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2016 (2) TMI 1296 - SC - Indian LawsAs per Ranjan Gogoi J. Interpretation of statute - public servant as contained in Section 2(c) of the Prevention of Corruption Act 1988 - meaning of the expression office appearing therein as well as public duty which is defined by Section 2(b) of PC Act - HELD THAT - There can be no dispute that before enactment of the PC Act Section 46A of the BR Act had the effect of treating the concerned employees/office bearers of a Banking Company as public servants for the purposes of Chapter IX of the Indian Penal Code by virtue of the deeming provision contained therein. The enactment of the PC Act with the clear intent to widen the definition of public servant cannot be allowed to have the opposite effect by expressing judicial helplessness to rectify or fill up what is a clear omission in Section 46A of the BR Act. The omission to continue to extend the deeming provisions in Section 46A of the BR Act to the offences Under Sections 7 to 12 of the PC Act must be understood to be clearly unintended and hence capable of admitting a judicial exercise to fill up the same. The unequivocal legislative intent to widen the definition of public servant by enacting the PC Act cannot be allowed to be defeated by interpreting and understanding the omission in Section 46A of the BR Act to be incapable of being filled up by the court. It is thus concluded that thhe accused Respondents are public servants for the purpose of the PC Act by virtue of the provisions of Section 46A of the Banking Regulation Act 1949 and the prosecutions launched against the accused Respondents are maintainable in law - petition dismissed. As per Prafulla C. Pant J. Whether the Chairman Directors and Officers of Global Trust Bank Ltd. (a private bank before its amalgamation with the Oriental Bank of Commerce) can be said to be public servants for the purposes of their prosecution in respect of offences punishable under Prevention of Corruption Act 1988 or not? - HELD THAT - Section 46A was inserted in Banking Regulation Act 1949 by Act No. 95/56 with effect from 14.01.1957. The expression every chairman who is appointed on a whole time basis managing director director auditor was substituted by Act No. 20/94 with effect from 31.01.1994 in place of every chairman director auditor . As such managing director of a banking company is also deemed to be a public servant. In the present case transactions in question relate to the period subsequent to 31.01.1994. In Federal Bank Ltd. v. Sagar Thomas and Ors. 2003 (9) TMI 707 - SUPREME COURT this Court has held that a private company carrying banking business as a scheduled bank cannot be termed as a company carrying any statutory or public duty. However in said case the Court was examining as to whether writ can be issued Under Article 226 of the Constitution of India against a scheduled bank or not. There was no issue before the Court relating to deeming fiction contained in Section 46A of Banking Regulation Act 1949 in respect of a chairman/managing director or director of a banking company against whom a crime relating to anti-corruption was registered. It is clear that object of enactment of P.C. Act 1988 was to make the anti corruption law more effective and widen its coverage. In view of definition of public servant in Section 46A of Banking Regulation Act 1949 as amended the Managing Director and Executive Director of a Banking Company operating under licence issued by Reserve Bank of India were already public servants as such they cannot be excluded from definition of public servant - For banking business what cannot be forgotten is Section 46A of Banking Regulation Act 1949 and merely for the reason that Sections 161 to 165A of Indian Penal Code have been repealed by the P.C. Act 1988 relevance of Section 46A of Banking Regulation Act 1949 is not lost. A law which is not shown ultra-vires must be given proper meaning. Section 46-A of Banking Regulation Act 1949 cannot be left meaningless and requires harmonious construction. As such in our opinion the Special Judge (CBI) has erred in not taking cognizance of offence punishable Under Section 13(2) read with Section 13(1)(d) of P.C. Act 1988. However we may make it clear that in the present case the accused cannot be said to be public servant within the meaning of Section 21 Indian Penal Code as such offence Under Section 409 Indian Penal Code may not get attracted we leave it open for the trial court to take cognizance of other offences punishable under Indian Penal Code if the same get attracted. The courts below have erred in law in holding that accused Ramesh Gelli and Sridhar Subasri who were Chairman/Managing Director and Executive Director of GTB respectively were not public servants for the purposes of Prevention of Corruption Act 1988 - Application disposed off.
Issues involved:
1. Definition and scope of "public servant" under the Prevention of Corruption Act, 1988. 2. Applicability of Section 46A of the Banking Regulation Act, 1949. 3. Judicial interpretation of legislative omissions. 4. Relevance of prior judicial precedents. 5. Specific case facts and their alignment with the legal definitions and provisions. Issue-wise detailed analysis: 1. Definition and scope of "public servant" under the Prevention of Corruption Act, 1988: The primary question revolves around whether the accused, who were Chairman and Executive Director of a private bank, fall under the definition of "public servant" as per Section 2(c) of the Prevention of Corruption Act, 1988 (PC Act). Section 2(c)(viii) of the PC Act defines "public servant" as any person who holds an office by virtue of which he is authorized or required to perform any public duty. The term "public duty" is defined in Section 2(b) as a duty in discharge of which the State, the public, or the community at large has an interest. The judgment emphasizes that the definition of "public duty" is broad and includes duties performed by individuals in offices that have a public character. 2. Applicability of Section 46A of the Banking Regulation Act, 1949: Section 46A of the Banking Regulation Act, 1949 (BR Act) deems certain officials of a banking company, including a chairman, managing director, director, auditor, liquidator, manager, and any other employee, as public servants for the purposes of Chapter IX of the Indian Penal Code. The judgment notes that with the enactment of the PC Act, the offences under Sections 161 to 165A of the Indian Penal Code were repealed and included in Sections 7 to 12 of the PC Act. The omission to update Section 46A of the BR Act to reflect this change is considered an unintended legislative omission, which the Court can fill through interpretation. 3. Judicial interpretation of legislative omissions: The judgment discusses the rule of casus omissus, which states that what has not been provided for in the statute cannot be supplied by the Courts. However, it also highlights exceptions to this rule where the Court can fill gaps to give effect to the legislative intent. The judgment references Lord Denning's opinion in Seaford Court Estates Ltd. v. Asher and subsequent cases to support the view that the Court can interpret statutes to fill unintended gaps and give effect to the legislature's intention. 4. Relevance of prior judicial precedents: The judgment cites several precedents to support its conclusions. In P.V. Narasimha Rao v. State (CBI/SPE), the term "office" was defined as a position with duties attached, especially of a public character. The case of Manish Trivedi v. State of Rajasthan is referenced to illustrate that the definition of "public servant" should be interpreted broadly to encompass individuals performing public duties. The judgment also refers to the case of Govt. of Andhra Pradesh v. P. Venku Reddy, which emphasizes a purposive approach to interpreting the definition of "public servant" to combat corruption effectively. 5. Specific case facts and their alignment with the legal definitions and provisions: The case involves the prosecution of the Chairman and Executive Director of Global Trust Bank (GTB) for alleged offences under the PC Act. The transactions in question occurred before the amalgamation of GTB with Oriental Bank of Commerce (OBC). The judgment concludes that the accused were public servants under the PC Act by virtue of Section 46A of the BR Act. It emphasizes that the legislative intent behind the PC Act was to widen the definition of "public servant" and that this intent should not be defeated by a technical omission in the BR Act. Conclusion: The judgment concludes that the accused are public servants for the purposes of the PC Act by virtue of the provisions of Section 46A of the BR Act. Consequently, the prosecutions against the accused are maintainable in law. The criminal appeals filed by the CBI are allowed, and the Writ Petition (Criminal) No. 167 of 2015 is dismissed. The judgment underscores the importance of interpreting statutes to fulfill the legislative intent and combat corruption effectively.
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