Supreme Court Upholds Disqualification of Zilla Parishad Member in Corruption Case

The case of Virendrasing vs. The Additional Commissioner & Others revolves around the disqualification of a Zilla Parishad member due to alleged misuse of office for personal financial gain. The Supreme Court upheld the disqualification, citing the need for transparency and probity in local governance. The ruling reinforces the principle that elected officials must not have direct or indirect financial interests in projects sanctioned by the government.

Background of the Case

The appellant, Virendrasing, was elected as a member of the Zilla Parishad, Chimthane Block, Taluq Shindkheda, District Dhule, on January 8, 2020. However, his election was challenged by Respondent No. 3, who had lost the election. The challenge was based on allegations that Virendrasing misused his position to award a government contract to his son.

Respondent No. 3 filed a petition under Sections 40 and 16(1)(i) of the Maharashtra Zilla Parishads and Panchayat Samitis Act, 1961. The core allegation was that Virendrasing had a financial interest in a road repair project sanctioned by the Aarave Gram Panchayat. The project, worth ₹14,62,871, was administratively sanctioned by the Zilla Parishad, Dhule, on June 5, 2020, and subsequently awarded to Virendrasing’s son through an e-tender process on July 21, 2020.

Legal Issues Before the Court

Whether the appellant’s involvement in the Zilla Parishad’s sanctioning of a project that benefited his son violated Section 16(1)(i) of the Maharashtra Zilla Parishads and Panchayat Samitis Act.
Whether the contract awarded to the appellant’s son constituted a direct or indirect financial interest by the appellant.
Whether the principles of natural justice were violated during the disqualification proceedings.

Arguments by the Petitioner (Appellant – Virendrasing)

The appellant challenged his disqualification, arguing:

“The contract was awarded by the Aarave Gram Panchayat, not the Zilla Parishad, and thus does not fall under Section 16(1)(i).”
“The appellant had no financial interest in his son’s business and did not reside with him.”
“The appellant was denied a fair hearing as the Divisional Commissioner did not allow oral arguments.”
“The Zilla Parishad only provided administrative approval, and the Gram Panchayat executed the project.”

Arguments by the Respondent (State of Maharashtra & Complainant)

The respondent, represented by Respondent No. 3, argued:

“The project was sanctioned by the Zilla Parishad and funded by state government grants, making it a ‘work done by order of the Zilla Parishad’ under Section 16(1)(i).”
“The appellant’s son was registered as a contractor only after the appellant’s election, indicating misuse of office.”
“The appellant used his position to influence the project and indirectly benefit from the funds.”
“Multiple adjournments were granted, and the appellant submitted written arguments, fulfilling the requirement of a fair hearing.”

Supreme Court’s Analysis and Judgment

The Supreme Court upheld the disqualification and made the following key observations:

“The objective of Section 16(1)(i) is to prevent financial conflicts of interest in Zilla Parishads. The provision applies to both direct and indirect interests.”
“The funds for the project flowed from the Zilla Parishad to the Gram Panchayat, making the Zilla Parishad the approving authority.”
“The appellant’s claim of financial independence from his son lacks evidence, as no proof of separate financial arrangements was provided.”
“Natural justice was not violated, as the appellant had ample opportunities to present his case.”

The Court ruled:

“The appeal is dismissed. The disqualification of the appellant under Section 16(1)(i) of the Maharashtra Zilla Parishads and Panchayat Samitis Act, 1961, is upheld.”

Key Takeaways from the Judgment

Section 16(1)(i) of the Maharashtra Zilla Parishads Act prohibits both direct and indirect financial interests of elected members in government contracts.
The mere approval of a project by a Zilla Parishad can be sufficient to establish financial interest if a relative of the member benefits from the contract.
Natural justice requirements are met if written arguments are considered, even if oral hearings are not granted.
Preventing conflicts of interest in local governance is crucial for maintaining public trust.

Impact of the Judgment

This ruling reinforces the legal framework ensuring transparency in local governance. It establishes that elected officials cannot evade accountability by using indirect methods to benefit financially from government projects. The decision sets a precedent for strict enforcement of anti-corruption provisions in local self-government institutions.

By upholding the disqualification, the Supreme Court sends a clear message that elected representatives must adhere to ethical governance practices and avoid financial conflicts of interest.

Petitioner Name: Virendrasing.
Respondent Name: The Additional Commissioner & Others.
Judgment By: Justice Sanjay Kishan Kaul, Justice Ahsanuddin Amanullah, Justice Aravind Kumar.
Place Of Incident: Dhule, Maharashtra.
Judgment Date: 17-04-2023.

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