques. It is only on 3.8.2010 that respondent No.2 conducted an enquiry on the basis of a complaint made by the then Sarpanch and the petitioner was debarred from participating in the Gram Panchayat election for a period of five years, as per penalty under Section 20(2) of the Act. The petitioner represented against the same and also pointed out that respondent No.2 had issued instructions to respondent No.3 for initiating proceedings under Section 216 of the Act. This is termed as illegal in view of the bar imposed under Section 216(4) of the Act. It can be noticed that thereafter respondent No.4 issued instructions to the Junior Engineer to take measurement of the work done in the tenure of the petitioner as Sarpanch and on the basis of a report, respondent No.4 has imposed a recovery of Rs.9,39,253/- against CIVIL WRIT PETITION NO.23260 OF 2010 :{ 6 }:
the petitioner. As per the petitioner, the measurement was done without any information to him. The petitioner was directed to deposit the amount within seven days and upon his failure to do so, the same was to be recovered as a land revenue. The petitioner appealed against this order on 18.1.2011 and requested respondent No.4 to withhold steps to recover the amount. Still, the matter was referred to revenue department on 25.1.2011. The petitioner prayed for staying the recovery, which was not stayed on the ground that order for recovery is passed by higher authorities. The petitioner accordingly filed Civil Writ Petition No.2829 of 2011, which was disposed of with the observation that respondent No.3 would decide the application for suspending the operation of order dated 9.11.2010 within four weeks. Respondent No.3 has dismissed the appeal and so the petitioner has filed the present writ petition.
While issuing notice, recovery of the amount in this case is also stayed. Respondents have filed reply, raising a preliminary objection about the maintainability of the writ petition on the ground that the petitioner has an alternative remedy of filing a revision against this order under Section 216(5) of the Act. It is also pleaded that the term of the petitioner ended in the year 2008 and the present proceedings initiated against him are within the stipulated period even as per Section 216(4) of the Act.
Both the counsel, while arguing their respective petitions, have heavily relied upon sub-section (4) of Section 216 of the Act, which according to them provides a bar of limitation for recovery of the amount of loss etc., which may have been assessed against a CIVIL WRIT PETITION NO.23260 OF 2010 :{ 7 }:
particular person while he was holding the elected post of Sarpanch or a Panch. Since the recovery of loss etc. and the bar to recover the same is regulated by Section 216 of the Act, it would be necessary to note the provisions of Section 216 of the Act, which are as under:-
"216. Liability of members of Panchayat. (1) Every member of a Panchayat shall be liable for the loss, waste or misapplication of any money or property belonging to the Panchayat, if such loss, waste or misapplication is a consequence of his neglect or misconduct while such member and shall also be liable to pay interest at the prescribed rate, from the date of loss, waste or misapplication, on the amount assessed under sub-
section (2) or sub-section (3) as the case may be. (2) The Block Development and Panchayat Officer concerned may, on the application of a Gram Panchayat or otherwise, and after giving the member concerned an opportunity to explain, assess, by order, in writing the amount due from him in account of such loss, waste or misapplication;
Provided that -
(a) where such member happens to be the Chairman or a member of the Panchayat Samiti, the proceedings under this sub-section shall he taken by the District Development and Panchayat Officer;
(b) where such member happens to be the Chairman, CIVIL WRIT PETITION NO.23260 OF 2010 :{ 8 }:
Vice-Chairman or a member of the Zila Parishad, the proceedings under this sub-section shall be taken by the Deputy Director.
(3) Any person aggrieved by an order made under sub-
section (2) may within a period of thirty days from- the date of such order, appeal to: -
(a) the District Development and Panchayat Officer, if the order has been made by the Block Development and Panchayat Officer;
(b) the Deputy Director, if the order has been made by the District Development and Panchayat Officer; and
(c) the Director, if the order has been made by the Deputy Director;
and on appeal being filed, the appellate authority may suspend the execution of the execution of the order upon such terms as to costs, payments of the amount involved or otherwise as he thinks fit and subject to the result of appeal, if any, the order of Block Development and Panchayat Officer, District Development and Panchayat Officer and the Deputy Director, as the case may be, shall be final.
