New Delhi/Mumbai: In an attempt to shield honest bankers from prosecuting agencies, the Parliament on Tuesday amended the Prevention of Corruption Act, accepting a long-standing demand.
Consequently, agencies will have to seek prior nod from appropriate authorities before proceeding to arrest a bank official accused of misdemeanour.
The Prevention of Corruption (Amendment) Bill, 2013, amends the archaic Prevention of Corruption Act, 1988. The passage of the bill comes at a time when many current and former bankers have been arrested for extending loans that soured later. The expectation is that with this cover in place, there could be a revival in bank lending.
The anti-corruption law accords punishment to both the bribe giver as well as the taker.
The amendments propose that a police officer will now have to take prior permission from appropriate authorities while pursuing cases against all public servants. Earlier, prior permission was needed only for joint secretaries and above.
Further, bankers cannot be pulled up under the amended corruption law unless they have accumulated assets disproportionate to their income or have misappropriated assets entrusted to them.
This has been done by narrowing the definition of what will constitute criminal misconduct to include only two offences—misappropriating of entrusted property and amassing assets disproportionate to known sources of income. According to a note by think tank PRS Legislative Research, the Act previously defined criminal misconduct to also cover offences including abuse of position, use of illegal means and disregard of public interest. This meant that loans given by bankers can be classified as providing pecuniary advantage and bankers could be prosecuted for criminal misconduct.
There will be a timeline of up to two years within which a case has to be decided .
Jitendra Singh, minister of state for personnel, public grievances and pensions, said the bill aims to provide enough safeguards for those public servants who perform their duties honestly.
“Approval of central vigilance commission (CVC) will be required and that will give protection to bankers and retired bankers. That was what our request was," said Rajnish Kumar, chairman, State Bank of India. “If CVC is overall responsible for the vigilance of public sector space including banks, and if they believe that there is a case for proceeding against a banker, then that is perfectly all right," he said.