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A. Sahadevan Vs. M. Muthuraj in His Capacity as the Auditor of the Kilchettipattu Panchayat Board - Court Judgment

LegalCrystal Citation
SubjectCivil;Limitation
CourtChennai High Court
Decided On
Reported in(1975)2MLJ122
AppellantA. Sahadevan;p. Doraiswami Naicker
RespondentM. Muthuraj in His Capacity as the Auditor of the Kilchettipattu Panchayat Board;The Revenue Divisio
Cases ReferredJayaramet Gounder v. Auditor
Excerpt:
- orders. natarajan, j.1. these two appeals, arising out of o.p. no. 4 of 1971 and o.p. no. 53 of 1970 on the file of the court of the district judge of north arcot at vellore, involve common questions of law.2. in c.m.a. no. 475 of 1971, the appellant, a former president of the kizhchettipattu panchayat board, was surcharged by the auditor, by his order dated 30th september, 1970 a sum of rs. 649-71p. on the ground the appellant had not spent the entire sum of rs. 3,089-15p. drawn by him from the panchayat funds for road work, but had spent only rs. 2,439-44p. and consequently, the appellant had to make good the loss of rs. 649-71p. caused to the panchayat. in c.m.a. no. 476 of 1971, the appellant, who was the president of ammoor panchayat from 1958 to 1965, was surcharged by the auditor a.....
Judgment:
ORDER

S. Natarajan, J.

1. These two appeals, arising out of O.P. No. 4 of 1971 and O.P. No. 53 of 1970 on the file of the Court of the District Judge of North Arcot at Vellore, involve common questions of law.

2. In C.M.A. No. 475 of 1971, the appellant, a former President of the Kizhchettipattu Panchayat Board, was surcharged by the Auditor, by his order dated 30th September, 1970 a sum of Rs. 649-71P. on the ground the appellant had not spent the entire sum of Rs. 3,089-15P. drawn by him from the Panchayat funds for road Work, but had spent only Rs. 2,439-44P. and consequently, the appellant had to make good the loss of Rs. 649-71P. caused to the Panchayat. In C.M.A. No. 476 of 1971, the appellant, who was the President of Ammoor Panchayat from 1958 to 1965, was surcharged by the Auditor a sum of Rs. 715-73P by his order dated 28th June, 1970 on the ground the appellant had not brought into account the usufructs of some tamarind trees belonging to the Panchayat which had been taken on lease by him, and further, had also drawn moneys for purchase of cement which was subsequently found to have been not utilised for the Panchayat. Both the appellants filed applications before the District Judge, under Rule 6 (1) (a) of the Surcharge and Disallowance Rules (hereinafter referred to as the Rules) framed under Section 178 (2) of the Madras Panchayats Act and prayed for the surcharge order being set aside. Apart from contending, in their respective applications that the surcharge order was unsustainable on facts, the appellants also contended the surcharge proceedings were barred by limitation. The learned District Judge overruled both the objections and sustained the order of surcharge. In these appeals, the appellants challenge the order of surcharge and the order of the learned District Judge, only on the ground of limitation.

3. The contention of the appellants is that the order of surcharge was passed beyond three years after they had rendered accounts and held office as President, and as such, the surcharge order was really barred by limitation. It is common ground the order of surcharge was passed beyond a period of three years after the amounts had been drawn or collected and failed to be remitted by the appellants. In support of their contention, the appellants place reliance on Section 173 of the Act, which is to the following effect:

Section 173 (1)--The president, executive authority and every member of a panchayat and the chairman, commissioner and every member of a panchayat union council shall be liable for the loss, waste or misapplication of any money or other property owned by or vested in the panchayat or panchayat union council if such loss, waste or misapplication is a direct consequence of his neglect or misconduct; and a suit for compensation may be instituted against him in any Court of competent jurisdiction by the panchayat or panchayat union council with the previous sanction of the Inspector.

(2) Every such suit shall be commenced within three years after the date on which the cause of action arose.

To buttress the contention that the Legislature intended that any suit instituted against the president, executive authority and member of a panchayat or the chairman, commissioner and member of a panchayat union council for compensation for the loss or waste or misapplication of funds caused by him to the panchayat or panchayat union council as the case may be should be commenced within three years after the date on which the cause of action arose, the appellants rely upon the period of limitation set under Section 165 of the Act in respect of distraint or suits or prosecutions launched upon to recover tax or other sums due to a panchayat or panchayat union council. Section 165 is to the following effect:

No distraint shall be made, no suit shall be instituted and no prosecution shall be commenced in respect of any tax or other sum due to a panchayat or panchayat union council under this Act or any rule, by-law, regulation or order made under it after the expiration of a period of three years from the date on which distraint might first have been, a suit might first have been instituted or prosecution might first have been commenced, as the case may be, in respect of such tax or sum.

