IMPORTANT POINT
The judgment established the principle that the State Government must adhere to the principles of natural justice and cannot suspend the financial power of municipal office bearers under the Act and Rules.

ORDER :

1. Since common questions of law and facts are involved in both cases, they are clubbed together, heard together and decided by this common order.

2. The petitioners are Presidents of Municipal Council, Mungeli, District - Mungeli and Nagar Panchayat Shivpur Charcha, District Korea.

3. The brief facts of WPC No. 2342 of 2024 are as under:-

I. The petitioner was duly elected as a Councilor and later on, he was elected as President of Municipal Council Mungeli, District – Mungeli in the election held in the year 2020 amongst the Councilors. Surprisingly, respondent No. 1 vide order dated 14.03.2024 suspended the financial power of the petitioner and only the Chief Municipal Officer was authorized to sign the cheques. The petitioner in this petition has raised grounds regarding the authority of the State with respect to withdrawing the financial power. It is also pleaded that Sections 323 & 324 of the CG. Municipalities Act, 1961 (hereinafter referred to as ‘the Act, 1961’) and CG. Municipal Accounts Rules, 1971 (hereinafter referred to as the ‘Rules, 1971’) do not permit the State Government to withdraw the financial power of the President, and thus it is pleaded that the power has been exercised arbitrarily by the authority.

II. In turn, it is stated by the respondents that the financial power of the petitioner/President has been withdrawn according to provisions of Sections 323 & 324 of the Act, 1961 read with Rule – 90(2)(ii) of the Rules, 1971. It is further stated in the reply that there were various complaints against the petitioner made by the contractors to the effect that deliberately cheques so presented by the Chief Municipal Officer were not signed by the petitioner. The work of drainage, drinking water connections, sewers and construction of roads was stopped by those contractors. The aforesaid complaints were made by the contractors on 05.12.2023. It is also stated in the reply that the Chief Municipal Officer, Mungeli took cognizance of the matter and after due enquiry, forwarded the letter to the State Government along with complaints and copies of the cheques, thereafter, the decision was taken by the State Government.

4. The brief facts of WPC No. 1695 of 2024 are as under:-

I. The petitioner was elected as Councilor of Nagar Palika Parishad, Shivpur Charcha, District – Korea, and thereafter, she was elected as President in the year 2022. Vide Order dated 14.03.2024 issued by respondent No. 1, the financial power of the petitioner was suspended in the exercise of the power conferred under Section 324 of the Act, 1961 read with Rule 90(2)(ii) of the Rules, 1971. It is pleaded in the Writ Petition that no opportunity of hearing was afforded. It is also stated that the provisions of Sections 323 & 324 of the Act, 1961 and Rule 90(ii) of the Rules, 1971 would attract.

II. In reply, it is stated that various complaints were made against the petitioner by the Councilors of Nagar Palika, Shivpur Charcha to the effect that the petitioner misused her power. She issued various work orders without technical sanction and prior approval from the Nagar Palika to her near and dear. There were also allegations concerning financial irregularities. After receiving such complaints, an enquiry was conducted and the matter was forwarded to the State Government. The fact-finding enquiry was conducted and conclusions were recorded by the Chief Municipal Officer in its report as under:-

Complaint No. 1

The new construction and beautification work of Chowk was done by the Chairman in Shubhash Nagar between Wards No. 4 and 5 without obtaining technical approval.

Conclusion:-

There is no document related to the above development work in the office, and thus the complaint has been found certified.

Complaint No. 2

The petitioner without obtaining technical approval, installed rope lights on the main roadside and in various places in the area of Municipal Council.

Conclusion:-

There is no document related to the above development works in the Muni