Monday, 25 May 2020

Delhi HC: Amendments to Prevention of Corruption Act, 2018 do not have a retrospective effect

 However, this Court is unable to accept that the PC
(Amendment) Act, 2018 seeks to repeal the provisions of Section
13(1)(d) of the Act, as it existed prior to 26.07.2018 ab initio. Mens
rea is an integral part of the offence under Sub-clause (ii) of Section
13(1)(d) of the PC Act. The use of the word ‘abuse’ in the said Subclause
indicates so. Thus, there is no reason to assume that the
legislative intent of repealing Section 13 of the PC Act was to exclude
the said offence from the scope of PC Act with retrospective effect.
54. In view of the above, Section 6(d) of the General Clauses Act is
applicable and persons convicted of committing the offence of
criminal misconduct under Section 13(1)(d) of the PC Act would not

be absolved of their offences or the liability incurred prior to the PC
Act coming into force. It is also relevant to note that the offence of
criminal misconduct as falling under the provisions of Section
13(1)(d) of the PC Act prior to its amendment, is not the same offence
as is now covered under the amended provision.
55. In view of the above, this Court is unable to accept that if it is
established beyond reasonable doubt that the appellant had abused his
position for securing a pecuniary advantage to VISUL, the benefit of
any beneficial construction of the PC (Amendment) Act, 2018 could
be extended to him.
IN THE HIGH COURT OF DELHI AT NEW DELHI
 Judgment delivered on: 22.05.2020
 CRL.A. 1186/2017

MADHU KODA  Vs  STATE THROUGH CBI .

CORAM
HON’BLE MR JUSTICE VIBHU BAKHRU


1. The appellant has filed the present applications, inter alia,
praying that the operation of the impugned order dated 13.12.2017
passed by the learned Special Judge convicting the appellant of the
offence of criminal misconduct under sub-clauses (ii) and (iii) of
clause (d) of sub-section (1) of section 13 read with sub-section (2) of
section 13 of the Prevention of Corruption Act, 1988 (hereafter ‘PC
Act’), be stayed.

2. The appellant desires to contest for election to public offices,
including contest elections for the Legislative Assembly of the State of
Jharkhand but is disqualified to do so on account of his conviction.
The appellant states that he was elected as a member of Bihar
Legislative Assembly for the first time in the year 2000. On
15.11.2000, the State of Jharkhand was carved out from the erstwhile
State of Bihar. The appellant held the office of the Minister of the
State for Rural Engineering Organization thereafter and continued to
do so till the year 2003. It is stated that thereafter, he held the office of
Minister of Panchayati Raj of Special Arrangement. The appellant
successfully contested the elections for the Legislative Assembly in
the year 2005 and in September 2006 was appointed the Chief
Minister of the State of Jharkhand. He continued to hold the said
office till 23.08.2008.
3. The appellant has been convicted by the impugned order in a
case captioned “CBI v. M/s Vini Iron and Steel Udyog Limited and
Ors.”arising from FIR No. RC 219 2012E 0012. The Trial Court
found that the appellant had abused his position as a public servant in
order to obtain the allocation of Rajhara Coal Block in favour of M/s
Vini Iron and Steel Udyog Limited (hereafter ‘VISUL’), without any
public interest.
Submissions
4. Mr Abhimanyu Bhandari, learned counsel appearing for the
appellant advanced contentions on, essentially, three fronts. First, he

submitted that there is neither any allegation nor any evidence to
establish, that the appellant had demanded any illegal gratification,
which is sine qua non of an offence under Section 13(1)(d) of the PC
Act. He stated that in absence of any such finding, the appellant’s
conviction under Section 13(1)(d) of the PC Act is ex facie
unsustainable. He relied on the deicions of the Supreme Court in
Khaleel Ahmed vs State of Karnataka: (2015) 16 SCC 350;
B.Jayaraj vs State of Andhra Pradesh: (2014) 13 SCC 55; P
Satyanarayana Murthy v Dist Inspector of Police and Others: (2015)
10 SCC 152; Mrs Neeraj Dutta vs State (Govt. of NCT of Delhi); and
State of Maharashtra v Dyaneshwar Laxman: (2009) 15 SCC 200 in
support of his contention that demand of illegal gratification was a
necessary ingredient of an offence under Section 13(1)(d) of the PC
Act.
5. Second, he submitted that the PC Act was amended with effect
from 26th July 2018 and the provisions of Section 13(1)(d) stand
deleted by virtue of the Prevention of Corruption (Amendment) Act,
2018 (hereafter the ‘PC Amendment Act, 2018’). He submited that the
allegations made against the appellant no longer constitute an offence
and, therefore, he is entitled to be acquitted by virtue of the doctrine of
beneficial construction. He relied on the decision of the Supreme
Court in T. Barai v enry AH Hoe and Another: (1983) 1 SCC 177 in
support of his contention.
6. Third, he submitted that the appellant’s conviction rested on the
assumption that he was close to one Vijay Joshi who controlled

VISUL. It is alleged that the machinery of the Government of
Jharkhand had worked to favour VISUL on account of the close
relationship between the appellant and Sh. Vijay Joshi. However, he
submitted, that there was no admissible evidence, which would even
remotely link or establish any such connection between the appellant
and Sh. Vijay Joshi. He contended that thus, the allegations of any
conspiracy must fail.
7. Mr R.S. Cheema, learned senior counsel appearing for CBI
countered the aforesaid submissions. He stated that the provisions of
Section 13(1)(d) of the PC did not necessarily require establishing that
any illegal gratification had been demanded or paid to the public
servant. He relied upon the decisions of Supreme Court in Neera
Yadav v CBI: (2017) 8 SCC 757; C.K. Jaffer Shareiff v State: (2013)
1 SCC 205; R Venkatkrishnan vs CBI: (2009) 11 SCC 737; and
State of Rajasthan vs Fatehkaran Mehdu: (2017) 3 SCC 198.
8. He briefly narrated the facts as found by learned Trial Court and
submitted that the same clearly establish that VISUL had been
favoured with allocation of the Coal Block at the instance of the
appellant. He also countered the submission that the benefit of PC
Amendment Act, 2018 could be extended to the appellant. He
referred to Section 6(d) of the General Clauses Act, 1897 (hereafter
‘the General Clauses Act’) and contended that since the appellant had
been convicted prior to the PC Amendment Act, 2018 coming into
force, the benefit of the same could not be extended to the appellant.

