A. M. AHMADI, J. ( 1 ) THE petitioner a property-holder and a tax-payer has filed this petition for directing respondents Nos. 1 and 2 to take appropriate action against respondent No. 3 Panchayat and its Chairman respondent No. 4 in respect of certain actions taken in contravention of the provisions of the Gujarat Panchayats Act 1961 (hereinafter called the Act ). The main grievance made by the counsel for the petitioner was that certain lands shown in the statement Annexure C to the petition were given on lease to different persons on nominal rent contrary to the provisions of sec. 98 of the Act thereby causing financial loss to the panchayat. It is averred that these lands having been vested in the panchayat by the Government under sec. 96 of the Act could not be given on lease without the previous sanction of the competent authority. Respondent No. 3 and the Chairman respondent No. 4 having given the land on lease to different persons without the previous sanction of the competent authority committed a violation of sec. 98 of the Act which resulted in substantial financial loss to the panchayat. According to the petitioner the lands were leased out on token rent by passing resolutions from time to time without obtaining the sanction of the competent authority presumably because the respondents knew that if they sought the sanction of the competent authority the same would not be forthcoming. In other words according to the petitioner this was a case of gross abuse of power and authority which ought to have been inquired into under sec. 317 (2) of the Act and the defaulter punished as provided therein. ( 2 ) NONE of the respondents has filed a counter-affidavit refuting the averments and allegations made in this petition. At the hearing of this petition Mr. Vasavada for Mr. Vakharia stated that the Development Commissioner had inquired into this matter and he had come to the conclusion by his order dated 25/07/1976 that in leasing the lands there was no violation of sec. 98 of the Act. He also gave me a typed copy of the order passed by the Development Commissioner which I have kept on record. Mr. Bukhari the learned Assistant Government Pleader who has the original file with him states after comparing this typed copy with the original order that it is faithful and can be relied upon. 98 of the Act. He also gave me a typed copy of the order passed by the Development Commissioner which I have kept on record. Mr. Bukhari the learned Assistant Government Pleader who has the original file with him states after comparing this typed copy with the original order that it is faithful and can be relied upon. ( 3 ) SEC. 96 of the Act provides that the State Government may subject to such conditions and restrictions as it may think fit to impose vest in a panchayat open sites waste vacant or grazing lands or public roads streets bridges ditches dikes and fences wells river-beds tanks streams lakes nallas canals water-courses trees or any other property in the gram or nagar as the case may be. Sub-sec. (4) of sec. 96 gives the Government the right of re-entry if the land etc. which has been v-ested in the panchayat is required by the Government for any public purpose. It would appear from the above provision that property vesting in the Government can be vested in a gram or nagar panchayat under see. 96 (1) of the Act but such vesting will not debar the Government from resuming at any time such site or land if it is required by it for any public purpose. Sec. 97 (1) speaks about a taluka or district panchayat vesting its property in a gram or nagar panchayat. There is no provision analogous to sec. 96 (4) of the Act insofar as vesting of taluka or district panchayat property in gram or nagar panchayat concerned. ( 4 ) REFERENCE may now be made to sec. 98 which according to the petitioner was breached when several lands set out in Annexure `c to the petition were given on lease from time to time to different persons on rent. Sec. 98 reads as under:98 (1) Subject to the provisions of sub-sec. (2) no lease sale or other transfer of any immovable property vesting in or acquired by a panchayat shall be valid unless such lease sale or other transfer has been made with the previous sanction of the competent authority. (2) In the case of a lease of immovable property other than the property vesting in the panchayat under sec. (2) no lease sale or other transfer of any immovable property vesting in or acquired by a panchayat shall be valid unless such lease sale or other transfer has been made with the previous sanction of the competent authority. (2) In the case of a lease of immovable property other than the property vesting in the panchayat under sec. 96 no such previous sanction shall be necessary if the period of lease does not exceed three yearsthe expression competent authority has been defined in sec. 2 (5) to mean such Government Officer panchayat or authority as the State Government may by notification in the Official Gazette appoint to perform the functions of a competent authority under such provisions of the Act and in respect of such panchayat as may be specified in the notification. For the purpose of this definition a Government officer includes a Government Officer posted under a panchayat under secs. 122 142 or 207 of the Act. Sub-see. (1) of see. 98 is made subject to the provisions of sub-sec. (2) which would mean that if the case falls within sub-see. (2) of sec. 98 it would be governed by that provision which is in the nature of an exception. Sub-see. (1) imposes an embargo no lease of any property vesting in a Panchayat shall be valid unless such lease has been made with the previous sanction of the competent authority. If a lease in respect of any immovable property vesting in the