application of any money or other property belonging to Panchayati Raj Institution is caused as a direct consequence of neglect or misconduct on the part of members including Chairpersons and Deputy Chairpersons of the Panchayati Raj Institution while in office, they shall be liable for the same. But, as per mandate of the said provision, before determining the extent and amount of liability of such office bearers for such loss, waste or mis-application of money or property, they are required to be served with a notice containing allegations against them and unless, they admit their liability and its amount, the competent authority or authorized officer is required to determine the liability or its extent, after recording evidence in support of allegations and after giving concerned office bearer an opportunity to cross-examine the witness. In this view of the matter, the action of the respondents in creating the demand against the petitioners, who are office bearers of various Gram Panchayats, straight away, on the basis of the inquiry conducted against their back, without adhering to the procedure laid down under Section 111 of the Act, is not sustainable in the eyes of law.”
