GOVT SANCTION NOT NEEDED TO PROSECUTE KSEB OFFICIALS
The Supreme Court on 13 May 2013 ruled that the sanction of the government is not necessary to prosecute an officer of a public sector undertaking or government company for offences committed while discharging his official duties.
Several employees of public sector companies and government companies claimed this privilege when they were prosecuted for offences during their tenure of office. The Officials invoked Section 197 of the Criminal Procedure Code, which stipulates that the government's sanction is required to prosecute a government servant.
however. a Division Bench consisting of Justice GN Ray and Justice GB Pattanaik has rejected these contention in a significant ruling, which will affect all PSU employees facing charges of misuse of their position and corruption. The main case involved was Mohammed Hadi Raja Vs State of Bihar.
Owing to the importance of the issue, the court had sought the assistance of the Attorney-General. The Central and State Government took the view that the protection given to public servants by section 197 was available to PSU officers also as they were the 3rd arm of the government, they deserve to be treated at par with government servants, the Center contended.
However, the prosecuting agencies countered this argument by stressing that though some PSUs and government companies may be treated as instrumentality or agencies of the state, their employees could not be treated as those directly under the government. A department directly run by the government has always been placed on a different footing than PSUs, it was submitted.
The judgement accepted the argument of the prosecuting agencies, and ruled that government company officials will not be covered by section 197 CrPC. It explained that a PSU or government company has an independent status and juridical personality distinct from the state.
Even if an officer of such instrumentality or agency takes or receives keeps or expends any property or executes any contract, such acts, even though in the ultimate analysis, they may be held to have been done in the interest of the state, cannot be construed as an action of the government'the judgement said'.
The court pointed out that whenever law-makers felt the need to include other functionaries within the definition of public servant, those functionaries were declared to be public servants under the respective laws. If the legislature had intended to include officers of PSUs and government companies under the 'protective umbrella' of section 197, it would have done so expressly, the court concluded.
The Supreme Court on 13 May 2013 ruled that the sanction of the government is not necessary to prosecute an officer of a public sector undertaking or government company for offences committed while discharging his official duties.
Several employees of public sector companies and government companies claimed this privilege when they were prosecuted for offences during their tenure of office. The Officials invoked Section 197 of the Criminal Procedure Code, which stipulates that the government's sanction is required to prosecute a government servant.
however. a Division Bench consisting of Justice GN Ray and Justice GB Pattanaik has rejected these contention in a significant ruling, which will affect all PSU employees facing charges of misuse of their position and corruption. The main case involved was Mohammed Hadi Raja Vs State of Bihar.
Owing to the importance of the issue, the court had sought the assistance of the Attorney-General. The Central and State Government took the view that the protection given to public servants by section 197 was available to PSU officers also as they were the 3rd arm of the government, they deserve to be treated at par with government servants, the Center contended.
However, the prosecuting agencies countered this argument by stressing that though some PSUs and government companies may be treated as instrumentality or agencies of the state, their employees could not be treated as those directly under the government. A department directly run by the government has always been placed on a different footing than PSUs, it was submitted.
The judgement accepted the argument of the prosecuting agencies, and ruled that government company officials will not be covered by section 197 CrPC. It explained that a PSU or government company has an independent status and juridical personality distinct from the state.
Even if an officer of such instrumentality or agency takes or receives keeps or expends any property or executes any contract, such acts, even though in the ultimate analysis, they may be held to have been done in the interest of the state, cannot be construed as an action of the government'the judgement said'.
The court pointed out that whenever law-makers felt the need to include other functionaries within the definition of public servant, those functionaries were declared to be public servants under the respective laws. If the legislature had intended to include officers of PSUs and government companies under the 'protective umbrella' of section 197, it would have done so expressly, the court concluded.
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