Prevention of Corruption Act: A Relook at the Proposed Amendments

~ By Kanu Agarwal

After the Prevention of Corruption (Amendment) Bill was introduced in the Rajya Sabha in 2013 by the UPA Government, the Select Committee of the Rajya Sabha, formed after the present Government assumed office, has analysed the changes, incorporated suggestions from various stakeholders and presented a detailed report. The Bill is pending and may be passed once the dead lock in the Upper House is resolved. There have been comments and editorials on the pending amendments raising concerns over the amendments which allegedly roll back the government’s promise to fight against corruption amidst the demonitisation hullabaloo. When analysed closely, most of the criticism falls short. For starters, it is necessary to understand thatthe jurisprudence and precedents surrounding the unamended sections is not squandered and comes in aid to the construction and interpretation as and when needed. It is in this light, we must analyse the proposed changes in the Prevention of Corruption Act and the impact they may have on future prosecutions.

The first change that the amendment proposes in the standardisation of the usage of the term used to refer to the illegal benefit the public servant gains during the course of employment. The unamended Act, in various places used different terms like ‘illegal gratification’, ‘pecuniary advantage’ or ‘valuable thing’ to refer to the benefit gained by the public servant causing certain amount of confusion in defining and interpreting the said terms. The amendment seeks to introduce the words ‘undue advantage’ throughout the Act and stadardise the usage and provide a lucid definition, in line with the unamended Act, to harmoniously construct and amend the definition. The meaning of the term’undue advantage’ is well understood in the international jurisprudence andare taken from United Nations Convention Against Corruption (UNCAC). It is defined as anygratification other than legal remuneration. The definition has a wide inclusionary clause of ‘any gratification’ to include gratification over and beyond the traditional pecuniary means and a restrictive exclusionary clause of ‘legal remuneration’ to include remuneration permitted by the Government.

The other noteworthy amendment is the imposition of time limit on the trial period on the Special Judge. The amendment is remarkable in its position considering the complex nature of the trial and the recurring phenomenon of long drawn trials before the Special Judge. The amendment imposes a limit of two years on the trial with the provision for extension of time period by six months each time recording reasons but with an upper limit of four years and is a very welcome move.

The major change that has created apprehensions are the changes to construction of Section 7 and Section 13. The unamended Act dealt with bribery and criminal misconduct by public servant in the said sections laying down conditions necessary to establish the commission of the said offences. Due to the overlapping nature of the construction of conditions in the two sections, on numerous occasions, the prosecuting agencies often utilise both to establish guilt, further burdening the evidentiary exercise. With the stratified construction of the amended Section 7 and 13, the offences now clearly stand segregated with bribery of any form under Section 7 and misappropriation and disproportionate assets cases under Section 13. Expanding the language, Section 7 contemplates a situation wherein a public servant induces another public servant to perform,improperly or dishonestly, a public duty even in anticipation of accepting an undue advantage from any person. The aforesaid situation was never contemplated in the unamended Act and would be instrumental in disrupting the present top down ‘food-chain’ of corruption by linking the activities of one public servant to another. Further, the Act removes the redundant phrase ‘agrees to receive’ from Section 7 in line with the prevailing precedents which mandate that the presence of an unequivocal ‘demand’ and the ‘acceptance’ in lieu of such demand is necessary for establishing the offence.

The omission of clause (d) of Section 13(1) has caused a certain confusion with the apprehension of removal of the provisions which had been instrumental in the trials of the Bofors scandal, 2G scam, Commonwealth scam, Coal scam, etc. Even experienced analysts like YogendraYadav[1] and Shalini Singh[2] have mistakenly assumed that the said omission amounts to decriminalisation of indirect forms of corruption. The said apprehension is fueled by the failure to critically analyse the expanded Section 7. The unamended Section 13(1)(d) refers to obtaining any valuable thingor pecuniary advantagefor himself or for any other person, by corrupt or illegal means or abusing the position orwithout any public interest. The amended Section 7 refers to ‘undue advantage’ in place of pecuniary advantage and valuable thing expanding the scope of the application of the Section. Further, the apprehension that the amendment removes the third party transactions which take place within the higher echelons of the bureaucracy ignores the nature of Section 7 and the Explanation 2[3] provided in the Section.

