PC Act- Prevention Of Corruption Act

· Gratification- U/S-7 of the Prevention of Corruption Act, 1988

· Public Servant- U/S-7 of the Prevention of Corruption Act, 1988

Prevention of Corruption Act, 1988

S-7 Of The PC Act, 1988

· Public servant taking gratification other than legal remuneration in respect of an official act under S-7 of the PC Act, 1988- A detailed legal analysis in the light of the bare legal provisions as contained in the Act and the Judgments of the Supreme Court of India and the Judgments of High Courts of the Indian States.

Corruption has been seen as an immoral and unethical practice since biblical times. But, while the Bible condemned corrupt practices, Chanakya in his teachings considered corruption as a sign of positive ambition. According to the Transparency International Corruption Perception Index, India is ranked 78 out of 180 nations. This is not a good look for a nation trying to boost its business sector. In India, the law relating to corruption is broadly governed by the Indian Penal Code, 1860 (‘IPC’) and the Prevention of Corruption Act, 1988 (as amended from time to time) (‘POCA’). The new amendments to POCA (‘POCA Amendment Act’) which provides for supply-side prosecution, among other key changes was passed by both houses of Parliament and received the assent of the President on July 26, 2018

In 1988 POCA was enacted to consolidate all laws relating to offences by public servants. However, POCA prosecuted and criminalised only bribe-taking and not bribe-giving. The erstwhile Section 7, Section 8, Section 9, Section 10 and Section 11 of POCA criminalised various corrupt acts of public servants and middlemen seeking to influence public servants per se while excluding the bribe giver as well as private entities -taking bribes. Although the application of POCA was limited to public servants, courts have given an expansive interpretation to the expression ‘public servant’. For instance, in Central Bureau of Investigation, Bank Securities & Fraud Cell v. Ramesh Gelli & Ors., the Supreme Court of India (‘Supreme Court’) held that the chairman and directors of a private bank would also be ‘public servants’ for the purpose of POCA. The POCA Amendment Act has now extended the scope of POCA to prosecute bribe givers, commercial organizations and its officials. However, the POCA Amendment Act has failed to bring within its ambit, corrupt practices among private entities inter se and illegal gratification to foreign officials. This paper aims to take a closer look at section 7 of the Prevention of Corruption Act, 1988.

SECTION 7 of the Prevention of Corruption Act, 1988

Public servant taking gratification other than legal remuneration in respect of an official

act.—Whoever, being, or expecting to be a public servant, accepts or obtains or agrees to accept or attempts to obtain from any person, for himself or for any other person, any gratification whatever, other than legal remuneration, as a motive or reward for doing or forbearing to do any official act or for showing or forbearing to show, in the exercise of his official functions, favour or disfavour to any person or for rendering or attempting to render any service or disservice to any person, with the Central Government or any State Government or Parliament or the Legislature of any State or with any local authority, corporation or Government company referred to in clause (c) of section 2, or with any public servant, whether named or otherwise, shall be punishable with imprisonment which shall be not less than

1. [three years] but which may extend to

2. [seven years] and shall also be liable to fine.

Explanations.—(a) “Expecting to be a public servant.” If a person not expecting to be in office obtains a gratification by deceiving others into a belief that he is about to be in office, and that he will then serve them, be may be guilty of cheating, but he is not guilty of the offence defined in this section.

(b) “Gratification.” The word “gratification” is not restricted to pecuniary gratifications or to gratifications estimable in money.

(c) “Legal remuneration.” The words “legal remuneration” are not restricted to remuneration which a public servant can lawfully demand, but include all remuneration which he is permitted by the Government or the organisation, which he serves, to accept.

(d) “A motive or reward for doing.” A person who receives a gratification as a motive or reward for doing what he does not intend or is not in a position to do, or has not done, comes within this expression.

(e) Where a public servant induces a person erroneously to believe that his influence with the Government has obtained a title for that person and thus induces that person to give the public servant, money or any other gratification as a reward for this service, the public servant has committed an offence

The main ingredients of the charge of an offence under Section 7 {Old Sec.161, I.P.C.} of the Act as observed by Hon’ble Justice Ranganath Mishra in R.S.Nayak v. A.R.Antulay and another, are

1) That the accused was a public servant;

2) That he must be shown to have obtained or attempted to obtain from any person any gratification other than legal remuneration and

3) That the gratification should be as a motive or reward for doing or forbearing to do, in the exercise of his official function, favour or disfavour to any person.