9. Next, he submitted that this was a case of conspiracy and the
facts of the case clearly established that the appellant was complicit in
the offence notwithstanding that his connection with Vijay Joshi had
not been irrefutably established.
10. Lastly, he submitted that whilst at the interim stage, the
sentence awarded to a convict can be suspended on the basis of a
prima facie view; his conviction cannot be stayed without considering
the wider ramifications. He referred to the decisions in KC Sareen vs
CBI: 2001(6) SCC 584; CBI v MN Sharma: 2008(8) SCC 549 and
Md. Dilawar Mir Vs CBI: 2014 SCC Online Del 6424 in support of
his contentnion.
The factual context
11. Before proceeding further, it would be relevant to briefly
narrate the factual context in which the present controversy arises.
12. On 13.11.2006, the Ministry of Coal, Government of India
issued an advertisement inviting applications for allocating thirty-eight
coal blocks pertaining to power, steel and cement sectors. This also
included Rajhara (North, Central & Eastern) Coal Block (hereafter
referred to as “Rajhara Coal Block”).
13. On 08.01.2007, M/s VISUL submitted its application for
allocation of Rajhara Coal Block situated in the State of Jharkhand, to
the Ministry of Coal, under the signatures of its Director, Shri Vaibhav
Tulsyan. The said Coal Block was intended to be used for an

integrated steel plant proposed to be set up in the State of Jharkhand.
A copy of the application filed by VISUL was also sent to the State of
Jharkhand for its comments.
14. It is stated that while processing VISUL’s application for
allotment of the Rajhara Coal Block, it was found that VISUL’s
requirement was low and therefore the State of Jharkhand did not
recommend allocation of any Coal Block in favour of VISUL. It sent
letters dated 07.12.2007 and 16.01.2008 recommending that the
Rajhara Coal Block be allocated jointly to M/s Zoom Vallabh Steel
Ltd. and M/s Mukund Limited.
15. It is stated that the Ministry of Steel, Government of India had
also set down a criteria for recommendation for allotment of coal
blocks. This included categorising applicants under various categories
depending upon their existing production capacity and proposed
capacity. It is stated that all companies which did not propose
achieving 0.3 MTPA capacity by December 2010 were not placed
under any category and, therefore, were ineligible for being
recommended for allocation of any coal block.
16. It is stated that based on the said criteria, VISUL was ineligible
for being recommended for allocation of any coal block. Therefore,
Ministry of Steel also did not recommend allocation of any coal block
in favour of VISUL.
17. Prior to May 2008, the State Government of Jharkhand was not
considering VISUL’s application favorably for recommendation. But

in the month of May 2008, the ownership of M/s VISUL changed
hands from the Tulsyan family to one Vijay Joshi, who is alleged to be
a close associate of the appellant. And, with the change in the
shareholding of VISUL, its fortunes also changed for the better.
18. All applications pertaining to steel and cement sector were
considered by the 36th Screening Committee headed by the Secretary,
Ministry of Coal, Government of India at its meetings held on
07.12.2007, 08.12.2007, 07.02.2008, 08.02.2008 and on 03.07.2008.
The said Committee made the final recommendations in its meeting
held on 03.07.2008.
19. On 02.07.2008, Shri B.K. Bhattacharya – who was a Section
Officer with the Department of Mines, State Government of Jharkhand
– prepared a note stating that the performance of M/s Zoom Vallabh
Steel Ltd was not satisfactory but the progress of VISUL was, and
therefore VISUL be recommended for allocation of the Rajhara Coal
Block.
20. It is stated that one of the co-accused, A.K. Basu, the then Chief
Secretary, Government of Jharkhand attended the final meeting of the
36th Screening Committee held on 03.07.2008 as a representative of
the State, Government of Jharkhand. And, despite being aware that
VISUL was not recommended for allocation of a coal block, he
allegedly insisted at the said meeting that M/s VISUL be considered
for allocation of Rajhara Coal Block. He also emphasized that the

Appellant (who was the chief minister of the State of Jharkhand)
desired that the Rajhara Coal Block be allocated to VISUL.
21. The 36th Screening Committee recommended the allocation of
Rajhara Coal Block jointly in favour of VISUL and Mukund and on
17.07.2008, the Prime Minister approved the same with some
modifications.
22. It is stated that thereafter, on 28.07.2008, a note was prepared
for recommending the allotment of Rajhara Coal Block exclusively to
VISUL. The said note was put up through the Deputy Secretary,
Secretary and the Chief Secretary before the Chief Minister
(appellant) on 28.07.2008 and he made an endorsement
recommending allotment of Rajhara Coal Block in favour of VISUL
exclusively, on the same date.
23. Shri A.K. Basu sent a letter on 28.07.2008 recommending that
VISUL be allocated the Rajhara Coal Block exclusively and Mukund
be allocated some other coal block. But, by that time, the 36th
Screening Committee had made its recommendations and the Prime
Minister had approved the allocation of the Rajhara Coal Block in
favour of VISUL and Mukund Ltd. jointly. Therefore, the said
recommendation was not considered.
Reasons and Conclusion
24. The first and foremost question to be addressed is whether it
was necessary for the prosecution to establish that the appellant had

demanded illegal gratification, for securing the appellant’s conviction
for committing an offence under section 13(1)(d) of the PC Act.
25. Section 13(1)(d) of the PC Act, as in force at the material time,
is set out below:
“13. Criminal misconduct by a public servant. – (1) A
public servant is said to commit the offence of criminal
misconduct, -
xxxx xxxx xxxx xxxx
(d) if he, -
(i) by corrupt or illegal means, obtains for himself or
for any other person any valuable thing or
pecuniary advantage; or
(ii) by abusing his position as a public servant,
obtains for himself or for any other person any
valuable thing or pecuniary advantage; or
(iii) while holding office as a public servant, obtains
for any person any valuable thing or pecuniary
advantage without any public interest.”
26. A plain reading of sub clause (ii) and sub-clause (iii) of clause
(d) sub-section (1) of section 13 of the PC Act indicates that a public
servant would commit an offence of criminal misconduct if he, by
abusing his position as a public servant, obtains for himself or for any
other person any valuable thing or pecuniary advantage. A plain
reading of the sub-clauses of clause (d) of section 13(1) of the PC Act
do not indicate that a demand of illegal gratification is a necessary

ingredient of the offence of criminal misconduct. Thus, there is no
reason to read-in such a condition in the said sub-clauses.
27. Mr Bhandari had rested his contention on the strength of certain
decisions rendered by the Supreme Court. In B. Jayaraj (supra), the
Supreme Court had observed as under:
“7. Insofar as the offence under Section 7 is
concerned, it is a settled position in law that
demand of illegal gratification is sine qua non to
constitute the said offence and mere recovery of
currency notes cannot constitute the offence
under Section 7 unless it is proved beyond all
reasonable doubt that the accused voluntarily
accepted the money knowing it to be a bribe. The
above position has been succinctly laid down in
several judgments of this Court. By way of
illustration reference may be made to the decision
in C.M. Sharma v. State of A.P.2 and C.M. Girish
Babu v. CBI.
8. In the present case, the complainant did
not support the prosecution case insofar as demand
by the accused is concerned. The prosecution has
not examined any other witness, present at the time
when the money was allegedly handed over to the
accused by the complainant, to prove that the same
was pursuant to any demand made by the accused.
When the complainant himself had disowned what
he had stated in the initial complaint (Ext.P-11)
before LW 9, and there is no other evidence to
prove that the accused had made any demand, the
evidence of PW-1 and the contents of Ext. P-11
cannot be relied upon to come to the conclusion
that the above material furnishes proof of the
demand allegedly made by the accused. We are,

therefore, inclined to hold that the learned trial
court as well as the High Court was not correct in
holding the demand alleged to be made by the
accused as proved. The only other material
available is the recovery of the tainted currency
notes from the possession of the accused. In fact
such possession is admitted by the accused himself.
Mere possession and recovery of the currency notes
from the accused without proof of demand will not
bring home the offence under Section 7. The above
also will be conclusive insofar as the offence
under Section 13(1)(d)(i) and (ii) is concerned as in
the absence of any proof of demand for illegal
gratification, the use of corrupt or illegal means or
abuse of position as a public servant to obtain any
valuable thing or pecuniary advantage cannot be
held to be established.”
28. The decision of the Supreme Court in B. Jayaraj (supra) was
followed by the Supreme Court it in its subsequent decision in Khalil
Ahmed v. State of Karnataka (supra).
29. In P. Satyanarayana Murthy v. District Inspector of Police
and Anr. (supra), the Supreme Court reiterated that the proof of
demand of an illegal gratification is the gravamen of an offence under
section 7 and sub-clauses (i) and (ii) of section 13(1)(d) of the PC Act.
The relevant extract of the said decision is set out below:
“20. In a recent enunciation by this Court to discern
the imperative pre-requisites of Sections 7 and 13 of
the Act, it has been underlined in B. Jayaraj in
unequivocal terms, that mere possession and recovery
of currency notes from an accused without proof of
demand would not establish an offence Under Section
7 as well as 13(1)(d)(i) and (ii) of the Act. It has been

propounded that in the absence of any proof of
demand for illegal gratification, the use of corrupt or
illegal means or abuse of position as a public servant
to obtain any valuable thing or pecuniary advantage
cannot be held to be proved. The proof of demand,
thus, has been held to be an indispensable essentiality
and of permeating mandate for an offence under
Sections 7 and 13 of the Act. Qua Section 20 of the
Act, which permits a presumption as envisaged
therein, it has been held that while it is extendable
only to an offence under Section 7 and not to those
under Sections 13(1)(d)(i) & (ii) of the Act, it is
contingent as well on the proof of acceptance of
illegal gratification for doing or forbearing to do any
official act. Such proof of acceptance of illegal
gratification, it was emphasized, could follow only if
there was proof of demand. Axiomatically, it was
held that in absence of proof of demand, such legal
presumption under Section 20 of the Act would also
not arise.
21. The proof of demand of illegal gratification, thus,
is the gravamen of the offence under Sections 7 and
13(1)(d)(i) & (ii) of the Act and in absence thereof,
unmistakably the charge therefore, would fail. Mere
acceptance of any amount allegedly by way of illegal
gratification or recovery thereof, dehors the proof of
demand, ipso facto, would thus not be sufficient to
bring home the charge under these two sections of the
Act.
22. As a corollary, failure of the prosecution to prove
the demand for illegal gratification would be fatal and
mere recovery of the amount from the person accused
of the offence under Sections 7 or 13 of the Act
would not entail his conviction thereunder.”

30. Although the above proposition appears attractive, a closer
examination of the aforesaid decisions clearly indicate that the same
cannot be read as authorities for the proposition that demand of an
illegal gratification is a necessary condition for convicting a public
servant for an offence of misconduct, as contemplated under Section
13(1)(d) of the PC Act. This is for two reasons. First of all, the plain
language of Section 13(1)(d) of the PC Act does not indicate that a
demand of illegal gratification by the public servant is an essential
ingredient of an offence of misconduct.
31. Secondly, a bare perusal of the judgments cited on behalf of the
appellant indicates that in all those cases, charges against the accused
were also framed under Section 7 of the PC Act. In terms of Section 7
of the PC Act, whoever being or expecting to be a public servant
accepts or obtains or agrees to accept or attempts to obtain from any
person for himself or for any other person any gratification whatever,
other than the legal remuneration as a motive or reward for doing or
forbearing to do any official act or for showing or forbearing to show
in exercise of his official functions in favour or disfavour to any
person or for rendering or attempting to render any service or
disservice to any person, would be punishable for committing an
offence under the said section. In other words, Section 7 of the PC
Act refers to an offence of demanding or obtaining illegal
gratification. In all the cases referred to on behalf of the appellant, the
accused were charged with the offence of demanding/accepting illegal
gratification. In addition, the accused were also charged with the

offence under Section 13(1)(d) of the PC Act in conjunction with the
offence under Section 7 of the PC Act. Clearly, in order to establish
the offence in such cases, it would be necessary for the prosecution to
establish that the accused had demanded or had obtained illegal
gratification either himself or by any other person as the same is
necessary for securing a conviction of an offence under Section 7 of
the PC Act.
32. Apart from criminal misconduct being in conjunction of
demand for illegal gratification, an offence under Section 13(1)(d) of
the PC Act could also be established as a standalone offence. In
Neera Yadav v. CBI (supra), the Supreme Court had examined the
provisions of Section 13 of the PC Act as then in force and had
explained the ingredients necessary for commission of the said
offence. Paragraphs 16 and 17 of the said decision are relevant and
are set out below:
“16. Section 13 of the PC Act in general lays down that
if a public servant, by corrupt or illegal means or
otherwise abusing his position as a public servant
obtains for himself or for any other person any
valuable thing or pecuniary advantage, he would be
guilty of “criminal misconduct”. Sub-section (2) of
Section 13 speaks of the punishment for such
misconduct. Section 13(1)(d) read with Section 13(2)
of the PC Act lays down the essentials and punishment
respectively for the offence of “criminal misconduct”
by a public servant. Section 13(1)(d) reads as under:
“13. Criminal misconduct by a public
servant.— (1) A public servant is said to commit
the offence of criminal misconduct—

(d) if he—
(i) by corrupt or illegal means, obtains
for himself or for any other person any
valuable thing or pecuniary advantage; or
(ii) by abusing his position as a public
servant, obtains for himself or for any other
person any valuable thing or pecuniary
advantage; or
(iii) while holding office as a public
servant, obtains for any person any valuable
thing or pecuniary advantage without any
public interest; or”
17. A perusal of the above provision makes it
clear that if the elements of any of the three subclauses
are met, the same would be sufficient to
constitute an offence of “criminal misconduct”
under Section 13(1)(d). Undoubtedly, all the
three wings of clause (d) of Section 13(1) are
independent, alternative and disjunctive. Thus,
under Section 13(1)(d)(i), obtaining any valuable
thing or pecuniary advantage by corrupt or
illegal means by a public servant in itself would
amount to criminal misconduct. On the same
reasoning “obtaining a valuable thing or
pecuniary advantage” by abusing his official
position as a public servant, either for himself or
for any other person would amount to criminal
misconduct.”
33. Ms Neera Yadav was, at the material time, the chairperson and
the Chief Executive Officer of Noida (New Okhla Industrial
Development Authority). In that case, the prosecution had alleged that

Smt. Neera Yadav had abused her official position for allotment of a
plot bearing no. B002 in Sector 32 in the draw of lots. It was alleged
that within a week of the allotment of the said plot, Ms Neera Yadav
had made a request for allotment of a plot in any of developed sectors
through conversion. The allotment of the plot bearing no. B002, which
was allotted in Sector 32, was converted to an allotment of a plot in
Sector 14A Noida comprising of an area of 415 square meters (Plot
No. 26). It was further alleged that after conversion of the plot, the
Chief Architect Planner of Noida had put up a note on the directions
of Smt. Neera Yadav for proposing a revision in the layout plan of
Plot Nos. 26, 27 and 28 in Sector 14A, by increasing their size from
450 square meters to 562 square meters, 525 square meters and 487.5
square meters respectively. Smt. Neera Yadav approved the same to
her benefit. It was alleged that by a subsequent change in the plan, a
7.5 meter wide road was carved out to the east of plot no. 26, which
also resulted in benefitting her. In addition to the above, the
prosecution established that Smt. Neera Yadav had abused her
position in securing allotments of two plots in favour of her daughters.
Both her daughters were allotted shops in Noida and on the basis of
such allotment, they had applied for allotment of residential plots,
which were also allotted to them. Since the allegations against Ms
Neera Yadav were established, she was convicted for criminal
misconduct under Section 13(1)(d) of the PC Act read with Section
13(2) of the PC Act. She was sentenced to undergo rigorous
imprisonment for a period of three years with the fine of ₹1,00,000/.
The Allahabad High Court upheld her conviction. Ms Neera Yadav

appealed to the Supreme Court. The Supreme Court upheld her
conviction but reduced her prison sentence from three years to two
years. In this case, there was no question of any demand for illegal
gratification as Ms Neera Yadav had abused her position as a public
servant for securing valuable property for herself and her children.
34. In R. Venkatkrishnan v. CBI (supra), the Supreme Court had
explained the import of sub-clause (iii) of Section 13(1)(d) of the PC
Act in the following manner:
“161. xxxx xxxx
Section 13 in general lays down that if a public
servant, by corrupt or illegal means or otherwise
abusing his position as a public servant obtained for
himself or for any other person any valuable thing or
pecuniary advantage he would be guilty of “criminal
misconduct”. Sub-section (2) thereof speaks of the
punishment for such misconduct. (See C.K.
Damodaran Nair v. Govt. of India.)
162. The ingredients of sub-clause (iii) of
Section 13(1)(d) contemplate that a public servant who
while holding office obtains for any person any
valuable thing or pecuniary advantage without any
public interest would be guilty of criminal misconduct.
Sub-section (2) of Section 13 provides for the
punishment for such criminal misconduct. Minimum
sentence is prescribed under Section 13(2) of the 1988
Act and a public servant who abuses his position as
such for obtaining for himself or for any other person
any valuable thing or pecuniary advantage cannot be
punished for a term of imprisonment, which is less
than for the duration of one year.

