Adequacy of Legal and Regulatory Framework to Combat Corruption in India

Adequacy of Legal and Regulatory Framework to Combat Corruption in India

ABSTRACT

 “…it’s dollars and cents, nickels and dimes; war and peace, it’s nickels and dimes, what’s clean?”[1]

As India takes giant strides in achieving its highest and fastest GDP growth seen in its short independence, an old cancer raising its ugly head once again threatens to derail the striking development that we are in the midst of- the cancer of corruption.

Corruption is Universal. It is not limited to India or even other developing countries for that matter. In its numerous forms, corruption exists across humanity. In today’s dynamic and ever-changing environment, forms of corruption can and do vary. In its most common forms, ‘corruption’ includes bribery, cronyism, nepotism and embezzlement. Corruption is the perversion of integrity. Political corruption refers to the use of official powers by government officials for their own illegitimate and private gain.

India is in the midst of its own person crisis. As the power of media grows, it brings to the fore a slew of facts and instances of such misuse that would normally have been swept under the carpet and remained largely unknown to the common man.

That corruption exists, was widely known to all. However, the quantum and size of corruption that exists today has shocked the common man. That it exists in every decision (rather than the odd one) is now suspected. The Prevention of Corruption Act of 1988 has broadly adopted the contemporary changes in the concept of corruption as now understood in criminal law. Political corruption can now be dealt with under the Act

Corruption has a corrosive impact on our economy. It worsens our image in international market and leads to loss of overseas opportunities. Corruption is a global problem that all countries of the world have to confront, solutions, however, can only be home grown. We have tolerated corruption for so long. The time has now come to root it out from its roots.

 “Corruption is like diabetes can only be controlled but cannot totally be eliminated”[2]         –Anonymous

The Problem of Definition

Everyone knows what corruption is; but it is difficult to define it in exact terms.

According to the Oxford English Dictionary,[3] the word ‘corrupt’ means “influenced by bribery, especially at the time of elections”. Encyclopedia Britanica[4]says a corrupt practice “includes bribery; but has reference to the electoral systems”. But these, as will be seen, are not definitions.

The word ‘corruption’ is generally defined in the context of specific normative standards. Thus, according to the Santhanam Committee,[5]  the term includes all “improper or selfish exercise of power and influence attached to a public life or to a special position   one occupies in public life.” This definition covers value- loaded terms like ‘improper’, and ‘selfish’. It is, therefore, not possible to work out on the basis of the definition a permanent criterion for identifying corrupt practices in the dynamic world of ours where ethical values change over time and space. Corruption may be alternatively defined as unlawful practices. Thus, Section 161 of the Indian Penal Code[6] defines corruption as follows:

Whoever, being or expecting to be a public servant, accepts or obtains, or agrees to accept, or attempts to obtain gratification whatever, other than legal remuneration as a motive or a reward for doing or forbearing to do any official act or for showing or forbearing to show, in exercise of his official functions, favour or disfavor to any person with the Central or State Government or Parliament or Legislature of any State or with any public servants as such…….”

Section 161 aims at penalizing simply the receipt of illegal gratification. Section 123 of the Representation of the people Act, defines corruption as practiced in relation to elections. Section 5(I) of the Prevention of Corruption Act, 1947, defines criminal misconduct of a public servant in the discharge of his duties in the following terms[7].

Corruption as viewed in Criminal Law

It is now universally accepted that apart from reparation or compensation, which everyone who wrongs another must incur and pay the wronged individual, the state also imposes certain penalties with the object of preserving peace and tranquility in the society and promoting good behavior towards each other and towards the society as a whole.

What improper conduct is to be branded as crime depends upon the force, vigour and movement of public opinion from time to time and from country to country; and even in the same country from Government to Government representing particular pattern of behavior. Generally, seriousness of crime is measured by its extent of damage to the society and its effects on the fair and even working of the legal system. Corruption has always been considered a serious type of anti-social act in criminal law.