It is immaterial whether amount is received before or after the favour is done’

The section does not require that the public servant must; in fact. be in a position to do the official act, favour or service at the time of the demand or receipt of the gratification.

To constitute an offence under this section, it is enough if-

a. The public servant who accepts the gratification, takes it by inducing a belief or hold out that he would render assistance to the giver with any other public servant, and

b. The giver gives the gratification under that belief.

It is further immaterial if the public servant receiving the gratification does not intend to do the official act favour or forbearance which he holds himself out as capable of doing.

LANDMARK JUDGEMENTS

The Hon’ble Apex court in Kishan Chander Vs State of Delhi has reiterated the settled proposition of law which has been settled in long line of judgment. The relevant para of judgment is as under:

“22. In a recent enunciation by this Court to discern the imperative pre- requisites of Sections 7 and 13 of the Act, it has been underlined in B. Jayaraj in unequivocal terms, that mere possession and recovery of currency notes from an accused without proof of demand would not establish an offence under Sections 7 as well as 13(1)(d)(i)&(ii) of the Act. It has been propounded that in the absence of any proof of demand for illegal gratification, the use of corrupt or illegal means or abuse of position as a public servant to obtain any valuable thing or pecuniary advantage cannot be held to be proved. The proof of demand, thus, has been held to be an indispensable essentiality and of permeating mandate for an offence under Sections 7 and 13 of the Act”.

That the Hon’ble Apex court further held in the aforesaid matter that as under:

“23. The proof of demand of illegal gratification, thus, is the gravamen of the offence under Sections 7 and 13(1) (d)(i)&(ii) of the Act and in absence thereof, unmistakably the charge therefore, would fail. Mere acceptance of any amount allegedly by way of illegal gratification or recovery thereof, dehors the proof of demand, ipso facto, would thus not be sufficient to bring home the charge under these two sections of the Act”

In view of aforesaid section and authoritative pronouncement, it is clear that the “demand and acceptance of illegal gratification” is sin quo non for attracting the provisions of section 7 of the PC Act, 1988.

Even recovery of tented money is not sufficient to sustain the charges unless and until the recovery is preceded with demand of illegal gratification and acceptance of the same.

So, filing of cases without gratifying the essential mandated ingredients of statutory provision is completely illegal and unjustified.

It was observed by the Supreme Court in Subash Parbat Sonvane v. State of Gujarat, (2002) 5 SCC 86, that words like ―accepts and ―obtains has been especially used by the legislature in Sections 7 and 13(1)(a) and (b) of the Act but in Section 13(1)(d) there is withdraw of the word ―accepts‖ and put importance on the word ―obtains‖. It has cited its prior decision of Ram Krishna v. State of Delhi, AIR 1956 SC 476, where it observed that:

“We have primarily to look at the language employed and give effect to it. The word “obtains” on which much stress was laid does not eliminate the idea of acceptance of what is given or offered to be given, though it connotes also an element of effort on the part of the receiver. One may accept money that is offered, or solicit payment of a bribe, or extort the bribe by threat or coercion; in each case, he obtains a pecuniary advantage, by abusing his position as a public servant.

It is enough, if by abusing his position as a public servant, a man obtains for himself any pecuniary advantage entirely, irrespective of motive or reward for showing favour or disfavor”.

In P. Satyanarayana Murthy v. State of A.P., (2015) 10 SCC 152, it has been settled by the Supreme Court that to convict the accused it is necessary to have adequate proof of demand and acceptance of illegal gratification by the public servants U/s 7 and 13 of the Prevention of Corruption Act, 1988. It also laid down hat without the proof of demand by the accused, mere possession and recovery of currency notes would not establish the offence U/s 7 and 13(1)(d)(i) and (ii) of the Act. The Supreme Court has made the below-mentioned observations:

―The proof of demand for illegal gratification, thus, is the gravamen, of the offence U/s 7 and 13(1)(d)(i) and (ii) of the Act and in the absence thereof, unmistakably, the charge, therefore, would fail. Mere acceptance of any amount, allegedly by way of illegal gratification or recovery thereof, dehors the proof of demand, ipso facto, would thus not be sufficient to bring home the charge under the two sections of the Act”.