163. For convicting the person under Section
13(1)(d)(iii), there must be evidence on record that the
accused “obtained” for any other person any valuable
thing or pecuniary advantage without any public
advantage.”
35. In this case also, the prosecution had neither established nor was
required to establish that the accused had demanded or obtained any
illegal gratification for obtaining for any person any valuable thing or
pecuniary advantage.
36. Thus, the contention that it is necessary for the prosecution to
establish a demand for illegal gratification for sustaining the allegation
of an offence under Section 13(1)(d) of the PC Act as in force prior to
26th July 2018, is without merit.
37. Having stated the above, it is also necessary to observe that
mere arbitrary or unreasonable exercise of official power to confer any
benefit or pecuniary advantage to an unconnected party, may be not be
sufficient to impute that the exercise of such power is culpable
misconduct under sub-clause (ii) of clause (d) of sub-section (1) of
Section 13 of the PC Act. First of all, it would be necessary for the
prosecution to establish that the public servant had abused his official
position; that is, used it for wrongdoing and for a purpose he ought not
to have. Secondly, the same was for securing a valuable thing or
pecuniary advantage for himself or for any other person, without any
public interest. Obviously, if the third person, who has acquired a
valuable thing or pecuniary advantage, is unconnected with the public

servant, it would be difficult to accept that the conduct of the public
servant is culpable in terms of Sub-clause (ii) of clause (d) of Subsection
(1) of Section 13 of the PC Act.
38. The legislative intent is not to punish a public servant for any
erroneous decision; but to punish him for corruption. The preamble of
the PC Act indicates that it was enacted “to consolidate and amend the
law relating to the prevention of corruption and for matters connected
therewith.” Thus, to fall within the four corners of Sub-clause (ii) of
clause (d) of Sub-section (1) of Section 13 of the PC Act, the
decision/conduct of the public servant must be dishonest amounting to
corruption. Transparency International defines corruption as\“the
abuse of entrusted power for private gain”.
39. Mens rea, the intention and/or knowledge of wrongdoing, is an
essential condition of the offence of criminal misconduct under
Section 13(1)(d)(ii) of the PC Act. Section 20 of the PC Act does not
apply to offences under Section 13(1)(d) of the PC Act and therefore,
mens rea cannot be presumed. It is, thus, necessary for the prosecution
to establish the same.
40. The scope of contentions advanced before this court are limited
and therefore, at this stage, it is not apposite to examine whether the
prosecution has established the necessary ingredients of Section
13(1)(d)(ii) of the PC Act. Needless to state that this aspect and the
evidence obtaining in this case would be required to be examined at
the stage of final hearing.

41. The next question to be considered is whether the appellant is
liable to be acquitted in view of the enactment of the PC (Amendment)
Act, 2018. It was contended on behalf of the appellant that he is
entitled to the benefit of the doctrine of beneficial construction. Since
the misconduct as contemplated under Section 13(1)(d) of the PC is no
longer an offence punishable under the PC Act as amended by virtue
of the PC Amendment Act 2018, the benefit of the same ought to be
extended to the appellant. Mr Bhandari had sought to draw strength
from the decision of the Supreme Court in T. Barai (supra) for
canvassing the above contention.
42. Section 13, as amended by virtue of the PC (Amendment) Act,
2018 and as is currently in force, reads as under:
“13. Criminal misconduct by a public servant.—(1) A
public servant is said to commit the offence of criminal
misconduct:—
(a) if he dishonestly or fraudulently misappropriates or
otherwise converts for his own use any property
entrusted to him or any property under his control as a
public servant or allows any other person so to do; or
(b) if he intentionally enriches himself illicitly during
the period of his office.
Explanation 1.—A person shall be presumed to
have intentionally enriched himself illicitly if he or any
person on his behalf, is in possession of or has, at any
time during the period of his office, been in possession
of pecuniary resources or property disproportionate to
his known sources of income which the public servant
cannot satisfactorily account for.

Explanation 2.—The expression “known sources
of income” means income received from any lawful
sources.”.
(2) Any public servant who commits criminal
misconduct shall be punishable with imprisonment for a
term which shall be not less than four years but which
may extend to ten years and shall also be liable to fine.”
43. In T. Barai (supra), the question, which fell for consideration
before the Supreme Court, related to the applicability of Section 16A
of the Prevention of Food Adulteration Act, 1954 as inserted by the
Prevention of Food Adulteration (Amendment) Act, 1976 (referred to
as ‘the Central Amendment Act’) in relation to the prosecution that
was launched under Section 16(1)(a) as applicable in the State of West
Bengal between the period 29.04.1974 to 01.04.1976. The offences in
question were punishable with imprisonment for life and therefore
triable by the Court of Sessions by virtue of the Act as amended by
Prevention of Adulteration of Food, Drugs and Cosmetics (West
Bengal Amendment) Act, 1973. The Division Bench of the Calcutta
High Court held that by virtue of the Prevention of Food Adulteration
(Amendment) Act, 1976 (Central Act) – which came into force on
01.04.1976 – all pending proceedings for trial of offences punishable
under Section 16(1)(a) of the Act as amended by the Prevention of
Adulteration of Food, Drugs and Cosmetics (West Bengal
Amendment) Act, 1973 (referred to as the West Bengal Amendment
Act), that had not been concluded would cease to be governed by the
West Bengal Amendment Act and would come within the purview of
the Prevention of Food Adulteration Act, 1954 as amended by the

Prevention of Food Adulteration (Amendment) Act, 1976.
Accordingly, the Court directed the Magistrate to proceed with the
trial because the punishment prescribed under the amended scheme
were significantly lower for the offences in question and, therefore,
such offences were triable by the Magistrate. In the aforesaid context,
following questions were framed by the Supreme Court for its
consideration – (i) whether the Central Amendment Act impliedly
repealed the West Bengal Act with effect from 01.04.1976 and, if so,
the effect of such repeal; (ii) whether the High Court was justified in
holding that the West Bengal Amendment Act was deemed to have
been obliterated from the statute book for all intents and purposes and,
therefore, excluded the operation of Section 8 of the Bengal General
Clauses Act, 1899 (which is pari materia to the Section 6 of the
General Clauses Act, 1897.); and (iii) whether the pending
proceedings were governed by the Central Amendment Act and
whether the repealed West Bengal Amendment Act preserved the
punishment to be imposed.
44. The court held that the Central Amendment Act had the effect
of completely obliterating the West Bengal Amendment Act and
would have a retrospective effect as it covered the same offence that
was the subject matter of the West Bengal Amendment Act. The
Central Act neither created a new offence nor posited that the
offending act had ceased to be an offence. It is settled law that an ex
post facto legislation, which enhances the punishment for an offence
and creates a new offence, cannot be applied retrospectively as the

same would violate Article 20(1) of the Constitution of India.
However, an ex post facto law that mitigates the rigors of law, does
not foul fall of Article 20(1) of the Constitution of India. There is no
reason to restrict the retrospective operation of such an enactment,
which reduces the rigors of the law. In view of the aforesaid
principles, the Supreme Court held that merely because the Central
Amendment Act had not expressly repealed the West Bengal
Amendment Act, it could not be said that the former was not
retrospective in its operation. The Supreme Court found that the
legislation had substituted the scheme and, therefore, the Act as
amended by the West Bengal Amendment Act stood repealed. The
Court was also of the view that the intention of the legislature was to
do so with retrospective effect. It is material to note that one of the
reasons that persuaded the Supreme Court to take the said view was
the fact that the Central Amendment Act was in respect of the same
offence that was earlier punishable under Section 16(1)(a) of the Act.
45. The provisions of Section 13 of the PC Act were substituted by
virtue of the PC (Amendment) Act, 2018. It is well settled that the
effect of substitution of a statutory provision by another is that the
earlier provision is repealed and is replaced by the provisions so
enacted. The provisions existing prior to the substitution cease to exist
and the provisions enacted in substitution of the earlier provisions
replace the earlier ones. Subject to any savings provision, the effect
would be to write down the substituted provision in the Act as
originally enacted. In Zile Singh v. State of Haryana & Ors.: (2004) 8SCC 1, the Supreme Court had explained the effect of substitution of a
statutory provision in the following words:
“24. The substitution of one text for the other preexisting
text is one of the known and well-recognised
practices employed in legislative drafting. “Substitution”
has to be distinguished from “supersession” or a mere
repeal of an existing provision.
25. Substitution of a provision results in repeal of the
earlier provision and its replacement by the new
provision (See Principles of Statutory Interpretation,
ibid, p.565). If any authority is needed in support of the
proposition, it is to be found in West U.P. Sugar Mills
Assn. and Ors. Vs. State of U.P. and Ors.: (2002) 2 SCC
645, State of Rajasthan Vs. Mangilal Pindwal: (1996) 5
SCC 60, Koteswar Vittal Kamath Vs. K. Rangappa
Baliga and Co.: (1969) 1 SCC 255 and A.L.V.R.S.T.
Veerappa Chettiar Vs. S. Michael & Ors.: AIR 1963 SC
933. In West U.P. Sugar Mills Association and Ors.’s
case (supra) a three-Judges Bench of this Court held that
the State Government by substituting the new rule in
place of the old one never intended to keep alive the old
rule. Having regard to the totality of the circumstances
centering around the issue the Court held that the
substitution had the effect of just deleting the old rule
and making the new rule operative. In Mangilal
Pindwal’s case (supra) this Court upheld the legislative
practice of an amendment by substitution being
incorporated in the text of a statute which had ceased to
exist and held that the substitution would have the effect
of amending the operation of law during the period in
which it was in force. In Koteswar’s case (supra) a
three-Judges Bench of this Court emphasized the
distinction between “supersession” of a rule and
“substitution” of a rule and held that the process of
substitution consists of two steps : first, the old rule is

made to cease to exist and, next, the new rule is brought
into existence in its place.”
46. The Statement of Objects and Reasons of the Prevention of
Corruption (Amendment) Bill, 2013 makes it clear that the said Bill
was introduced pursuant to India’s ratification of the United Nations
Convention against Corruption (UNCAC) in May 2011, judicial
pronouncements, and the need to bring domestic laws in line with
international practices. The Statement of Objects and Reasons reads
as under:-
“The Prevention of Corruption Act, 1988 provides
for prevention of corruption and for matters connected
therewith. The ratification by India of the United Nations
Convention Against Corruption, the international
practice on treatment of the offence of bribery and
corruption and judicial pronouncements have
necessitated a review of the existing provisions of the
Act and the need to amend it so as to fill in the gaps in
description and coverage of the offence of bribery so as
to bring with it in line with the current international
practice and also to meet more effectively, the country’s
obligations under the aforesaid convention.”
47. The said Bill was introduced in the Rajya Sabha on 19.08.2013
and was referred to the Department related Standing Committee on
Personnel, Public Grievances, Law and Justice which presented its
69th Report on the Bill to the Parliament on 06.02.2014. The Law
Commission also submitted a Report (254th Report) expressing its
views on the amendments. The Select Committee of Rajya Sabha on
Prevention of Corruption (Amendment) Bill, 2013 was constituted on
11.12.2015 to examine the Bill and the amendments proposed by

Government and the members and to submit its Report to the Rajya
Sabha.
48. The current international practices as laid down by the United
Nations Convention Against Corruption does not provide any reason
for substitution of Section 13 of the PC Act. The Report of the Law
Commission is also silent on the amendment to Section 13 of the PC
Act. However, the Select Committee of Rajya Sabha on Prevention of
Corruption (Amendment) Bill, 2013 does briefly indicate that the
Government had proposed as many as thirty official amendments to
the aforesaid Bill in 2015. The Select Committee had considered the
said amendments and also elicited the views of various stakeholders
including the Central Bureau of Investigation. It held several sittings
to examine the said amendments proposed by the Bill. The Committee
also noticed that Section 13(1)(d)(iii) of the PC Act had covered a new
species of crime related to corruption, which was not contemplated
under the Prevention of Corruption Act, 1947. The Committee also
referred to the decision of this Court in the matter of Runu Ghosh and
Ors. v. Central Bureau of Investigation: 2011 SCC Online Del 5501,
wherein a Division Bench of this court had articulated the aforesaid
view and rejected the challenge to the provisions of Section
13(1)(d)(iii) of the PC Act. In that case, this Court had also held that
mens rea was not an essential ingredient of the offence under Section
13(1)(d)(iii) of the PC Act. The Report submitted by the Select
Committee further indicates that most of the stakeholders had agreed
to the amendment proposed by the Government, which had the effect

of deleting the provisions of section 13(1)(d)(iii) of the PC Act. It does
appear from the above that the intention of substituting Section 13 by
enacting the PC (Amendment) Act, 2018 was to exclude the act of any
public servant obtaining any valuable thing or pecuniary advantage for
any person, without any public interest as an offence of criminal
misconduct.
49. It is relevant to note that PC Act was enacted, inter alia, to
make the then existing anti corruption laws more effective by
widening their coverage and strengthening the provisions. It was
enacted to consolidate and amend the law relating to prevention of
corruption and for matters related thereto. The Prevention of
Corruption Act, 1947 did not include any offence of the nature as
specified under Section 13(1)(d)(iii) of the PC Act. It does appear that
the said provision was introduced only for the purpose of expanding
the scope and coverage of the law relating to prevention of corruption.
Thus, for the first time, an act/conduct resulting in a pecuniary
advantage to a third party was held culpable, as a species of
corruption, merely because such an act or conduct was without public
interest.
50. There were serious concerns expressed that decisions which did
not involve any mens rea or any guilty intention or knowledge could,
nonetheless, be considered as offences under the PC Act. Some
stakeholders also expressed the view that such an interpretation would
make public servants reluctant to make any decisions involving grant
of any advantage to any third party.

51. It is apparent that said concerns were addressed by substituting
Section 13 of the PC Act. The enactment of the PC (Amendment) Act,
2018 to substitute the provisions of Section 13 does indicate the
legislative intent to exclude any such act, which was construed as
criminal misconduct only for the reason that the conduct was against
public interest.
52. Since the PC Amendment Act addressed the concerns regarding
Sub-clause (iii) of Section 13(1)(d) of the PC Act, it would stand to
reason to accept that the legislative intent was always to ensure that
mens rea be considered as an integral part of any offence of
corruption. As noticed herein before, the very definition of corruption,
as is commonly understood, includes an element of dishonesty and
abuse of power by a public servant.
53. However, this Court is unable to accept that the PC
(Amendment) Act, 2018 seeks to repeal the provisions of Section
13(1)(d) of the Act, as it existed prior to 26.07.2018 ab initio. Mens
rea is an integral part of the offence under Sub-clause (ii) of Section
13(1)(d) of the PC Act. The use of the word ‘abuse’ in the said Subclause
indicates so. Thus, there is no reason to assume that the
legislative intent of repealing Section 13 of the PC Act was to exclude
the said offence from the scope of PC Act with retrospective effect.
54. In view of the above, Section 6(d) of the General Clauses Act is
applicable and persons convicted of committing the offence of
criminal misconduct under Section 13(1)(d) of the PC Act would not

be absolved of their offences or the liability incurred prior to the PC
Act coming into force. It is also relevant to note that the offence of
criminal misconduct as falling under the provisions of Section
13(1)(d) of the PC Act prior to its amendment, is not the same offence
as is now covered under the amended provision.
55. In view of the above, this Court is unable to accept that if it is
established beyond reasonable doubt that the appellant had abused his
position for securing a pecuniary advantage to VISUL, the benefit of
any beneficial construction of the PC (Amendment) Act, 2018 could
be extended to him.
56. In the present case, the contention on behalf of the appellant is
that the prosecution had failed to establish any relationship between
Sh. Vijay Joshi and the appellant and, therefore, the appellant is liable
to be acquitted is a matter of evaluating the evidence. Whilst the
contention advanced by the appellant is prima facie merited, this
Court does not consider it apposite to consider this aspect in any detail
at this stage.
57. In the light of the above, the principal question to be examined
is whether the conviction of the appellant is liable to be stayed. The
power of a court to stay a conviction has been considered by the
Supreme Court in several decisions. In Navjot Singh Sidhu v. State of
Punjab: (2007) 2 SCC 574, the Supreme Court had summarized the
legal position as under:

“4. Before proceeding further it may be seen
whether there is any provision which may enable the
Court to suspend the order of conviction as normally
what is suspended is the execution of the sentence. Subsection
(1) of Section 389 says that pending any appeal
by a convicted person, the appellate Court may, for
reasons to be recorded by it in writing, order that the
execution of the sentence or order appealed against be
suspended and, also, if he is in confinement, that he be
released on bail, or on his own bond. This Sub-section
confers power not only to suspend the execution of
sentence and to grant bail but also to suspend the
operation of the order appealed against which means the
order of conviction. This question has been examined in
considerable detail by a Three Judge Bench of this
Court in Rama Narang v. Ramesh Narang & Ors.
(1995) 2 SCC 513 and Ahmadi, C.J., speaking for the
Court, held as under (para 19 of the reports) :-
“19. That takes us to the question whether the
scope of Section 389 (1) of the Code extends to
conferring power on the Appellate Court to stay
the operation of the order of conviction. As
stated earlier, if the order of conviction is to
result in some disqualification of the type
mentioned in Section 267 of the Companies
Act, we see no reason why we should give a
narrow meaning to Section 389(1) of the Code
to debar the court from granting an order to that
effect in a fit case. The appeal under Section
374 is essentially against the order of conviction
because the order of sentence is merely
consequential thereto; albeit even the order of
sentence can be independently challenged if it is
harsh and disproportionate to the established
guilt. Therefore, when an appeal is preferred
under Section 374 of the Code the appeal is
against both the conviction and sentence and,
therefore, we see no reason to place a narrow

