IN THE HIGH COURT OF ANDHRA PRADESH AT AMARAVATI (Special Original Jurisdiction) WEDNESDAY, THE FIFTH DAY OF FEBRUARY TWO THOUSAND AND TWENTY FIVE ^ PRESENT THE HONOURABLE SRI JUSTICE TARLADA RAJASEKHAR RAO WRIT PETITION NO: 28172 OF 2024 \\ Between: 1. The Lakshmipuram Gram Panchayat, Lakshmipuram Village, Regidi Amadalavalasa Mandal, Vizianagaram District Rep by its Sarpanch Smt. Kemburi Tejavathi, W/o Venkateswara Rao, Aged about 50 years, Occ; Sarpanch, R/o Lakshmipuram Village, Regidi Amadalavalasa Mandal, Vizianagaram District 2. The Munakalavalasa Gram Panchayat, Munakalavalasa Village, Regidi Amadalavalasa Mandal, Vizianagaram District Rep by its Sarpanch Vavilapalli Chandra Sekhar Rao, S/o Late Bhujanga Rao, Aged about 44 years, Occ- Sarpanch, R/o Munakalavalasa Village, Regidi Amadalavalasa Mandal, Vizianagaram District 3. The Gullapadu Gram Panchayat, Gullapadu Village, Regidi Amadalavalasa Mandal, Vizianagaram District Rep by its Sarpanch Smt. Viyyapu Lavanya, W/o Chakrapani, Aged about 31 years, Occ: Sarpanch, R/o Gullapadu Village, Regidi Amadalavalasa Mandal, Vizianagaram District ...PETITIONER(S) AND 1. The Union of India, Ministry of Rural Development Department Krishi Bhavan, Dr. Rajendra Prasad Road, New Delhi - 110001 INDIA Rep by its Principal Secretary 2. The State of Andhra Pradesh, Panchayat Raj & Rural Development Department, Secretariat Building, Velagapudi, Amaravati, Guntur District Rep. by its Principal Secretary 3. The Commissioner, PR & RD Department Government of Andhra Pradesh, Vijayawada 4. The Engineer-in-Chief, Panchayat Raj, Vijayawada Government of Andhra Pradesh 5. The District Collector, cum The District Programme Coordinator MGNREGS-AP, Vizianagaram District, Vizianagaram 6. The Project Director, DWMA, Vizianagaram District, Vizianagaram 7. The Superintendent Engineer, PRI Circle, Vizianagaram District 8. The Executive Engineer, PRI Division, Vizianagaram @ Bobbin, Vizianagaram District 9. The District Panchayat Officer, Vizianagaram 10. The Mandal Praja Parishad Development Officer, Regidi Amadalavalasa Mandal, Vizianagaram District 11. Meesala Chandra Rao, S/o Sanyasi Appala Naidu MGNREGS Work Vendor, Work Id No. 0201003025/RC/9999005226849 R/o Lakshmipuram Gram Panchayat, Regidi Amadalavalasa Mandal, Vizianagaram District 12. Karnena Gowrinaidu, S/o Lakhsmi Naidu MGNREGS Work Vendor, Work Id No. 0201003025/RC/9999005226813 Work Id No. 0201003025/RC/9999005226661 R/o Lakshmipuram Gram Panchayat, Regidi Amadalavalasa Mandal, Vizianagaram District 13. Podilapu Satyanarayana, S/o Suryanarayana MGNREGS Work Vendor, Work Id No. 0201003025/RC/9999005226705 R/o Lakshmipuram Gram Panchayat, Regidi Amadalavalasa Mandal, Vizianagaram District 14. Sasapu Janardhanarao, S/o Satyam Naidu, MGNREGS Work Vendor, Work Id No. 0201003039/RC/9999005226633 Work Id No. 0201003039/RC/9999005226642 Work Id No. 0201003039/RC/9999005226660 Work Id No. 0201003039/RC/9999005226670 Work Id No. 0201003039/RC/9999005226627 R/o Munakalavalasa Gram Panchayat, Regidi Amadalavalasa Mandal, Vizianagaram District 15. Munjeti Jhansi, W/o Purushotam Naidu MGNREGS Work Vendor, Work Id No. 0201003040/RC/9999005226873 Work Id No. 0201003040/RC/9999005226837 R/o Gullapadu Gram Panchayat, Regidi Amadalavalasa Mandal, Vizianagaram District ...RESPONDENTS Petition under Article 226 of the Constitution of India praying that in the circumstances stated in the affidavit filed therewith, the High Court may be pleased to issue a writ of mandamus or any other appropriate writ or direction declaring 1) the action of the respondents No. 3 to 10 in entrusting the Works for execution in the Petitioners Gram Panchayats to the respondents No. 11 to 15 in the name of “Vendors” is arbitrary, illegal, contrary to the MGNREG Act and A.P Panchayat Raj Act and Rules made there under and one without jurisdiction and 2) the Re No. 25/B/E.G.S/2022 dated 24.10.2024 MGNREGS Mandal Parishad, Regidi Amadalavalasa issued by 10th respondent requesting the 6th respondent for registration of Vendors List for execution of works of MGNREGS Convergence works including Proposals List 2024-25 in so far as petitioner Gram Panchayats to the respondents No. 11 to 15 as arbitrary, illegal, in contravention of the provisions of the MGNREG Act and A.P Panchayat Raj Act and Rules made there under and one without jurisdiction and consequently direct the respondents No. 3 to 10 to entrust the MGNREGS Convergence works in so far as the petitioner Gram Panchayats to the Petitioner Gram Panchayats only for execution by strictly adhering to the provisions of the MGNREG Act and the A.P Panchayat Raj Act and Rules made there under lA NO: 1 OF 2024 Petition under Section 151 CPC praying that in