In India, the first codified criminal law i.e. the Indian Penal Code, 1860, contained a full chapter[8] which dealt with corruption. However, it confined its operation to those defined as public servants under Section 21 of the code. Mainly misconduct and abuse of power by public servants were covered under this chapter.[9] Being governed by the traditional rules of criminal liability, the provisions in the I.P.C. could not successfully combat corruption by public servants who constituted a powerful class which had a considerable influence for titling the scales of justice. Moreover, the definition of the public servant suffered from many defects as many important functionaries engaged in discharging public duties were left out of the definition of public servant. However, the redeeming feature of the period till the start of the First World war was that the people in India, by and large were bound by moral values which abhorred corruption than by materialistic considerations of the industralised western world.

The scope of bribery and corruption by public servants had considerably increased due to war conditions. Even after the Second World War opportunities for corrupt practices remained for a considerable time. Extensive schemes for post war reconstruction opened wide new avenues for corruption among public servants. However, the existing provisions of the I.P.C were found to be insufficient for effective handling and controlling of corrupt public servants.[10] Therefore, to supplement and strengthen law against corruption, the Prevention of Corruption Act, 1947, entered the statute book. The Act being a social legislation aimed at eradicating corruption, changed the traditional rules of criminal liability by presuming mens rea on the part of public servant if actus reus was proved.[11] Criminal misconduct in the discharge of official duty was made an offence under Section 5 of the Act. However, it neither gave a separate definition of public servant nor made improvements in Section 21 of the I.P.C through a special amending clause. Generally, public servants were prosecuted under Section 161 of the I.P.C[12] read with Section 5 of the Act. In pursuance of the recommendations of the Santhanam Committee for taking stringent measures against rampant corruption the Act was amended in 1964.

Inspite of the amendment of the Act, the situation viciated by corrupt practices could not be redeemed. Rather corruption expanded its sphere of activity by engulfing the entire society. Even the elected representatives of the people who are supposed to be the repository of public faith by discharging their duties with honesty and integrity succumbed to the vagaries of corruption by sharing its booty with public servants. Efforts made for bringing political corruption within the purview of the Act did not succeed as elected representatives through whom most of the corruption is routed through were not considered as public servants.[13] Corruption among ministers and other political heavy-wrights in more dangerous than corruption in Government machinery in terms of the enormity of the stakes involved in public life. Corruption and indecency in political life informs all sections of the society since violations are committed by those very persons who are expected to set the norms of social and political conduct for other whom they represent as role-models. It is fact that many of their kith and kin have reaped a good harvest in terms of money and good positions through the abuse of Government machinery at their disposal. The more usual forms of political corruption in India are graft, violation of election laws and tax laws, and abuse of official and political machinery because of the liaison of political forces with big business.[14] Political corruption provides patronage to corruption by public servants as there are rules to ensure probity among officials but there are none for ministers, legislators and political parties.[15] All this adds to the imperatives of having a comprehensive legislation on corruption in its present perspectives i.e. successful handling of the socio-legal problem of corruption in a modern welfare state.

The Prevention of Corruption Act, 1988 has replaced the Prevention of Corruption Act, 1947 and it has also incorporated sections-161 to 165-A of the I.P.C. This Act was envisaged as a comprehensive legislation for prevention of corruption in India by widening its scope and streamlining procedural and related matters. This was evident from the statement of objects and Reasons of the Prevention of Corruption Act, 1988 which provides:[16]

The Act of 1988[17] has broadly adopted the contemporary changes in the concept of corruption as now understood in criminal law. Political corruption can now be dealt with under the Act. The Act was adopted an independent definition of public servant under section 2( c). the definition given under section 21 of the I.P.C is no longer applicable to the Act as was the case under the Prevention of Corruption Act, 1947. The definition of public servant under section 2( c) especially under sub-sections (ii), (iii), (vii), and (ix)[18]  has covered political corruption as elected representatives such as M.P.s, M.L.As, Municipal Commissioners, the chairman of Corporations are now public servants.

