Prevention of corruption (Amendment) Act 2018: Boon or a Bane?

This Article is written by Avantika Jain Intern at Legal Vidhiya 

Introduction:

Corruption has long been a problem in India. It reduces trust, undermines democracy, hinders economic growth and exacerbates social problems such as poverty, inequality and the environmental crisis. Opportunistic leaders who believe there is a chance to make money if someone asks them for a job are the ones who start corruption.

The Prevention of Corruption Act 1988 was passed to stop corruption in civil service positions. The act has not undergone any additional modifications since then, which has contributed to its uneven success.

Due to the little success of this act, a new law was needed. Consequently, on 26 July 2018, the Prevention of Corruption Act 2018 came into force.

What constitutional elements are connected to the prevention of corruption act?

Written laws also specify statutory and statutory provisions related to corruption. The Constitution of India, which serves as the supreme law of the country, contains provisions on judicial jurisdiction. The Office of the Comptroller and Auditor General (CAG) was set up to regulate money and economy-related offences. In addition, there are other bodies at the federal and state levels, including the Central Oversight Commission, the Parliamentary Accounts Committee, the Central Bureau of Investigation and the Association of Certified Trading Systems. (State Office for Combating Corruption).

The Constitution is protected by the Supreme Court. According to the Constitution, the fundamental rights enshrined in Part III of the Constitution are to be protected by the Supreme Court. Fundamental rights protect individuals from the vast powers of the state.

Article 12 of the Constitution defines the state.

The following “files” are accessible under Articles 32 and 226 of the Constitution of India, except the Public Interest Litigation (PIL) instrument.

•  Habeas Corpus
•  Mandamus
•  Prohibition
•  Prohibition statement
•  Writ of Certiorari
•  Prescription Quo-Warranto

All these injunctions have different effects and different levels of authority, but in reality, they are only tools of the judiciary to check administrative discretion.

Prevention corruption act 2013 

The Prevention of Corruption Act 1988 is primarily what the Amendment to the Prevention of Corruption Act 2013 is intended to change.

The United Nations Convention Against Corruption (UNCAC) was ratified by India in May 2011 and subsequent judicial declarations in corruption cases were required to fill any gaps in the description and coverage of the crime of bribery to be consistent with current international practice.

The bill and its official amendments aim to amend up to 19 sections of the Prevention of Corruption Act 1988.

In addition, an amendment to the Prevention of Money Laundering Act 2002 has been proposed.

Various amendments to the main Act have been proposed, including the replacement of Sections 7, 8, 9, 10, 12, 13, 14, 19 and 20; deletion of § 11 and § 24; addition of sections 2, 4 and 32; the creation of new sections, namely sections 17A and 18A; and subsequent amendments to § 1, 15, 16 and 23.

The main elements of the proposed official changes from 2015 are: –

• Imposing tougher penalties for bribery offences, including penalties for both parties involved.
• Penalties are increased from a basic limit of 6 months to 3 years and a maximum of 5 years to 7 years (a seven-year sentence elevates corruption to the category of heinous crimes).
• It is proposed that powers of attachment should be vested in the Court of First Instance (Special Judge) rather than the District Court to prevent profits from the profits of corruption.
• In order to control the supply side of corruption, the scope of the rule to limit the solicitation of civil servants was extended from natural persons to commercial entities.
• Ensuring that commercial organizations are given guidance on how to prevent people associated with them from bribing public officials.
• In the past four years, the typical length of a PC Act trial has exceeded eight years

Prevention of corruption ( amendment) act, 2018

Highlights and key changes brought by the amendment act: 

• Definition of undue advantage: According to the Amendment Act, any public employee who accepts or tries to accept any “undue advantage”—either for himself or for someone else—instead of performing their public duties will be punished with a minimum sentence of three years and a maximum sentence of seven years in jail. The undue advantage is described in the Amendment Act as any benefit that a public employee is allowed to receive that is not legal compensation. Additionally, the term “gratification” is not restricted to rewards in the form of money or other material goods. Due to the broad meaning, even non-monetary benefits like a better posting, post-retirement benefits, gifts, and favours that are not worth money can fall under the definition of undue advantage.

