Judgment:
Chandrashekhara Das, J.
1. Rule by consent to be heard forthwith.
2. The petitioner who is a Sarpanch of village Panchayat of Avedem-Cotombi and Chaifi is challenging in this writ petition, an order passed by the Goa State Election Commission, Panaji, dated 30th April, 1996, which is exhibited as Exhibit 'G' in this writ petition. The State Election Commissioner, third respondent herein, by order impugned, dismissed a petition filed by the petitioner. The petitioner had filed his petition as Case No. 2 before the Goa State Election Commission seeking a declaration that the first respondent herein, namely Shri Kushali S. Kalekar, stood disqualified for non-payment of dues to the Panchayat. It is necessary to note a few more facts to complete the narration of facts.
It is borne out from the records that the aforesaid petition was filed by the petitioner before the Goa State Election Commission on the eve of a resolution of 'No Confidence Motion' being moved against him by the first respondent. Shri Kushali Kalekar. The Goa State Election Commission had granted an interim injunction restraining the first respondent from functioning or holding out as a member by its order dated 21st November, 1995. This order was also vacated by the Goa State Election Commission by the impugned order.
The counsel for the first respondent alone appeared before us and argued the case apart from the counsel for the petitioner. He tried to justify the order impugned. The main ground that has been urged by Mr. A.N.S. Nadkarni, counsel for the petitioner, is that the observation of the Goa State Election Commission that in the absence of rules framed under the Goa Panchayat Raj Act, 1993, the Goa, Daman and Diu Village Panchayat (Recovery of Dues) Rules, 1966, which were framed under the old Act will occupy the field for declaring a Member to be disqualified under section 10(d) of the Goa Panchayat Raj Act, 1993, hereinafter called 'the new Act'. According to the State Election Commission, in order to say that a person is in arrears, a proper notice in the prescribed form should be sent to the person. The State Election Commission further held that section 10(d) of the Goa Panchayat Raj Act disqualifies a Member only when he is in arrears for a prescribed period and since under the new Act, no rules have been framed, the prescribed period shown in the section should be taken as period laid down in the 1966 rules. The 1966 Rules provide for three months time for payment after the demand is made in the prescribed form. In short, the main ground of rejection of the petition filed by the petitioner by the Goa State Election Commission is that the first respondent cannot be said to be one who is in arrears for more than a period of three months in order to attract section 10(d) of the Goa Panchayat Raj Act, unless he was served a notice in the form prescribed under the Recovery of Dues Rules, 1966, and he had failed to pay such dues before the expiry of three months from the date of receipt of notice. Before going into the controversy involved in this case, it is necessary to examine the relevant provisions of the new Act applicable in this case.
3. The relevant definition sections are as follows :---
'Section 2(17) :---'prescribed' means prescribed by rules framed under this Act.'
'Section 10 :---Disqualifications for membership---
A person shall be disqualified for being chosen as, and for being a Member of the Panchayat if-
(a) he is so disqualified by or under any law for the time being in force for the purpose of the elections to the State Legislature:
Provided that no person shall be disqualified on the ground that he is less than twenty five years, if he has attained the age of twenty one years;
(b) he has been dismissed from service of the Government or any local authority;
(c) he holds any office of profit under any local or other authorities subject to the control of the Central Government, the State Government or the Government of any other states, other than such offices as are declared by rules made under this Act not to disqualify the holder;
(d) he is in arrears for such period as may be prescribed of any tax, fee or other sum due to the Panchayat;
(e) he has been convicted by a Court of any offence involving moral turpitude and five years have not elapsed since his release; or
(f) he has directly or indirectly any share or monetary interest in any work done by or to the Panchayat or any contract or employment with, under or by or on behalf of, the Panchayat.
(g) he is employed in any Corporation, whether Statutory or otherwise, owned or controlled or financed in part or fully, by the Central Government or the Government or any State Government .'
