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CHAPTER-III
PREVENTION AND CONTROL OF CORRUPTION:
LEGISLATIVE FRAMEWORK
A. General
Indian history is full up with countless anti-corruption measures and
subsequent punishments. The Rig Veda, a sacred Hindu text described as
,221
'the oldest literary monument of the Indo-European races discusses the
prevention of corruption and extortion. 'Vishnu and Manu' punished
people who accepted bribes and punished corrupt government officials with
property forfeiture. Though, British colonial rule saw its fair contribute to
deceitful practices, Britain still attempted to minimize such acts. During his
tenure as governor general, Lord Cornwallis, in contract to Warren
Hastings, implemented policies like increasing salary of East India
Company servants, prohibiting such servants from receiving gifts, and
opening the doors for the creation of the Indian Civil Service, all actions
whose purposes were to reduce corruption.
In the 19th century before the end of colonialism in India, Britain
passed the IPC in 1860, to construct a proper legal criminal system. In the
pre independence period, the IPC was the chief tool to combat corruption in
public life. The IPC has a Chapter on 'Offences by Public Servant'. Section
161 to 165 provided the legal framework to prosecute corrupt public
servants. At that time, the need for a special law to deal with corruption
was not felt. The Second World War created scarcity which gave
opportunity to unscrupulous elements to utilize the situation leading to
large scale corruption in public life. This situation continued even after the
war. The law makers concerned about this danger felt that hard legislative
measures need to be taken. Hence the Prevention of Corruption Act, 1947
was enacted to fight the evils of bribery and corruption.
221
23 Encyclopedia Americana: A Library of Universal Knowledge 517 (1919). The Rig
Veda dates back as early as 1200 B.C.

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An efficient legal system is crucial to fight against corruption, as an
ineffective or politicized judiciary is the best friend of corruption. The first
step in a judicial reform process is a review of the country's legal structure,
to uncover weak points and inconsistencies in the laws, as well as out dated
222
legislation that should be removed from the civil and criminal codes.
In
any country, the judicial system is honest and respected, it can counter the
activities of a corrupt government, as in the case of Brazil, where former
President 'Collor de Mello ' was impeached by Congress and the process
upheld and monitored by the Apex Court. Answerability of the judicial
system to the public and to the government is essential in fighting
corruption within the courts. Those responsible for the investigation,
prosecution and supervision of corruption cases should have the highest
ethical standards and be subjected to periodical review of their work, as
well as having clear accountability machinery to superiors and an adequate
system to address complaints.223
Many a scam has staggered and has been staggering the development
and interests of the Nation. To protect the progressive welfare of the state
by preventing bribery and corruption, the law makers have thought of
enacting Anti-Corruption Laws in India and protect the structure from the
evil of corruption. The government of India has enacted Prevention of
Corruption Act, 1988, besides relevant statutory provisions which are
precisely presented in this chapter.
1. The PC Act, 1947
The Act of 1947 did not redefine nor expand the definition of offences
related to corruption prescribed in the Indian Penal Code 1860. Similarly it
has adopted the same definition of Public Servant as in the Indian Penal
Code 1860. However the law defined a new offence criminal misconduct in
222
Maria Del Mars Landette M., "Combating Corruption: What the Ecuadorian
Anti-Corruption Agency Can learn from International Good Practice"
University of Birmingham, 2002 p. 87.
223
Geddes B. and Ribeiro Neto A, "Institutional Sources of Corruption in Brazil"
North South Center Press, 1999 p.34.

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discharge of official duty for which enhanced punishment of minimum one
year to maximum seven year was stipulated. In order to shift the burden of
proof in certain cases to the accused, it was provided that whenever it was
proved that a public servant had accepted any gratification, it shall be
presumed that the public servant accepted such a gratification as a motive
or reward under sections 161, 164-165 without the permission of the
authority competent to remove the charged public servant. The Act of 1947
also provided that the statement by bribe giver would not subject him to
prosecution. It was considered essential to grant such immunity to the bribe
giver, who might have been forced by situations into giving a bribe. This
immunity was not provided. All complaints would become liable for
punishment, which would discourage them from giving complaints against
any public official who accepted bribe.224
The Act also provided that the statement by bribe-giver would not
subject him to prosecution. It was considered essential to grant such
immunity to the bribe-giver, who might have been forced by situations into
giving a bribe. This immunity was not provided; all complaints would
become liable for punishment, which would discourage them from giving
complaints against any public official who accepted bribe. In 1952, the
Criminal Law (Amendment) Act brought some changes in laws relating
corruption in India. The punishment provided under section 165 of the
Indian Penal Code was increased to three years instead of existing two
years. Also a new Section 165-A was inserted in the Indian Penal Code,
which made abetting as offences, which defined in Sections 161 and 165 of
the code 1860. It was also stipulated that all corruption related offences
should be tried only by Special Judges.225
2. Santhanam Committee Report
The next phase of development is very important in the context. While
participating in the debates on the demand for grants for the Ministry of
224
Section 2: The Prevention of Corruption Act. 1947.
225
Section 8: The Prevention of Corruption Act, 1947.