interpretation on Section 389(1) of the Code not
to extend it to an order of conviction, although
that issue in the instant case recedes to the
background because High Courts can exercise
inherent jurisdiction under Section 482of the
Code if the power was not to be found
in Section 389(1) of the Code. We are,
therefore, of the opinion that the Division
Bench of the High Court of Bombay was not
right in holding that the Delhi High Court could
not have exercised jurisdiction under Section
482 of the Code if it was confronted with a
situation of there being no other provision in the
Code for staying the operation of the order of
conviction. In a fit case if the High Court feels
satisfied that the order of conviction needs to be
suspended or stayed so that the convicted
person does not suffer from a certain
disqualification provided for in any other
statute, it may exercise the power because
otherwise the damage done cannot be undone;
the disqualification incurred by Section 267 of
the Companies Act and given effect to cannot
be undone at a subsequent date if the conviction
is set aside by the Appellate Court. But while
granting a stay or suspension of the order of
conviction the Court must examine the pros and
cons and if it feels satisfied that a case is made
out for grant of such an order, it may do so and
in so doing it may, if it considers it appropriate,
impose such conditions as are considered
appropriate to protect the interest of the
shareholders and the business of the company.”
5. The aforesaid view has recently been reiterated and
followed by another Three Judge Bench in Ravi Kant S.
Patil v. Sarvabhouma S. Bagali JT 2006 (1) SC 578.
After referring to the decisions on the issue, viz., State
of Tamil Nadu v. A. Jaganathan (1996) 5 SCC

329, K.C. Sareen v. C.B.I., Chandigarh (2001) 6 SCC
584, B.R. Kapur v. State of T.N. &Anr. (2001) 7 SCC
231 and State of Maharashtra v. Gajanan &Anr. (2003)
12 SCC 432, this Court concluded (para 12.5 of the
report) :
“16.5. All these decisions, while recognizing
the power to stay conviction, have cautioned
and clarified that such power should be
exercised only in exceptional circumstances
where failure to stay the conviction, would lead
to injustice and irreversible consequences.”
The Court also observed :-
“11. It deserves to be clarified that an order
granting stay of conviction is not the rule but is
an exception to be resorted to in rare cases
depending upon the facts of a case. Where the
execution of the sentence is stayed, the
conviction continues to operate. But where the
conviction itself is stayed, the effect is that the
conviction will not be operative from the date of
stay. An order of stay, of course, does not
render the conviction non- existent, but only
non-operative.”
6. The legal position is, therefore, clear that an appellate
Court can suspend or grant stay of order of conviction.
But the person seeking stay of conviction should
specifically draw the attention of the appellate Court to
the consequences that may arise if the conviction is not
stayed. Unless the attention of the Court is drawn to the
specific consequences that would follow on account of
the conviction, the person convicted cannot obtain an
order of stay of conviction. Further, grant of stay of
conviction can be resorted to in rare cases depending
upon the special facts of the case.”
58. In view of the above, there is no doubt that this Court does have
the power to stay the conviction. However, such power is to be

exercised in exceptional circumstances and in cases where this Court
is convinced that not staying the conviction would lead to injustice
and irreversible consequences. In K.C. Sareen v. CBI, Chandigarh:
(2001) 6 SCC 584, the Supreme Court had also explained that the
Court while considering the question whether to stay the conviction
pending hearing of the appeal, must also consider the wider
ramifications of the same.
59. This Court is of the view that the appellant has a prima facie
case. However, this Court is not persuaded to accept that his
conviction is liable to be stayed on this ground alone. The appellant
has been convicted of an offence after trial. One of the consequences
of the conviction is that the appellant is not qualified to run for public
office. While it is contended that this would lead to injustice and
irreversible consequences, the Court must also consider wider
ramifications of the same.
60. In recent times, there has been an increasing demand that steps
be taken for decriminalization of politics. A large number of persons
with criminal antecedents or who are charged with heinous crimes
stand for and are elected to Legislative Assemblies and the Parliament.
This has been a matter of some concern. In Public Interest
Foundation and Ors. v. Union of India and Ors.: (2019) 3 SCC 224,
the Supreme Court had observed as under:
“2. The constitutional functionaries, who have
taken the pledge to uphold the constitutional principles,
are charged with the responsibility to ensure that the

existing political framework does not get tainted with
the evil of corruption. However, despite this heavy
mandate prescribed by our Constitution, our Indian
democracy, which is the world's largest democracy, has
seen a steady increase in the level of criminalization
that has been creeping into the Indian polity. This
unsettlingly increasing trend of criminalization of
politics, to which our country has been a witness, tends
to disrupt the constitutional ethos and strikes at the very
root of our democratic form of government by making
our citizenry suffer at the hands of those who are
nothing but a liability to our country.”
61. The Court considered the plea of the petitioner in that case to
disqualify persons who were charged with heinous offences to contest
elections to public offices. The Law Commission, in its 244th Report,
had also recommended that a person against whom the charges have
been framed be disqualified from standing for elections.
62. The Supreme Court in Public Interest Foundation v. Union of
India (supra), had extensively referred to the recommendations of the
Law Commission and, after noting various decisions, had observed as
under:
“118. We have issued the aforesaid directions
with immense anguish, for the Election Commission
cannot deny a candidate to contest on the symbol of a
party. A time has come that the Parliament must make
law to ensure that persons facing serious criminal cases
do not enter into the political stream. It is one thing to
take cover under the presumption of innocence of the
accused but it is equally imperative that persons who
enter public life and participate in law making should be
above any kind of serious criminal allegation. It is true

that false cases are foisted on prospective candidates,
but the same can be addressed by the Parliament
through appropriate legislation. The nation eagerly
waits for such legislation, for the society has a
legitimate expectation to be governed by proper
constitutional governance. The voters cry for systematic
sustenance of constitutionalism. The country feels
agonized when money and muscle power become the
supreme power. Substantial efforts have to be
undertaken to cleanse the polluted stream of politics by
prohibiting people with criminal antecedents so that
they do not even conceive of the idea of entering into
politics. They should be kept at bay.”
63. Clearly, if the wider opinion is that persons charged with crimes
ought to be disqualified from contesting elections to public offices, it
would not be apposite for this Court to stay the appellant’s conviction
to overcome the disqualification incurred by him.
64. It would not be apposite to facilitate the appellant to contest
elections for any public office, till he is finally acquitted.
65. In view of the above, the applications filed are dismissed.
VIBHU BAKHRU, J
MAY 22, 2020

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