The argument advanced is that the order of surcharge in each of the appeals is barred by limitation as it was passed beyond a period of three years from when moneys were drawn for meeting the expenditure or moneys were realised for and on behalf of the local body.

4. Arguing contra, Mr. G. Ramaswami, learned Counsel for the Government contends that the Legislature has specifically made provision for Rules relating to the powers of Auditors in the matter of surcharge under the Act and the Rules are a complete Code in themselves in so far as surcharge proceedings are concerned, and it is only those Rules which would govern the rights of parties in respect of orders of surcharge and recovery of disallowed amounts. To appreciate the argument of the learned Counsel, it is necessary to make reference to Section 178 of the Act and relevant portions therein, since it is under that provision the Government have been conferred powers by the Legislature to frame Rules on various matters. Sub-section (1) of Section 178 is worded as follows:

The Government shall, in addition to the rule making powers conferred on them by any other provisions contained in this Act, have power to make rules generally to carry out the purposes of the Act.

Sub-section (2) is to the following effect:

In particular, and without prejudice to the generality of the foregoing power, the Government may make rules etc., etc.

Clause (xvi-a) of Sub-section (2) of Section 178, which was inserted by Act XVIII of 1964 is the relevant clause relating to powers of Auditors to disallow and surcharge items etc., and it is in the following terms:

as to the powers of auditors to disallow and surcharge items, appeals against orders of disallowance or surcharge, and recovery of sums disallowed or surcharged.

By virtue of Clause (xvi-a) of Sub-section (2) of Section 178, the Government passed G.O.Ms. No. 1127, L. A., dated 18th May, 1965, and framed Rules relating to the powers of Auditors in the matter of surcharge under the Madras Panchayats Act. The Rules were to be effective from 2nd September, 1964. Rule (1) enjoins the commissioner of a panchayat union council of the executive authority of a panchayat to submit all accounts to auditors appointed under Section 141 of the Act, as required by the auditors. Rule 2 lays down the powers of auditors to summon books, deeds, contracts, accounts, vouchers, receipts or other documents for perusal or examination and also to require any person appearing before the auditors to make and sign declarations, answer questions, prepare and furnish statements etc. Rule 3 lays down the procedure to be followed by the auditors on scrutiny of accounts, statements etc., and their duty to report to the panchayat or the panchayat union council any defect, impropriety, irregularity etc. in the expenditure or in the recovery of moneys due to the panchayat or the panchayat union council as the case may be. Sub-rule (b) concerns with the report to be made in the case of loss, waste, or misapplication of money etc., and reads as follows:

The auditors shall report to the Panchayat or panchayat Union Council any loss, waste or misapplication of money or other property owned by or vested in the Panchayat or Panchayat Union council if such loss, waste or misapplication is a direct consequence of his neglect or misconduct, with the names of persons directly or indirectly responsible for such loss, waste or misapplication.

Rule 4 has reference to the remedial measures the Commissioner or the Executive Authority has to take to remedy the defects or irregularities pointed out by the Auditors. Rule 5 Sub-rule (1) gives power to the Auditors to disallow every item contrary to law and surcharge the same on the concerned person, and is to the following effect:

Any auditor empowered by the Government may disallow every item contrary to law and surcharge the same on the person making or authorising the making of the illegal payments and may charge against any person responsible therefor the amount of any deficiency, loss or unprofitable outlay incurred by the negligence or misconduct of that person or of any sum, which ought to have been, but is not brought to account by that person and shall, in every such case, certify the amount due from such person.

