Recovery order passed by an authority lacking statutory competence is coram non judice and void ab initio.

The appellants (Sarpanch/members of a Gram Panchayat) challenged a recovery order dated 03.01.2025 for ₹4,00,940/- issued under Section 89 of the M.P. Panchayat Raj Avam Gram Swaraj Adhiniyam, 1993.

The order was passed by the Additional Collector/CEO, Zila Panchayat, alleging financial irregularities in the installation of street lights.

The appellants argued that the work was executed per technical sanctions and estimates issued by the Sub-Divisional Officer (SDO) and PWD engineers.

A Single Judge initially dismissed the writ petition, relegating the appellants to an alternative remedy.

The appellants appealed, contending the Additional Collector lacked jurisdiction to issue the recovery order.

1. Whether the Additional Collector (Development)/CEO, Zila Panchayat, possesses the statutory competence to act as the "Prescribed Authority" under Section 89 of the Adhiniyam, 1993.

2. Whether the existence of an alternative remedy bars the High Court’s jurisdiction under Article 226 when an order is challenged as being coram non judice.

3. Whether the recovery order was sustainable without a specific finding of personal pecuniary gain or an inquiry into actual financial loss.

Section 89 of the M.P. Panchayat Raj Avam Gram Swaraj Adhiniyam, 1993, which mandates that recovery for loss or misapplication of funds can only be initiated by a "Prescribed Authority" after providing a reasonable opportunity of being heard.

Rule 3 of the M.P. Panchayats (Appeal and Revision) Rules, 1995, designates the Sub-Divisional Officer (Revenue) as the competent authority for Gram Panchayat matters, while the Collector acts as the appellate authority.

The principles established in Whirlpool Corporation v. Registrar of Trade Marks (1998) 8 SCC 1 were cited to affirm that an alternative remedy does not bar writ jurisdiction if the impugned order is without jurisdiction or violates natural justice.

The Court found that the Additional Collector lacked inherent jurisdiction to pass the recovery order because under the statutory scheme, the Collector/Additional Collector serves as an appellate authority and not the primary inquiring authority for Gram Panchayat affairs.

The "Prescribed Authority" must be specifically notified under Section 2(xxi), and no such notification was produced for Respondent No. 3.

On merits, the Court observed that the SDO, Kotma, had sanctioned the work and contractors, and the work was certified as completed by PWD engineers.

The Additional Collector failed to quantify actual loss or prove misconduct, instead mechanically ordering recovery of the entire project cost despite a lack of evidence regarding inferior quality from the District Energy Officer.

Consequently, an order by an authority lacking jurisdiction is void ab initio.

The Court allowed the appeal and set aside the recovery order dated 03.01.2025 and the Single Judge's order dated 04.02.2025.

The recovery was deemed arbitrary as it ignored the fact that the appellants acted pursuant to approvals from the competent authority (SDO) and lacked a rigorous fact-finding inquiry into actual loss.