the circumstances stated in the affidavit filed in support of the petition, the High Court may be pleased to grant stay of all further proceedings including execution of works by the VENDORS i.e respondents No. 11 to 15 in the petitioner Gram Panchayats i.e Lakshmipuram Gram Panchayat, Munakalavalasa Gram Panchayat and Gullapadu Gram Panchayat and disbursement of bills by the respondent authorities to them, pending disposal of the writ petition. lA NO: 1 OF 2025 Petition under Section 151 CPC praying that in the circumstances stated in the affidavit filed in support of the petition, the High Court may be pleased to receive the additional material papers i.e 1) Measurement Book in 2421/A, 2) Measurement Book in 2853/A and 3) FTO transaction details of respondents No. 11 to 15 in the above writ petition lA NO: 2 OF 2024 Petition under Section 151 CPC praying that in the circumstances stated in the affidavit filed in support of the petition, the High Court may be pleased to receive the additional material papers i.e Rc No. 25/B/EGS/2022 dated 02.11.2024 along with a list of 129 vendors and translation in the above writ petition Counsel for the Petitioners: SRI KALANGI SUMALATHA Counsel for the Respondent No.1: A RAVINDRA BABU (CENTRAL GOVT COUNSEL) Counsel for the Respondents No.2, 3, 4, 6 to 9: GP FOR PANCHAYAT RAJ AND RURAL DEVELOPMENT Counsel for the Respondent No.5: GP FOR REVENUE Counsel for the Respondent No.10: SRI Y KOTESWARA RAO, STANDING COUNSEL Counsel for the Respondents No,11 to 15: -- The Court made the following: Order THE HON’BLE SRI JUSTICE TARLADA RAJASEKHAR RAO WRIT PETITION No.28172 of 2024 ORDER: The present Writ Petition is filed under Article 226 of Constitution of India for the following relief/s: ....pleased to issue a writ of mandamus or any other appropriate writ or direction declaring 1) the action of the respondents No.3 to 10 in entrusting the Works for execution in the Petitioners’ Gram Panchayats to the respondents No. 11 to 15 in the name of “vendors” is arbitrary, illegal, contrary to the MGNREG Act and A.P. Panchayat Raj Act and Rules made there under and one without jurisdiction RC.NO.25/B/E.G.S./2022 dated 24.10.2024 MGNREGS Mandal Parishad, Regidi Amadalavalasa issued by 10‘^ respondent requesting the 6**^ respondent for registration of Vendors List for execution of works of MGNREGS Convergence works including Proposals List 2024-25 in so far as petitioner Gram Panchayats to the respondent No.11 to 15 as arbitrary, illegal, in contravention of the provisions of the MGNREG Act and A.P. Panchayat Raj Act and Rules made thereunder and one without jurisdiction and consequently direct the respondents No.3 to 10 to entrust the MGNREGS Convergence works in so far as the petitioner Gram Panchayats to the Petitioner Gram Panchayats only for execution by strictly adhering to the provisions of the MGNREG Act and the A.P. Panchayat Raj Act and 2) the 2 and Rules made there under and pass such other or further orders 2. The present Writ Petition is filed to declare the action of the respondent Nos.3 to 10 in entrusting works in the petitioner’s Grampanchayats to respondent Nos. 11 to 15 in the name of “vendors” as arbitrary, illegal and contrary to Sub Section (5) of Section 16 of the MGNREG Act and A.P. Panchayat Raj Act and Rules made there under. The respondents have filed their counter affidavit stating that the works were identified as per the guidelines of the Mahatmagandhi National Rural Employment Guarantee Scheme (MGNREGS Act) and the vendors registered as recommended by the Mandal Development Officer, Regadi Amudalavalasa vide Rc.No.25/B/EGS/2022 dated 24.10.2024 by the 10‘^ respondent and the deponent-the Commissioner, Panchayat Raj and Rural Development Department, Tadepally, Guntur, has acted as per the instructions issued vide circular No.1309/EGS/DEE(T) Migration to NREGA Soft/2021, dated 01.03.2022 and these registered vendors are for supply of materials only. 3. ) Learned counsel for the petitioner submit that the Government of India enacted Mahatma Gandhi National Rural Employment Guarantee Act, 2005 (MGNREGA) (for short the Act) with an object to provide for the enhancement of livelihood security of the households in the rural areas of the country by providing at least 100 days of guaranteed wage employment in financial year to every household whose adult members volunteer to do unskilled manual work and for matters connected with or incidental thereto. And further submits that under sub section (5) of Section 16 of the Act, the programme officer shall allot at least 50% of the work in terms of its cost under a scheme be implemented throughout the Gram Panchayats. In the present case the respondents have not allotted the work to the Panchayats despite the Gram Panchayats passed resolution. Without following the due process allotting the work to vendors is nothing but flagrant violation of the fundamental rights guaranteed under the Constitution of India and the Act and the Scheme. If the resolution of the petitioner’s Grampanchayats are not complied with then there would not have any sanctity to the provisions of the Act and its scheme and clearly breach of the Act the Grampanchayats would face serious hardship and 4. every to Gram as and 4 irreparable loss. Hence, prayed to direct the respondents to allot the work to the petitioner’s Grampanchayats as per the resolution of the Grampanchayat. The counsel for the petitioner has emphasised his arguments mainly on the provision of Section 16 of the Act. For the facility, Section 16 is extracted hereunder. 5. Responsibilities of the Gram Panchayats;- (1) The Gram Panchayat shall be responsible for identification of the projects in the Gram Panchayat area to be taken up under a Scheme as per the recommendations of the Gram Sabha and the Ward Sabhas and for executing and supervising such works. (2) A Gram Panchayat may take up any project under a Scheme within the area of the Gram Panchayat as may be sanctioned by the Programme Officer. (3) Every Gram Panchayat shall, after considering the recommendations of the Gram Sabha and the Ward Sabhas, prepare a development plan and maintain a shelf of possible works to be taken up under the Scheme as and when demand for work arises. (4) The Gram Panchayat shall forward its proposals for the development projects including the order of priority between different works to the Programme Officer for scrutiny and preliminary approval prior to the ) 5 commencement of the year in which it is proposed to be executed. (5) The Programme Officer shall allot at least fifty per cent, of the works in terms of its cost under a Scheme to be implemented through the Gram Panchayats. The Programme Officer shall supply each Gram Panchayat with— (6) (a) the muster rolls for the works sanctioned to be executed by it; and (b) a list of employment opportunities available elsewhere to the residents of the Gram Panchayat. The Gram Panchayat shall allocate employment opportunities among the applicants and ask them to report for work. (7) (8) The works taken up by a Gram Panchayat under a Scheme shall meet the required technical standards and measurements. 6. As seen from sub-section (5) of Section 16 of the Act, it manifests that allot at least fifty per cent of the works in terms of its cost under a Scheme to be implemented through the Gram Panchayats. And the Annual Master Circular memo dated 2024- 2025 is a comprehensive document covering all aspects of implementation of (MGNREGA). The clause 7.1.1 of chapter 7 cfivulges that at least 50% in terms of its cost under a Scheme to 6 be implemented through the Gram Panchayats to the gram Panchayats. 7. Now the issue for consideration is that whether the said sub-section (5) of Section 16 is mandatory or directory. The known rule of interpretation is to examine whether the use of expression "shall" is mandatory or directory, the Court is not only to consider the actual words used but also the scheme of the statute, the intended benefit to public or what is enjoined by the provision and material danger to the public by the contravention of the same. 8. In celebrated judgment of seven Judges in the case of Hari Vishnu Kamath v. Ahmad Ishaque and others'’, the Supreme Court held that an enactment in form mandatory might in substance be directory, and that the use of the word "shall" does not conclude the matter., when it was held as under:- "(26). It is well established that an enactment in form mandatory might in substance be directory, and that the use of the word "shall" does not conclude the matter. The question was examined at length in Julius v. Bishop of Oxford^, and various rules were laid down for determining AIR 1955 SC 233 ^(1880) LR5AC214(S) I 7 when a statute might be construed as mandatory and when as directory. They are well-known, and there is no need to repeat them. But they are all of them only aids for ascertaining the true intention of the legislature which is the determining factor, and that must ultimately depend on the context. What it has to be seen whether in sub-section (5) of section 16 the word "shall" could be construed as meaning "may". The Supreme Court judgment in Dhampur Sugar Mills Ltd. V. State ofU.P.