Recovery orders issued against an Ex-Sarpanch solely on audit reports without independent enquiry violate natural justice.

The petitioner served as the Sarpanch of Gram Panchayat, Bhaismundi, from 2010 to 2015.

During his tenure, a road construction project under the MGNREGA scheme was executed and verified by authorities as satisfactory.

Following his demission from office, an audit conducted for the year 2016-17 alleged financial irregularities amounting to ₹88,358/-.

Consequently, Respondent No. 3 issued an order on 20.01.2021 directing recovery based on the audit, which led to a list of proposed recoveries by Respondent No. 5 on 03.03.2022 and a final recovery notice-cum-order by Respondent No. 4 on 06.04.2022.

The petitioner challenged these orders on the grounds that they were issued without an independent inquiry or a hearing.

1. Whether a recovery order issued against an Ex-Sarpanch solely on the basis of an audit report, without conducting an independent inquiry or providing an opportunity of hearing, is legally sustainable.

Principles of Natural Justice, specifically the doctrine of audi alteram partem (the right to be heard), which mandates that no person shall be condemned unheard.

The court implicitly observed that statutory recovery proceedings must involve a fact-finding inquiry beyond a mere audit objection to establish liability.

The Court observed that the impugned recovery order dated 06.04.2022, and its preceding communications, were founded exclusively upon the findings of an audit report for the year 2016-17.

The Court noted a complete absence of evidence indicating that any independent inquiry was conducted to verify the alleged irregularities or that the petitioner was afforded an opportunity to respond to the allegations.

By bypassing these procedural safeguards, the respondents acted in violation of the principles of natural justice.

The Court reasoned that since the order lacked the fundamental requirement of a fair hearing, it could not be sustained under the law.

The High Court set aside the impugned notice-cum-order dated 06.04.2022.

The Court granted liberty to the competent authorities to initiate fresh proceedings in accordance with the law, provided they conduct a proper inquiry and afford the petitioner a due opportunity of hearing.

The petition was disposed of with these observations.