(4) Notwithstanding anything contained in this section no person shall be called upon to explain why he should not be required to make good any loss, after the expiry of four years from the occurrence of the loss, waste or misapplication or after the expiry of two years from his CIVIL WRIT PETITION NO.23260 OF 2010 :{ 9 }:
ceasing to be a member, whichever is later.
(5) The State Government may call and examine the record of any order made under this section for the purpose of satisfying itself as to the legality and propriety of such order and may confirm, modify or rescind such order;
Provided that no order prejudicial to any person shall be made by the State Government, unless that person has been afforded a reason- able opportunity of showing cause against the proposed order.
(6) The amount assessed as due from a member may, in the event of his death, be recovered from his legal heirs to the extent of property inherited by them from such member."
A perusal of the Section would show that every member of a Panchayat shall be liable for a loss, waste or misapplication of any money or a property belonging to the Panchayat, if such loss, waste or misapplication is a consequence of his neglect or misconduct etc. In addition, he is also made liable to pay interest at the prescribed rate from the date of loss on the amount assessed. Block Development and Panchayat Officer is empowered to assess the loss, waste or misapplication of the amount in writing after giving due opportunity to the member concerned to explain the same. Sub- section (3) of the Act, makes a provision for right of appeal for an aggrieved person and the Appellate Authority has the power to suspend the execution of the order on such terms as considered CIVIL WRIT PETITION NO.23260 OF 2010 :{ 10 }:
appropriate. Sub-section (4) then lays down a bar for recovery of loss etc. after expiry of two years from such person seizing to be a member or after expiry of four years from the occurrence of the loss, whichever is later. Sub-section (5) empowers the Government to exercise the power of revision.
The submissions having been concentrated on sub- section (4) of Section 216 of the Act, the same shall require examination in detail. The nature of bar as laid down in this sub- section may have to be seen. It may require a look whether this provision is mandatory or prohibitory or if there is any scope of its term being considered negotiable or that the time period is extendable in any manner. The scope of recovery, which can be ordered and the causes for which it can be so done may also have to be examined in the light of the provisions of Section 216 of the Act. In other words, whether a person who is accused of embezzling the amount of Panchayat while being Sarpanch or a Panch, could plead a bar of limitation, if he is asked to make good the embezzled amount.
This Section, in my view, may require a strict reading. The liability of a member of Panchayat is to pay the loss based on misapplication of any money or property and such loss or waste or misapplication has to be a consequence of his neglect or a misconduct. Apparent intention of the legislature is to exclude from its purview the cases where the amount is found to be embezzled by a Member. It appears that only cases of neglect or misconduct, which is not chargeable as a criminal misconduct and leads to causing any CIVIL WRIT PETITION NO.23260 OF 2010 :{ 11 }:
loss, waste or misapplication of any money that is made recoverable under this Section. The loss caused by a member by way of embezzlement cannot be a consequence of negligence. The words `waste or misapplication' would further qualify this aspect and prima- facie would exclude those cases where there is intentional misappropriation or embezzlement of the amount. Loss caused also is relatable to the neglect or a misconduct other then a criminal misconduct, which will lead to liability on the part of a member to make good the same. This Section basically is creating a liability in regard to the loss based on misapplication of any money or property which can be recovered alongwith interest.
In support, reference can be made to the observations of this Court in Criminal Misc. No.50274 M of 2006 (Smt.Sona Devi Vs. State of Haryana), decided on 19.12.2007, where somewhat similar view has been expressed by this Court while interpreting Section 105 of the Punjab Gram Panchayat Act, 1952, which regulates the similar recovery in the State of Haryana and is identically worded. It is held by the Court that only the sum which is on account of loss, waste or misapplication due to neglect or misconduct can be so recovered under this Section and this Section would not be any hurdle in the business of the State to fasten criminal liability on such Panch or Sarpanch for misappropriation of funds.
Thus, the Section provides for manner of assessing the loss etc. The Section very significantly lays down a period of limitation not for assessing the loss as such but for calling upon a Panch or Sarpanch to make good the loss. Sub-section (4) does not CIVIL WRIT PETITION NO.23260 OF 2010 :{ 12 }:
talk of any liability to pay. In other words, the limitation under this sub-section is not in regard to payment of the loss assessed but is concerned with calling upon a person to explain as to why he should not be required to make good any loss.