Inspite of the settled principles of interpretation of statutes, the Act which is a social legislation enacted to eradicate social vice of corruption from society is being misinterpreted or wrongly quoted by even legal luminaries who are engaged by top politicians by paying heavy fees running into lacs of rupees. They challenge the very application of the Act to the elected representatives of people on the filmsy pretext that M.L.A s and M.P. are not public servant. They harp on the meaning of public servant given in section 22 of the I.P.C and cite judegments based on section 21 completely ignoring the relevant provisions of section 2 ( c) of the Act which leave no doubt regarding position of elected representatives of the people through whom much of the corruption is channelized. The broad sweep of section 2 (c ) (viii) requires only two things to be a public servant i.e. one must hold an office by virtue of which he is required to perform public duty. An M.P. or M.L.A holds an office and discharges public duties. It is pertinent to point out some observations of the Delhi High Court in the Famous case of L.K. Advani versus Central Bureau of Investigation[19]. While dealing with the concept of public servant under the Act in its application to M.L.As and M.P.s, the High Court has highlightened the historical and current perspectives of political corruption. It has held:

A perusal of the statement of Objects and Reasons behind the enactment of Prevention of Corruption Act, 1988 reveals that the legislators wanted to amend the existing anti-corruption laws with a view to making them effective by extending the scope and ambit of the definition of ‘public servant’ and to bring within its sweep each and every person who held an office by virtue of which he was required to perform any public duty. Thus the underlying idea was to eradicate corruption. The object of the Act is a very laudable one. Hence it cannot be so construed as to narrow down scope. It is well known that when the words of a statute are wide and clear then a restrictive meaning cannot be given to them. The purpose of the Act is clear and unambiguous i.e the eradiation of corruption. Hence a construction which would enhance the objects of the Act and curb the mischief has to be put. The object of the Act is to serve as a beacon. If there are certain devices and dark areas in the enactment they are to be illuminated with the help of the said object, nay it is the duty of the court to put such construction which would illuminate the said areas. Thus, this court is of the view that having regard to moral and commendable object of the Act, a purposive interpretation should be put on the relevant provisions of the law so as to fulfill the intention of the legislature and eschew an interpretation which defeats the object of the Act. If so construed M.P. would be covered by the definition given in section 2 ( c) (viii) of the Act.[20]

Right to Information as a tool to Combat Corruption

In India today, being a welfare-state, the state has spread its tentacles to virtually every aspect of public life. The person on the street is condemned to grapple hopelessly with corruption in almost every aspect of daily work and living. Information is power, and the executive at all levels attempts to withhold information to increase its scope for control, patronage, and the arbitrary, corrupt and unaccountable exercise of power. Ultimately the most effective systemic check on corruption would be where the citizen herself or himself has the right to take the initiative to seek information from the state, and thereby to enforce transparency and accountability. It is in this context that the movement for right to information is so important. The statutory right to information gives a legal right to have access to government-held information strengthens democracy by ensuring transparency and accountability in the actions of public bodies. It enhances the quality of citizen-participation in governance from mere vote-casting, to involvement in the decision-making that affects her or his life.[21]

The most effective check on corruption would be where the citizen has the right to take the initiative to seek information from the state, and thereby to enforce transparency and accountability. This would enhance the quality of participatory political democracy.

Although the right to information is implicit in the Constitution of India the dominant culture of the executive has been one of secrecy and resolute denial of access to information. Demystification of rules and procedures and pro-active dissemination of relevant information amongst the public serves as a very strong safeguard against corruption.

To this end the RTI Act empowers ordinary citizens to exercise far greater control over corrupt and arbitrary exercise of state power. It increases transparency and takes away excuses provided under the Official Secrets Act, 1923 and the Freedom to Information Act, 2000 to evade accountability. It grants citizens access to government information and a mechanism to control public spending.