Rule 5 (1) has an Explanation, but we are not concerned with it in these appeals. Sub-rule (2) of Rule 5 makes it obligatory for the Auditor to give Written reasons for his decision in respect of disallowances, surcharge or charge and further lays down that a copy of such order should be sent by registered post to the person against whom the order is made. Sub-rule (3) of Rule 5 refers to the effect of the failure of the surcharged person to receive the order and also states that the time limit of fourteen days fixed in Rules 6 and 7 for compliance with the surcharge order is to be calculated from the date of such refusal. Rule 6 gives the option to an aggrieved person to challenge the order of surcharge by either applying to the principal civil Court of original jurisdiction or to appeal to Government. Sub-rule (2) of Rule 6 provides that if the aggrieved person has resorted to the civil Court, he has a right to prefer an appeal to the High Court against the order of the Court of first resort. Rule 7 states that every sum certified by the Auditor to be due from any person, if not paid by the person concerned, shall be recoverable in the same way as an amount decreed by the Court. Rule 8 gives the Government the power to waive recovery of the whole or any part of the surcharged amount and Rule 9 states that 'Government' referred to in the above Rules is the Government of Madras.

5. Mr. B. Kumar for Mr. T. R. Rajagopalan and Mr. Janakiraman, learned Counsel for the appellants in the respective appeals, contends that Rules 5, 6 and 7 referred to above have to be read and interpreted in conformity with Section 173 and consequently, the limitation of three years prescribed in the said section must govern disallowance of amounts and surcharges as well. The principal question to be considered therefore, is whether Section 173 governs the Rules framed under Clause (xvi-a) of Sub-section (2) of Section 178 and thereby restricts the powers of disallowance and surcharge given to an auditor under Rule 5 to a period of three years from the date on which the cause of action arose. Pausing here, for a moment, I may straightaway say that Section 165 of the Act, on which also reliance is placed by the appellant's counsel to contend that surcharge proceedings are also subject to a limitation period, has no relevance to the controversy on hand. Section 165 refers to distraint proceedings, suits and prosecutions taken, on behalf of the Panchayat or the Panchayat Union Council in respect of any tax or other sum due under the Act or any rule, by-law regulation or order made under it. This section cannot obviously have reference to the liability of the President, the Executive Authority and Member of a Panchayat or the Chairman, Commissioner and Member of Panchayat Union Council for the loss, waste or misapplication of any money or other property owned by or vested in the Panchayat or Panchayat Union Council as a consequence of his neglect or misconduct. For a liability of the latter kind, Section 173 has been specifically enacted. Clearly, therefore, Section 165 can have reference only to tax or other sums due to a Panchayat or a Panchayat Union Council from third parties, and not to compensation amounts the officers of a local body have to pay for the loss caused by them to the Panchayat or for waste or misapplication of Panchayat funds.

5. Coming, now, to the question as to whether there is a conflict between Section 173 and the Surcharge Rules and as whether Section 173 would override the Rules, a scrutiny of the provisions contained in the section and the Rules reveals beyond doubt that though there is a seeming and apparent similarity between Section 173 and the Rules, in reality they deal with different situations and as such, the Rules cannot in any manner, be trammelled by the section. Firstly, it has to be seen that Section 173 of the Act does not make reference to the appointment of auditors or their powers to 'is allow and surcharge items. On the other hand, it is Clause (xvi-a) of Sub-section (2) of Section 178, that makes specific and pointed reference to the powers of auditors to disallow and surcharge items, besides appeals against orders of disallowance or surcharge and recovery of sums disallowed or surcharged. Such being the case, the Rules framed for surcharge and disallowance are directly and solely referable to Section 178 (2) (xvi-a) and not to any portion of Section 173 of the Act. That it was the intention of the Legislature to treat surcharge proceedings distinctly and not include them within the ambit of Section 173, is made apparent by Section 173 making reference to suits approved by Inspectors being instituted for compensation from the concerned officer-bearers for the loss caused to the Panchayat or council, whereas Section 178 (2) (xvi-a) provides for Rules being framed to define and demarcate the powers of auditors to disallow and surcharge items and also the procedure for recovery of sums disallowed or surcharged. It could never have been the intention of the Legislature that disallowed and surcharged sums also should be recovered from the concerned office-bearers by means of suits as envisaged under Section 173, as Clause (xvi-a) contemplates as mode of recovery by other means than a suit. It may further be seen that Clause (xxii) of Section 178 (2) relates to the powers of Government to make rules for realisation of any tax or other sum due to a Panchayat or Panchayat Union Council either by distraint and sale of moveable property or by prosecution before a Magistrate or by a suit or otherwise. This clause is related to, and has its foundation in, Section 165, because that section also deals with recovery of dues by distraint proceedings or institution of suit or launching or prosecution. Such identity of procedure as is found between Clause (xxii) and Section 165 is not to be seen between Clause (xvi-a) and Section 173. Yet another circumstance which significantly brings out the difference between Section 173 and the Rules framed under Clause (xvi-a) is that while Section 173 makes reference to a suit being instituted for compensation, Rule 7 of the Rules framed under Clause (xvi-a) lays down that every sum certified to be due from any person by the auditor shall be recoverable in the same way as an amount decreed by the Court. The two provisions, therefore, postulate entirely different situations in that, the section deals with the right of a Panchayat or Council to institute a suit for compensation while the rule refers to a right in the nature of a decree to recover the amounts certified by the auditor. It is therefore clear that Section 173 has no application to surcharge proceedings and recovery of amounts thereunder and consequently, the period of limitation prescribed under Section 173 cannot have application to the latter class of cases.