panchayat is effected without the previous sanction of the competent authority such a lease would be clearly in contravention of sub-see. (1) of see. 98 of the Act. However since that sub-section is subject to the provisions of sub-see. (2) it may be advantageous to appreciate the exception created by that sub-section. That sub-section states that in the ease of a lease of immovable property other than the properly vesting in the panchayat under sec. 96 no previous sanction as contemplated by sub-sec. (1) shall be necessary if the period of lease does not exceed three years. In order to take advantage of the exception created by this sub-section it must be shown that the property leased is not one which came to be vested in the panchayat under sec. 96 of the Act. See. 96 no previous sanction as contemplated by sub-sec. (1) shall be necessary if the period of lease does not exceed three years. In order to take advantage of the exception created by this sub-section it must be shown that the property leased is not one which came to be vested in the panchayat under sec. 96 of the Act. See. 96 deals with the vesting of State-Government property in the gram or nagar Panchayat and therefore on a proper construction of sub-see. (2) of sec. 98 it must be held that that sub-section would not apply to property vested in the panchayat under sec 96 of the Act. Any other property can be given on lease without the previous sanction of the competent authority provided the period of lease does not exceed three years. In the instant case the contention of the petitioner in paragraph 6. 1 of the petition is that the parcels of land which came to be leased to different individuals and institutions as detailed in Annexure C to the petition had vested in the panchayat under sec. 96 of the Act. This averment which is in unmistakable language has not been controverted by any of the respondents. As stated earlier none of the respondents has filed a counter-affidavit challenging all or any of the averments of fact made in the petition. It would therefore appear on a true interpretation of sec. 98 (2) of the Act that if the property leased is one which had vested ill the panchayat under sec. 96 such a property cannot be leased without the previous sanction of the competent authority regardless of the duration of the lease. ( 5 ) THE order passed by the Development Commissioner on 25/07/1976 shows that one of the matters to be considered was the leasing out of the lands without the previous sanction of the competent authority in contravention of sec. 98 of the Act. Four specific matters were inquired into and we are concerned with item No. 4 which refers to lands having been leased on as many as 155 occasions to different parties without the previous sanction of the competent authority. It is further mentioned therein that on many of the plots so leased superstructures of a permanent nature have come up. While dealing with the allegations that the lands had been leased contrary to the requirements of sec. It is further mentioned therein that on many of the plots so leased superstructures of a permanent nature have come up. While dealing with the allegations that the lands had been leased contrary to the requirements of sec. 98 of the Act the Development Commissioner in paragraph 4 of the order states that since the duration of lease in no case exceeded three years the previous sanction of the competent authority was not required in view of sec. 98 2) of the Act. This in my opinion is an erroneous reading of sec. 98 (2) of the Act. The benefit of the exception carved out by sec. 98 (2) of the Act would not be available in respect of lands vested in the panchayat by virtue of sec. 96 of the Act. If the initial lease is in contravention of sec. 98 (1) of the Act and if the case is not covered by the exception in sub-sec. (2) thereof the subsequent renewals of the lease would also meet the same fate. I am therefore of the view that the Development Commissioner dropped the proceedings then proposed under sec. 297 of the Act on an erroneous reading of sec. 98 of the Act. However since the question of removal of respondent No. 4 does not now survive in view of the fact that he is no more holding office Mr. Raval stated that appropriate action ought to be taken under sec. 317 of the Act. His grievance is that notwithstanding several representations made by the petitioner the alleged act of leasing out land which came to be vested in the panchayat under sec. 96 to different persons mentioned in Annexure C to the petition is not inquired into as provided by sec 317 (2) of the Act. Under sub-sec. (2) of sec. 317 `an officer authorised by the Government has to inquire into allegations made against the panchayat member in the present case respondent No. 4. ( 6 ) IN view of the above the petition succeeds in that the State Government shall direct an Officer authorised by it to exercise power under sec. 317 (2) of the Act and take action against respondent No. 4 after a proper inquiry into the allegations that on account of the lease of different parcels of land belonging to the panchayat in contravention of sec. 317 (2) of the Act and take action against respondent No. 4 after a proper inquiry into the allegations that on account of the lease of different parcels of land belonging to the panchayat in contravention of sec. 98 (1) of the Act there has been loss waste or misapplication of money or other property of the panchayat to which respondent No. 4 was a party or which had been caused or facilitated by his misconduct or gross negligence in performance of his duty as a member of the panchayat. The rule is made absolute accordingly with no order as to costs. C. A. not pressed. No order. Petition allowed: Rule made absolute. .