RTI act requires government officials to furnish information requested by citizens or face punitive action and provides for computerisation of services. This along with the various central and state government established vigilance commissions has considerably reduced corruption and has opened up avenues to redress grievances.

In a recent case the finance ministry under-secretary Jagbir Sigh Phaugat said while deeming a settlement between the Central Bank of India and whistleblower Abhijit Ghosh illegal that “The agreement debars Ghosh from his constitutional rights of freedom of press and no one can debar a person form invoking the provisions of the RTI act.”[22]

Seeds for the Legislation on Right to Information

In 1966, the right to information was established for the federal government agencies when the United States adopted the Freedom of Information Act (FOIA). After the resignation of President Richard Nixon in 1974, FOIA strengthened and became the model for other states of the US who adopted similar statutes. FOIA also became the model for other countries, such as Canada, Australia, and New Zealand – all of which adopted similar laws in 1982. By 1990, fifteen other nations, mainly the developed countries in Europe had similar statutes. In the next two decades, similar statutes were adopted by some of the other developed countries like Germany, United Kingdom and Japan. While acting as per the advice of international institutions like World Bank, the FOIA style laws were also adopted by some of the governments later on. By 2010, over seventy nations had adopted the FOIA style of laws. Even in China, a right to information was provided by way of adopting certain regulations. The laws adopted by most of the countries over the last two decades, however, differ in many respects from the United States and the other countries who had adopted it earlier.

The RTI Act under section 27(1) and 28(1) specifies to the appropriate Governments and the Competent Authorities to make rules pertaining to implementation of the Act. Under Section 6 of the RTI Act, PIOs are required to provide reasonable assistance to the applicant in drafting and submission of the application. But unfortunately the implementation of these clauses seems to far short of satisfaction. Unless the various problems attached to implementation of RTI ACT are addressed comprehensively by the appropriate Government and Public Authority in tandem, it would continue to be an issue

Acknowledging the Difference: Is there a Solution?

Some recommendations are as under:

  • Investigative agencies like the police and the Central Bureau of Investigation, whilst being operated under the auspices of the government, must be allowed to investigate freely and without any interference. Long-pending reforms for the police force must be implemented which will make appointments and therefore investigations transparent.
  • Discretionary quotas in various resources give to politicians must be abolished. Land and mines are such resources where tremendous corruption has been alleged. It is wisely said that power corrupts and absolute power corrupts absolutely!
  • Stringent penalties existing under the Act must be utilized effectively in order to send out a deterrent effect. The Act should also also additionally specifically encompass bribe-givers.
  • As more Indian companies venture overseas, the government should consider implementing law similar to the Foreign Corrupt Practices Act, 1977 (“FCPA”) prevalent in the United States of America. Interestingly, FCPA has extra territorial effect, which provides an adequate deterrent.

 Measures to Reduce Corruption and make India a Better Place to Live

1. Introduce State-Funding as part of Election reforms

The high cost of elections and candidates’ dependence on money, often of questionable provenance, compromises them from the very outset. Once beholden to moneybags, they are under obligation to return the favour if they win. Of course, not all candidates can be funded by the state. So, It is suggested that only candidates belonging to national parties receive election money from the state. In this too we can pare down eligibility by regions. For instance, the CPM might be a “national party” but its influence is largely limited to Bengal, Kerala and Tripura. Its candidates getting funding in any other state should depend on its performance in that state in the previous election. By the same token, state parties must get funding in their specific states, like the BSP in UP or the BJD in Orissa.

2. A Reasonable and Transparent Tax Structure, Backed by Clean and Clear Enforcement

Our direct taxes (personal income and corporate) are no longer unreasonable, so there’s little excuse for trying to evade them. But there is an unhealthy trend in piling on surcharges on various pretexts. Also, there are tons of other taxes that can add up to quite a bit. Finally, there’s the larger question of how efficiently and honestly taxpayer’s money is put to use- when you see the state of government hospitals and schools, and rotten roads, you wonder where the money you paid as tax has gone.