• People liable for offering bribes to public servants: Prior to the Amendment Act, the PC Act did not contain a specific provision for someone who gives or promises to give an undue advantage. Now, giving an undue advantage to a public servant is a specific offence that carries a 7 (seven) year prison sentence, a fine, or both. But if a person is coerced or forced to offer an unfair advantage but discloses this to the appropriate authority within 7 (seven) days of doing so, he will not be held responsible. In accordance with the PC Act, a person who testified that he provided a public servant with an unfair advantage during a corruption trial would not be prosecuted for the crime of abetment. The Amendment Act does not include this clause. Effectively, offering bribes could turn into a danger for those who do so, discouraging them from testifying in a case against dishonest public officials.

• Bribes offered by commercial organisations: According to the Amendment Act, a “commercial organisation” includes not only a company or partnership formed or incorporated in India and conducting business there or abroad but also a body or partnership formed or incorporated outside of India and conducting business in India. The Amendment Act has replaced Section 9 of the PC Act to include a particular provision for offences committed by businesses and those connected to them. It states that a commercial organization will be punished with a fine, the amount of which is not specified in the Amendment Act, if it violates any of the PC Act’s listed offences with the intent to gain or keep business or maintain an advantage in the conduct of its operations.

According to the Act, the Central Government must create and issue regulations that forbid people affiliated with for-profit groups from bribing any public servants. If a commercial organisation can show that it had adequate procedures in place to ensure compliance with the Central Government’s guidelines issued to prevent people connected to the commercial organisation from engaging in such conduct, it can defend itself when accused of any offence under the PC Act. In order to safeguard itself from any type of PC Act prosecution in the event that any associated person is accused of giving bribes, the corporate sector in India will need to be hasty in enacting its internal guidelines and making sure that its employees are informed and abiding by them.

In addition, if it is established that the offence was committed with the knowledge or complicity of any director, manager, secretary, or another officer of the organization, that individual will also face charges under the PC Act. 

• Redefining criminal misconduct: The PC Act defined criminal misconduct by a public servant as, among other things: (i) using illegal means to obtain any valuable thing or monetary reward for himself or any other person; (ii) abusing his position as a public servant to obtain a valuable thing or monetary reward for himself or any other person; and (iii) obtaining a valuable thing or monetary reward for any person without the consideration of the public interest. This section is replaced by the Amendment Act, which limits the definition of criminal misconduct to the following two actions: (i) misappropriating or converting for personal use any property belonging to or under the control of a public servant; and (ii) accumulating assets out of all proportion to known sources of income. In addition to showing that the latter is true, it must also be shown that the person intended to obtain assets that were out of proportion to their income. As a result, the Amendment Act has reduced the range of illegal behavior and raised the bar for proving the crime of possessing disproportionate assets.

• Prior approval from the relevant government for an inquiry and prosecution: According to the PC Act, serving public officials could only be prosecuted with the previous approval of the relevant government. The Amendment Act expands this defense of needing previous approval to an investigation before filing charges. For crimes committed while in office, this protection is also given to former officials. The third provision to Section 19(1) stipulates a three-month directory (but not necessary) time frame in which the appropriate government must inform the public of its judgement regarding such a sanction. The Central Government may also establish standards for the granting of sanctions for punishment.

• Attachment of property: The Prevention of Money Laundering Act of 2002 and the Criminal Law Amendment Ordinance of 1944 will be applied in accordance with the Amendment Act for the purpose of seizing and managing property obtained through a violation of the PC Act. 

• The time frame of trial: A deadline for finishing the hearing was not specified by the PC Act. The Amendment Act now mandates that the Special Judge make every effort to finish the hearing in under two years. This time frame may be extended by 6 (six) months at a time and a total of 4 (four) years, provided that the appropriate justifications are recorded.

