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2007 DIGILAW 506 (ALL)

MADHUBALA BHARTI v. STATE OF UTTAR PRADESH

2007-03-02

R.P.MISRA, SHISHIR KUMAR

body2007
JUDGMENT By the Court.—The present writ petition has been filed for quashing the order dated 19.10.2001 (Annexure 1 to the writ petition) and a writ of mandamus directing the respondents not to recover the disputed amount on the basis of citation (Annexure 1 to the writ petition). 2. The facts arising out of the present writ petition is that the petitioner was elected as a President of Nagar Panchayat Roza, District Shahjahanpur, which is known as Railway Settlement Nagar Panchayat Roza District Shahjahanpur. The petitioner took oath on 1.12.1995 and remained president of Nagar Panchayat Roza till November, 2000 and during his tenure as President the petitioner was authorised to appoint employees in Nagar Panchayat under the provision of United Provinces Municipalities Act, 1916, under Section 70 of the Act which provides that in case of emergency, the petitioner can appoint temporary servants subject to the conditions given in Section 70 of the U.P. Municipalities Act. The State Government issued an order dated 21.11.1991 through which it was provided that services of retired employees in local bodies should not be extended and they also should not be re-appointed on the basis of contract. Another Government Order was issued on 26.6.1992 by the State Government in connection with the appointment on regular vacancies arising in local bodies and through the said order it was provided that employees from outside can be appointed only when there is no daily wages in the local body. 3. It is expedient to mention that one person Sri Kant Sharma applied for service in the Nagar Panchayat Roza and his application was forwarded by the Executive Officer, Nagar Panchyat Roza, District Shahjahanpur upon which the petitioner appointed Sri Kant Sharma on consolidated salary of Rs.1,200/- per month with effect from 28.2.1996. One Munish Kumar Saxena, was working as clerk in the Nagar Panchyat Roza and he was sent as Sahayak Pariyojna Adhikari Zila Nagriya Vikas Adhikari Shahjanpur with effect from 14.5.1996 and from that date he was not drawing the salary from Nagar Panchayat Roza as he was not discharging the work as a clerk of Nagar Panchayat, Roza. It appears that some members of Nagar Panchayat Roza made a complaint regarding the financial indiscipline alleged to have been made by the petitioner. It appears that some members of Nagar Panchayat Roza made a complaint regarding the financial indiscipline alleged to have been made by the petitioner. On the basis of said complaint an enquiry was made by the Additional Commissioner Bareilly on 15.1.1997 and he did not object in his enquiry report regarding of appointment of Sri Kant Sharma. Only a query was made by the Commissioner from the Executive Officer regarding the daily wages class IV employees alone. Sri Munish Kumar Saxena remained on deputation in District Urban Development Agency up to 31.3.2000. Sri Kant Sharma moved an application on 1.5.1997 for being appointed on the post of clerk on regular basis in the pay scale of Rs. 950-1500. An affidavit to that extent was also given that Munish Kumar Saxena has gone on deputation, as such, in the aforesaid vacancy he may be appointed as clerk and in case of any objection by any authority he will refund the amount of salary which has been received by him through Nagar Panchayat. Then the Executive Officer, Nagar Panchayat, Roza forwarded the application with recommendation that Sri Srikant Sharma has worked satisfactorily and the post is already sanctioned so the services of Sri Kant Sharma can be regularised in the pay of Rs. 950-1500. On the basis of the recommendation of Executive Officer, the petitioner appointed Sri Kant Sharma by exercising powers under Section 70 of the U.P. Municipalities Act. A copy of the recommendation as well as the application has been filed as Annexure 9 to the writ petition. On the basis of the aforesaid recommendations an order was passed for appointment of Sri Kant Sharma purely as a temporary employee with an indication that his services may be discontinued at any point of time and a copy of the said order was also forwarded to Collector, Shahjahanpur and no objection to that effect was raised. As no objection was raised till July, 2000, when the Collector Shahjahanpur sent a letter dated 29.7.2000 to the petitioner that why the services of Sri Kant Sharma were not discontinued prior to completion of 240 days and how he has been appointed. An explanation to that effect was also called. The aforesaid letter was issued by the District Magistrate on the behest of one Rakesh Kumar Vishwakarma who was political rivalry with the petitioner. An explanation to that effect was also called. The aforesaid letter was issued