Allahabad High Court Asks UP Govt To Fix Conflict In Limitation Period For Recovering Panchayat Fund Losses From Pradhan

The Allahabad High Court has held that the period within which surcharge can be imposed on a Gram Pradhan for loss, waste or misapplication of Gram Panchayat money or property is governed by the proviso to Section 27 of the U.P. Panchayat Raj Act, 1947, and not by the shorter period prescribed in the third proviso to Rule 257(2) of the U.P. Panchayat Raj Rules 1947. It held that the Rule is in conflict with the Act.Under the proviso to Section 27 of the U.P. Panchayat Raj Act, 1947, liability to surcharge ceases after ten years from the occurrence of the loss, waste or misapplication, or five years from the date the person liable ceases to hold office, whichever is later.The third proviso to Rule 257(2) of the U.P. Panchayat Raj Rules 1947 fixes shorter periods. Under it, no Pradhan, Up-Pradhan, Member, Officer or servant is liable for any loss, waste or misuse after four years from its occurrence or after three years from the date of ceasing to hold the post, whichever is later.The bench of Justice Rajan Roy and Justice Manjive Shukla held,“the law is settled that a Rule cannot supplant, supersede or be in conflict with the Act under which it has been framed. Apparently, the 3rd proviso to Rule 257 or the U.P. Panchayat Raj Rules 1947 is in conflict with the proviso to Section 27, which is the substantive provision governing the subject.”Appellant, a Gram Pradhan, filed a special appeal under Chapter VIII Rule 5 of the Allahabad High Court Rules 1952 against an interim order dated 17th June 2026 passed on his writ petition. By that order, while recovery of Rs. 4,38,104 under the surcharge order was stayed till the next date of listing, he was directed to deposit Rs. 2 lakhs within 15 days.It was argued for the appellant that he had demitted office in March 2026 and that in view of Rule 256 read with Rule 257 of the U.P. Panchayat Raj Rules 1947, surcharge could not be imposed after three years from demitting office. The Court observed that surcharge is provided for by Section 27 of the U.P. Panchayat Raj Act, 1947, which is the substantive provision on the subject, and that the proviso to it prescribes longer periods than the Rule. It held that the decision relied upon by the appellant did not involve the issue before it, and noted that the proviso to Section 27 was not noticed by the single judge while passing the impugned order.Directing the Additional Chief Standing Counsel to communicate the judgment to the A.C.S./Principal Secretary, Panchayat Raj, since the Rules cannot conflict with the substantive provision in the Act, the Court observed,“The State Government should look into the matter and remove this discrepancy as this may lead to unnecessary litigation.”Accordingly, finding no merit in the submission of the appellant, the Court dismissed the appeal.Case Title: Harikesh Verma v. State Of U.P. Thru. Prin. Secy. Panchayati Raj Deptt. Lko. And 5 OthersClick Here To Read/Download Order

Allahabad High Court Asks UP Govt To Fix Conflict In Limitation Period For Recovering Panchayat Fund Losses From Pradhan

Upasna Agrawal

This is a premium content
Available exclusively to
Our subscribers

INR 1099+GST

Tags

Upasna Agrawal

Allahabad High Court Asks UP Govt To Fix Conflict In Limitation Period For Recovering Panchayat Fund Losses From Pradhan

Upasna Agrawal

This is a premium content Available exclusively to Our subscribers

INR 1099+GST

Tags

Upasna Agrawal

This is a premium content
Available exclusively to
Our subscribers