'Section 11 :---Decision on questions as to disqualification---
If any question arises as to whether a member of a Panchayat has become subject to any disqualification referred to in section 10, it shall be referred to the State Election Commission for decision and its decision thereon shall be final.' 'Section 245 :---Repeal and savings ---
The Goa, Daman and Diu Village Panchayats Regulation, 1962 (9 of 1962) and the Goa Panchayat Raj Ordinance 1994 (Ordinance No. 2 of 1994) is hereby repealed;
provided that such repeal shall not affect---
(a) the previous operation of the Goa, Daman and Diu Village Panchayat Regulation, 1962 (9 of 1962) or the Ordinance or anything duly done or suffered thereunder; or
(b) any right, privilege, obligation or liability acquired, accrued or incurred under the said Regulation; or
(c) any penalty, forfeiture or punishment incurred in respect of any offence Committed against the said Regulation; or
(d) any investigation, legal proceeding or remedy in respect of such right, privilege, obligations, liability, forfeiture or punishment as aforesaid and any such investigation, legal proceeding or remedy may be instituted., continued or enforced, and any such penalty, forfeiture or punishment may be imposed as if this Act had not been passed:
Provided further that :
(a) subject to the preceding provisions, anything done or any action taken (including any appointment or delegation made, tax fee or cess imposed, notification, order instrument or direction issued, rules, regulations, forms, bye-laws or schemes framed, certificates obtained, permits or licences granted or registration effected) under the said Regulation or the said Ordinance shall be deemed to have been done or taken under the corresponding provisions of this Act and shall continue to be in force accordingly unless and until superseded by anything done or any action taken under this Act; ..................
(d) any reference in any enactment or in any instrument to any provision of the repealed Regulation or the said Ordinance shall, unless a different intention appears, be construed as a reference to the corresponding provisions of this Act.
Provided further that not with standing anything contained in any other law for the time being in force all Panchayats continued in terms of proviso to Article 234 of the Constitution of India, shall continue to exercise the power under this Act until the Panchayats are duly constituted under this Act.'
Before the present enactment came into force, the Act that governed the field was the Goa, Daman and Diu Village Panchayat Regulation, 1962. Section 11 of the old Act more or less corresponds to the present section 10(d) of the new Act. Section 11 of the act (No. 9 of 1962) hereinafter called regulation, reads as under :-
'Disqualification for membership---
A person shall be disqualified for being chosen as, and for being, a member of a Panchayat if he ---
(a) .....
(b) .....
(c) .....
(d) .....
(e) .....
(f) .....
(g) .....
(h) .....
(i) .....
(j) is in arrears for such period as may be prescribed of any tax, fee or other sum due to the Panchayat.'
The provisions of section 19(d) of the new Act are in pari materia with those of section 11(j) of the old Regulation. By a Notification No. CDB/VPT/244/70-71 dated 16th June, 1971 which was published in the Gazette on 24th June, 1971, it has been notified that the period prescribed for the purpose of Clause (j) of section 11 of the Regulation is three months. In other words, in order to become a member disqualified he should be in arrears of any dues to the Panchayat for a period more than three months.
4. The learned Counsel for the petitioner, Mr. A.N.S. Nadkarni, mainly argued that instead of relying on Rule 6 of the Rules of 1966 (Recovery of Dues Rules), the Election Commission ought to have relied upon this Notification as no period has been prescribed under section 10(d) of the new Act by virtue of operation of section 245 of the Goa Panchayat Raj Act, and the Notification dated 16th June, 1971, issued under the old Act governed the field. He submits that the first respondent was informed of arrears of a sum due from him to the Panchayat by a Notice dated 1st July, 1993, and on expiry of three months from that date if the first respondent kept the arrears still unpaid, undoubtedly he fell under the clouds of disqualification prescribed under section 10(d) of the Goa Panchayat Raj Act. Therefore, the question posed in this petition is whether the grounds stated by the Election Commission that so long as first respondent was not served a notice in the form prescribed under Recovery of dues Rules of 1966, he cannot be treated as disqualified or whether as contended by Mr. Nadkarni that he could be declared as disqualified as he was in arrears for more than three months. On perusal of the impugned order of the Election Commission it can be seen that the Election Commission also relied upon section 245 of the new Act in order to bring the application of the 1962 Regulation which was said to be continued in force till it was superseded by any further Act under the new act, but the only difference is that the Election Commission relied upon the Goa, Daman and Diu Village Panchayat (Recovery of Dues) Rules, 1966 while passing the impugned order. According to the Election Commission under Rule 3 of the Recovery of Dues Rules, 1966, a person becomes a defaulter only when he fails to pay tax