(1)

RESERVED

Case :- SPECIAL APPEAL No. - 65 of 2017

Appellant :- Shamim

Respondent :- State Of U.P. Thru Secy. And 5 Others

Counsel for Appellant :- Manish Kumar Nigam,Sanjai

Kumar Pandey

Counsel for Respondent :- C.S.C.,Satya Priya Upadhyay

Hon'ble Krishna Murari,J.

Hon'ble Suneet Kumar,J.

Hon'ble Ashok Kumar,J.

(Per Suneet Kumar, J)

A Division Bench of this Court in (Shamim vs. State

of U.P. through Secretary

1

) finding itself unable to

accept the law laid down by the co-ordinate Bench in

Smt. Sonia Versus State of U.P.

2

, referred for

“authoritative pronouncement by a larger Bench”, the

following questions for determination:-

“(i) As to whether the District Magistrate at

the point of time when he proceeds to cease

the administrative and financial authority of

the Pradhan, he acts as a Tribunal or acts as

an administrative authority.

(ii) The view as expressed in the case of

Smt. Sonia (supra) that under the scheme

of things provided for under the U.P.

Panchayat Raj Act, 1947, the District

Magistrate exercising delegated authority of

State Government acts as Tribunal is a

correct view or District Magistrate exercises

administrative authority, while exercising

authority under Section 95(1)(g) of U.P.

Panchayat Raj Act, 1947.”

1Special Appeal No. 65/2017 dated 31.01.2017

2. 2013(5) ADJ 559

(2)

Since the decision rendered by the Division Bench in

Sonia has been doubted, the reference comes before this

Bench of three Judges.

The issue which falls for determination turns upon

the provision of Section 95 of U.P. Panchayat Raj Act,

1947

3

. Clause (g) of sub-section (1) of Section 95 deals

with removal of Pradhan of a Gram Panchayat and is in

the following terms:-

95. Inspection – (1) The State Government

may –

(a) …............

(b)..............

(c)..............

(d)..............

(e)..............

(f)..............

(g) Remove a Pradhan, Up-Pradhan or

member of a Gram Panchayat or a Joint

Committee or Bhumi Prabandhak Samiti, or

a Panch, Sahayak Sarpanch or Sarpanch of a

Nyaya Panchayat if he –

(i) absents himself without sufficient cause for

more than three consecutive meetings or sittings,

(ii) refuses to act or becomes incapable of acting

for any reason whatsoever or if he is accused of

or charged for an offence involving moral

turpitude,

(iii) has abused his position as such or has

persistently failed to perform the duties imposed

by this Act or rules made thereunder or his

continuance as such is not desirable in public

interest, or

[(iii-a) has taken the benefit of reservation under

sub-section (2) of Section 11-A or sub-section (5)

or Section 12, as the case may be, on the basis of

a false declaration subscribed by him stating that

3. Panchayat Raj Act

(3)

he is a member of Scheduled Castes, the

Scheduled Tribes or the backward classes, as the

case may be.]

(iv) being a Sahayak Sarpanch or a Sarpanch of

the Nyaya Panchayat takes active part in politics,

or

(vi) suffers from any of the disqualifications

mentioned in Clauses (a) to (m) of Section 5-A:

Provided that where, in an enquiry held by

such person and in such manner as may be

prescribed, a Pradhan is prima facie found to

have committed financial and other

irregularities such Pradhan shall cease to

exercise and perform the financial and

administrative powers and functions, which

shall, until he is exonerated of the charges

in the final enquiry, be exercised and

performed by a Committee consisting of

three members of Gram Panchayat

appointed by the State Government.

Provided that –

(i) no action shall be taken under Clause (f),

Clause (g) except after giving to the body or

person concerned a reasonable opportunity of

showing cause against the action proposed;

(ii).....

(2) A person under sub-clause (iii) and (iv) of

clause (g) of sub-section (1) of this section shall

not be entitled to be re-elected or re-appointed to

any office under this Act for a period of five years

or such lesser period as the State Government

may order in any case.

(3) No order made by the State Government

under this section shall be called in question

in any Court.

(4) Where any [Gram Panchayat]

4

, Joint

Committee or Bhumi Prabandhak Samiti is

[dissolved]

5

the State Government may appoint

such person or persons to exercise and perform

the powers and duties thereof as it may deem fit.

