SUPREME COURT: PUBLIC SERVANTS CAN BE PROSECUTED UNDER CORRUPTION ACT

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The Supreme Court has held that office bearers of a registered cooperative society are public servants and can be prosecuted on the charges of corruption under the Prevention of Corruption Act.

A bench comprising Justices Altamas Kabir and Cyriac Joseph while allowing the appeal of state of Madhya Pradesh directed that Rameshwar, Chairman of Indore Premier Cooperative Bank Ltd and other Directors will face trial for frequently taking a loan of Rs 56,50,000 in favour of persons without verifying their credentials.

The apex court while setting aside the impugned judgment of Madhya Pradesh High Court noted ‘the High Court also did not, while considering the definition of the expression public servant take into account the fact that the decision in Laljip Rajshi Shah was no longer applicable in view of the amended provision of section 2 (c) of the Prevention of Corruption Act 1988, defining the said expression.

prima facie, it appears to us that the respondent number one and three in their capacity as a chairman and the executive officer of the bank, come within the definition of public servant under section 2 (c) (9) of the 1988 act.’ The apex court, however, made it clear that the observations made in the judgment should not influence the trial in any way and concluded that the impugned judgment in these two appeals are set aside and charges framed by the trial court against the respondent are restored and the trial court is directed to proceed with the trail.

The loan was allegedly sanctioned in favour of fictitious firm floated by Himanshu Joshi, son of Mr Hem Joshi, public contact officer for purchase of vehicles but vehicles were never purchased and there was no firm at the given address.

The name of bogus firm was Indore Motors and Agro Machinery.

The complaint was lodged by one Harish Patil and Kanhain Lal Yadav with the Lok Ayukta MP.

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