The Supreme Court has highlighted that the protection offered by Section 197 of the Criminal Procedure Code (CrPC) does not extend to individuals employed in Nationalized Banks.
Section 197 CrPC comes into play only when the public servant occupies a position that is exclusively terminable upon governmental authorization. This point was underscored by Justices B R Gavai and J B Pardiwala.
In the specific instance, the accused held the role of Assistant General Manager at the State Bank of India, Overseas Bank (Bank), Hyderabad. The allegation against him involves alleged collaboration with co-accused to deceive the bank by sanctioning a corporate loan of Rs. 22.50 crore for M/s Sven Genetech Limited, Secunderabad. The accused faced an FIR under Sections 120-B r/w 420, 468, and 471 of the Indian Penal Code, 1860. The Telangana High Court dismissed his plea to quash the FIR via a petition.
In his appeal to the Supreme Court, the appellant raised the following queries:
(i) Can it be established that the appellant, while serving as an Assistant General Manager at the State Bank of India, Overseas Bank, is exclusively removable from his position with government authorization, thereby rendering Section 197 of the CrPC applicable?
(ii) Is it permissible for the Special Court (CBI) to proceed with charges against the appellant for offenses under the Indian Penal Code (IPC), even though the authorization to prosecute the appellant under Section 19 of the Prevention of Corruption Act, 1988, is not on record due to its rejection?
Addressing the first query, the court took note of the stipulations of Section 197 CrPC and remarked:
“While an individual employed in a Nationalised Bank is considered a public servant, the purview of Section 197 of the CrPC is not relevant in such cases, as Section 197 is pertinent only when the public servant holds a position where removal from service can solely occur with the approval of the Government. It is undisputed that the appellant does not occupy a post that necessitates removal from service exclusively with the sanction of the Government. Given this perspective, even if the appellant is regarded as a public servant, the provisions of Section 197 of the CrPC do not find applicability.”
Another argument presented was that, due to the absence of authorization under Section 19 of the Prevention of Corruption Act, 1988, the appellant should not be subject to prosecution solely for IPC offenses, warranting exemption from the ongoing criminal proceedings. In addressing this matter, the court responded:
“A fixed rule cannot be established that in a prosecution before a Special Judge, the previous sanction under Section 19 of the PC Act, 1988 would invariably serve as the exclusive prerequisite. If the charges leveled against the public servant encompass offenses beyond those punishable under the PC Act, 1988, specifically under the general legal framework (i.e. IPC), the court is obligated to scrutinize, both at the stage of cognizance and subsequently as the case advances, whether the need for sanction under Section 197 of the CrPC exists. A notable distinction exists between the statutory requisites of Section 19 of the PC Act, 1988 on one hand, and Section 197 of the CrPC on the other. For offenses solely under the PC Act, 1988, the public servant’s sanction is obligatory. In instances involving general penal law violations by a public servant, the necessity (or lack thereof) of sanction under Section 197 of the CrPC hinges on factual intricacies. The criterion in the latter scenario revolves around the “nexus” between the act of commission or omission and the official duty of the public servant. Committing an offense punishable by law can never constitute a facet of the official duty of a public servant. It is an overly simplistic approach to decide and dismiss the need for sanction under Section 197 of the CrPC based solely on this rationale. The “safe and sure test” is to determine whether the failure or neglect to perform the contested act would render the public servant accountable for dereliction of official duty. While the public servant might have acted “beyond the scope of his duty,” if a “nexus” exists between the impugned act and the execution of official duty, the protective coverage of Section 197 of the CrPC must not be denied, as long as the execution of official duty is not exploited to conceal illicit actions.”
Case Title : A. Sreenivasa Reddy vs Rakesh Sharma | 2023 (SC) 614 | 2023 INSC 682
Section References:
Section 197, CrPC: Prosecution of Judges and Public Servants
Section 19, PC Act 1988: Previous Sanction necessary for prosecution
By: Suman Roy, B.A.LLB 4th Year from University of Calcutta- LJD Law College
0 Comments