4. Subs. By U.P. Act No. 9 of 1994

5. Subs. By U.P. Act No. 9 of 1994

(4)

Section 95 of the Panchayat Raj Act is in Chapter VII.

It is titled as 'External Control'. Section 95 is titled

'Inspection'. Section 95(1) (g) of the Panchayat Raj Act

provides for removal of a Pradhan.

The main enactment is Section 95(1)(g), it provides

for removal and not cessation of financial and

administrative power, which is provided in its proviso. Two

provisos qualify the main provision namely removal

proceedings and not each other.

These two proviso operate in different fields:

(i). proviso to Section 95(1) provides reasonable

opportunity in the removal proceedings ;

(ii). proviso to Section 95(1) (g) provides cessation of

financial and administrative powers during removal

proceeding.

The proviso to section 95(1) provides for reasonable

opportunity in proceedings for removal of a Pradhan under

Section 95(1) (g). But it does not apply to the proviso to

Section 95(1) (g) providing preliminary or fact finding

enquiry: the purpose of this enquiry is to find out if there

is any prima facie case against the Pradhan or not.

Section 95(1) (g) read with its proviso envisages two

enquiries:

A preliminary or fact finding enquiry: (i) On the basis

of this enquiry, financial and administrative powers of a

Pradhan can be ceased and a committee to perform these

functions can be appointed. This takes place under Rule 4

of the U.P. Panchayat Raj (Removal of Pradhan, Up-

(5)

Pradhan and Members) Enquiry Rules, 1997

6

, read with

proviso to Section 95(1) (g) of the Act; (ii) The final

enquiry is done to remove a Pradhan which takes place

under Rule 6 of the Enquiry Rules, 1997 read with Section

95(1) (g) Clauses (i) to (v), as well as, the proviso to

Section 95(1). The proviso to Section 95(1) (g) providing

cessation of financial and administrative powers does

contemplate a preliminary enquiry by a person and

procedure to be prescribed; the rules have to be framed

for the same. The State Government has framed the

Enquiry Rules, 1997. Rule 3 provides, how a complaint

may be filed against a Pradhan. Rule 4 provides for

conducting a preliminary enquiry. It is on the basis of this

preliminary enquiry that action can be taken under the

proviso to Section 95(1) (g). This is explained in Rule 5 of

the Enquiry Rules, 1997. Rule 3 of the Enquiry Rules is

titled 'Procedure relating to a complaint' and provides how

a complaint may be made. It provides two ways: (i) by a

private person that has to be supported by an affidavit

and has to comply other conditions of sub-rules (1) to (4)

of Rule 3; (ii) the other by a public servant, and in this

case the restrictions of the complaint by a private person

do not apply.

Rule 4 is titled as 'Preliminary enquiry'. The District

Magistrate can order a preliminary enquiry on the

complaint or report or otherwise. The enquiry under rule 4

is a preliminary enquiry or fact finding enquiry. It has to

be considered prima facie whether any financial or other

irregularities have been committed by the Pradhan or not.

The final enquiry is yet to be done. Rule 3(5) of the

6. Enquiry Rules, 1997

(6)

Enquiry Rules, 1997 provides that the complaint, which

does not comply with any of the preceding sub-rule of

Rule 3 should not be entertained.

In Hafiz Ataullah Ansari Vs State of U.P. and

others

7

, one of the question before the Full Bench was

with regard to providing an opportunity before ceasing

financial and administrative powers of a President during

his removal proceedings under the Uttar Pradesh

Municipalities Act, 1916. Though the words of the

Municipalities Act are different but the Full Bench was of

the view that the same reasoning applies in connection to

Pradhan of a Gram Panchayat:

“It is not necessary to involve a head of a local

body in the process of collecting material or in

the preliminary inquiry. However, it is necessary

to ask and consider his explanation, or point of

view or version regarding charges before issuing

notice under the relevant provisos under the

different enactments.

In view thereof, a Pradhan is neither entitled to be

associated with the preliminary enquiry nor is entitled to

get the copy of the preliminary enquiry report. His only

right is to have his explanation or point of view or version

to the charges considered before the order for ceasing

his financial and administrative powers is passed.

