Panchayat or as a Member, Chairman or Vice Chairman of a Panchayat Union Council or District Panchayat shall, on conviction by a Criminal Court, be disqualified from being a member, President, Vice President or Chairman, as the case may be.

Penalty for acquisition by an officer or servant of interest in contract work Penalty for acquisition by an officer or servant of interest in contract work.—If any officer or servant of a Panchayat knowingly acquires, directly or indirectly, by himself or by a partner, employer or employee, any personal share or interest in any contract or employment with, by or on behalf of the Panchayat, he shall be deemed to have committed an offence under section 168 of the Indian Penal Code (Central Act XLV of 1860): Provided that no person shall by reason of being a shareholder in, or member of, any company, be held to be interested in any contract entered into between the company and the Panchayat unless he is a director of such company: