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E-NOTES

Class : B.A.LL.B/BBA LL.B III Semester

Paper Code : LLB 507
Subject : Socio Economic Offences

Unit – III

PREVENTION OF CORRUPTION ACT, 1988

INTRODUCTION

• Corruption is “dishonest and illegal behavior by people in positions of

authority or power”.

• Corruption promotes illegality, unethicalism, subjectivity, inequity, injustice,

waste, inefficiency and inconsistency in administrative conduct and
behavior.

• There is hardly any sphere of life whether social, political, economic or

culture which is free from corruption.

• Corruption includes illegal acts like bribery, extortion, embezzlement, use of

speed money etc.

• World Bank defines it as “the use of public office for private profit.

• Various forms of corruption are prevalent in every society.

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FORMS OF CORRUPTION

• Systematic corruption- It is a situation where all major institutions of a

state, sustain and thrive through corrupt illegal practices. The acts of bribery,
embezzlement and extortion are common place.

• Individual corruption- It is not as much of a threat to the economy as

systematic corruption but its impact on the morale of society cannot be
overlooked.

• Grand corruption-This form of corruption is practiced by state agents to

sustain their wealth, power, status and office. It results in misallocation of
natural resources, biased policies, and weakening of legal bases against
corruption.

• Petty Corruption-Small scale, everyday corruption at bureaucratic level is

known as petty corruption. It is in the form of bribery or grease payments.

• Supply side corruption and demand-side corruption- The former is used

to describe the act of offering an illicit payment or undue advantage;
whereas the latter relates to the acceptance or solicitation of such a payment
or advantage.

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RECOMMENDATION OF SNATHANAM COMMITTEE ON

PREVENTION OF CORRUPTION

• The committee was created in 1962 by central government with K.

Santhanam as its chairman and gave its report in 1964.

• It suggested institutional mechanisms and process-related steps to fight

corruption.

• The committee report as well as 29th law commission report of 1966 has
recognized, Misuse of position by public servants, Misappropriation of
public property and funds and Trafficking in licenses, permits etc., as
“socio economic offences”.

• The Santhanam committee can be termed as the “The mother of anti-

corruption agencies in India because the Central Vigilance Commission
(CVC), the Central Bureau of Investigation and the Enforcement Directorate
(ED) was born out of it. CVC was set up pursuant to committee
recommendation in 1964, to tackle cases of corruption in central
government.

• Committee recommended the adoption of preventive measures against those

habitually corrupt public servants i.e. bribe givers, to strike at the evil from
the other end.

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ANTI-CORRUPTION MEASURES AND LAWS

• India is a signatory (not ratified) to the UN Convention against corruption

since 2005. The Convention covers a wide range of acts of corruption and
also proposes certain preventive policies.

• Following this, Central Vigilance Commission came up with National Anti-

Corruption Strategy in 2010, recommending set of action to be taken by
the government and a set of action by the political entities, judiciary, media,
citizens, private sector and civil society organizations in governance process
to reshape national integrity system and combat corruption.

• Public Servants in India can be penalized for corruption under the

Indian Penal Code, 1860 and the Prevention of Corruption, 1988.

• The Benami transactions (Prohibition) Act, 1988 prohibits benami

transactions.

• The Prevention of Money Laundering Act, 2002 penalizes public servant for
the offence of money laundering.

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CRIMINAL MISCONDUCT

when the public servant

• misappropriates the property entrusted to him

• obtains a valuable thing by abusing his official position

• is in possession of disproportionate assets to the known sources of his

income

• abuses office

• obtains a valuable thing or pecuniary advantage by corrupt or illegal means

or by abusing his official authority

he commits a criminal misconduct.

DEFINITIONS

Section 2(b) “public duty” means a duty in the discharge of which the State, the
public or the community at large has an interest.

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Section2(c) “public servant” means— (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;

(v) any person authorised by a court of justice to perform any

duty, in 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 court of justice
or by a competent public authority;

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(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;

(viii) any person who holds an office by virtue of which he is

authorised 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 from the Central Government or
a State Government or from any corporation established by
or under a 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;

(x) any person who is a chairman, member or employee of

any Service 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;

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(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;

(xii) any person who is an office-bearer or an employee of an

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.

APPOINTMENT OF SPECIAL JUDGES

Section 3

• empowers Central Government and State Government to appoint Special

Judges to try the following offences

• offence punishable under this Act

• any conspiracy to commit or any attempt to commit offences specified in

above.

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Section 4

• specifies the jurisdiction of the special Judges appointed in sec 3

• offences described in sec 3 are to be tried by Special Judges

• Special Judge also has powers to try any offence, other than an offence
specified in sec 3.

Section 5

• describes the procedure to be followed and the powers of Special Judge

Special judge

 can take cognizance of offences without the accused being committed to him

 may tender a pardon to such person who makes a true disclosure of the
whole circumstances relating to the offence

Provisions of CrPC shall apply to the proceedings before the Special

Judge.

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Section 6

• authorises Special Judge to conduct a trial in a summary manner, in cases

where violation of section 12-A(1) of Essential Commodities Act, 1955

• and pass upon any person a sentence of imprisonment for a term not
exceeding one year

• convicted person will not have any right to appeal against such summary
trial if the term of imprisonment does not exceed one month.