by the District Magistrate on the behest of one Rakesh Kumar Vishwakarma who was political rivalry with the petitioner. Subsequently, an order was issued by the Collector by name to the petitioner and explanation to that effect was called from the petitioner regarding the aforesaid appointment. Immediately, after the aforesaid letter dated 15.9.2000 the petitioner passed an order that appointment of Sri Kant Sharma was continued only as employee on contract basis on consolidated salary. The petitioner also submitted an explanation to the Collector Shahjahanpur on 26.9.2000 and explained each and every thing regarding appointment of Sri Kant Sharma. It was specifically been stated in the said explanation that the said appointment was made on the basis of recommendation of the then Executive Officer and no explanation has been called from the Executive Officer. After the aforesaid statement of the explanation of the petitioner, the petitioner has got no information regarding enquiry and the petitioner completed his tenure in the month of November, 2000. Subsequently, the petitioner came to know that the appointment of Sri Kant Sharma has been held illegal by the State Government and letter was issued on 10.4.2001 by the President, Nagar Panchayat Roza cancelling the appointment of Sri Kant Sharma under the provisions of Section 74 of the Municipalities Act. The petitioner was never informed even after the cancellation of appointment of Sri Kant Sharma, a recovery certificate was sent by the Collector Shahjahanpur through S.D.M. Sadar to the respondent No. 2 for making recovery of Rs. 2,08,667.19p from the petitioner, on the basis of recovery, the respondent No. 2 has issued citation on 4.10.2001 and asked the petitioner to deposit the aforesaid amount up to 19.10.2001. Petitioner after coming to know about the aforesaid fact submitted an application to the District Magistrate on 10.10.2001 and asked for a copy of the recovery order through which recovery is being made and other relevant papers to verify the fact as on what basis the liability has been fixed upon the petitioner but no document has been supplied to the petitioner. 4. 4. It has been submitted on behalf of the petitioner that before issuance of the recovery certificate no opportunity was given to the petitioner even the order passed for recovery of the alleged amount of salary paid to Sri Kant Sharma from the petitioner, has not been served upon the petitioner. The appointment of Sri Kant Sharma was made as a temporary employee only on the basis of the recommendation of the Executive Officer. It is also relevant to mention here that Sri Munish Kumar Saxena worked on deputation from 14.5.1996 till 31.3.2000 and during this period Sri Kant Sharma has worked on the post of clerk and in lieu of his working he has been paid salary up to 31.3.2000. It has further been submitted that recovery of the amount of salary paid to an employee which is being recovered from the petitioner is against the principles of natural justice, as he was initially appointed on contract basis and subsequently he was given a temporary appointment on the post of clerk. The Executive Officer on whose recommendation appointment was made has already been suspended for the aforesaid reasons as the salary bill is always being prepared and forwarded by the Executive Officer, the President of Nagar Panchayat cannot be held to be responsible and liable for the salary paid to an employee. As the order passed by the respondents is wholly illegal and against the principles of natural justice, as such, the petitioner has approached this Court. 5. As the counter and rejoinder affidavits have already been exchanged, as such, with the consent of the parties the writ petition is being disposed of. 6. It has been submitted on behalf of the petitioner that the impugned order has been passed purporting to be in exercise of the powers by the State Government under Section 81 of U.P. Municipalities Act. The surcharge can be recovered under the U.P. Municipalities Board Surcharge Rules, 1948 and as per the said rules, the Examiner Local Funds Accounts has to give notice in the case of any loss, waste or misuse of any money. In the present case, no notice or show cause has been issued under the aforesaid rules, as such, notice issued by the Collector itself is without any authority of law. In the present case, no notice or show cause has been issued under the aforesaid rules, as such, notice issued by the Collector itself is without any authority of law. As per Rule 4, the President cannot be held liable where the loss has been caused by an act of the President in the bonafide discharge of his duties. In case there was an emergency of work and as such the appointment made under Section 70 cannot be termed to be malafide. The aforesaid appointment was in the bonafide discharge of the duties of the President for conducting work of Nagar Panchayat. As the procedure provided under the Rules have not been followed, as such, it is a case of clear breach of opportunity and against the principles of natural justice. Even no enquiry has been conducted as per the Rules. 