Lokayukta Lacked Jurisdiction to Decide Civil Disputes Between Private Parties: Bombay High Court

In a important judgement, Bombay High Court quashed the order of the Maharashtra Lokayukta, which directed a cooperative society to withhold payments to the petitioners, Bhiku Anna Tambe and others, and instead pay the respondent, Ganpat Anna Tambe, in connection with a dispute over sugarcane supplies. The court held that the Lokayukta lacked jurisdiction to intervene in the civil dispute involving inheritance issues and found the Lokayukta's order to be in violation of natural justice, as the petitioners were not impleaded in the proceedings before the Lokayukta.

The dispute involved three brothers, Bhiku Anna Tambe, Laxman Anna Tambe, and Ganpat Anna Tambe, over the inheritance of properties in Jeur, Taluka Purandar, and the subsequent payments for sugarcane supplies made to the cooperative society, Shree Someshwar Sahakari Sakhar Karkhana Ltd.. The brothers had ongoing civil and cooperative court disputes over ownership of the property from which the sugarcane was being supplied.

The Shree Someshwar Co-operative Society initially passed a resolution to stop accepting sugarcane from either party due to their internal inheritance dispute. The petitioners challenged this resolution before the Co-operative Court, which passed an interim order on January 8, 2018, restraining the cooperative society from enforcing its resolution.

Meanwhile, Ganpat Anna Tambe (respondent) filed a complaint with the Lokayukta, alleging that the petitioners had fraudulently obtained payments from the cooperative society by using a fraudulent map prepared in collusion with a government official (Talathi). The Lokayukta, by its order dated December 6, 2019, directed that payments for sugarcane supplies should be made to Ganpat Tambe instead of the petitioners, despite the ongoing court proceedings.

Jurisdiction of the Lokayukta: The key issue was whether the Lokayukta, under Section 8(1) of the Maharashtra Lokayukta and Upa-Lokayuktas Act, 1971, had the authority to intervene in a civil dispute regarding the payments for sugarcane supplies, particularly when the dispute was already before the civil and cooperative courts.

Violation of Natural Justice: The petitioners argued that the Lokayukta’s order was passed without them being made parties to the proceedings, violating the principles of natural justice.

Interference in Civil Disputes: The court had to determine whether the Lokayukta could issue directions that affected a private civil dispute concerning inheritance and property rights.

The Bombay High Court noted that the Lokayukta's jurisdiction under the Maharashtra Lokayukta Act is limited to investigating allegations against public servants for abuse of power or corruption. The court found that the Lokayukta's role does not extend to deciding civil disputes between private parties, especially when such matters are already being litigated in civil and cooperative courts. The court emphasized:

"The Lokayukta is not empowered to decide purely civil disputes between the parties, particularly when courts and other quasi-judicial authorities are seized of such disputes."

The court further observed that the direction to withhold payments to the petitioners and redirect them to the respondent was made without jurisdiction and in violation of natural justice, as the petitioners were not even given an opportunity to be heard in the Lokayukta proceedings.

Additionally, the court noted that the Co-operative Court had already passed an interim order allowing the petitioners to continue supplying sugarcane, and payments were being made to them accordingly. The Lokayukta's interference in this matter was inappropriate and beyond its statutory powers.

The court quashed the Lokayukta’s order, holding that it was issued without jurisdiction and violated the principles of natural justice. The court directed that the civil and cooperative courts should continue to adjudicate the underlying inheritance and payment disputes. The judgment clarified that the court did not express any opinion on the merits of the inheritance dispute, which should be resolved by the appropriate judicial forums.

"The rights and entitlements of the parties in the underlying civil dispute remain open for determination by the civil and cooperative courts."

The court also set aside the cooperative society’s letter dated February 7, 2020, which had suspended payments to the petitioners based on the Lokayukta’s order. The society was directed to resume payments to the petitioners unless there was any other court order preventing them from doing so.

In this ruling, the Bombay High Court reasserted the limited jurisdiction of the Lokayukta under the Maharashtra Lokayukta Act, holding that the Lokayukta cannot intervene in ongoing civil disputes, particularly where property rights and inheritance issues are involved. The court emphasized the importance of natural justice and the right of parties to be heard before any orders affecting their legal and financial rights are issued.

Date of Decision: October 17, 2024

Bhiku Anna Tambe and Others vs. Ganpat Anna Tambe and Others