or any other sum due from him to the Panchayat on or before the due date specified in the Demand Notice to be served on him and has been so served a writ of demand in form 'A' appended to the 1966 Rules giving him 30 days notice from the date of the serving of the notice of demand to pay the sum demanded in that writ or to show sufficient cause to the satisfaction of the Panchayat for non-payment. In that reasoning the Election Commission found that a mere audit objection would not be sufficient or a letter like one dated 1st July, 1993, also will not amount to a Notice issued under Recovery of Dues Rules, 1966. Therefore, the controversy narrowed down to the point whether the Notification issued under the old Act dated 16th June, 1971 (gazetted on 24th June, 1971) is relevant to the controversy or whether the Recovery of Dues Rules, 1996, would apply. We find some substance in the contention of Shri Nadkarni. The reason is that the Notification issued under section 11 of the old Act and section 10(d) of the new Act deals with similar and same subject. Both sections laid down the circumstances under which membership in a Panchayat could be declared to be lost to a member on incurring the disqualification prescribed under the Act. As we pointed out earlier, section 10(d) of the new Act is the verbatim reproduction of section 11(j) of the old Act. Therefore, going by the meaning of section 245, what is alive or continued in force, notwithstanding the repeal of the old Act is not only that which was not repugnant to the new Act but also anything done or action taken including Notification or order Direction issued, or Rules, Regulation, Forms, Bye-laws, Scheme framed, or forfeiture, etc., etc., shall be deemed to have been done or taken under the corresponding provisions of this Act and shall continue to be in force accordingly unless and until superseded by anything done or any action taken under this Act.
5. Admittedly, no Rules have been framed for implementation of section 10(d) of the new Act. In the absence of any rules framed the old Rules will continue in force by virtue of proviso (a) to section 245 of the new Act. The Election Commission thus fell in error to assume that in order to attract the provisions of disqualification of a Member he must be in arrears for more than three months after serving notice under Recovery of dues Rules According to the Election Commission, unless a notice under form 'A' prescribed under Recovery of Dues Rules, 1966 is served on him, it cannot be treated as a demand and according to the Election Commission unless the demand is made in the prescribed form and the expiration of one month of receipt of notice of such demand in the prescribed form has elapsed, one cannot be said to be in arrears and further, in order to attract the provisions of disqualification he must be in arrears as aforesaid for more than three months. It is in these circumstances the Election Commission has rejected the plea of the petitioner that the first respondent has incurred disqualification for being a Member of the Panchayat. As we pointed out earlier the approach and reasoning of the State Election Commission is thoroughly misplaced and misconceived.
6. Now, therefore, we have to examine whether the first respondent incurred disqualification under section 10(d) of the new Act read with the Notification dated 16th June, 1971. In order to fall under section 10(d) one should be in arrears for more than three months. The contention of the first respondent before us is that the letter dated 1st July, 1993, cannot be treated as a demand, though before the Election Commission he challenged the very liability for the payment. However, before us though he admits the liability he submits that there was no demand as envisaged by law and only from the date of such demand the three months period could be reckoned. He submits that except the letter dated 1st July, 1993, there was no demand served on the first respondent to reckon the period three months. We cannot agree with the contention of the first respondent for the following reason.
7. The first respondent in his affidavit filed before this Court on 3rd June, 1996, of course, did not deny the liability. He says that he was prepared to pay the amounts due as pointed out by the Audit personally, but the respondent No. 2 in collusion refused to accept the remainder amount after accepting half the amount. One thing clear from these pleading is that he was aware that such an amount is due from him to the Panchayat and he had acknowledged that liability by making payment of a portion of the amount. Therefore he cannot be heard to say that no demand was made by the Panchayat. In the present circumstances and for the purpose of section 10(d) we hold that the letter dated 1st July, 1993, is a valid demand made by the Panchayat on the first respondent for making payment in dispute of Rs. 540/-. As we pointed out earlier in pursuance of the letter he has paid Rs. 270/- on 1st April, 1995. An argument was advanced at the instance of the first respondent that the letter of 1st July, 1993 issued by the Panchayat gives him instalment facility to remit the entire amount and also it gives no last date within which time he should pay the amount and therefore it was contended on behalf of the first respondent that letter dated 1st July, 1993, cannot be treated as a demand. It is difficult to digest these arguments.
