Section 199(1) in The M.P. Municipal Accounts Rules, 1971
(1)Whenever any loss of the Municipal Fund or property of the value of more than Rs. 50 by embezzlement, theft or otherwise is discovered or suspected, the fact shall be promptly reported by the Chief Municipal Officer to the Collector and to the Examiner of Local Fund Accounts. The matter shall also be brought to the notice of the Finance Committee or the Standing Committee at the next meeting held after the embezzlement is discovered or suspected. The matter shall be fully inquired by the Chief Municipal Officer and he will send a complete report to the Municipal Council and the Collector of the district showing the total sum of money misappropriated, the method in which the embezzlement was effected and the steps taken to recover the money and punish the offender. If there is a prima facie case of embezzlement, theft or otherwise, the Chief Municipal Officer shall except in trial cases, promptly report the case to the police for investigation in case of cognizable offence, and in case of non-cognizable offence pledge a complaint in the Court.