3. Reduce the role of the state in people’s lives to the absolutely essential

The greater the scope for state interference- be it the police or the clerk in a government office or the customs inspector – the greater the scope for harassment and graft.

4. Genuine Autonomy for the Public/Government Sector

Bog PSUs- think Air India, for instance- place huge contracts. Even a fraction of that is huge money in absolute terms. There is always a temptation for political bosses to exert their influence and swing the contract for chosen ones and receive handsome kickbacks. So get them out of the day-to-day functioning of these PSUs.

5. Introduce Sweeping Police Reforms and Stronger Judicial Accountability

This has been discussed for decades but there’s been no action. The recommendations for reforms are already there. Set a time frame for implementation. This will make the police not just a professional force that’s not at the beck and call of politicians, but also a trained one with in-built checks against developing vested interests. Today the situation often is that the investigator (police officer) is answerable to the person being investigated (politician). Also, separate the police into two wings: one for investigation and the other for maintaining law and order. The two functions are different and require different skill sets. Sadly, the image of judiciary has taken a knock in recent years—for the common man, the courts are the last resort for seeking justice.

6.Blacklist Corrupt Businessman

Private businesses caught indulging in corrupt practices or bribing officials should be blacklisted for say, 10 years and be barred from government projects. In the category of corrupt practices would fall use of shoddy material—like road contractors who give one inch of tar when they are supposed to give four inches and the road crumbles after one monsoon. Bigger instances or private businesses cutting corners in public projects by colluding with corrupt officials should attract exemplary punishment.

Finally, and this is for every one of us, let’s try and say no to bribes. This is the campaign against giving bribes as the mood against corruption is high. Ultimately, we can’t get rid of the bribe taker if we are willing to be bribe givers.

Conclusion

The vice of corruption which is now a way of life and a potent threat to polity, has degenerated the Indian Society by rupturing its moral fabric. The cancer of corruption is an insidious host which is more dangerous than the army of the enemy at our frontiers. We can visualize the movements of the enemy and modulate our defence accordingly but we are helpless before the insidious host who is eroding the sound bases of our socio-economic legal set-up by clandestine dubious operations. When a country faces a particular danger from a particular problem, may it be terrorism or corruption, it has to be countered by stringent legal measures which have the support or approval of the society at large for those interest the emergency measures are pressed into service. Corruption which has been equated with the disease of cancer in India by the Honourable Supreme Court should be projected as the most serious problem of the modern India which deserves deterrent treatment at every stage of criminal justice system. General awareness regarding dangerous consequences of corruption has to be created. Awakening of masses through strong public opinion is the prime need of the time. A multipronged socio-legal approach against corruption can go a long way in analyzing and controlling corruption in its correct Indian perspective. If quick urgent steps are not taken at all levels for proper enforcement of anti-corruption laws in India, it may continue to dispense injustice as aptly pointed out by eminent jurist Nani Palkiwala:

   “Law is not only an ass but also a snail. The courts these days are not cathedrals of justice but cashinos. If you lose at one state, you double the stake and approach the higher stage.[23]


[1]  All My Sons, Arthur Miller

[2] T.N. Sehshan, Ex Election Commissioner

[3] The Concise Oxford Dictionary of Current English, Clarendon Press, Oxford, 1964.

[4] Encyclopedia Britanica, 1929 Edition, London, p.472.

[5] Government of India, Ministry of Home Affairs, Report of the Committee on Prevention of Corruption, New Delhi, 1964, p.5.