The Full Bench in Vivekanand Yadav Versus State

of U.P. and others

8

relying upon Hafiz Ataullah Ansari

held that it is not only necessary that the explanation or

7. 2011 (2 ) UPLBEC 889 : 2011(3) ADJ 502

8 2010(4) UPLBEC 3278 : 2011 (1) ALJ 694

(7)

point of view or the version of the affected Pradhan should

be obtained but should also be considered before being

prima facie satisfied of his being guilty of financial and

other irregularities and ceasing his powers. Of course the

consideration of the explanation does not have to be a

detailed one. There should be indication that mind has

been applied while forming the opinion by the District

Magistrate. This has also been explained in Hafiz

Ataullah Ansari.

In Vivekanand, it was clarified that the Enquiry

Rules, 1997 were meant to apply in these cases where it

was considered expedient to cease the financial and

administrative powers and also providing for formal final

enquiry for removal (Rule 6). Under proviso to section

95(1)(g) right to exercise financial and administrative

powers can only be ceased if the District Magistrate prima

facie finds that the Pradhan was guilty of financial or other

irregularities in an enquiry (preliminary enquiry or fact

finding enquiry) by such person in such manner

prescribed and not otherwise. It is only such report that

would come within the purview of the word “otherwise” in

Rule 5 of the rules. All kinds of reports or information may

not be relied under Rule 5 lest the rule may be hit by the

statutory provision.

Before we proceed further, it would be appropriate to

briefly note the historical background of the local bodies

and the legislative history of the Panchayat Raj Act.

Upon the Seventy-third and Seventy-fourth

Constitutional Amendments being brought into force,

accordingly, a new Part IX and Part IXA relating to

(8)

Panchayats and Municipalities was added in the

Constitution, which inter alia, provides for:

Devolution by the State Legislature of powers

and responsibilities upon the Panchayats with

respect to the preparation of plans for economic

development and social justice and for the

implementation of development schemes

(Article 243G) ;

Sound finance of the Panchayats by securing

authorisation from State Legislatures for

grants-in-aid to the Panchayats from the

Consolidated Fund of the State, as also

assignment to, or appropriation by, the

Panchayats of the revenues of designated

taxes, duties, tolls and fees (Article 243H) ;

Bringing existing laws in conformity with

provisions contained in Part IX of the

Constitution within one year. (Article 243N).

Article 243B in Part IX envisages three tier

system of panchayats ; one at village level, one

at district level, and one at intermediate level.

In our State, rural areas of a district are divided

into blocks that in turn consists of villages and

three levels of panchayats were already in

existence.

A gram panchayat is a local body governing a

village ; it could comprise more than one village

as well. It is governed by the Panchayat Raj

Act;

A kshettra panchayat governs a block

(intermediate level) and zila panchayat a

district. They are governed by U. P. Kshettra

Panchayat and Zila Panchayat Adhiniyam, 1961,

(the Kshettra-Zila Panchayat Act).

The provisions introduced by the Constitutional

Amendment Acts have conferred constitutional status on

(9)

municipalities and panchayats as institution of local

Government. Their role and position are defined by the

Constitution as are their powers, duties and

responsibilities. They are not mere administrative

agencies of the State but, as institutions of local self

governance, have been conferred with a degree of

autonomy to ensure that democracy finds expression at

the groosroots of Indian society. The Constitution seeks to

attain a decentralisation of democratic governance

through these institutions. (vide: Paras Jain)

In Vivekanand, Court noticed the historical

background of local bodies and the legislative history of

the Panchayat Raj Act, in particular, the changes brought

about by the legislature in Section 95:

“25. Initially, Section 95(1) (g) provided for

suspension as a punishment, but there was no

specific provision for suspension during

pendency of removal proceeding. It was claimed

that power to suspend during removal

proceeding is included in power to remove as it

was necessary for its execution. This was

negated by the courts. Section 95(1) (g) as it

stood at that time is given in Appendix-2 ;

whereas Appendix-1 is the index of other

appendices and includes abbreviations used in

the judgment.

26. Subsequently, Section 95(1) was amended

and Sub-section (gg) was inserted by U. P. Act

No. 3 of 1973 giving power to suspend during

pendency of removal proceedings. A proviso was

also inserted at the end of Section 95(1) . It

provides reasonable opportunity before taking

proceeding, apart from others, under Section

95(1) (g). It is referred to as the proviso to

Section 95(1) of the Panchayat Raj Act. The

relevant parts of U. P. Act No. 3 of 1973 and

Section 95(1) of the Panchayat Raj Act after this

(10)

amendment are given in Appendix-3 and 4.

