History and Evolution of Anti-Corruption Law in India

Indian anti-corruption law has developed in four stages. The Penal Code of 1860 created the basic offences of a public servant taking gratification. The Prevention of Corruption Act, 1947 was a wartime response to profiteering in supplies and added the concept of criminal misconduct. The Act of 1988 consolidated everything into one statute and widened its reach. The amendment of 2018 recast the offences around undue advantage, criminalised the giving of a bribe and introduced a screen before investigation. Running alongside is a second line of development, the institutional one, from the Special Police Establishment of 1941 to the Central Vigilance Commission and the Lokpal.

1. The Older Tradition

Corruption in office is not a modern preoccupation. The Arthashastra attributed to Kautilya devotes a chapter to the embezzlement of public funds, lists some forty ways in which an official may misappropriate revenue, and contains the observation that just as it is impossible to know when a fish moving in water is drinking it, so it is impossible to detect an officer handling public money taking some of it. The practical lesson drawn there, that detection requires rotation of officers, audit and informants, anticipates much of the modern machinery.

2. The Penal Code and the Act of 1947

1. 1860. Sections 161 to 165 of the Indian Penal Code created the offences of a public servant taking gratification other than legal remuneration in respect of an official act, taking gratification to influence a public servant, and obtaining a valuable thing without consideration from a person concerned in a proceeding or business. Section 165A, added later, dealt with abetment.
2. 1941 and 1946. The Special Police Establishment was created by executive order in 1941 to investigate bribery in war supply transactions, and was given statutory form by the Delhi Special Police Establishment Act, 1946. This is the institutional origin of the Central Bureau of Investigation, which still derives its police powers from that Act.
3. 1947. The Prevention of Corruption Act, 1947 was enacted as a temporary measure in conditions of post-war scarcity and rationing, when corruption in the distribution of controlled commodities had become acute. Its central innovation was Section 5, which created the offence of criminal misconduct in the discharge of official duty, and Section 4, which raised a presumption against a public servant proved to have accepted gratification.
4. 1952. The Criminal Law (Amendment) Act, 1952 provided for the appointment of special judges to try these offences, enhanced the punishments, and made the offences triable exclusively by such judges. The architecture of a dedicated court thus predates the Act of 1988 by more than thirty years.

3. The Santhanam Committee and the Amendment of 1964

The Committee on Prevention of Corruption chaired by K. Santhanam reported in 1964 after examining the causes of corruption in the public services. Its findings shaped the law for a generation.

• It found that corruption had become widespread and that the existing machinery was inadequate, in part because proof of a specific bribe transaction is difficult and in part because delay in departmental and criminal proceedings destroyed deterrence.
• It recommended the creation of a central vigilance body, and the Central Vigilance Commission was established by a government resolution in 1964. It received statutory status only through the Central Vigilance Commission Act, 2003, and then as a consequence of the directions in Vineet Narain v. Union of India, (1998) 1 SCC 226.
• It recommended that possession of assets disproportionate to known sources of income be made an offence, on the footing that a corrupt officer's wealth is easier to prove than the individual transactions that produced it. That recommendation was enacted as clause (e) of Section 5(1) of the Act of 1947 by the amendment of 1964, and it survives today, in altered form, as Section 13(1)(b) of the Act of 1988.

The Law Commission examined the subject in the same period, its report on social and economic offences recommending a comprehensive and consolidated statute, and its later reports addressing the difficulties of proof and the sanction requirement.

4. The Act of 1988

The Prevention of Corruption Act, 1988 gave effect to the recommendation for consolidation. It repealed the Act of 1947 and the relevant part of the Criminal Law (Amendment) Act, 1952, omitted Sections 161 to 165A of the Penal Code and re-enacted them in an expanded form as Sections 7 to 12, carried forward criminal misconduct as Section 13, widened the definition of public servant very considerably, enhanced the minimum and maximum punishments, retained the special judge and the statutory presumption, and introduced the sanction requirement in Section 19.

5. The Institutional Line

1. 1998. In Vineet Narain v. Union of India the Supreme Court, proceeding by continuing mandamus, struck down the single directive requiring prior approval before an inquiry against senior officers, and directed that the Central Vigilance Commission be given statutory status with superintendence over corruption investigations, that the Director of the investigating agency be selected by a committee and have a minimum tenure, and that the executive have no role in the day to day functioning of the agency.
2. 2003. The Central Vigilance Commission Act gave effect to those directions, and inserted Section 6A into the Delhi Special Police Establishment Act, 1946, reviving in statutory form the requirement of prior approval that had been struck down.
3. 2011. India ratified the United Nations Convention against Corruption. Its obligations, including the criminalisation of bribery of officials by private persons and of bribery in the private sector, and the liability of legal persons, are the immediate reason for much of the amendment of 2018.
4. 2013 and 2014. The Lokpal and Lokayuktas Act, 2013 created an ombudsman with power to inquire into allegations against public functionaries and to refer matters for investigation, and the Whistle Blowers Protection Act, 2014 was enacted to protect those who disclose corruption, though it has not been brought fully into force.
5. 2014. In Subramanian Swamy v. Director, CBI, (2014) 8 SCC 682 a Constitution Bench struck down Section 6A of the Delhi Special Police Establishment Act as violative of Article 14, holding that a classification between senior and junior public servants for the purpose of initiating an inquiry into corruption had no rational nexus with the object of rooting out corruption.
6. 2018. The Prevention of Corruption (Amendment) Act recast the offences, criminalised bribe giving, introduced liability for commercial organisations, narrowed criminal misconduct, and inserted Section 17A, which requires prior approval before an enquiry or investigation into a decision or recommendation of a public servant.

6. Related Topics and Provisions