Ill-gotten Wealth of Public Servants

 C.V. Narasimhan

        A statutorily formalised mechanism for dealing with and putting down corruption in our governance has been in operation for over six decades.  The exclusive law to penalise corruption, namely the Prevention of Corruption Act, has been amended from time to time to tackle new forms of corrupt practices.  Investigating agencies have also been progressively strengthened to be more effective.  Yet, in the general perception of people, corruption has increased all round and the problem is seen to be intractable.  This is largely because many functionaries in administration and public life who are generally known to be abjectly corrupt do not get caught, and even if caught by the investigating agencies they ultimately get acquitted in Courts which are beset by outmoded procedures and archaic rules of evidence.

    2.  In practice, it is difficult to get evidence about collusive corruption which involves large money and takes place at high levels, because all the parties concerned stand mutually benefitted and do not at all like to expose each other.  At the other end of the spectrum, we have the victims of extortionate type of corruption involving relatively small money but prevalent among the large mass of government servants at the ground level in administration.  The harassed victims do not come forward to expose this corruption because of  fear of severe reprisal by the minions in government.

    3.  Deficiencies and failures in the anti-corruption mechanism have, over the years, made the general public become cynical and take a defeatist view of this malady in public life and administration.  The criminal justice system has practically ceased to have any deterrent effect to put down this fast growing evil.  Agitational  politics of the day which invariably involves arrests of mini VIPs followed by their production in court with due publicity of their smiling and triumphant faces in the press, have taken away the stigma that was attached to involvement in criminal proceedings in the former years.  The situation is further compounded by the increasing entry and aggressive presence of ‘charge-sheeted’ persons in the State Assemblies and Parliament.

    4.  It is time we forged a new approach and policy in regard to anti-corruption measures to pull the common people out of their growing cynicism and infuse some measure of confidence in them to look for relatively clean governance.  We may start with the problem of high level corruption which, on many occasions, is also linked with political corruption.  Our efforts should be to keep this type of corruption under effective check and control in a manner that will be known and appreciated by the general people.

    5.  All acts of corruption, specially at high levels, invariably result in illegal accumulation of considerable wealth by the government functionary or the concerned politician, which he will not be able to account for by any legal or other legitimate means.  The wealth will mostly be in the form of immovable property or proprietory hold  over business enterprises either in his own name or in the names of family members or others under his complete control.  Such benami holdings have now become common in the commercial world.  It is this quick acquirement of financial resources by the corrupt politician or government official that attracts public attention.  Unfettered enjoyment of this ill-gotten wealth by the corrupt in government and politics makes the common people despondent and lose confidence in the government of the day. Continuance of this situation will seriously undermine the fabric of our much-valued democracy.  Something has to be done quickly and demonstrably to retrieve the situation. 

   6.  Presently, possession of disproportionate assets by public servants is an offence under Section 13 (1) (e) of the Prevention of Corruption Act.  However, cases dealt with under this provision are relatively very few in the totality of cases handled by the CBI and the State Anti-Corruption agencies year after year. It is imperative in this context that we enact a special and comprehensive law to penalise and effectively prevent the enjoyment of such ill-gotten wealth by any person who is party to a corrupt act in administration.  The new law, which may be called ‘Accountability of Assets of Public servants Act’,  will have to meet the following requirements.

     (a) It should be applicable to all public servants as specially defined in that law itself.           

          The definition should include –

         (i) all persons as defined under Section 2 (c) of the Prevention of Corruption Act,


        (ii) all Members of Parliament and Members of the State Legislatures

       (iii) all Members of Panchayats established under the Constitution, and

       (iv) office-bearers of all political parties duly registered with the Election   


     (b) Section 13(1) (e) of the Prevention of Corruption Act, 1988 may be deleted, and its        

          provisions may be suitably amplified and incorporated in the new Act to penalise  

          possession of unaccountable assets by a public servant as newly defined.

     (c) The provisions of Criminal Law Amendment Ordinance of 1944 are presently used  

          for attaching the properties acquired by a person by an act of corruption, when that  

          act is under investigation.  The provisions also provide for forfeiture of that

          property if the person gets convicted in court.  All these provisions should be

          incorporated in the new Act in an amplified form to provide for the attachment and

          forfeiture of all the unaccounted assets of the person prosecuted/ convicted under

          the new Act; and not limited to the properties directly connected with the specific

          act of corruption covered by the trial.

     (d) The procedural provisions in the Smugglers and Foreign Exchange  Manipulators  

          (Forfeiture of Property) Act of 1976 could be suitably amplified and adopted in the

          new Act to ensure that the properties held benami are also covered.

     (e) The new Act should provide for Special Courts to function as fast-track courts to

          try offences under the Act.

     (f) Special rules of evidence should be formulated in the new Act, to be applicable to

          trials under the Act.  We should give up archaic principles like ‘Hundred guilty

          men may escape but not one innocent man shall ever get punished ’.  While the

          second half of the principle is unexceptionable, the first half works to the

          advantage of the corrupt.  Likewise, the ‘benefit of doubt’ principle should not be

          carried too far in attachment or forfeiture proceedings.  In fact, any element of

          doubt in the legitimacy of possession of any property by an accused person should

          go to the benefit of the society and the property should be confiscated accordingly.

     (g) There should be provision for the mandatory award of minimum of one year

          imprisonment to a person convicted in court for an offence under the new Act.

    7.  Anti-corruption investigating agencies at the Centre and in the States should launch and maintain a special drive to enforce the new Act.  Special wings should be set up to collect intelligence and investigate offences under the Act. Adequate expertise will have to be developed to investigate concomitant offences under the Income Tax Act, Foreign Exchange Management Act, Foreign Contribution Regulation Act, etc., which may arise in some cases.  Investigating officers for the special wings may be drawn from different departments  like CBI, Police, Income-Tax and Enforcement Directorate, and duly trained and motivated to handle the new task with a missionary zeal to unearth and confiscate the ill-gotten wealth of the corrupt. 

   8.  Investigation into specific acts of corruption poses difficulties because of the unwillingness of the beneficiaries or victims of corruption to depose freely and fully about the connected facts.  In contrast, the investigation into the quantum and possession of assets does not very much depend on the oral evidence of such beneficiaries or victims but will be concerned substantially with a variety of documentary evidence connected with the acquisition of assets.  This calls for patient and intelligent scrutiny of several documents at different places, pursuing clues from point to point and ultimately tracing their linkage with the accused person.  When once this task is done well the case will stand on firm evidence that can be put in court.  The special wings have to develop the expertise for this type of investigational work.

    9.  High level corruption may also sometimes involve transactions abroad in foreign exchange.  In a well researched book published in 1997  Prof. Jean Ziegler, an eminent academician of Switzerland, has exposed the deep involvement of the Swiss banking system in providing safe vaults for holding the monies of authoritarian rulers, power brokers and high level influence peddlers across the world.  The expertise to be acquired by the special wings will include the legal procedure, working technique and methodology to probe into bank transactions within India and also abroad, specially Switzerland .  Interpol’s active help should be sought and got in all possible ways.

   10. In the normal course, the Income Tax department deals with several cases of ‘concealed income’,  ‘undeclared assets’, and so on.  But all their efforts are principally directed towards assessment and collection of the related tax only, as a matter of revenue for the government.  Very rarely are criminal prosecutions launched on this account.  This attitude has to change in the present context.  There should be a duly authorised and close contact between the Income Tax authorities and the proposed new wings of the investigating agencies to identify promptly the cases that directly or indirectly involve public servants as defined in the new Act.  All such cases should be pursued immediately by the investigating agencies for prosecutions in court, aimed at securing deterrent punishments for the offenders.  The matter of assessment and collection of tax on the undisclosed assets may follow later.  Effective cooperation and coordination for this purpose among all the departments concerned, specially the CBI, the Central Board of Direct Taxes and the Enforcement Directorate, should be ensured by the Prime Minister and the Finance Minister showing their unqualified joint support for this exercise. 

    11.  The Central Vigilance Commission may constitute a small working group of experienced jurists and investigators to evolve the draft for the new Act, and recommend  its very early legislation in Parliament.