7. The petitioner has placed reliance upon a judgement of this Court in Algu v. District Magistrate, Azamgarh and others, 2002(3) ESC 420 (All)(DB). The reliance has been placed upon para 4 of the said judgement. The same is being reproduced below : “Section 81 of the U.P. Municipalities Act clearly provides that a President of the Municipal Board shall be liable to surcharge for the loss, wastage and misapplication of any money or property of the Municipality if such loss, wastage or misapplication is a direct consequence of his neglect or misconduct while acting as such President, therefore, in view of this provision any loss or wastage or misapplication of money or property of the Municipality, if it has been caused as a direct consequence of neglect or misconduct of the President, can be recovered from him. The procedure for recovery of amount has been provided in U.P. Municipal Board Surcharge Rules, 1948. Rule 3 of the Rules provides that in any case where the Examiner, Local Funds Accounts, U.P. considers that there has been a loss, wastage of misuse of any money or other property belonging to the Board as a direct consequence of the misconduct or negligence of the President, he may call upon the President to explain in writing why such President should not be surcharged with the amount misused or which represents the loss or wastage caused to the Board or to its property. Rule 4 provides that the Examiner shall submit all the papers to the Government which shall consider the matter and pass order of surcharge against the President. Rule 6 provides that the President who has been surcharged shall pay the amount for while he has been surcharged within three months from the date of communication by the Government or the Examiner as the case may be. The facts of the present case show that the petitioner did not personally submit any explanation but an explanation was submitted by the then president of the Nagar Panchayat. The Explanation has not been examined and considered by the State Government and straightway the Collector has issued the recovery certificate. The procedure followed in issuance of recovery certificate against the petitioner is not in accordance with the Rules. It is averred in Paragraph 4 of the writ petition that the Explanation submitted by the current President of the Nagar Panchayat may be treated to be that on behalf of the petitioner. Learned Counsel for the petitioner has also made a statement that the Explanation of the current President may be treated to have been filed by the petitioner himself. We are, therefore, of the opinion that the explanation given by the current President should be considered by the State Government in accordance with the Rules and thereafter a final order should be passed.” 8. The order passed by the respondents, as the reply filed by the petitioner has not at all being considered, as such, the order passed by the respondents are totally against the principles of natural justice. Applying Section 81, it was necessary to consider that whether any loss, waste or misapplication of any money has been done by the President. In the present case, the clerk was appointed as per Section 70 of the Municipalities Act and he has worked for the benefit of Nagar Panchayat and the salary has been paid only to one person, as such, it cannot be said that there is any loss as stated by the respondents. The further submission has been made by the learned Counsel for the petitioner that under Section 70 of the Municipalities Act, the President is entitled to appoint persons on temporary basis in the emergency according to G.O. dated 21.11.1991. The temporary appointment does not prohibit in view of the aforesaid Government Order. 9. The further submission has been made by the learned Counsel for the petitioner that under Section 70 of the Municipalities Act, the President is entitled to appoint persons on temporary basis in the emergency according to G.O. dated 21.11.1991. The temporary appointment does not prohibit in view of the aforesaid Government Order. 