Zila Panchayat Can Withdraw Financial Powers From Sarpanch Involved In Corruption Case: MP High Court

Referring to Madhya Pradesh Panchayat (Powers and Functions of Chief Executive Officer) Rules,  Justice Vishal Dhagat in his order observed, “As per said provisions, it is the duties of Chief Executive Officer to ensure that no loss of money or property of Panchayat is caused, therefore, Chief Executive Officer, Zila Panchayat has power to issue orders withdrawing financial powers of Sarpanch who is found to be involved in a corruption case. Action has been taken only to ensure against loss of money of Panchayat. Further he is also empowered under sub-rule (xvi) of Rule 4 to take steps to remove any defect, irregularity brought to the notice of Panchayat in course of audit of its account. In these circumstances, it cannot be said that Chief Executive Officer, Zila Panchayat do not have power to withdraw financial powers of Sarpanch.”

A petition was filed under Article 226 of the Constitution of India challenging an order by which the financial power of Sarpanch were withdrawn and financial powers were given to Panchayat Coordinator. The aforesaid order was passed as the petitioner was caught red handed accepting bribe of Rs. 50,000/-.

The counsel for the petitioner submitted that without considering the reply and giving opportunity of hearing to petitioner, respondent No. 3/Chief Executive Officer passed the impugned order by which financial powers of petitioner were withdrawn. It was further submitted that there is no provision to take away financial power of Sarpanch on account of registration of offence.

On the contrary, the counsel for Respondent No. 2/Superintendent of Police submitted that since the petitioner has been found involved in case of corruption, therefore, Chief Executive Officer, Zila Panchayat, Shahdol rightly passed an order of withdrawing financial powers from petitioner.

After hearing both the sides, the Court referred to the Madhya Pradesh Panchayat (Powers and Functions of Chief Executive Officer) Rules, 1995. The Court noted that Rule 4 of said Rule gives Chief Executive Officer the power to supervise and control the execution of all activities of Panchayat. It states that the Chief Executive Officer shall take necessary measures for speedy execution of all works and development scheme of Panchayat, initiate or conduct proceedings, civil or criminal on behalf of Panchayat and he has also power to draw and disburse money out of the Panchayat Fund.

The Court further referred to Rule 4, sub-rule (xiii) which prescribes that the Chief Executive Officer shall ensure against loss of money or property of any Panchayat in possession or charge of employees of the Panchayat in discharge of duties and to place before Panchayat or Standing Committee empowered.

Referring to the provisions, the Court noted that it is the duty of the Chief Executive Officer to ensure that no loss of money or property of Panchayat is caused.

Therefore, the Court held that the Chief Executive Officer, Zila Panchayat has power to issue orders withdrawing financial powers of Sarpanch who is found to be involved in a corruption case.

The petition was hence, dismissed.

Case Title: Manghu Baiga Versus State Of Madhya Pradesh And Others, Writ Petition No. 8657 Of 2025

Counsel for Petitioner: Advocate Akhilesh Kumar Singh

Counsel for Respondent/State: Advocate Shikha Sharma

Counsel for Respondent No. 2/SP: Advocate Abhinav Shrivastava and Siddharth Shrivastava