Chairman & Director Of Banking Company Operating Under RBI Are Public Servants Under Prevention Of Corruption Act: Telangana HC
The Telangana High Court held that the chairman and director of a banking company operating under a licence issued by the Reserve Bank of India (RBI) were public servants under the Prevention of Corruption Act (PC Act)
The Court explained that when a public servant dishonestly or fraudulently misappropriates any property entrusted to them or under their control, intending to enrich themselves illicitly during the period of their office, they would be liable for penal prosecution under Section 13 of the PC Act.
A Single Bench of Justice E.V. Venugopal observed, “No doubt, in view of definition of public servant in Section 46A of Banking Regulation Act, 1949, as amended, Section 21 IPC and Section 2 of PC Act, the Managing Director and Executive Director of a banking company operating under licence issued by the Reserve Bank of India, were already public servants, as such they cannot be excluded from definition of ‘public servant’.”
SPP Anandi represented the petitioner, while Sr. Advocate L. Ravi Chander appeared for the respondent.
The accused faced charges under Section 13(2) read with Section 13(1)(d) of the PC Act related to their roles as Chairman, Managing Director, and Executive Director, respectively, of erstwhile Global Trust Bank between 1994 and 2003. Allegations against them included conspiracy, fraud, and misappropriation of bank funds.
The trial court subsequently exonerated them from the offences holding that the accused were not public servants.
In an appeal before the High Court, the CBI argued that the accused had misused their official position while they were entrusted with public money and hence, were liable to be prosecuted for the offences covered under the provisions of the PC Act.
“The object of enactment of P.C. Act, was to make the anti-corruption law more effective and widen its coverage,” the Court stated.
The Court held that the accused were public servants under the purview of the PC Act.
Accordingly, the High Court allowed the criminal revision.
Cause Title: Central Bureau of Investigation v. Sridhar Subasri
Appearance:
Petitioner: SPP Anandi
Respondent: Sr. Advocate L. Ravi Chander; Advocates E.Umamaheshwar Rao and C.Sharan Reddy