9. The further submission made that the amount which is being recovered from the petitioner cannot be recovered as arrears of land revenue. Rule 6(2) of U.P. Municipal Board Surcharge Rules, 1948 provide that the amount of surcharge can be recovered as per the provisions of Chapter VI of the Municipalities Act, 1916. Chapter VI of Municipalities Act is having Section 166 to 177. Section 173A provides for recovery of taxes as arrears of land revenue. The surcharge does not come under the purview of Section 173-A and in view of the above as per the rules amount can be recovered by any other mode provided under the said chapter. The reliance has been placed upon a judgement of this Court reported in (2003) 2 UPLBEC 1283 , Teeto Singh v. District Magistrate, Mathura and others. It has been held in the said judgement that amount which has not been mentioned under Section 173-A cannot be recovered by the aid of that section. The further reliance has been placed by the learned Counsel for the petitioner in Girja Dayal Srivastava v. State of U.P., 1987 UPLBEC 1121. In which it has been provided that under the Public Accounts Default Act, 1950, the amount cannot be recovered as arrears of land revenue. The petitioner immediately after making appointment on the basis of the recommendation made by the executive officer has informed the said fact to the Collector on 30.5.1997. The transfer of Munish Kumar Saxena and withdrawal of his salary from DUDA is also clear in view of the averments made in the writ petition and the documents in support thereof. As the information of appointment itself was given to the Collector and salary bills were prepared by the executive officer and at no point of time the Collector has ever informed the petitioner that the appointment made by the petitioner is against the rules. As the information of appointment itself was given to the Collector and salary bills were prepared by the executive officer and at no point of time the Collector has ever informed the petitioner that the appointment made by the petitioner is against the rules. In case any information to that effect would have been given to the petitioner, the petitioner would have taken appropriate action which clearly proves the bonafide of the petitioner and at this stage it cannot be said that the action of the petitioner was not bonafide. Further it has been submitted that in view of 3rd proviso of the Surcharge Rules, 1948, of Rule 4, the government cannot start any new enquiry due to the passing of the period of limitation. 10. In the case of the petitioner no procedure of the surcharge rules has been followed nor any enquiry has been conducted by the State Government nor any notice has been issued by the Examiner Local Funds Accounts U.P. neither the reply submitted by the petitioner was ever considered before passing the impugned order. In such circumstances, the petitioner submits that the impugned order is liable to be quashed. 11. A counter affidavit has been filed on behalf of the respondents. It has been stated in the counter affidavit that though Sri Munish Kumar Saxena was sent on deputation on 14.5.1996 from Nagar Panchayat Roza but the amount of insurance and provident fund were being deposited before the Nagar Panchayat Roza. As the appointment of Sri Kant Sharma was not in accordance with law and the government has beard a loss of the amount which has been paid to Sri Sri Kant Sharma, as such, the petitioner is liable to pay the said amount. 12. We have heard learned Counsel for the petitioner as well as the learned Standing Counsel and have perused the record. 13. From the record it is clear that the power has been conferred upon the President to make an appointment on the basis of government order issued from time to time in case there is a necessity. 12. We have heard learned Counsel for the petitioner as well as the learned Standing Counsel and have perused the record. 13. From the record it is clear that the power has been conferred upon the President to make an appointment on the basis of government order issued from time to time in case there is a necessity. Admittedly, one of the permanent employee who was working as a clerk has been sent on deputation to other place and Sri Kant Sharma who was working on consolidated basis and on the basis of the aforesaid vacancy he was appointed on temporary basis on the post of clerk and in lieu thereof he was being paid salary. The respondents have failed to prove from the record that the salary was being paid on the aforesaid post to the two persons that is Sri Kant Sharma as well as Sri Munish Kumar Saxena who were sent on deputation in the District Urban Development Agency. It is also clear from the record that services of Sri Kant Sharma was terminated immediately when Sri Munish Kumar Saxena joined the post. 14. The document annexed with the writ petition has not been denied by the respondents. It is clear that on the basis of recommendation made by the Executive Officer, Sri Kant Sharma was appointed by the petitioner and information to that effect was given to the District Magistrate, has not raised any objection to that effect, as such, now at a belated stage, whether the respondents can take a plea that the appointment was made in contravention of the provision and the salary which has been paid to the employee is liable for recovery from the petitioner. 