6. From another view point also the contention of the appellant's counsel that the limitation clause provided in Section 173 should be imported into the Rules cannot be sustained. No time limit is prescribed under the Act for audit proceedings being taken or completed. As already stated, Section 173 makes no reference to the appointment of auditors, their rights and duties and the time limit within which they should complete the audit. Consequently, when there is no time limit for audit proceedings, it is futile for the appellants to contend that time limit of three years should be imported in respect of audit proceedings as well. Even assuming, for argument's sake, that Section 173 governs surcharge proceedings as well, Sub-section (2) of Section 173 says that a suit as contemplated under Sub-section (1) should be commenced within three years after the date on which the cause of action arose. Disallowance of amounts and surcharge orders can be passed on an office-bearer by an auditor only after the audit of accounts is taken up and completed. It is only then the cause of action will arise, and from that time the local body will certainly have a time limit of three years to institute proceedings against the officer or office-bearer to recover the amount. Viewed in that light, even Section 173 does not lend support to the contention of the appellants that the surcharge proceedings are barred by limitation.

7. A conspectus of the Rules framed for surcharge and disallowance leads to the irresistible conclusion that it is a code by itself in so far as the disallowance and surcharge of amounts by auditors are concerned. As already stated, the Rules refer to the powers of the auditors to summon accounts, vouchers, receipts etc., to require any person appearing before them to sign declarations etc., and to fine persons failing to comply with any requisition lawfully made.

8. The Rules provide for service of the surcharge proceedings on the person concerned and the effect of his refusal to receive the order. Provision is also made for an appeal being preferred by the aggrieved person against an order of surcharge. Lastly, the Rules also lay down the procedure for recovery of the surcharged amount. Nothing is therefore left in doubt and every conceivable situation has been provided for in so far as surcharge and disallowance are concerned. This is again a factor which warrants the conclusion that the Rules in question have nothing to do with Section 173 and cannot therefore be trammelled or curtailed in any manner by the period of limitation stipulated in that section.

9. Argumentatively, if the contention of the appellants' counsel is to be accepted, even then, the matter is not devoid of solution and harmonious interpretation. I may only refer to certain treatises on interpretation of statutes and certain decided cases to show that, where there are seemingly inconsistent provisions in an Act or between a section of the Act and the Rules framed thereunder, the attempt and effort of the Court must be to reconcile the two situations as far as possible and give effect to the intention of the Legislature by construing harmoniously the conflicting provisions. Firstly, it may be pointed out that the Rules are framed subsequent to the Act and are, therefore, later in point of time. In Maxwell on the Interpretation of Statutes (Twelfth Edition) at page 187, it is stated as follows :--' If two sections of the same statute are repugnant, the known rule is that the last must prevail.' Apart from that, it may be seen that the dissimilarities between Section 173 and Rule 5 have the effect of making Section 173 a general provision and Rule 5 a special provision. No doubt, learned Counsel for the appellants points out that the wordings of Section 173 and Rule 3 are more or less identical. But then, Rule 3 does not govern Rule 5, nor does it have any impact OP it. Rule 3 (a) concerns itself with the duty of the auditors to report to the Panchayat or Panchayat Union Council any material impropriety or irregularity in the expenditure or in the recovery of moneys due to the Panchayat or Council in the accounts of the said Body; Rule 3 (b) concerns itself with the duty of the auditors to report to the Panchayat or the Council any loss, waste, or misapplication of money or other property owned by or vested in the Panchayat or council due to the neglect or misconduct of any person. Rule 4 lays down the procedure which the Commissioner or Executive Authority has to follow for remedying the defects or irregularities pointed out by the auditors under Rule 3. Rule 5 has reference to an entirely different situation, viz., the exercise of powers by an auditor to disallow items contrary to law and surcharge the same on the concerned person. It may be seen that it is not every auditor who can act under Rule 5, but only an auditor who is empowered by the Government, who can act in that manner. Consequently, Rule 5 gives the auditor a power to disallow every item contrary to law which is wider in import than the words, ' loss, waste or misapplication of money or other property ' found in Rule 3. Rule 5 has also reference to the concerned person being charged for deficiency, loss or unprofitable outlay resulting from his negligence or misconduct. This rule is therefore of wider amplitude than Rule 3 and deals with different types of situations not at all contemplated or provided for under Section 173. It therefore amounts to a special provision even if Section 173 is to be construed as a general provision relating to recovery of amounts the local body has lost by loss, waste or misapplication. The guideline afforded by Maxwell to deal with such a situation is contained in the following words, which are found at page 187 of the aforesaid book:

