Opinion split over protection for civil servants under new anti-graft law

At one end are concerns that the new Act will defang corruption combatting agencies; at the other is the call for reimbursement of costs payable to exonerated officers

“The Aircel-Maxis case will be the test for the application of the changes in the amended Prevention of Corruption Act,” said Gopal Krishna Pillai, former home secretary. In this case, the Foreign Investment Promotion Board (under former finance secretary Ashok Chawla) had made a decision exactly of the sort that officers are called upon to decide. If such decisions come up for questions, there should a protection mechanism for the civil servants when there are no financial stakes for them, he told Business Standard. 

In July 2018, Parliament passed amendments to the Prevention of Corruption Act (PCA), 1988. Pillai’s reference is to this law. The Aircel-Maxis case, now under investigation by the CBI and the Enforcement Directorate, is about a foreign investment clearance given in 2006 to the deal during the term of former finance minister P Chidambaram.The allegation is that the clearance to the deal given by the Board exceeded its financial authority, a typical PCA case. Business Standard decided to quiz former government officers about the extent to which decision-making in the government was indeed affected by the PCA’s 1988 avatar. Also, should government officers exonerated by courts get reimbursed for the cost of fighting their cases?

The PCA bill to change the 1988 version was pending since August 2013 in the Rajya Sabha, at the tumultuous phase of the Indian polity, when a series of corruption-related charges rocked the UPA government. The NDA government made amendments to the bill and that is the version which went through Parliament now, with the support of the principal Opposition party Congress as well. “Under the 1988 Act, as well as the 2013 Bill and 2015 amendments, if a public servant takes an undue advantage for performing his public function improperly, he would be punished. However, the 2015 amendments create an exception,” notes a commentary by Prianka Rao for legislative issues think tank, PRS India. How many officers have been charge sheeted under PCA?  It is not an empty threat. A government reply in Parliament says, “As per data provided by National Crime Record Bureau (NCRB), a total of 4,966 cases in 2014 and 5,250 cases in 2015 were reported under PCA”. Though to be fair, since 2014, only four officers have been prematurely retired “in public interest”. 

Under these circumstances, the exceptions are quite necessary, says U K Sinha, former chairman of the Securities and Exchange Board of India (Sebi). 
 

“I am particularly concerned about the effect the earlier Act had on regulators like Sebi, who have to take quasi-judicial decisions.  Even though appellate mechanism by way of SAT and the Supreme Court is provided by law, criminal investigations were being initiated to question the quantum of punishment awarded by Sebi, the quality of its orders or the time taken to pass an order,” says Sinha.  This resulted in serious de-motivation in the minds of officials, who took up these issues with the government and also formed an association for mutual help and assistance, he said. Retired officers didn’t even get a fig leaf of the protection available to serving officers.

The amendments create a safe harbour for both, through the new section 17A, which says: “No police officer shall conduct any enquiry or inquiry or investigation into any offence alleged to have been committed by a public servant under this Act, where the alleged offence is relatable to any recommendation made or decision taken by such public servant in discharge of his official functions or duties, without the previous approval… of the authority competent to remove him from his office, at the time when the offence was alleged to have been committed.” Sinha is clear that “extensive damage was done to the morale of the public servants” with the application of the 1988 Act. 

Predictably, the exception has created a furore among police officers. Writing in Indian Express,  M L Sharma, former special director, CBI, claims, “By divesting the anti-corruption agencies of initiative in combating corruption, this provision is likely to render them toothless.” 

But as former cabinet secretary K M Chandrasekhar notes: “Investigators do not fully understand the logic and purpose of a decision and its nuances by stipulating approval of competent authority. Through this mechanism, it protects individuals who make genuine mistakes in the course of their work.” One of the ways in which deterrence can be enforced is through the Whistle Blowers Protective (Amendment) Bill, 2015. Passed by Lok Sabha it is pending in the Rajya Sabha.

According to Chandrasekhar, PCA is now a “balanced Act” with the changes. “It brings both the bribe giver and the bribe taker within its ambit, even corporate entities”. He explained that the amended PCA gives more powers to attach and forfeit assets of officers against whom genuine corruption cases have been initiated.

So what took the government so much time to bring in the changes? In the very first Pragati meeting, a monthly review of government performance that Prime Minister Narendra Modi holds with secretaries, they had pointed to the pressures created by the PCA on decision making. Modi had assured them he would act fast. It has been four years since. Former coal secretary, Anil Swarup says this was inevitable since there are several stages of examination. “But it is good that it finally arrived before this government bowed out”.

Pillai says during his term he had proposed that officers who were acquitted by the courts under PCA cases should be reimbursed their costs for fighting their legal defence.  “There is a West Bengal (Bangla) cadre officer I know of, who sold his flat and used his provident fund money to pay for his case. The reimbursement clause was supposed to be part of the revised bill, but got nowhere.” Amitabh Kant, CEO of Niti Aayog, said he too is in favour of the proposal. But with the Act already through Parliament, this seems out of reckoning. It seems the only possible way the government can make good the costs is to introduce it in subordinate legislation, but no serving officer was willing to comment on it. 

Ultimately, as Swarup says, the amended PCA should not be treated as a defence mechanism by government employees. “There is now no excuse for civil servants to delay decisions anymore.” Sinha is also sanguine that it “will provide ample protection to honest officials from any possible harassment and help them to carry out their task more fearlessly.”

Chandrasekhar agrees this could speed up decision making, but he has a caveat. “Where the officer is looking upward for signals on how to act and when he is afraid that a wrong step may invite humiliation and dislocation, the situation may not materially change. (PCA) is but one part of a much larger malaise.”