15. According to U.P. Municipalities Board Surcharge Rules, 1948, it is a procedure for the purposes of recovery of Surcharge. Rule 4 provides the procedure after explanation or when no explanation is furnished, the proviso to that effect is also there that in case there is a satisfaction that the loss was caused by an act of the President, member or servant in the bonafide discharge of his duty then no recovery can be made. Admittedly, after furnishing the reply, the petitioner has not been afforded any opportunity. Admittedly, after furnishing the reply, the petitioner has not been afforded any opportunity. Under the Municipalities Act, the power of appointment in case of emergency of working the president can make appointment under Section 70, as such, it cannot be turn to be malafide unless and until it is proved that the appointments have been made only for the benefit of the petitioner. From the record it is also clear that no notice under Surcharge Rule 1948 has ever been given to the petitioner and the petitioner has not been given any opportunity, as such, the orders of recovery passed against the petitioner is breach of principles of natural justice. In our opinion, Section 81 of the Act is not applicable in the present case unless and until a liability to that effect is fixed upon the petitioner for any loss waste or mis-collection of any money done by the petitioner. It is also clear from Section 70 of the Municipalities Act that the President is entitled to appoint persons on temporary basis in case of emergency in view of Government Order dated 21.11.1991. The Division Bench of this Court in Algu v. District Magistrate (supra) clearly held that the aforesaid amount can be recovered as arrears of land revenue as the procedure for recovery of amount has been provided in U.P. Municipal Board Surcharge Rules, 1948. Rule 3 of Rules provides that in any case where the Examiner Local Funds Accounts, U.P. considers that there has been a loss, waste or misuse of any money or other property belonging to the Board as a direct consequence of the misconduct or negligence of the President he may call upon the President to explain in writing why he should not be surcharged with the amount misused or which represents the loss or wastage caused to the Board or to its property. Rule 4 provides that examiner shall submit all the papers to the government who will consider the matter and passed orders of surcharge against the President. 16. The fact of the present case shows that only on the basis of a show cause notice and after the petitioner submitted an explanation but the explanation has not been examined and considered by the State Government and the Collector has straight way issued the recovery certificate. 16. The fact of the present case shows that only on the basis of a show cause notice and after the petitioner submitted an explanation but the explanation has not been examined and considered by the State Government and the Collector has straight way issued the recovery certificate. The procedure followed in issuance of recovery certificate against the petitioner is not in accordance with the rules. It has been averred in the writ petition that explanation submitted by the petitioner has not been considered. This fact has not been denied by the respondents. 17. The another factor which is to be considered by this Court that whether the recovery of loss caused by a public servant to the government can be recovered as arrears of land revenue. In case of Girja Dayal Srivastava (supra) the Division Bench of this Court has clearly held that process of recovery arrears of land revenue is an exception to the oral process. The right of recovery as arrears of land revenue must be shown to be permitted by statutory provision including the statutory rules in respect of government servant. In respect of the government servant, loss caused to the government may be recovered from the salary under Section 40 of the Civil Services (Classification, Control and Appeal) Rules, 1930 as applicable in U.P. But under Public Account Default Act, 1850 it cannot be recovered as arrears of land revenue. In case of Titoo Singh v. District Magistrate (supra) the provision of Sections 173-A and 21 was being considered and the Division Bench of this Court has held that it cannot be recovered as arrears of land revenue. It can adopt other modes of recovery. 18. In view of the aforesaid fact, we are satisfied that the recovery cannot be made against the petitioner unless and until a liability to that effect of the loss of government amount is fixed upon the petitioner. 19. The writ petition is allowed and the orders passed by the respondents dated 1st September, 2001 (Annexure 2 to supplementary affidavit) and consequential order of recovery (Annexure 1 to the writ petition) issued by respondent No. 2 are hereby quashed. 20. No order as to costs. ————