[6] Op. cit., Report of the Committee on Prevention of Corruption, p.5

[7] A public servant is said to commit the offence of criminal misconduct:

a) If he habitually accepts or obtains or agree to accept or attempts to obtain for himself or any other person, any gratification (other than legal remuneration) as a motive or reward such as is mentioned in section 161 of the Indian Penal Code;

b) If he habitually accepts or obtains or attempts to obtain for himself or any other person any valuable thing without consideration which he knows to be inadequate, from any person, whom he knows to have been, 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 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 under his control as a public servant or allows any other person so to do; or

d) If he, by corrupt and illegal means or by otherwise abusing his position as public servant, obtains for himself or for any other person any valuable thing or pecuniary advantage; or

e) If he or any other 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 own income.

Needless to point out that the legal definition of corruption is too narrow.

[8] Chapter IX dealing with offences by or Relating to Public Servants.

[9] H.S. Gour, Penal Law of India 1398 (Vol. II, 10th ed.). Section 21 contains twelve clauses. If a person falls under any one of the classes only then he is deemed to be a public servant for the purpose of the I.P.C i.e. for being tried for bribery. If a person is not covered by any of the classes, he cannot be tried for the offence under the I.P.C not being a public servant, however, his act pernicious to the society may be.      

[10] Statement of objects and Reasons of Prevention of Corruption Act, 1947, Gazette of India dated November 23, 1946, Part V, p. 384.

[11] Section 4 of the Act.

[12] Deals with Talking illegal gratification by public servant as a motive or reward for showing official favour.

[13] I.P.C Amendment Bill 1972 contained in provisions for making M.P. and M.L.A as public servant but the same was deleted by the Joint Select  Committee of the Parliament. Supreme Court in Nayak, R.S. v. Antulay, A.R., AIR 194 SC 684 has held that M..A is not a public servant.

[14] Ahmed Siddique; CRIMINOLOGY, 398 (1997, 4th ed.).

[15] The Santhanam Committee Report, pp. 101-102

(1)  [16] The Bill is intended to make the existing anti-corruption laws more effective by widening their coverage and strengthening their provisions.

(2)  The Prevention of Corruption Act, 1947 was amended in 1964 based on the recommendations of the Santhanam Committee. There are provisions in Chapter IX of the Indian Penal Code 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 wealth. The Bill seeks to incorporate all these provisions with modifications so as to make the provisions more effective in combating corruption among public servants.

(3) The Bill inter alia, envisages widening the scope of the definition of expression “public servant”, incorporation of offences under sections 161 to 165-A of the Indian Penal Code, enhancement of penalties provided for these offences and incorporation of a provision that the order of the trail court upholding the grant of sanction for prosecution would be final if it has not already been challenged and the trail has commenced. In order to expedite the proceedings, provisions for day-to-day trail of cases and prohibitory provisions with regard to grant of stay and exercise of powers of revision and interlocutory order have also been included.

[17] Gazette of India (Extraordinary), Part II, Section 1, dated 12.9.1988.

[18] Section 2 (c ) (ii) provides: Public Servant means any person in service or pay of local authority.

Section 2 ( c) (iii) reads: Public servant means any person in the service or pay of a corporation established by or under a Central, Provincial or State Act, or any authority or a body owned by or controlled or aided by the Government or a Government company as defined in section 617 of the companies Act, 1956.

Section 2( C) (viii) provides: Public Servant means any person who holds an office by virtue of which he is authorized or required to perform any public duty.

Section 2 (c) (ix) reads: Public servant means any person who is the president, secretary or office bearer of a registered co-operative society engaged in agriculture trade or industry or banking.

[19] 1997 Cri. L.J. 2559 (Delhi).

[20] Ibid, at p. 2567

[21] SHALU NIGAM, Right to Information Law & Practice, at p. 4.

[22] Marpakwar, Prafulla, “Bank-whistleblower deal illegal”, TOI Dec 24, 2010.

[23] Quoted in Judicial and Criminal Justice System Requires Overhauling by T.V. Rajeshwar.

By:-Lalit Ajmani

2nd Year Student – BA.LLB (Hons.)

Rajiv Gandhi National University of Law, Punjab

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