The explanation of the amended Section 7clearly provides for obtaining of undue advantage by a public servant for ‘himself or any other person’ would be included under said provisions. Further, Explanation 2(ii) expressly clarifies that any undue advantage obtained through a third party is at par with advantage obtained directly for the purposes of Section 7. Further, note the use of the same language (italicized portion) in the Explanation as the erstwhile Section 13(1)(d). The inclusion of the same in the explanation has mistakenly been seen subsuming of a provision and diluting the same amounts to ‘including of the crime of murder under provision for grievous hurt. The question here is the effect of the provision itself in light of language therein understood in light of the amendment which makes it abundantly clear that crime envisaged to be curbed under Section 13(1)(d) is clearly covered and in fact, expanded under the amended Section 7. Another important aspect that the unwarranted criticism fails to understand is that, in effect, the amended Section 7, if compared to the unamended Section 13(1)(d), is far wider and further lowers the prosecutorial burden by removing the caveats of corrupt or illegal means, abuse of position or lacking public interest which were often used by corrupt officials to wriggle out of allegations. The amended Section 7 provides that the obtaining of undue advantage is in itself an offence and there is no burden on the prosecution to prove improper performance of public duty or abuse of position or lack of public interest.One must remember that without the CAG reports in the 2G scam and the Coal-gate scam, the standard of proof improper public duty would have been impossible to prove. No wonder that lawyers like KapilSibbal advocated a ‘zero loss’ theory to camouflage the transaction as one done in pursuance of larger public good. Further, contrary to apprehensions, as per the construction of the Explanation 1[4] to Section 7, there is no need to prove any bribery or direct quid pro quo in the transaction. Where a public servant receives illegal gratification in a clandestine manner, he can still be prosecuted in the same manner and there is no additional burden on the investigating officer and in fact, lowers the prosecutorial burden in such cases.

In practice, while there were numerous high profile cases registered under Section 13(1)(d), there were rarely any convictions as vague and situational concepts of abuse of position and public purpose are extremely hard to prove and more so considering the ‘proof beyond all doubt’ approach of criminal law. Further, the tendency to judge the Act and the unamended section by merely keeping the high profile cases in mind would cause disservice to the law. The unhinged guillotine of the law is to be examined from both side in all kinds of cases. The law remains the same for the high and mighty corrupt and the law abiding peon, and the misuse of the same, would affect the latter more. Be that as it may, in effect, after the omission of Section 13(1)(d), with the changes and expansion in Section 7 and the holistic study of the amended Act, corruption through third party transactions has been explicitly illegalized and the scope of such transaction has been expanded as opposed the popular apprehensions.

The amendment expressly criminalises bribe-giving, a provision which was absent in the unamended Act. Although, as per the unamended Act, the bribe givers could be prosecuted for abetment of the crime under the Act but the amendment specifically brings in a new provision to deal with the issue. During the discussions before the Rajya Sabha Committee, there was emphasis on the separation of ‘coercive bribery’ and ‘collusive bribery’. The Committee noted that there exists a very thin line between the two even in the international arena with ample possibilities of persons falling on either side to misuse the protection. The definition of such terms would be difficult to frame and the evidentiary exercise required to separate the two would result in unnecessary delays. As per the Rajya Sabha Report, the clause criminalises all forms of bribe giving with an exception wherein the bribe giver had given the bribe under compulsion and reports the same within seven days to escape prosecution. The only protection afforded to a bribe giver is in cases where the accused is able to establish that she/she was being compelled to give the bribe. The said requirement to prove ‘being compelled’ to give the bribe, contrary to apprehensions, would not be difficult for honest bribe givers to prove. That apart, the deletionof Section 24, contrary to apprehensions, cannot have any effect on ‘trap cases’. Trap cases are one wherein on demand of money by the public servant, the bribe giver first approaches the Lokayukta Police which then lay the trap to catch the public servant red handed. The said trap cases would still be equally viable as a person who approaches the agencies before the payment of bribe is obviously protected as he has not yet paid the bribe. As for the bribe givers who have already paid the bribe, there can be no question of a trap case or them hesitating to come forward for the same as the procedure for trap cases does not work after the bribe has been paid.