8. In this context we have to examine what is the dictionary meaning of 'demand'. According to 'Straud's Judicial Dictionary', 'demand' means something more than asking; it is a requisition in the shape of force.
As per the 'Chambers 20th Century Dictionary', 'demand' means to ask peremptorily or authoritatively for; the asking for what is due.
According to the 'Concise Oxford Dictionary', 'demand' is an insistent and a peremptory request made as of right.
9. On examining the various meanings given to the word 'demand' by these dictionaries we have no hesitation to hold that the letter dated 1st July, 1993, is a demand legally made on the first respondent. All the ingredients which are spelt out from the meaning of the word 'demand' are present in the letter. It has been issued by authority and it contains an insistence and the receiver of the letter has no escape but to comply with the demand. We have to perceive the controversy in a larger perspective as well. The Panchayat is an institution functioning as basic political unit where democratic training is imparted to the citizens in village level. The principles of democracy and integrity of individual in public life are destined to be inculcated among the citizens under these political institutions at grass root level, apart from its other object of local self governance. Such institutions are to be manned by only those persons who are basically having unquestionable character and who set an example to others showing transparency in their activities. In the background of such a social object to be achieved by the Panchayat Raj Act, a responsible Member who is supposed to exhibit an ideal conduct for the other citizens in respect of the relationship with the Panchayat and other citizens cannot be permitted to be absolved from a liability of any dues to the Panchayat by raising a technical plea. His conduct before the Election Commission also is not becoming of a pancha of a Panchayat. On receipt of the notice issued by the Panchayat intimating his liability to pay Rs. 540/- and after having remitted half of the amount of 1st November, 1995, he pleaded before the Election Commission without demure that there is no liability of payment. He disputed the liability before the Election Commission. On a close scrutiny of the dealing, we find that it was a transaction perilously close to misappropriation of funds of the Panchayat. The first respondent obtained money from Panchayat. The first respondent obtained money from Panchayat on different occasions on the pretext of having done manual work for the Panchayat. But actually was doing no such work, of course with the connivance of the Panchayat officials. But audit took a soft view of the matter and asked him to refund the amount for non-production of vouchers for having paid the workers for the so-called work done. This conduct of the first respondent according to us, to say the least, is not becoming of a pancha of a Panchayat. Of course, it was open to him to raise the objection when he received the letter dated 1st July, 1993, or when he came to know about the Audit Objections. From the relevant provisions in the Panchayat Raj Act it can be seen as how to deal with such Audit objections if objected to by the person concerned. But here in this case the Audit objection has been accepted by the first respondent. No dispute had been raised at any point of time about his liability or the quantum of liability. He accepted the liability and remitted a portion of the amount. Therefore, there is no difficulty in holding that he was in arrears. The question is how long was he in arrears in order to attract the mischief of section 10(d) of the Act. For this also we rely upon the conduct of the petitioner himself. Needless to say that the letter dated 1st July, 1993, gave him an opportunity to pay the amount due in instalments. A portion of the amount was paid by him only after a lapse of two years from receipt of letter dated 1st July, 1993. He was told by the said letter that this amount was found due from him by the Audit Department while they were auditing the accounts in the year 1988-89 and the letter further says that in the Audit Report of 1991-92 also the auditor has raised objection and directed the Panchayat to recover the said amount in instalments. When we read this letter in the light of section 19(d) read with the Notification dated 16th June, 1971, this amount ought to have been paid within three months from 1st July, 1993, if he wanted to avoid the disqualification. The instalment provided in this letter cannot be taken beyond the three months because no authority has been given power to extend the statutory period prescribed by law. Therefore, the letter dated 1st July, 1993, giving instalment facility to the petitioner only means that he could pay that amount within three months by instalments. In other words, the first respondent cannot take refuge under the wording of the letter of 1st July, 1993, to surpass the mandatory provision of the rules. The letter should be interpreted in such a way that dues which are allowed should be so paid by instalments within three months, so that he may not incur any disqualification. Allowing payment of instalments does not mean that he can pay it at any time or he can extend the period of payment for an indefinite period as he was trying to do in this case. This amounts to inroads into the mandate of the statute. Therefore, we are of the opinion the first respondent has already incurred the disqualification being in arrears of the amount due on the expiry of three months from the date of the letter dated 1st July, 1993.
9. The approach of the State Election Commission in passing the impugned order can be viewed in another angle. The Goa Panchayat Raj Act, 1993 has been passed by the Legislative Assembly of Goa on 25th May, 1994, and has been assented to by the Governor on 9th July, 1994. Section 1 of the Act deals with the short title and commencement of the Act. Sub-section (2) of section 1 reads as follows :---
'Section 1(2) :---Section 245 shall be deemed to have come into force with effect from 20-4-1994, while the remaining sections shall come into force on such date as the Government may, by notification in Official Gazette specify and different dates may be specified for different provisions of the Act.'
It is discernible that section 245 is deemed to have come into force on 20th April, 1994. In other words, the repeal of the earlier enactment namely, the Regulation of 1962, has come into effect on 20th April, 1994. All the provisions of the Regulation and the Rules made thereunder have to be deemed to be in force till 20th April, 1994. The letter evidenced by Exhibit 'E' whereby the first respondent had been given notice of non-payment of Rs. 540/- due to the Panchayat in pursuance of the Audit objections had been issued on 1st July, 1993. As per the conclusions arrived at by us in this case, letter Exhibit 'E' should be treated as a demand of the amount due to the Panchayat. Three months period expired on 31st October, 1993. As on 1st November, 1993, it was apparently clear that the first respondent was in arrears for more than three months. On 1st November, 1993, the actual regulation that prevailed was that of the old one. Therefore, the exercise done by the Election Commission to find out what are the rules relevant for the purpose of section 10(d) of the new Act was, according to us, really unnecessary. From the aforesaid undisputed facts, it can be seen that the first respondent could have been declared as disqualified to continue as a Member from 1st November, 1993, under section 11(j) read with the Notification dated 16th June, 1971. Merely because disqualification which was incurred by the first respondent under the old Act and the Rules was not taken note of either by the Panchayat or by the authorities concerned, it cannot be said that he could continue even thereafter, on incurrence of disqualification. In view of the above reasoning also, we have no hesitation to hold that the first respondent has become disqualified to continue as Member of the Panchayat.
10. Before parting with this case, we cannot help pointing out a procedural irregularity committed by the Election Commission in this case. Section 11 of the new Act as aforesaid enjoins upon the Election Commission to render a decision on a question which arises as to whether a Member of the Panchayat has become subject to any disqualification referred to in Sub-section (10). The section also postulates that the Election Commission should decide the question on a reference made to him. On a conjoint reading of sections 10 and 11 it can be seen that the incurrence of disqualification on the circumstances enumerated under section 10 has to be first decided by the Panchayat and it has to be informed to the concerned Member disqualified. If the Member disputes the decision of the Panchayat as to his disqualification, then the Panchayat will have to refer the matter to the Election Commission. Therefore, section 11 of the Act becomes clear that the Election Commission will get the jurisdiction only on a reference of a question made to it. Section 11 does not give any party other than the Panchayat or and the person subject to disqualification any right to approach the State Election Commission for a final decision under section 11. Therefore, on a petition filed by the petitioner, the State Election Commission should not have proceeded with the matter as there was no reference of a question as laid down by law. We find here in this case, the State Election Commission even on a petition filed by the petitioner granted an interim injunction, which we doubt very much whether such an action is permissible under the Act. As we have pointed out earlier, since we are setting aside the order of the Goa State Election Commission on merits, we point out this irregularity and leave the matter here for the future guidance of the State Election Commission.
11. Therefore, the writ petition is allowed and rule is made absolute on the following terms. We find that the order of the Goa State Election Commission is illegal and liable to be set aside and is hereby quashed. The first respondent is hereby declared to be disqualified under section 10(d) of the Goa Panchayat Raj Act and does not continue to be a Member of the Panchayat with effect from 31st October, 1993, onwards.