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Home Affairs in June, 1962, some members of the Lok Sabha, specifically
referred to the growing menace of corruption in administration. In reply to
the debate, the then Home Minister suggested that some members of
Parliament and if possible, some other person of the society do sit with the
officers in order to review the problem of corruption and made
suggestions.226 In compliance of the announcement, a committee chaired by
Shri K. Santhanam, M.P. was appointed with nine specific terms of
227.
reference
to examine the organization, set up, functions and responsibilities of
a.
the vigilance divisions in the Ministries and Departments of the
Government of India and to suggest measures to make them more
effective.
b.
to examine the organization, strength, procedures and methods of
workings of the Special Police Establishment and the problems
experienced by it, and to suggest measures to further improve its
working.
to suggest and consider steps to be taken to highlight the
c.
responsibilities of each Department for checking corruption.
d.
to suggest amendments in law which would ensure speedy trial of
cases of Bribery, Corruption and Criminal Misconduct and to make
the law otherwise more effective.
to examine the rules relating to disciplinary proceedings and to
e.
consider what changes are essential in order to expedite these
proceedings and to make them more effective.
f.
to suggest measures calculated to produce a social climate both
amongst public servants and in the general public in which bribery
and corruption may not grow.
226
Ibid.
227
Virendra Kumar, "Committees and Commissions in India" Vol. V (1977), p. I.

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to examine the Government Servants Conduct Rules and to
g.
recommend amendments essential for ensuring maintenance of
absolute integrity in public services.
h.
to suggest steps for securing public support for anti-corruption
measures. and
i.
to consider special measures that may be essential in corporate
public undertaking to secure honesty and integrity amongst their
employees.
The committee submitted its report on March 31, 1964. The Committee
made its recommendations on each of these matters. A Code of Conduct
was also suggested accordingly for the Ministers. The Code, inter alia,
casts an obligation on the Ministers to furnish to the Prime Minister/Chief
Minister at the time of their initial appointment and every year thereafter, a
declaration showing details of the properties of his family. It was also
suggested that the chances of corruption would be minimized to a large
extent, if, the executive is separated from the legislature and the Ministers
are directly appointed on the basis of their proven meritorious performance
and track record.228
3.
The PC Act, 1988
Salient features of the Act
a.
The PC Act, 1988 consolidates the provisions of the PC Act 1947,
the Criminal Law (Amendment) Act, 1952 and sections 161-165 of the
IPC. Besides, it has certain provisions intended to effectively fight
against corruption among public servants. The salient features of the act
are as under:
i.
The term Public Servant is also defined in the act. The definition is
broader is then what existed in the IPC.
228
G. Sadasivan Nair, "Judicial Activism no Panacea for Prevention of Corruption"
Cochin University Law Review, (1997), p. 377.

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ii.
Anew term Public Duty is introduced in the act.
Offences relating to corruption in the IPC have been brought in
111.
Chapter third of the Act, and they have been deleted from the IPC.
All cases under the PC Act should be tried only by Special Judges.
lv.
Proceedings ofthe court have to be held on a day to day basis.
v.
vi.
Penalties prescribed for various offences are enhanced.
vii.
Criminal Procedure Code, to provide for expeditious trial Section 22
of the act provides for amended Section 243, 309, 317 and 397 of
Criminal Procedure Code.
It has been specified that the no court shall stay the proceedings
VIII.
under the act on the grounds of any error or irregularity in the
sanction granted, unless in the opinion of the court it has led to
failure of justice.
Other existing laws regarding presumptions, immunity to bribe
giver, investigation by an officer of the rank of Deputy
Superintendent of Police (DSP) access to bank records etc have
been retained.
The PC Act widened the scope of the definition of a public servant
enhanced penalties provided for offences in earlier laws. Since the PC Act
is the main law for dealing with offences of pertaining to corruption in
India. It enacted by Parliament in 39th year of the Republic of India as
follows:
• This act may be called the 'Prevention of Corruption Act. 1988. '
• It extends to the whole of India except the State of Jammu and
Kashmir and it applies also to all citizens of India and outside
229
b. Statement of Object and Reasons
In the statements of objects and reasons of the act, it is expressly
mentioned that the object of the act is to amend the existing anti corruption
Published in the Gazette of India and Received the Assent of the Present on 9th
Sept.
229
1988. Part-II, sec. 1, dated 12th sept. 1988, pp. 1-13.