One may in which repugnancy can be avoided is by regarding two apparently conflicting provisions as dealing with distinct matters or situations.

I may also refer with advantage to the following passage occurring in page 419 of Bindra's Interpretation of Statutes (5th Edition):

When there are in a statute two provisions which are in conflict with each other, such that both of them cannot stand, they should, if possible, be so interpreted that effect can be given to both, and that a construction which renders either of them inoperative and useless should not be adopted except in the last resort.

Again, at page 627 of the same book, it is stated as follows:

A by-law is not repugnant to the general law merely because it creates a new offence, and says that something shall be unlawful which the law does not say is unlawful. It is repugnant if it makes unlawful that which the law says is lawful...if it expressly or by necessary implication professes to alter the general law of the land....if it adds something inconsistent with the provisions of a statute creating the same offence ; but if it adds something not inconsistent, that is not sufficient to make the by-law bad as repugnant.

In J.K. Cotton Spinning and Weaving Mills v. State of Uttar Pradesh : (1961)ILLJ540SC , the Supreme Court held as follows:

In the interpretation of statutes the Courts always presume that the Legislature inserted every part thereof for a purpose and the legislative intention is that every part of the statute should have effect. These presumptions will have to be made in the case of rule-making authority also...'We reach the same result by applying another well-known rule of construction that general provisions yield to special provisions'.

Thier Lordships also approved the following passage occurring in Pretty v. Solly (1859) 26 Beav. 606 (quoted in Craies on Statute Law at page 206, 6th Edition):

The rule, is that whenever there is a particular enactment and a general enactment in the same statute and the latter, taken in its most comprehensive sense would overrule the former, the particular enactment must be operative, and the general enactment must be taken to affect only the other parts of the statute to which it may properly apply.

On the question of interpretation of seemingly conflicting provisions in an enactment, a Full Bench of the Andhra Pradesh High Court held in M. Agaiah v. Mohammed Abdul Kareem : AIR1961AP201 as follows:

It is a well-settled canon of construction of statutes that the provisions of a statute should be so read as to harmonise one with the other and not to read a repugnancy into them. Even if two enactments appear to be inconsistant, it must be seen that one is a qualification of the other.

Again, at page 207, the Full Bench observed as follows:

It is a Well-established rule of interpretation of statutes that no provision of an enactment should be regarded as a superfluity. Courts cannot, without necessity or sound reason, regard any part of an enactment as redundant. They should always incline to the view that every word was intended by the Legislature to have some meaning and effect.

This Court itself in Vaidyanatha v. L.I.C. of India : AIR1964Mad24 , had to deal with Sections 9 and 11 of the Life Insurance Corporation Act, 1956, as amended in 1957. Repelling the argument that Section 11 was inconsistent with Section 9 and that Section 9 would govern all contracts of service, this Court held as follows:

We are, however, unable to agree that Section 9 will have application, to the contracts of service which the employees had with their previous managements. Section 11 deals specifically with the transfer of service of existing employees of the Insurers to the Corporation. The former section being of a general nature capable of covering all contracts, a reasonable interpretation of its scope will be not to extend its application to subjects specially dealt with by the latter provision, namely, Section 11 of the Act. The latter provision deals with a separate subject which should alone apply-to it ; otherwise there will be a conflict between Sections 5, 9 and 11.