The Act criminalises bribe giving by commercial organisations so that the law regarding the crime of bribe giving is in tune with the fact that most collusive bribes are given by or on behalf of commercial organisations. The only escape route for the organisation would be the establishment of adequate procedures to prevent associated persons from giving such bribes. The problematic provision therein is the definition of commercial organisation which excludes charitable organisations from the net. If one studies the NGO, trust and charitable organisations and their work in India closely, the misuse of the said organisations would result in a loophole which could be utilized by vested interests. Another apprehension is with regard to the deletion of Section 10 claiming that no effective substitutes are spelled out in the proposed bill, since while abetment of an offence is an offence, the abetment of abetment is not. This has no basis in criminal law as the abetment of abetment, if done knowingly amounts to abetment itself and the abetment of abetment, unknowingly, cannot be abetment (or for that matter any crime) as per the settled criminal jurisprudence of mensrea. Further, the apprehension at the deletion of Section 11 (Public servant obtaining a valuable thing without consideration from person concerned in proceeding or business transacted by such public servant) as the same is amply dealt with by Section 7. To put it bluntly, the existing Act was defined and worded very shabbily with multiple overlaps and confusion which often made the work of the prosecution difficult with the accused presenting different versions of the same.

The next major amendment is in Section 13 of the unamended Act with the amendment merely juggling words from one place to another with hardly any impact on the legal usage of the Section. The apprehensions in various quarters that threshold of proof has been raised in the cases of disproportionate assets is highly misplaced if one studies the text of the previous Act and the amendment closely. The previous Act provides that if a person or any person on his behalf, is in possession of assets for which he cannot satisfactorily accounthaving pecuniary resources or property disproportionate to his known sources of income, would be guilty of criminal misconduct. The amendment states that a person would be said to have committed criminal misconduct if he ‘intentionally enriches’ himself during the term of his office. By using the term intentional enrichment, the amendment has caused certain confusion with allegation of raising of burden of proof on the prosecution but a closer study of the Explanation of the said amended Section 13 would dispel all doubts. Using the same language, the amendment clarifies that a person shall be presumed to have intentionallyenriched himself illicitly ifhe or any person on his behalf, is in possession of assets for which the he cannot satisfactorily account for; beingpecuniary resources or property disproportionate to his known sources of income. Therefore, in effect, the term intentional enrichment is the same as the previous unamended section and the only change would be usage of the term ostensibly to bridge the gap between the international jurisprudence and India laws on the subject. Further, the unamended Act defined “known sources of income” as incomereceived from any lawful source and such receipt has been intimated in accordance with law. The amendment removes the phrase requiring intimation of the receipt but would hardly have any impact considering the nature of investigation and trial in disproportionate asset cases and the surrounding precedents of the Supreme Court. The apprehension that the accused would be allowed to cite fresh sources of income after the trial has been initiated against them resulting in a loophole which was earlier plugged by the Act in 1988, is misplaced as the calculation of income and the known sources of income would, in practice, remain the same and merely because the said phrase has been omitted, the practice adopted by the agencies and the Court will not change.

Other than the above said, the protection of sanction under Section 19 has been extended to retired public servants curing an irrational position. As per the prevailing position, no sanction is required wherein public servants who have retired even though the allegations pertain to the time when the said persons were functioning in the capacity of public servants. Often the said provision is misused by investigating agencies which wait for the retirement of senior public servants only for the purposes of bypassing the protection enshrined under Section 19. The above said amendment are largely positive and there has been little or no criticism of the same. The amendment also fixes a time limit for according prosecution sanction vide Section 19 is a very welcome step as often the sanction from the concerned department delays the prosecution. Surprisingly, even this has been labelled half-hearted, in light of no provision for a “deemed sanction”. The concept of sanction is very important in terms of the prevention of corruption and it would be absolute anathema to introduce a concept of deemed sanction. As is often the case in government departments, such decisions are delayed for various reasons, sometime legitimate and sometimes not quite so legitimate. The concept of a deemed sanction would take away the vital protection in case wherein the delay has been caused on genuine reasons like transfers of senior officers, ministerial approvals, etc. In case the competent authority delays decision making beyond four months, it would still be bound to explain the said delay creating a strong enough deterrence for the same whilst providing the requisite protection in genuine cases.