^ and held as under:- 9. "18. The use of word "may" or "shall" is not conclusive. Whether the provision is merely directory or mandatory, was examined by Hon'ble the Supreme Court wherein it has been held that whether the provision is directory or mandatory is required to be decided by ascertaining the intention of the Legislature and not by looking at the language in which the provision is clothed. The Court must examine the scheme of the Act, purpose and object underlying the provision, consequences likely to ensue or inconvenience likely to result if the provision is read one way or the other and many more considerations relevant to the issue." (2007) 8 see 338 8 In Collector of Monghyr v. Keshav Prasad Goenka and others^, the Supreme Court held that the question as to whether the provision is mandatory or directory has to be decided not merely on the basis of any specific provision, which for instance sets out the consequences of the omission to observe the 10. requirement but for the purpose for which the requirement has been enacted particularly in the context of the other provisions of the Act and the general scheme thereof. In another judgment in Municipal Corporation of Greater Bombay v. The B.R.S.T. Workers Union^:- the Hon’ble Supreme Court held that the Court is required to ascertain the real intention of the legislature which will include the examination, nature and 11. design of the statute, the consequences which would follow from construing it one way or the other and whether the object of the legislation would be defeated or furthered by a particular construction. The relevant excerpt from the decision reads, thus:- "18. After elaborate discussion by the Apex Court in State of Uttar Pradesh v. Babu Ram Upadhya [AIR 1961 SC 751] regarding, whether the use of the word 'shall' in a statute makes the provision mandatory or directory various ''air 1962 SC 1694 ® (1973) 3 see 546 9 principles that have to be borne in mind in deciding. It has been emphasised that for ascertaining the real intention of the Legislature the court, among other things, may consider the nature and the design of the statute, the consequences which would follow from construing it one way or other and whether the object of the legislation will be defeated or furthered by a particular construction. 26. In a judgment reported as Amardeep Singh \/s. Harveen Kaut^, the Supreme Court held that the Court is required to consider the nature and design of the statute; the consequences which would follow from construing it the one way or the other; the impact of other provisions whereby necessity of complying with the provisions in question is avoided; the circumstances. namely, that the statute provides for contingency of the non- compliance with the provisions; the fact that the non-compliance with the provision is or is not visited with some penalty; the serious or the trivial consequences, that flow therefrom; and the factors which are required to be determined whether the provision is mandatory or directory. 27. Counsel for the petitioner would emphasis his argument on the grounds that the word ‘vendor’ was not defined under ® (2017) 8 see 746 ( 10 m MGNREGA act or under A.P. Panchayat Raj Act 1994 the duties of the vendor as it indicated in memo No 25811309/CRP&RD/ EGS/PM(SP)/2024 dated 09-10-2024 is only provided material to procure materials from the vendor and entrusting the work to vendor is contrary to the aforementioned acts hence prayed to entrust the MGNREGS Convergence works in so far as the petitioner or Gram Panchayats to Gram Panchayats only for execution by strictly adhering to the provisions of the MGNREG Act and the A.P. Panchayat Raj Act the Petitioner and Rules made there under. 28. Under clause 12.4.(12) of chapter 12 of the Annual Master Circular memo dated 2024-2025 that it says that material has to be procured from the vendor, for facility purpose the hereby extracted here under:- same is “Material can be procured when the work has been approved or at ongoing status and all the materials which mentioned at the time of technical sanction. Vendor has to be registered before bills get entered. All the taxes have to be entered by the state which can be used at the time of bill entry.” On conjoin reading of the provision 16 of MGNREG act and section 45 of the A.P. Panchayat Raj Act 1994 that it is the duty of 29. 