27. Subsequently, Section 95(1) of the

Panchayat Raj Act was again amended by U. P.

Act No. 9 of 1994 to bring it in conformity with

the 73rd Constitutional Amendment Act. The

relevant parts of the U. P. Act No. 9 of 1994 and

Section 95(1) after amendment are given in

Appendix-5.

28. By the aforesaid amendment, Section 95(1)

(gg), providing for suspension, was deleted

however a proviso to Section 95(1) (g) was

inserted. It provides ceasing of financial and

administrative power of a pradhan during

removal proceeding on fulfillment of conditions

mentioned therein. This proviso is referred to as

proviso to Section 95(1) (g). The other proviso

mentioned earlier is referred as proviso to

Section 95(1) . The relevant part of Section

95(1) at the time of passing of the impugned

orders is given in Appendix-6.

29. The proviso to Section 95(1) (g)

contemplates an enquiry before ceasing financial

and administrative powers by such person and

procedure, as may be prescribed. The State

Government has framed the Enquiry Rules in

pursuance of the same. The relevant part of

these rules is given in Appendix-7.”

It is relevant to note that Section 95 confers power

upon the State Government to remove Pradhan or to

cease financial or administrative powers. However, Section

96A of the Panchayat Raj Act empowers the State

Government to delegate all or any of its powers under the

Panchayat Raj Act to any authority subordinate to it. The

power under Section 95(1) (g), as well as, under the

Enquiry Rules, 1997 has been delegated by the State. In

Section 95(1)(g), as well as, Enquiry Rules, 1997, use the

words “State Government” but its power has been

delegated to the “District Magistrate” vide notification

(11)

dated 30.04.1997.

Five Judge Bench in Paras Jain Versus State of

U.P. and others

9

, considering similar provision under

Section 48(2) of the Municipalities Act, approved the

reasoning in Hafiz Ataullah Ansari. On the applicability

of the principles of natural justice before the financial and

administrative powers of the President of a municipality

cease, such an order envisages civil consequences which

cannot be cured merely by a post-decisional hearing:

"In the case, where a head of a local body is

deprived to exercise financial and administrative

power, and ultimately the proceeding for

removal are dropped then in such an event his

loss can never be compensated. A post

decisional hearing cannot cure the

harm/damage done to him.

xxx

The principles of natural justice or the yardstick

of fairness would be met if the explanation of

the affected head of the local body or his point

of view or version is considered before recording

the satisfaction or finding of prima facie guilt

before issuing notice and passing order for

ceasing financial and administrative powers."

Hafiz Ataullah Ansari explained that such an

opportunity to submit an explanation need not be as

detailed as in a regular enquiry and all that is necessary is

to enable the elected head of the municipality to have his

point of view or version considered. The conclusions which

were arrived at by the Full Bench were as follows:

“133. Our conclusions are as follows:

(a) There can be proceeding for removal of

9. 2016 (1) ADJ 1

(12)

President under section 48(2) of the

Municipalities Act without ceasing his financial

and administrative power under its proviso;

(b)The following conditions must be satisfied

before cessation of financial and administrative

powers of a President of a Municipality can take

place:

(i) The explanation or point of view or the

version of the affected President should be

obtained regarding charges and should be

considered before recording satisfaction and

issuing notice/order under proviso to section

48(2) of the Municipalities Act;

(ii) The State Government should be objectively

satisfied on the basis of relevant material that:

The allegations do not appear to be groundless;

and The President is prima facie guilty of any of

the grounds under Section 48(2) of the

Municipalities Act.

(iii) The show-cause notice must contain the

charges against the President;

(iv) The show-cause notice should also indicate

the material on which the objective satisfaction

for reason to believe is based as well as the

evidence by which charges against the

President are to be proved. Though in most of

the cases they may be the same;”

Supreme Court in Ravi Yashwant Bhoir v.

Collector

10

, held that removal of a duly elected member

on proved misconduct is a quasi judicial proceeding:

"There can also be no quarrel with the settled

legal proposition that removal of a duly elected

member on the basis of proved misconduct is a

quasi-judicial proceeding in nature. (Vide:

Indian National Congress (I) v. Institute of

10. (2012) 4 SCC 407

(13)

Social Welfare

11

. This view stands further

fortified by the Constitution Bench judgments

of this Court in Bachhitar Singh v. State of

Punbaj

12

and Union of India v. H.C. Goel

13

.

