1 NAFR HIGH COURT OF CHHATTISGARH AT BILASPUR Reserved for orders on : 30.04.2025 Order passed on 30.06.2025 WPC No. 2358 of 2022 1 - Panduram Bariha S/o Dharmu Bariha Aged About 35 Years R/o Village Gram Panchayat Charouda, Block Pithora, District : Mahasamund, Chhattisgarh ... Petitioner(s) versus 1 - State Of Chhattisgarh Through The Secretary, Department Of Panchayat New Mantralaya, Mahanadi Bhawan, Atal Nagar Raipur,, District : Raipur, Chhattisgarh 2 - Collector District - Mahasamund, Chhattisgarh. 3 - Sub Divisional Officer (Revenue) Pithora, District : Mahasamund, Chhattisgarh 4 - Chief Executive Officer Janpad Panchayat Pithora,, District : Mahasamund, Chhattisgarh ... Respondent(s) (Cause-title is taken from Case Information System) For Petitioner : Mr. C. R. Sahu, Advocate along with Mr. Sushobhit Singh, Advocate For State : Mr. Khulesh Sahu, Panel Lawyer SB- Hon'ble Shri Justice Amitendra Kishore Prasad C.A.V. Order 1. The instant writ petition is being preferred against the arbitrary and illegal action of the respondent State authorities, who have initiated recovery proceedings against the petitioner in blatant violation of the mandatory procedure prescribed under Sections 89 and 92 of the Chhattisgarh Panchayati Raj Adhiniyam, 1993. The petitioner, Digitally signed by SHAYNA KADRI 2 therefore, challenges the impugned recovery proceedings on the ground that they are unsustainable in law, having been initiated without adherence to the due process envisaged under Section 89 of the Chhattisgarh Panchayati Raj Adhiniyam, 1993. The petitioner has prayed for following reliefs by way of this writ petition :- “10.1 That, this Hon'ble court may kindly be pleased to issue appropriate writ, order, direction and quash the impugned proceedings Annexure P/1 pending before the office of Respondent No 3. 10.2 That this Hon'ble court may direct the respondent authorities to grant reasonable opportunity of hearing to the petitioner before initiating any coercive action of recovery under section 92 of the Panchayati raj adhiniyam 1993. 10.3 That, this Hon'ble Court may kindly be pleased to grant any other relief as it may deems fit and appropriate.” 2. Facts of the case, in a nutshell, are that the petitioner was the duly elected Sarpanch of Gram Panchayat Charouda, District Mahasamund, Chhattisgarh. During his tenure, certain allegations regarding irregularities in the execution of development works were leveled against him by individuals who are allegedly inimical to his political standing. In response to these allegations, the petitioner submitted a detailed statement of defense and reply, denying the charges and requesting a fair hearing. However, without conducting any formal proceedings under Section 89 of the Chhattisgarh Panchayati Raj Adhiniyam, 1993 (hereinafter referred to as "the Act of 1993"), which mandates a proper enquiry, issuance of show cause notice, and an opportunity of being heard, the respondent authorities arbitrarily and unlawfully issued a recovery notice under Section 92 of the Act. An enquiry report was purportedly prepared, but no copy of the 3 same was supplied to the petitioner at the relevant stage. Respondent No. 4, without initiating the mandatory enquiry procedure under Section 89 and without affording any reasonable opportunity of hearing, directly recommended recovery and issued a letter to the competent authority (SDO) for initiating recovery proceedings against the petitioner. Based on this recommendation, respondent No. 3 registered a revenue recovery case under Section 92 of the Act, bypassing the due process altogether. The petitioner, upon receipt of the notice, submitted a comprehensive reply pointing out the procedural lapses and violation of statutory provisions. Despite this, the recovery proceedings were pursued in contravention of law. Both Sections 89 and 92 must be read harmoniously, and any recovery under Section 92 must be preceded by a proper enquiry under Section 89. In light of these facts, the petitioner is constrained to approach this Hon’ble Court under Article 226 of the Constitution, challenging the impugned recovery proceedings as arbitrary, illegal, and violative of the petitioner’s statutory and fundamental rights. 3. Learned counsel for the petitioner submits that the actions of the respondents are flagrantly arbitrary, unreasonable, and violative of Article 14 of the Constitution of India, which guarantees equality before the law and equal protection of the laws. The respondents have failed to act in a fair and just manner and have instead adopted a patently discriminatory and unjust approach towards the petitioner by initiating recovery proceedings without following the mandatory statutory safeguards prescribed under Act of 1993. Such conduct clearly amounts to a denial of equality and contravenes the fundamental 4 principles of fairness and justice enshrined in the Constitution. The respondents have egregiously failed to comply with the mandatory procedure prescribed under Section 89 of the Act, 1993, before proceeding to invoke the recovery provisions under Section 92 of the said Act. The omission of respondents to adhere to prescribed procedural mandate renders their actions illegal, arbitrary, and liable to be set aside. It is further contended by the learned counsel for the petitioner that the respondents have failed to afford the petitioner a reasonable opportunity of hearing, which is a cornerstone of the principles of natural justice. No proper enquiry was conducted, nor was the petitioner given any chance to defend himself before initiating the recovery proceedings. He placed reliance upon the judgement of this Court passed in W.P.