11 the gram panchayat to provide all resources to the gram panchayat. From perusal of section 45 of A.P. Panchayat Raj Act it is the obligation of the gram panchayat to provide certain matters as contemplated under sub-section (1) of section 45 of the panchayat raj act and under sub-section (2) of section 45 that it obligates the government, subject to such rules as may be made in this behalf, entrust the Gram Panchayats with any functions in relation to the subjects specified in Schedule-I and sub-section (3) of section 45 says that the Gram Panchayats shall do resource planning at village level. On conjoin reading of the 16 of MGNREG act and section 45 of the A.P. provision Panchayat Raj Act 1994 that it is the duty of the gram panchayat to provide all resources to the gram panchayat. From perusal of section 45 of A.P. Panchayat Raj Act it is the obligation of the gram panchayat to provide certain matters as contemplated under sub-section (1) of section 45 of the panchayat raj act and under sub-section (2) of section 45 that it obligates the government, subject to such rules as may be made in this behalf, entrust the Gram Panchayats with any functions in relation to the subjects specified in Schedule-1 and sub-section (3) of section 45 says that the Gram Panchayats shall do resource planning at village level. 12 Otherwise, giving the work to the vendor would be against the two acts described above because the word "vendor" was defined or derived from the above two acts. If the act does not define the word "vendor," the work cannot be given to the vendor. Despite the petitioner's argument, section 16(5) of the 30. MGNREGA 2005 stipulates that the gram panchayats must get at least 50% of the costs; this does not preclude the other 50% of the work from being distributed to the others. "The scheme of MGNREGA aims to strengthen the households in rural areas. The provision indicating the use of the word 'shall' is mandatory." That a part that where the sub-section (5) of Section 16 of 31. the Act clearly mandates that at least fifty per cent of the works in terms of its cost under a Scheme to be implemented through the Gram Panchayats when it deviated it is contrary to the provisions of law. When the law prescribes a thing to be done in a particular manner following a particular procedure, it shall be done in the same manner following the provisions of law, without deviating from the prescribed procedure. Hence this court is of the opinion that word “shall” in sub-section (5) of section of the act is mandatory. ( 1 13 Sub-section 5 of Section 16 of the Act, clearly mandates that at least 50% of the works, in terms of their cost, under the 32. scheme should be implemented through the Gram Panchayats. However, the respondents have not allotted the work to the Gram Panchayats and have instead selected vendors. Therefore, the l allotment of the works to the respondents is contrary to the provisions outlined above. Additionally, even according to the memo dated 01.03.2022, relied upon by the respondents under Chapter 7.1.1, at least 50% of the works, in terms of their cost. / should be allocated to the Gram Panchayats for implementation. 33. Therefore, the allotment of the work to the vendors contravenes the provisions of the Act. In view of the aforesaid provisions, the respondents are required to allot at least 50% of the work, in terms of its cost, under the scheme to be implemented through the Gram Panchayats. Accordingly, the Writ Petition stands allowed, and the allotment made to the vendors is in contravention of Subsection 5 of Section 16 of the Act and the circular memo dated 01.03.2022. 30. Hence in view of the above discussion, the Writ Petition is allowed and the respondents are directed to follow sub-section 5 of Section 16 of the Act and the Circular Memo dated 01.03.2022 14 while entrusting the work to the vendors. There shall be no order as to costs. As a sequel, interlocutory applications, if any pending in this Writ Petition shall stand closed. Sd/- V SAVITRI GOWRI ASSISTANT REGISTRAR SECmirOFFICER //TRUE COPY// To, 1. The Principal Secretary, Union of India, Ministry of Rural Develooment mooTiNDIA" development State of Andhra Pradesh, Panchayat Raj and SavarcCKSfoistricr'''"""'’ 3. The Commissioner, PR and RD Department Government Pradesh, Vijayawada ^ Andhra'^PradeslT'^^'^^’ Vijayawada Government New Delhi - of Andhra of MGNRPrq JP® District Programme Coordinator MGNREGS-AP, Vizianagaram District, Vizianagaram 6. The Project Director, DWMA, Vizianagaram District, Vizianagaram 7. The Superintendent Engineer, PRI Circle, Vizianagaram District Vi^ana^a^am Disfricf"®®''' Vizianagaram @ Bobbiii, 9. The District Panchayat Officer, Vizianagaram 10. The A ^ Mandal Praja Parishad Development Amadalavalasa Mandal, Vizianagaram District Officer, Regidi 11. One CC to SRI KALANGI SUMALATHA Advocate [OPUC] 12. One CC to SRI A RAVINDRA BABU (CENTRAL GOVT COUNSEL) Advocate [OPUC] 13. Two CCs to GP FOR PANCHAYAT RAJ AND RURAL DEVELOPMENT, High Court of Andhra Pradesh [OUT] 14. Two CCs to GP FOR REVENUE, High Court of Andhra Pradesh [OUT] 15. Three CD Copies ^ I# HIGH COURT jf / DATED:05/02/2025 I I i t 2'MAR 2025 g . Current section ORDER WP.No.28172of2024 ALLOWING THE WP WITHOUT COSTS