Therefore, the principles of natural justice are

required to be given full play and strict

compliance should be ensured, even in the

absence of any provision providing for the

same. Principles of natural justice require a fair

opportunity of defence to such an elected office

bearer.”

An elected official is accountable to the electorate

and removal or cessation of administrative and financial

powers has serious repercussions since it takes away the

right of the electorate to be represented by a candidate

who is elected. Undoubtedly, the right to hold the post is

statutory and in that sense is not absolute but removal

can take place. Only after strictly adhering to the

provisions laid down by the legislature for removal or

ceasing administrative and financial power. The

requirement of observing the principles of natural justice

was hence held to be mandated before an order to that

effect is passed. Interpreting the expression "abuse of

powers" as a ground for removal, it was held in Ravi

Yashwant Bhoir that this would not mean the mere use

of power which may appear to be simply unreasonable or

inappropriate but implies a willful abuse or an intentional

wrong.

In Paras Jain the Five Judge Bench was of the view

that cessation of financial and administrative powers of an

11. (2002) 5 SCC 685

12. AIR 1963 SC 385

13. AIR 1964 SC 364

(14)

elected head of a municipality is replete with serious

consequences and has a direct impact upon the authority

of the elected head. It erodes authority and impacts upon

the ability of the President to effectively discharge the

functions of the office by preventing the discharge of

financial and administrative authority.

“The cessation of financial and administrative

powers of an elected head of a municipality is a

matter of significance and is replete with

serious consequences. The effect of the

financial and administrative powers, functions

and duties being ceased, has a direct impact

upon the authority of the elected head. It

erodes authority and impacts upon the ability

of the President to effectively discharge the

functions of the office by preventing the

discharge of financial and administrative

authority. Bereft of financial and

administrative powers, functions and

duties, the office of the President of a

municipality is reduced to a cipher. In fact,

the proviso envisages that upon the

powers being ceased, they shall be

exercised by the District Magistrate or an

officer nominated, not below the rank of a

Deputy Collector. This consequence is

serious enough to warrant the Court to

read a compliance with the principles of

natural justice into the provision so as to

ensure a fair procedure and safeguard

against an unfair recourse to its power by

the State Government....”

(emphasis supplied)

In the backdrop of the legislative history and the

status of an elected Pradhan, after the Constitutional

Amendment, the primary issue is whether the power

(15)

exercised by the State Government/District Magistrate

under the proviso to Section 95(1)(g) of Panchayat Raj

Act is a purely administrative or a quasi judicial. In other

words whether State Government/District Magistrate

while exercising power under the proviso to Section 95(1)

(g) is a Tribunal.

Full Bench in Committee of Management, Shri

Kashi Raj Mahavidyalaya, Aurai and another v.

Deputy Director of Education, Vth Region, Varanasi

and others

14

, explained why judgment of Courts or

Tribunal is excluded qua maintainability of Special Appeals

under Chapter VIII Rule 5 of the Allahabad High Court

Rules, 1952. The Court observed:

"The rationale behind exclusion of special

appeal in respect of a decree or order made by

a court is that once a decision has been

rendered by a competent court of jurisdiction,

one challenge in the High Court against such

decree or order should be enough, so far as the

High Court is concerned and finality should

attach to that decision even if the decision has

been rendered by a learned Single Judge of the

High Court. Since the tribunals also

discharge similar functions of deciding

disputes acting judicially, as is done by the

courts and they enjoy the same status as

the Courts do, as the tribunals have also

been entrusted with inherent judicial

powers of the State, there is no reason

why the same reason should not apply for

exclusion of special appeal in respect of

order of a tribunal. Therefore, a tribunal

within the meaning of rule 5 must be an

authority which is required to act judicially

and which has been entrusted with the

inherent judicial powers of the State."

(emphasis supplied)

141997 (29) ALR 417

(16)

Supreme Court in Jaswant Sugar Mills Ltd.,

Meerut Vs. Lakshmi Chand & others

15

and Mrs.