Following the ratio in these decisions, it may be seen that even if Section 173 Were to be construed as a general provision covering all cases wherein the Panchayat or Council will be entitled to recover amounts lost by reason of waste, misapplication etc., still Rule 5 must perforce be construed as a special provision dealing with disallowance and surcharge by auditors and one capable of co-existing with the other provisions of the Act. In that view also, the period of limitation prescribed under Section 173 cannot govern or regulate the provisions of Rule 5.

10. Learned Counsel for the appellants raise a contention that disallowance and surcharge dealt with under the rules cannot override the provisions contained in the Act itself, and would argue that the Rules can be given only a secondary place in juxtaposition with the sections in the Act. This argument contains a fallacy. Section 199 (1) of the Act lays down that all rules, notifications and orders made or issued under the Act shall be published in the Fort St. George Gazette and unless they are expressed to come into force on a particular day, shall come into force on the day on which they are so published. Sub-section (2) gives the Legislature a right to amend the Rules or to invalidate them. As long as the Legislature does not have recourse to the powers conferred on it under Sub-section (2), the Rules will have as much statutory force as the Act itself. This position is clearly enunciated in Maxwell on Interpretation of Statutes (11th Edition) at page 49, in the following terms:

Instruments made under an Act which prescribes that they should be laid before Parliament for a prescribed number of days, during which period they may be annulled by a resolution of either House but that if not so annulled they are to be of the same effect as if contained in the Act and are to be judicially noticed, must be treated for all purposes of construction or obligation or otherwise exactly as if they were in the Act.

Mr. B. Kumar advances another argument to nullify the provisions in the Rules which are at variance with Section 173. According to him, surcharge is only a different mode of recovery of the sums due to the Panchayat from its officers or office-bearers, past or present, and consequently, the basic limitation prescribed under Section 173, viz., a three year limitation period must govern surcharge proceedings as well. He would further contend that what cannot be achieved by filing a suit under Section 173 cannot be sought to be accomplished by having recourse to surcharge proceedings and that the surcharge proceedings will be as much vulnerable to the law of limitation as suits themselves would be under Section 173. In support of this argument, learned Counsel places reliance on Hansraj v. Dehra Dun M.E.T. and Company . In that case, the Board held that amounts which the Company itself could not have recovered by reason of limitation, the liquidators of the Company, who had entered the scene when winding up operations of the Company commenced, would not also be entitled to recover. This decision has no relevancy to the facts of the instant case. The error committed by Mr. B. Kumar is in presuming that a surcharge proceeding is only a mode of recovery and cannot be considered different from a suit. As already referred to surcharge proceedings are not to be equated with suits or deemed a substitute for suit because an order of surcharge is to be given the same weight as a decree of Court.

11. Yet another contention of Mr. Kumar is that the Rules framed under an Act cannot, be inconsistent with the provisions of the Act and have overriding effect over them. To lend force to this argument, he places reliance on Burrakar Coal Company Limited v. Labour Appellate Tribunal : (1958)IILLJ580Cal , where it is stated that a Rule or a by-law made under a statute cannot, unless there are express indications in the statute itself, override the provisions of other statutes or the general law. This argument can have attraction only if Section 173 is found to include in its ambit surcharge proceedings as well. When such is not the case, the plea that the Rules framed under the Act ought not to be given recognition in so far as they are repugnant to Section 173, cannot be sustained.

12. It only now remains for me to meet the argument of Mr. B. Kumar that, on a former occasion, I have held in v. Jayaramet Gounder v. Auditor, Rayandapuram Panchayat Board, represented by Revenue Divisional Officer, Tiruvannamalai C.M.A. No. 371 of 1971, dated 10th August 1973 that the period of limitation prescribed in Section 173 would govern surcharge proceedings as well. On a perusal of the judgment,. I find that the contention of learned Counsel is untenable. Though that was also a case arising out of surcharge proceedings against a Panchayat Board President, the' grievance of the appellant's counsel therein was that the District Judge had totally failed to consider the plea of limitation raised by the appellant. While, therefore, remitting the matter to the District Judge for fresh consideration, all that I have stated in that case was, it would' prima facie appear that the surcharge proceedings should have been instituted against the President at least within a period of three years of his ceasing to be the President of the Panchayat . That : appeal was not argued at length and in depth as the appeals on hand have been argued, and even there, I have not conclusively held that surcharge proceedings-would, undoubtedly, be governed by the provisions of Section 173. The decision rendered in the above said case cannot therefore be of any assistance to the appellants.

13. In the result, both the appeals are found to be devoid of merit and are consequently dismissed. But there will be no order as to costs in either.


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