Lastly, the other amendment which has attracted a huge amount of criticism, is the addition of Section 17A. The said section provides for additional protection to government servant especially during the tendering process wherein there were increased apprehensions because of frivolous complaints and harassment beingsuffered by officers. The section provides for permission to be taken from the appropriate authority before the police officer shall conduct any enquiry orinvestigation into any offence alleged to have been committed by apublic servant which is relatable to any recommendation made or decision takenin discharge of his official functions or duties. As the language makes it clear, the said protection is only available in situations wherein complaints have been made against a public servant pertaining to any official decision taken by him in the official capacity. A pertinent point herein is that official functions and decision making in a department is already regulated by the service rules which bound the officer. In case of the breach of any of the checks imposed through the service rules, a departmental inquiry results in various forms of punishment albeit of non-criminal nature. Further, decision making, especially pertaining to tenders and government property, is thoroughly controlled by the government policy and Rule of Business.It is a result of decision making process at various levels and often it would be wrong to make a particular employee the scape goat for a particular decision. While the enormity of scams like 2G, Bofors, Coal-Gate, etc, all of which were regulated by Government tenders is not to be ignored, it is necessary to note that other unscrupulous elements have been harassing government servant through various extra governmental and extra judicial means. Further, it has to be remembered that cases could be initiated and built in the 2G and the Coal-gate scams on account of the CAG reports which came out establishing serious doubts on the process. Without the said CAG report, which represents a cog in-built in the executive setup, it is unimaginable that any trial would have even started in these matters.

The said protection, which has been brashly termed as ‘diabolical’ in some quarters, is the prevalent practice across various Lokayuktas and Lokapals wherein the technical departments, before registering a FIR, refer the complaint to the requisite department for a comment and departmental action.If the said action is deemed to be inadequate, then criminal charges are pushed. The amendment may, in practice, result in inaction and perhaps protection of the certain corrupt officials in cases of high level corruption, it cannot be accused of worsening the present situation.Be that as it may, the provision is open to criticism as the process of investigation may be halted before the permission is taken. This may result in a redundant complaintsin the absence of an investigative material to serve as the basis of a decision of the appropriate authority.The amendment is hardly of a ‘diabolical’ nature as has been referred to in certain quarters. The said provision may still indeed be questioned before the constitutional Courts but it is completely different from the ‘single directive’ which was declared unconstitutional by the Supreme Court in the Vineet Narayan case.

Overall, if the amendments are to be analysed from a legal perspective ascertaining the impact on the prosecutorial process, it would be clear that the amendments are aimed at enlarging the scope of what is considered ‘corruption’ within the setup. The amendments aim to bring the Indian law at par with the international convention which the country has signed and ratified. The amendments standardise and rationalize the two main penal provisions of Section 7 and Section 13 providing a great deal of cohesion and cogent compartmentalisation. The amendment also extends vital protections to retired officers and clarifies the confusion regarding forfeiture of property. The controversy regarding the permission seeking before investigation under the proposed Section 17A could have been avoided considering there are genuine concerns over its applicability. Other than that, the criticism surrounding the alleged omission of Section 13(1)(d) is ludicrous if one studies the impact of the changes brought about in Section 7 of the Act through the amendment.

As isoften the case in democracies, public sentiment affects the law making process to a great extent. We must realise that law making is a highly technical process and requires discussion, debate and deliberation to result in to a viable draft. The over-reliance on public sentiment creates extraordinary situations wherein laws pertaining to internal security, external aggression or terrorism are sought to be made lenient even though they regulate genuinely troubled spheres and on the other hand, the laws pertaining to crimes against women, corruption, etc, even after being already being extremely strict, are expected to be made more ‘draconian’. This public sentiment basedinsincere approach, is an avoidable latch in the democratic law making. Often the critique of the amendment, in various respected quarters, rests onthe classic rhetoric of ‘sab mile hue hain’. While it is easy to fall prey and be cynical about the situation within the bureaucracy and politics in general, and create a holier than thou image by criticizing the same, one must be fair in interpreting the law. It is understandable that criticizing the amendment amidst the demonitisation drive might be politically viable and fashionable in some quarters, the said criticism must be borne out of genuine apprehensions and not by the incomplete reading of amendmentsand shallow understanding of the prevailing law.

(Author is an advocate at the Supreme Court of India, New Delhi.)

[1] Time to blow the whistle, The Hindu, 12 Dec 2016

[2] Prevention of Corruption Act: Watered down version will make scamsters look like saints, Firstpost

[3] Explanation states:

(i) the expressions “obtains” or “accepts” or “attempts to obtain” shall cover cases where a person being a public servant, obtains or “accepts” or attempts to obtain, any undue advantage for himself or for another person, by abusing his position as a public servant or by using his personal influence over another public servant; or by any other corrupt or illegal means;

(ii) it shall be immaterial whether such person being a public servant obtains or accepts, or attempts to obtain or is to accept or attempt to obtain the advantage directly or through a third party.

[4] For the purpose of this section, the obtaining, accepting, or the attempting to obtain an undue advantage shall itself constitutes an offence even if the performance of a public duty by public servant, is not or has not been improper.

 

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