Sarojini Ramaswami Vs. Union of India & others

16

,

laid down as follows:

"It would appear that to determine the question

whether an authority is a tribunal, the nature of

the order passed by the authority and also the

characteristic of the body which is called upon

to adjudicate upon the matter in dispute are

material considerations. Even a judicial

authority may, in a given situation, act in

administrative or executive capacity. In that

situation the authority would not be a tribunal.

Likewise an administrative authority, even if

required to act judicially would not be a tribunal

if it is not invested with the inherent judicial

power of the State."

The term “judicial or quasi-judicial” has been given a

liberal interpretation so as to include orders by tribunal or

authorities other than the regular Courts of justice. The

dictionary meaning of the word quasi is “not exactly” and

it is just in between a judicial and administrative function.

In Durga Shankar Mehta vs. Thakur Raghuraj

Singh & others

17

, Supreme Court held:

“It is now well settled by the majority decision

of this Court in the case of Bharat Bank Ltd. v.

Employees of the Bharat Bank Ltd. (1) that the

expression "Tribunal" as used in article 136

does not mean the same thing as "Court" but

includes, within its ambit, all adjudicating

bodies, provided they are constituted by the

State and are invested with judicial as

distinguished from purely administrative or

executive functions.”

15AIR 1963 SC 677

16AIR 1992 SC 2219

17AIR 1954 SC 520

(17)

In Associated Cement Companies Ltd. v. P.N.

Sharma and another

18

, the Constitution Bench of the

Supreme Court held:

“Tribunals which fall within the purview of

Art.136(1) occupy a special position of their

own under the scheme of our Constitution.

Special matters and questions are entrusted to

them for their decision and in that sense, they

share with the courts one common

characteristic: both the courts and the tribunals

are" constituted by the State and are invested

with judicial as distinguished from purely

administrative or executive functions”. (vide

Durga Shankar Mehta v. Thakur Raghuraj

Singh, 1955-1SCR 267 at p. 272 : (AIR 1954

SC 520 at 522). They are both adjudicating

bodies and they deal with and finally

determine disputes between parties which

are entrusted to their jurisdiction. The

procedure followed by the courts is regularly

prescribed and in discharging their functions

and exercising their powers, the courts have to

conform to that procedure. The procedure

which the tribunals have to follow may not

always be so strictly prescribed, but the

approach adopted by both the courts and

the tribunals is substantially the same, and

there is no essential difference between

the functions that they discharge. As in the

case of courts, so in the case of tribunals, it is

the State's inherent judicial power which has

been transferred and by virtue of the said

power, it is the State's inherent judicial function

which they discharge. Judicial functions and

judicial powers are one of the essential

attributes of a sovereign State, and on

considerations of policy, the State transfers its

judicial functions and powers mainly to the

courts established by the Constitution; -but that

does not affect the competence of the State, by

appropriate measures, to transfer a part of its

judicial powers and functions to tribunals by

entrusting to them the task of adjudicating

18AIR 1965 SC 1595

(18)

upon special matters and disputes between

parties. It is really not possible or even

expedient to attempt to describe exhaustively

the features which are common to the tribunals

and the courts, and features which are distinct

and separate. The basic and the fundamental

feature which is common to both the courts and

the tribunals is that they discharge judicial

functions and exercise judicial powers which

inherently vest in a sovereign State.”

(emphasis supplied)

The Supreme Court relied upon an earlier decision in

Province of Bombay vs. Kusaldas S. Advani and

other

19

, approving the principle stated therein:

i. that if a statute empowers an authority not being a

Court in the ordinary sense, to decide disputes arising out

of a claim made by one party under the statute which

claim is opposed by another party and to determine the

respective rights of the contesting parties who are

opposed to each other there is a lis and prima facie in the

absence of anything in the statute to the contrary it is the

duty of the authority to act judicially and the decision of

the authority is a quasi judicial act;

ii. that if a statutory authority has power to do any

act, which will prejudicially affect the subject, then,

although there are not two parties apart from the

authority and the contest is between the authority

proposing to do the act and the subject opposing it, the

final determination of the authority will yet be a quasi

judicial act provided the authority is required by the

statute to act judicially.

The question before the Supreme Court was whether

19AIR 1950 SC 222

(19)

the State Government is a tribunal when it exercises its

authority under R. 6(5) or R. 6(6):

“No rules have been made prescribing

the procedure which the State Government

should follow in dealing with appeals

under these two sub-rules, and there is no

statutory provision conferring on the State

Government any specific powers which are

usually associated with the trial in courts

and which are intended to help the court in

reaching its decisions. …........ But as we

already stated, the consideration about the

presence of all or some of the trappings of

a court is really not decisive. The presence

of some of the trappings may assist the

determination of the question as to

whether the power exercised by the

authority which possesses the said

trappings, is the judicial power of the State

or not. The main and the basic test

however, is whether the adjudicating

power which a particular authority is

empowered to exercise, has been

conferred on it by a statute and can be

described as a part of the State's inherent

power exercised in discharging its judicial

function. Applying this test, there can be no

doubt that the power which the State

Government exercises under R. 6(5) and R.

6(6) is a part of the State's judicial power. It

has been conferred on the State Government by

a statutory Rule and it can be exercised in

respect of disputes between the management

and its Welfare Officers. There is, in that sense,

a lis; there is affirmation by one party and

denial by another, and the dispute necessarily

involves the rights and obligations of the parties

to it. The order which the State Government

ultimately passes is described as its decision

and it is made final and binding. Besides, it is

an order passed on appeal. Having regard to

these distinctive features of the power

conferred on the State Government by R. 6(5)

and R. 6(6), we feel no hesitation in holding

(20)

that it is a Tribunal within the meaning of Art.

136(1)”. (Refer: State of H.P. vs. Raja

Mahendra Pal and others

20

)

(emphasis supplied)

The matter again came up in Indian National

Congress (I) vs. Institute of Social Welfare and

others

21

; the question before the Supreme Court was

whether Election Commission in exercise of its power

under Section 29-A of Representation of People Act, 1951

for allotment of symbol acts administratively or quasi-

judicially. The Court laid down the principles when an act

of a statutory authority would be quasi-judicial:

“24. The legal principles laying down when an

act of a statutory authority would be a quasi-

judicial act, which emerge from the aforestated

decisions are these :

Where (a) a statutory authority

empowered under a statute to do any act (b)

which would prejudicially affect the subject (c)

although there is no lis or two contending

parties and the contest is between the authority

and the subject and (d) the statutory authority

is required to act judicially under the statute,

the decision of the said authority is quasi-

judicial.

25. Applying the aforesaid principle, we are of

the view that the presence of a lis or contest

between the contending parties before a

statutory authority, in the absence of any other

attributes of a quasi-judicial authority is

sufficient to hold that such a statutory authority

is quasi judicial authority. However, in the

absence of a lis before a statutory authority, the

authority would be quasi-judicial authority if it

is required to act judicially.”

Finally, the Court held as follows:

20(1999) 4 SCC 43

21(2002) 5 SCC 685

(21)

“We do not find any merit in the submission. At

the outset, it must be borne in mind that

another test which distinguishes administrative

function from quasi-judicial function is, the

authority who acts quasi-judicially is required to

act according to the rules, whereas the

authority which acts administratively is dictated

by the policy and expediency. In the present

case, the Election Commission is not required to

register a political party in accordance with any

policy or expediency but strictly in accordance

with the statutory provisions......”

The Court held that Election Commission under

Section 29A is required to act judicially by giving a

decision after making enquiry, wherein, an opportunity of

hearing is to be given to the representative of the political

party. In view thereof, Commission is a quasi-judicial

authority and the decision rendered by it is a quasi-

judicial order:

“The Election Commission while exercising its

power to register a political party under Section

29A of the Act, acts quasi-judicially and decision

rendered by it is a quasi-judicial order and once

a political party is registered, no power of

review having conferred on the Election

Commission, it has no power to review the

order registering a political party for having

violated the provisions of the Constitution or for

having committed breach of undertaking given

to the Election Commission at the time of

registration.

The provisions of Section 21 of the General

Clauses Act cannot be extended to the quasi-

judicial authority. Since the Election

Commission while exercising its power under

Section 29A of the Act acts quasi-judicially, the

provisions of Section 21 of the General Clauses

Act has no application.”

Having due regard to the statement of law as to

(22)

when an authority is said to be acting quasi-judicially or

administratively, the provision contained in proviso to

Section 95(1)(g) is to be examined.