Section 7 -If a public servant is charged with

Accepting any gratification other than legal remuneration in respect of an

official act, as a motive or reward for doing any official act or showing any
favour or disfavour to any person in official function.

• Section 8-If a public servant is charged with

Accepting or attempting to obtain any gratification by corrupt or illegal

means, to do any official act.

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• Section 9- If a public servant is charged with

Accepting or attempting to obtain any gratification for exercise of personal

influence with public servant, to do any official act.

• If any public servant

Section 10 - abets the offences defined in sec 8 & 9

Section 11 - obtains valuable thing, without consideration form person

concerned in proceeding or business transacted by such public servant.

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OFFENCES AND PENALTIES

Section 12- Punishment for abetment of criminal offences defined in sec 7 &
11: Public servant shall be punishable with imprisonment which shall not be less
than six months but which may extend to five years and shall also be liable to fine.
It would be seen that a minimum sentence of six months has been made mandatory
and fine is no more optional before the Courts.

Section: 13. Criminal misconduct by a public servant.—(1) A public servant is

said to commit the offence of criminal misconduct,—

(a) if he habitually accepts or obtains or agrees to accept or

attempts to obtain from any person for himself or for any other person any
gratification other than legal remuneration as a motive or reward such as is
mentioned in section 7; or

(b) if he habitually accepts or obtains or agrees to accept or

attempts to obtain for himself or for any other person, any valuable thing without
consideration or for a consideration which he knows to be inadequate from any
person whom he knows to have been, or to be, or to be likely to be concerned in
any proceeding or business transacted or about to be transacted by him, or having
any connection with the official functions of himself or of any public servant to

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whom he is subordinate, or from any person whom he knows to be interested in or

related to the person so concerned; or

(c) if he dishonestly or fraudulently misappropriates or

otherwise converts for his own use any property entrusted to him or under his
control as a public servant or allows any other person so to do; or (d) if he,—

(i) by corrupt or illegal means, obtains for himself

or for any other person any valuable thing or pecuniary advantage; or

(ii) by abusing his position as a public servant,

obtains for himself or for any other person any valuable thing or pecuniary
advantage; or

(iii) while holding office as a public servant,

obtains for any person any valuable thing or pecuniary advantage without any
public interest; or

(e) if he or any person on his behalf, is in possession or has, at any time during the
period of his office, been in possession for which the public servant cannot
satisfactorily account, of pecuniary resources or property disproportionate to his
known sources of income.

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Section14. Habitual committing of offence under sections 8, 9 and 12.—

whoever habitually commits— (a) an offence punishable under section 8 or section
9; or

(b) an offence punishable under section 12, shall be

punishable with imprisonment for a term which shall be not less than five years
but which may extend to ten years and shall also be liable to fine.

Section15. Punishment for attempt. —Whoever attempts to commit an offence

referred to in clause (c) or clause (d) of sub-section (1) of section 13 shall be
punishable with imprisonment for a term which shall not be less than two years but
which may extend to five years and with fine.

Section16. Matters to be taken into consideration for fixing fine.—Where a

sentence of fine is imposed under sub-section (2) of section 13 or section 14, the
court in fixing the amount of the fine shall take into consideration the amount or
the value of the property, if any, which the accused person has obtained by
committing the offence or where the conviction is for an offence referred to in
clause (e) of sub-section (1) of section 13, the pecuniary resources or property
referred to in that clause for which the accused person is unable to account
satisfactorily.

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Section 18 Power of Bankers’ Books: a Police Officer empowered to investigate

under section 17 can even inspect any bankers’ books in so far as they relate to the
accounts of the person suspected to have committed that offence.

Section:20. Presumption where public servant accepts gratification other than

legal remuneration.—(1) Where, in any trial of an offence punishable under
section 7 or section 11 or clause (a) or clause (b) of sub-section (1) of section 13 it
is proved that an accused person has accepted or obtained or has agreed to accept
or attempted to obtain for himself, or for any other person, any gratification (other
than legal remuneration) or any valuable thing from any person, it shall be
presumed, unless the contrary is proved

(2) Where in any trial of an offence punishable under section 12 or under clause
(b) of section 14, it is proved that any gratification (other than legal remuneration)
or any valuable thing has been given or offered to be given or attempted to be
given by an accused person, it shall be presumed, unless the contrary is proved,
that he gave or offered to give or attempted to give that gratification or that
valuable thing, as the case may be, as a motive or reward such as is mentioned in
section 7, or, as the case may be, without consideration or for a consideration
which he knows to be inadequate

(3) Notwithstanding anything contained in sub-sections (1) and (2), the court may
decline to draw the presumption referred to in either of the said sub-sections, if the

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gratification or thing aforesaid is, in its opinion, so trivial that no inference of

corruption may fairly be drawn.

Section 21

• defines the accused public servant as a competent witness to disprove the

charges made against him. He can give evidence on oath to defend himself.

Section 26

• Special Judges appointed under Criminal Law Amendment Act, 1952 shall
be deemed as Special Judge

Section 27

• Authorises High Court to exercise all powers of appeal and revision

conferred by the Cr.PC as if the Court of the Special Judge were a Court of
Session trying cases within the local limits of the High Court

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