Section 216 (1) of the Act creates a liability of a Sarpanch or a Panch for any loss, waste or misapplication of Gram Panchayat fund or property belonging to the Panchayat, where such loss, waste or misapplication is a consequence of his neglect or misconduct while working as Panch or Sarpanch etc. Having created this liability, sub-section (4) makes a provision that no person shall be called upon to explain why he should not be required to make good any loss after expiry of four years from the occurrence of loss etc. or after expiry of two years from his ceasing to be a Sarpanch or a Panch. The point requiring notice here is that sub-section (4) does not in any manner relieve the Panch or Sarpanch of the liability, which is created by sub-section (1) of the Section but only lays down a bar for recovery after the period as provided in the said sub-section. After laying down the liability, the Section itself also provides a power to recover the same to the Block Development and Panchayat Officer. This is a mode of execution of the loss, waste or misapplication of funds, which is established or proved and so the bar would be only for this mode of recovery provided under the Section and can not in any manner effect the liability of the Panch or Sarpanch to make good this loss. There would be other method to recover this loss or misapplication of funds, if this method provided under the Section itself get eclipsed with the passage of time. The limitation is in regard CIVIL WRIT PETITION NO.23260 OF 2010 :{ 13 }:
to mode of recovery. The proceedings to assess the loss etc. apparently is not barred and the bar is only for asking a person as to why he should not make good any loss, which obviously has already been assessed. Thus, this Section would only require that a person should be asked within this period to make good the loss and once he is served with any notice, then the bar of limitation would not run. If this Section is interpreted in any other manner, then it will become redundant. Any person would easily avoid, making good the loss, either by contesting the same or otherwise challenging the same before any Forum just to buy time and then turn around and plead the bar of limitation. That is why the Section has very wisely used the words that "no person shall be called upon to explain why he should not be required to make good the loss" and not that the loss can not be recovered after the period of limitation as provided in this sub- section.
Besides, it may now be seen if this provision is laying down any prohibition for recovering of the liability fastened by this Section. A person can not be called upon to explain why he should not be required to make good any loss, if the period prescribed is over. This period is for calling upon to explain and does not have any effect on the liability to pay. Thus, where the person is asked to explain within four years or within two years of having acted to be Sarpanch etc., there would not be any prohibition for recovery or liability. Liability being not prohibited by any period in any manner would still remain. May be that short method to recover the loss is not available, if one is not even called upon to explain loss within the laid CIVIL WRIT PETITION NO.23260 OF 2010 :{ 14 }:
down period. There is nothing in this Section to indicate that the legislature policy was to excuse the Sarpanch or a Panch of the liability. The period of limitation as laid down in Section 216 (4) of the Act is only for method of recovery of loss, which is caused by such Panch or Sarpanch on account of any neglect. The liability to pay this loss, waste or misapplication is neither prohibited by any provision nor sub-section (i) of Section 216 can be said to be prohibitory in nature so far as liability is concerned. There is no limitation provided for assessing the liability. Again, the limitation for recovery is only when the loss, misapplication or waste etc. is due to neglect on the part of Sarpanch or a Panch and not in those cases where the allegation is of embezzlement or misappropriation or criminal breach of trust, which shall always be chargeable. To me, it appears that the short method requiring the Panch or a Sarpanch to pay this amount voluntarily and on his refusal to recover the same as land revenue may get eclipsed by virtue of the limitation laid down in this Section. Where the person has been called upon to explain within the stipulated period, then the bar certainly would not get attracted. It is not the actual acquisition or payment of the loss etc. as such which is barred but it is only a calling upon a Panch or Sarpanch to explain as to why he should not make good any loss.
The allegation in the present case is that the petitioner has embezzled an amount of `6,27,880/- for which the proceedings were initiated against him. The first notice to the petitioner was issued on 14.4.2005. The petitioner had remained as a Sarpanch from 1998 to June 2002. Thus, the first notice was well within the CIVIL WRIT PETITION NO.23260 OF 2010 :{ 15 }:
period of limitation. Accordingly, the petitioner can not escape the liability to make good this loss or misapplication on account of embezzlement, in view of the fact that first notice was served to him within the period of limitation prescribed.
The writ petition is accordingly dismissed.
July 10, 2012 (RANJIT SINGH ) khurmi JUDGE