The proviso to Section 95(1)(g) clearly provides that

an inquiry (preliminary inquiry) to a complaint is to be

held by such person and in such manner as may be

prescribed. The inquiry is prescribed under the Enquiry

Rules, 1997 (rule 4) and on the report if in the opinion of

the State Government/District Magistrate, it is, prima

facie, found that Pradhan has committed financial and

other irregularities then such Pradhan shall cease to

exercise and perform financial and administrative

functions until he is exonerated from the charges in final

enquiry. Sub-section (3) of Section 95 in clear terms

provides that an order passed by the State Government

under this section shall not be called in question in any

Court.

On conjoint reading of Rule 3, 4 and 5 of Enquiry

Rules, 1997 mandates that the State Government/District

Magistrate on receiving the complaint in terms of Rule 3

would order the Enquiry Officer to conduct a preliminary

enquiry “with a view to finding out if there is prima facie

case” for formal enquiry. The State Government/District

Magistrate is required to form an opinion on the basis of

the report that the formal enquiry should be held against

the Pradhan. While determining whether prima facie case

has been made out relevant consideration is whether on

evidence led it was possible to arrive at the conclusion.

Prima facie case does not mean a case proved to the hilt

but a case which can be said to be established if the

(23)

evidence which is led in support of the case were to be

believed. (Refer: Nirmala J Jhala vs. State of

Gujarat

22

.

The words “the State Government is of the opinion”

indicate that the opinion must be formed by the State

Government and it is implicit that the opinion must be an

honest opinion based on the preliminary enquiry report.

In Vivekanand, Hafiz Ataullah Ansari and

thereafter reiterated in Paras Jain that the elected

representative would have to be given an opportunity to

raise objection to the findings returned in the preliminary

enquiry and his/or her objections will have be considered,

though prima facie, by the State Government/District

Magistrate before an order ceasing the financial and

administrative power and functions is passed. The

consequence of the order passed in exercise of power

under Section 95(1)(g) is serious consequence as it

divests the elected representative from exercising power

until exonerated in final enquiry and the decision of the

State Government is final. The decision taken by the State

Government is not based on any expediency or policy of

the State, rather, it is a statutory power conferred upon

the State Government exercising inherent judicial power

after confronting the elected representative, with show

cause notice based on the preliminary report, thereafter,

taking a decision upon due application of mind on the

objections of the elected Pradhan. Once such an order is

passed, it is not open for the State Government to either

review or modify the order during the course of final

enquiry. The order, therefore, finally decides the issue

22. (2013) 4 SCC 301)

(24)

between Pradhan and the Authority (State Government)

in so far it relates to exercise of financial and

administrative power. The office of the local body is an

elected office of the constitutional democratic institution;

the elected head is not a government servant and it would

be improper to compare these proceeding with

departmental proceeding in service jurisprudence. A head

of a local body is elected for a limited term. If during the

removal proceedings, he is denuded from exercising

financial and administrative powers then even if he is

exonerated in the enquiry the time spent during enquiry is

lost, he does not get his period extended. The

consideration about the presence of all or some of the

trappings of a court is really not decisive. The main and

basic test is whether the adjudicating power which a

particular authority is empowered to exercise has been

conferred on it by a statute and can be described as part

of the State's inherent power exercised in discharging its

judicial function. Applying this test there can be no doubt

that the power which the State Government/District

Magistrate exercises under proviso to Section 95(1)(g) is

a quasi-judicial power exercised by a quasi-judicial

authority.

Once the financial and administrative function is

ceased, it affects the constitutional and statutory right of

the Pradhan; no power of review having been conferred

on the District Magistrate. He has to act according to the

rules exercising the inherent judicial power of the State

Government and is not dictated by the policy or

expediency of the State.

(25)

We accordingly proceed to answer the reference in

the following terms:

(A). The District Magistrate exercising delegated

authority of the State Government, is a Tribunal

exercising quasi judicial power by a quasi judicial

authority under the proviso to Section 95(1)(g) of the

Panchayat Raj Act while proceeding to cease the

administrative and financial authority of the Pradhan

pending final enquiry.

(B). Re-Question (i):The decision of the Division

Bench in Smt. Sonia vs. State of U.P. (supra) lays down

the correct position of law.

The reference to the Full Bench accordingly stands

answered. The special appeal shall now be placed before

the regular Bench according to roster for disposal in light

of the questions so answered.

Order Dated: 01.05.2018

Mukesh

(Ashok Kumar, J) (Suneet Kumar, J) (Krishna Murari, J)