(C.) No. 4574 of 2021, in a case involving facts and circumstances analogous to the present. This Court has unequivocally interpreted Sections 89 and 92 of the Act, 1993, and held that compliance with the procedure under Section 89 is a mandatory prerequisite before invoking the recovery mechanism under Section 92. In light of the above, it is clear that the respondents have acted in direct violation of the statutory provisions, the principles of natural justice, and the binding judicial pronouncements of this Hon’ble Court. Consequently, the impugned recovery proceedings initiated under Section 92 of the Act, without prior compliance with Section 89, are arbitrary, illegal, and without jurisdiction. The petitioner, therefore, prays that the said recovery proceedings be quashed and set aside in the interest of justice. 4. On the other hand, learned counsel appearing on behalf of the State strenuously opposes the submissions advanced by learned counsel for 5 the petitioner and contends that the instant writ petition lacks merit and is liable to be dismissed as the actions taken by the respondents are neither arbitrary nor illegal. The recovery proceedings initiated against the petitioner under Section 92 of the Act of 1993 have been undertaken strictly in accordance with law and are based on cogent grounds arising from irregularities committed during the tenure of petitioner as Sarpanch. The challenge of petitioner that these proceedings violate Sections 89 and 92 of the Act of 1993 and that the recovery was initiated without following due process, is misconceived and contrary to the facts on record. It is submitted that the petitioner, in his capacity as Sarpanch, was subject to an enquiry which culminated in a detailed enquiry report finding irregularities and recommending recovery. The said enquiry was conducted in a fair and transparent manner and the petitioner was given sufficient opportunity to present his defense and submit replies to the allegations. The claim of petitioner that no enquiry or show cause notice was issued under Section 89 is factually incorrect and is belied by the documents on record, which demonstrate that the enquiry process was duly followed before initiating recovery proceedings. The submissions of the learned counsel for petitioner that Sections 89 and 92 of the Act of 1993 must be read in isolation and that recovery cannot be initiated without prior formal enquiry under Section 89 are not entirely correct. It is well settled that these provisions are to be construed harmoniously to ensure effective enforcement of Panchayati Raj administration. However, the discretion to proceed with recovery under Section 92 is exercisable by the competent authority after considering the enquiry report and the facts of each case. Where the enquiry report clearly 6 indicates recovery is warranted, recovery proceedings can legitimately be initiated to protect public interest and ensure accountability. The contention that the respondents have acted in violation of Article 14 of the Constitution is wholly untenable. The respondents have not acted arbitrarily or discriminatorily but have merely exercised their statutory powers in a transparent, fair, and lawful manner. The assertion of petitioner that the process was unfair is without any substantive basis and does not disclose any violation of the principles of natural justice. The petitioner was afforded reasonable opportunity to submit his replies and defend himself against the charges. Further, the Act itself contemplates recovery under Section 92 based on the findings of an enquiry and allows for reasonable procedural flexibility to ensure effective recovery in cases of financial irregularity. The impugned recovery proceedings under Section 92 are lawful, justified, and validly initiated. 5. I have heard learned counsel for the respective parties and perused the documents annexed along with the petition with atmost circumspection. 6. Under Sections 89 of the Panchayat Raj Adhiniyam, it is categorically provided that if any person is found to have caused loss, waste, or misappropriation of any money or other property belonging to the Panchayat, such person is liable to make good the loss. However, it is a mandatory requirement that the person concerned must be given a reasonable opportunity of hearing before any such liability is imposed. Sections 89 of the Panchayat Raj Adhiniyam is extracted below for ready reference : 7 “89. Liability of Panch etc. for loss, misappropriation. - (1) Every Panch, member, office-bearer, officer or servant of Panchayat shall be personally liable for loss, waste or misapplication of any money or other property of the Panchayat to which he has been a party or which has been caused by him by misconduct or gross neglect of his duties. The amount required for reimbursing such loss, waste, or misapplication shall be recovered by the prescribed authority; Provided that no recovery shall be made under this section unless the person concerned has been given a reasonable opportunity of being heard. (2) If the person concerned fails to pay the amount, such amount shall he recovered as arrears of land revenue and credited to the funds of the Panchayat concerned.” 7. After issuance of show-cause notice, if the person concerned fails to deliver the articles of money involved in the notice, prescribed authority may cause him to be apprehended and may send him with a warrant in such form as may be prescribed, to be confined in a Civil Jail for a period not longer than 30 days. Sections 92 of the Panchayat Raj Adhiniyam is extracted below for ready reference : “92. Power to recover records, articles and money. - (1) Where the prescribed authority is of the opinion that any person has unauthorisedly in his custody any record or article or money belonging to the Panchayat, he may, by a written order, require that the record or article or money be delivered or paid forthwith to the Panchayat, in the presence of such officer as may be appointed by the prescribed authority in this behalf. (2) If any person fails or refuses to deliver the record or article or pay the money as directed under sub-section (1), the prescribed authority 8 may cause him to be apprehended and may send