• Enhancement of Punishment: The maximum sentence of 7 (seven) years in prison, with or without a fine, has been raised from 5 (five) years to 7 (seven) years, with a minimum sentence of 6 (six) months in prison. The amount of the penalty for aiding and abetting crimes has also been raised.

What are some of the problems and difficulties suffered in the fight against the menace of corruption?

Even though sufficient rules are in place to combat it, corruption remains one of the biggest threats facing Indian society. Below are some of the problems and difficulties faced by the Indian criminal justice system in the fight against corruption.

A) There is no law to deal with corruption in the private sector: The current legislation in India that deals with corruption-related offenses is the Prevention of Corruption Act, 1988. However, this law was primarily enacted to deal with cases of corruption involving public sector and public employees. , despite the fact that widespread corruption exists even in the private sector and seriously threatens the nation’s overall growth and development.

The private sector has grown considerably since the liberalization of the Indian economy in the early 1990s. With the growth of private industry, the problem of corruption worsens there. Now it has grown to alarming proportions. It is by far the biggest threat to Indian society at present. In line with UNCAC’s vision, efforts are underway to enact legislation to address misconduct in the private sector.

B) Inherent delays in the criminal justice system: Punishments are not swift and progress is painfully slow. Section 19 of the Act on Corruption states that prior to filing a lawsuit to remove a public servant from office, the competent authority must grant consent.

This often leads to delays in the case.

Responsible authorities often take a long time to approve prosecution requests after receiving reports from investigative authorities. Permission is occasionally refused for political or other reasons.

The Corruption Act mandates that only special judges preside over proceedings in cases of alleged corruption. Compared to the number of corruption cases brought before their tribunals, the number of special judges is woefully inadequate. For this reason, the number of pending cases in these courts increases every year. In addition, there is a significant disparity between the number of cases handled by investigating authorities and courts. During criminal prosecutions, adjournments are often requested or granted for various reasons.

C) Hostile Witnesses: The prosecution must prove its case beyond a reasonable question to successfully convict a corrupt public official. This is a strict statutory requirement under India’s general rule of evidence, the Indian Evidence Act. Even in the case of corruption, there is no exception to this rule.

In order for the prosecution to prove its case beyond a reasonable doubt, it must rely heavily on witness testimony.

However, due to coercion, luring and intimidation by the other side, witnesses often do not support the case. There is no programmed witness security and no guidelines for swift and decisive action against hostile witnesses. As a result, witnesses are often uncooperative and undermine the prosecution’s case.

Its impact on corruption in India:

Bribery was reduced by 10% in 2019 compared to 2018 

• Persons who paid bribes reduced from 56% in 2018 to 51% in 2019 

• Cash bribes were reduced from 2018 to 2019, while those paid via agents and paid in kind, increased 

Conclusion

A positive development in the fight against corruption can be considered the amendment of the law, which contains a number of provisions regarding companies and persons that offer an unjustified advantage. The definitions and punishments for the crimes related to receiving an unjustified benefit, being a habitual offender and aiding and abetting have also been amended and strengthened.

The amendment to the law brought much-needed changes, but also added more hurdles to investigation and prosecution. The amendment to the law stipulates that the prior approval of the relevant government must be obtained in order to initiate investigations into current and former public servants. Although the amendment to the law appears to strengthen the defenses available to officials accused of corruption, the intention was to prevent the victimization of respected officers.

The person has also been found guilty under the PC Act of receiving an undue advantage, being a habitual offender or aiding and abetting an offence. This presumption currently only applies to the crime of receiving an unfair advantage. When a person is accused of being a habitual offender and an accessory to a crime, the burden of proof shifts to the prosecution.

To ensure that internal compliance mechanisms are in place to mount a possible defense to allegations of bribery, the corporate sector will need to be mindful of central government directives. Other details, such as the amount of the fine for business organizations, are not known.