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laws with a view to making them more effective by extending the scope
and ambit of the definition of public servant and to bring to within its ambit
each and every person who held an office by virtue of which he was
required to perform any public duty.230
i.
The Bill is intended to make the existing anti-corruption Laws
more effective by widening their coverage and by strengthening the
provisions.
The P.C. Act, 1947, was amended in 1964 based on the
11.
recommendations of the Santhanam Committee. There are
provisions in Chapter IX of the IPC to deal with Public servants and
those who abet them by way of criminal misconduct. There are also
provisions in the Criminal Law (Amendment) Ordinance, 1944, to
enable attachment of ill gotten weather obtained through corrupt
means, including from transferees of such wealth. The ordinance
seeks to incorporate all these provisions with modifications so as to
make the provisions more effective in curbing corruption among
public servants.
iii.
The Ordinance, inter alia, envisages widening the scope of the
definition of the expression 'public servant incorporation of
offences under section 161-165A of the IPC, enhancement of
penalties provided for these offences and incorporation of a
provisions that the order of the trial court upholding the grant of
sanction for prosecution would be final if it has not already been
challenged and the trial has commenced. In order to expedite the
proceedings, provision for day to day trial of cases and prohibitory
provisions with regard to grant of stay and exercise of powers of
revision on interlocutory orders have also been included.
iv.
Since the provisions of sections 161-165A of the IPC are
incorporated in the proposed legislation with enhanced
Published in the Gazette of India. (Extra ordinary) Pan-II Sec. I dated 12th Sept.
230
1988.

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punishments, it is not essential to retain those sections in the IPC.
Consequently, it is proposed to delete those sections with the
necessary saving provisions.
Definition of Public Servant
c.
Section 2 of the Prevention of Corruption Act, 1988 defines 'Public
Servant' broadly. The Act covers 12 categories of persons irrespective of
the fact weather they have been appointed by government or not they are
under purview of the public servant. These categories are as follows:
i.
Any person in the service or pay of the government or remunerated
by the government by fees or commission for the performance of
any public duty.
ii.
Any person in the service or pay of a Local Authority.
iii.
Any person in the service or pay of a corporation established by or
under a Central Provincial or State Act, or an authority or a body
owned or controlled or aided by the government or a government
company as defined in section 617 of the Companies Act, 1956.
iv.
Any Judge, including any person empowered by law to discharge,
whether by himself or as a member of any body of persons, any
adjudicatory functions.
Any person authorized by a court of justice to perform any duty, in
v.
connection with the administration of justice, including a liquidator,
receiver or commissioner appointed by such court.
vi.
Any arbitrator or other person to whom any cause or matter has
been referred for decision or report by a court of justice or by a
competent public authority.
vii.
Any person who holds an office by virtue of which he is empowered
to prepare, publish, maintain or revise an electoral roll or to conduct
an election or part of an election.

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viii.
Any person who holds an office by virtue of which he is authorized
or required to perform any public duty.
ix.
Any person who is the President, Secretary or other office bearer of
a registered co-operative society engaged in agriculture, industry,
trade or banking, receiving or having received any financial aid
form the Central Government or a State Government or from any
corporation established by or under Central Provincial or State Act,
or any authority or body owned or controlled or aided by the
government or a government company as defined in section 617 of
the Companies Act, 1956.
Any person who is a chairman, member or employee of any Service
x.
Commission or Board, by whatever name called, or a member of
any selection committee appointed by such Commission or Board
for the conduct of any examination or making any selection on
behalf of such commission or Board.
xi.
Any person who is a Vice-Chancellor or member of any governing
body, professor, reader, lecturer or any other teacher or employee,
by whatever designation called, of any university and any person
whose services have been availed of by a university or any other
public authority in connection with holding or conducting
examinations.
Any person who is an office bearer or an employee of an
xil.
educational, scientific, social, cultural or other institution, in
whatever manner established receiving or having received any
financial assistance from the Central Government or any state
government, or local or other public authority.
xiii.
Persons falling under any of the above sub clauses are public
servants, whether appointed by the government or not. Wherever the
words, 'Public Servant' occur, they shall be understood of every
person who is in actual possession of the situation of a public

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servant, whatever legal defect there may be in his right to hold that
situation.
xiv.
Persons falling under any of the above sub clauses are public
servants, whether appointed by the Government or not. Wherever
the words, 'Public Servant' occur, they shall be understood of every
person who is in actual possession of the situation of a public
servant, whatever legal defect there may be in his right to hold that
situation.
i.
Member of Legislative Assembly or Member of Parliament is
Public servant
In Habibulla Khan231 the apex court held that a Member of
Legislative Assembly is not an Public Servant under section 21 of the IPC,
but M.L.A. comes within the purview of sub clause (viii) of clause (c) of
section 2 of the act 1988 as held by the Orissam an M.L.A. 'holds an
office' and 'performs public duty'. In appeal the Supreme Court proceeded
held that M.L.A. is a public servant.
In the case of P. V. Narasimha Ra0232 a five Judge bench of the
Supreme Court laid down that a M.P. holds an office and by virtue of such
of such office he is required or authorized to perform duties and such duties
are in the nature of public duties. An M.P. would fall within the ambit of
sub clause (viii) of clause (c) of section 2 of the Act 1988 even though
there is no authority who can grant sanction for his prosecution under
section 19(1) of the act. Sanction is not necessary for the court to take
cognizance of the offences and the prosecuting agency shall, before filing a
charge sheet for offences punishable under section 7, 10, II, 13 and 15 of
the Act against an M.P. in a criminal court, obtain the permission of the
Chairman of the Rajya Sabha or Speaker of the Lok Saba as the case may
be.
231
1993 Cri. L.J. 3604.
232
1998 Crl. L.J.2930.