him with a warrant in such form as may be prescribed, to be confined in a Civil Jail for a period not longer than thirty days. (3) The prescribed authority may - (a) for recovering any such money direct that such money be recovered as an arrear of land revenue; and (b) for recovering any such record or articles issue a search warrant and exercise all such powers with respect thereto as may lawfully be exercised by a Magistrate under the provisions of Chapter VII of the Code of Criminal Procedure, 1973 (No. 2 of 1974). (4) No action under sub-section (1) or (2) or (3) shall be taken unless a reasonable opportunity has been given to the person concerned to show cause why such action should not be taken against him. (5) A person against whom an action is taken under this section shall be disqualified to be member of any Panchayat for a period of six years commencing from the initiation of such action.” 8. From a perusal of the order sheet and the investigation report dated 25.01.2022, it is evident that the enquiry revealed misappropriation of funds by the petitioner as well as the Secretary of the Gram Panchayat in relation to development works. Consequently, proceedings under Section 89 were required to be initiated, which involve issuing a show cause notice and conducting a proper enquiry to allow the concerned parties to present their defense. Thereafter, if the amount is not recovered or paid voluntarily, the competent authority, in this case, the Sub-Divisional Officer (Revenue), may initiate proceedings under Section 92 for recovery of the amount. Vide letter dated 02.03.2022, the Sub-Divisional Officer (Revenue), Pithora issued a notice to the 9 petitioner for recovery of Rs. 8,98,520/- on the basis of the enquiry report. The petitioner, however, approached this Court contending that recovery proceedings were initiated without following the due process under Sections 89 and 92 of the Act. It is the grievance of the petitioner that no proper enquiry or show cause notice under Section 89 was conducted or issued, and the recovery notice under Section 92 was issued arbitrarily and prematurely. 9. It is well settled that Sections 89 and 92 of the Act of 1993 must be read harmoniously. Section 89 of the Act of 1993 mandates a detailed enquiry, issuance of a show cause notice, opportunity to file reply, and a fair hearing before any recovery action is initiated. Section 92 of the Act of 1993 provides the mechanism for recovery only after the enquiry under Section 89 is completed and if the amount remains unpaid. From the documents on record, it appears that the enquiry report dated 25.01.2022 was prepared based on the investigation, and thereafter, the Sub-Divisional Officer (Revenue), Pithora took action to issue recovery notice as per Section 92 of the Act of 1993. Although the petitioner contends that no copy of the enquiry report or show cause notice was provided before initiation of recovery proceedings, the Sub- Divisional Officer (Revenue), Pithora has indeed issued a notice to the petitioner, giving an opportunity to respond. The claim of petitioner that no opportunity of hearing was given is not fully substantiated. The proceedings before the Sub-Divisional Officer (Revenue) under Section 92 of the Act of 1993 envisage the opportunity to submit reply and contest the recovery. No final order of recovery has been passed till date, and the matter remains pending before the competent authority. The Court also takes note of the submissions that the petitioner has 10 submitted replies and raised objections regarding procedural lapses, which ought to be duly considered by the Sub-Divisional Officer (Revenue) before passing any recovery order. The initiation of recovery proceedings under Section 92 of the Act of 1993 is a statutory power exercised in accordance with the findings of the enquiry report and the requirement to safeguard public funds. 10. The Court finds no sufficient ground to interfere with the recovery proceedings at this stage as the statutory procedure has been broadly complied with, and the matter is currently pending before the competent authority. It is well established that the writ jurisdiction under Article 226 of the Constitution should not ordinarily be exercised to interfere in such matters which require detailed factual adjudication and are subject to statutory procedure. However, the Court directs that the respondent authorities shall ensure strict adherence to the provisions of Section 89 and Section 92 of the Act of 1993, and before passing any recovery order, the petitioner shall be afforded full and fair opportunity of hearing, including access to the enquiry report and all relevant documents. 11. In view of the above, the writ petition is disposed of with a direction the respondents shall not pass any final recovery order under Section 92 without affording the petitioner a reasonable opportunity of hearing as mandated under the Act. The Sub-Divisional Officer (Revenue) shall consider the replies and objections made by petitioner in a fair and unbiased manner and decide the recovery claim in accordance with law within a period of two months from the date of receipt of a certified copy of this order and further, the petitioner is directed to approach 11 before Sub-Divisional Officer (Revenue), Pithora along with copy of this order within a period of 30 days from the date of receipt of this order. It is further directed that no coercive recovery action shall be taken against the petitioner until the recovery proceedings are concluded by the competent authority after following due process. 12. It is made clear that this Court has not expressed any opinion on the merits of the case. The prescribed authority shall be at liberty to pass appropriate orders, but only after affording due opportunity of hearing to the petitioner. 13. With this observation and direction, this writ petition stands disposed of. Sd/- (Amitendra Kishore Prasad) Shayna JUDGE