State of Maharasthra V. Gajanan & Anr. 2004 Cr.L.R. SC 242

P.C. Act 1988 - Sec. 7 – Criminal Procedure Code 1973 – Sec. 389(1) – Conviction in corruption case- Stay of sentence as well as conviction by High Court thus facilitating continuance of service of respondent public servant – Held, not proper. impugned order set aside. (See Para 4) Ref. 2001 CrLR SC 526 K.C. Sareen V. CBI Chandigarh.

In this case the Hon'ble Supreme Court had that by the impugned judgment the High Court while entertaining a criminal appeal against an order of conviction recorded by the Special Court against the respondents herein for an offence u/s 7 of the P.C. Act not only State the sentence imposed by the trial court but also proceeded to stay the conviction which could facilitate the respondent public servant to continue the hold the civil post in spite of the conviction recorded against him. While doing so the High Court rejected the objection of the state as also distinguished the judgment of this court in K.C. Sareen V. CBI Chandigarh.

In the said judgment in K.C. Sareen (Supra), The Hon'ble Supreme Court has held that it is only in very exceptional cases that the court should exercise such power of stay in matters arising out of the act. The High Court has in the impugned order nowhere pointed out what is exceptional fact that in its opinion required it to stay the conviction. The impugned order was set aside and the appeals were allowed.

· S-9 PC Act, 1988-

· S-10 PC Act, 1988-

· S-11 PC Act, 1988-

· S-12 PC Act, 1988-

· S-13 PC Act, 1988-

· S-13(1)(d)(ii)- PC Act, 1988- abusing his position as a public servant, obtains for himself or for any other person any valuable thing or pecuniary advantage-

· S-14 PC Act, 1988-

CONCLUSION

Since its introduction in Parliament on August 19, 2013, the POCA Bill underwent changes based on the Law Commission Report. After five long years since its introduction, the POCA Bill was passed by the upper house on June 19, 2018, followed by the lower house on June 24, 2018. The POCA Bill finally received the assent of the President on July 26, 2018 and the POCA Amendment Act came to be enacted. Section 7, Section 8, Section 9 and Section 11 of POCA, as substantially amended by way of the POCA Amendment Act, provide for instances of taking gratification, influencing public servants or accepting gifts. These sections are amended substantially keeping in mind India’s obligations under the UNCAC. In respect of offences under Sections 7, 11 and 13, the court has held these to be an abuse of office by the relevant public servant. Transactions which contravene provisions of POCA necessarily contemplate a public servant and illegal gratification in connection with securing a favour from the public servant or as an incentive or reward to the public servant. It is equally important that there should be a demand of such sum made by the public servant and the mere fact that the individual has a valuable thing, in the absence of proof of such demand, may not result in a conviction under Section 7 of POCA. It has also been held that an offence under Section 7 is an abuse of office and that the acts of the concerned individuals have the colour of authority.

Bail Judgments: Prevention Of Corruption act, 1988

• Anil Kumar Vs. GNCT Of Delhi, Bail Appln. No.878/ 2015, Dated-25.05.2015, Vipin Sanghi, J, Delhi High Court. [Full PDF Judgment]

Who Is Public Servant:

• Central Bureau of Investigation, Bank Securities & Fraud Cell Versus Ramesh Gelli and Others, Criminal Appeal Nos. 1077-1081 Of 2013, Judgment Dated: 23.02.2016, Bench: Prafulla C. Pant & Ranjan Gogoi, JJ, Supreme Court Of India [Full PDF Judgment]- Issue, Who is “Public Servant” under the PC Act, 1988- Held, the Chairman and Managing Director, as also the Executive Director of Global Trust Bank are public servants for the purpose of the PC Act by virtue of the provisions of Section 46A of the Banking Regulation Act, 1949.

PC Act- S-13.

· Krishan Chander Versus State Of Delhi, Criminal Appeal No. 14 Of 2016, Judgment Dated: 06.01.2016, Bench: T.S. Thakur & V. Gopala Gowda, JJ, Supreme Court Of India [Full PDF Judgment]- Prevention of Corruption Act, 1988- Sections 7 and 13(1)(d) R/W S-13(2)- Was pleaded that, “15..... A mere production of the tainted money recovered from the appellant along with positive result of phenolphthalein test, sans the proof of demand of bribe is not enough to establish the guilt of the charge made against appellant.”- Held, “34. It is well settled position of law that the demand for the bribe money is sine qua non to convict the accused for the offences punishable under Sections 7 and 13(1)(d) read with Section 13(2) of the PC Act.

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