Previous Sanction Under Section 17A Not Required To Prosecute Public Servants for Benami Deals: Kerala High Court

The Kerala High Court has recently observed that a public servant purchasing shares as “benami” and the purchasing of public property under a “benami” does not come within the purview of Section 17A of the Prevention of Corruption Act, 2018.According to the section, which was introduced by way of amendment on 26th July, 2018, no police officer can conduct an inquiry into an offence under the Act alleged to have been committed by a public servant in the discharge of his official functions without prior approval of the government or authority which can remove said person from office.Justice A. Badharudeen was considering a plea challenging the quick verification order passed by a Special Judge (Vigilance) to look into a complaint against an alleged incident of transfer of around 1,20,000 ESOP shares of CIAL (Cochin International Airport Ltd.) to a non-employee by its former Managing Director in 2004. The Court observed: “Purchasing shares by the public servant as benami in the name of a third person is not within the domain of Section 17A of PC Act, 2018. In this case, an investigation as to commission of offences punishable under the Benami Prohibition Act also steps in, where offences under the PC Act, 2018 also involved. Purchasing public property under a benami would not come within the purview of Section 17A of the PC Act, 2018.”In the judgment, the Court also looked into whether Section 17A has retrospective application. The Special Judge has opined in the impugned order had stated that prior approval was not applicable in the case. The public prosecutor had argued that the impugned order was passed in 2020 and the section, which was introduced in 2018, would apply. It was also submitted that sanction was already applied for by the prosecution. The Court looked into the Supreme Court decisions in State of Rajasthan v. Tejmal Choudhary, wherein it was held that Section 17A is not retrospective in nature. It referred the decision in Yashwant Sinha and Ors. v. Central Bureau of Investigation as well as the split verdict made in Nara Chandrababu Naidu v. State of Andhra Pradesh, which led to the question on retrospective applicability of the Section to be referred to a Constitution Bench.Further, the question on need for preliminary inquiry was also considered by the Court. The decisions of the Supreme Court in Pradeep Nirankarnath Sharma v. State of Gujarat, Vinod Kumar Pandey v. Seesh Ram Saini were referred to wherein the mandate to register an FIR upon disclosure of a cognizable offence was clearly laid down. The High Court noted that the question of mandate of prior approval was not looked into by the Supreme Court in these decisions whereas in the latter case, the Apex Court had categorically stated that if information received does not disclose a cognizable offence but indicates necessity of an inquiry being conducted, then a preliminary inquiry can be conducted for ascertaining facts that may disclose a cognizable offence. Thereafter, it looked into the statement filed by the Dy.S.P which had said, "it is respectfully submitted that the order from the Court of the Enquiry Commissioner and Special Judge (Vigilance), Muvattupuzha is forwarded to Director VACB for approval for conducting Quick Verification."Thus, the Court was of the opinion that there was no need to interfere with the impugned order. It observed that further steps as per the order can be proceeded after getting prior approval under Section 17A and disposed of the petition.Case No: Crl.M.C. No. 991 of 2025Case Title: V.J. Kurian v. State of Kerala and Anr.Citation: 2025 LiveLaw (Ker) 577Counsel for the petitioner: Thomas J. Anakkallunkal, Jayaraman S., Nirmal Cheriyan Varghese, Litty Peter, Anupa Anna Jose Kandoth, P. Vijaya Bhanu (Sr.)Counsel for the respondents: Dinoop P.D., K.P. Prasanth, T.S. Krishnendu, Archana Suresh, Sunitha K.G., C. Unnikrishnan (Kollam), Ananda Padmanabhan, Uthara A.S., Goutham Krishna U.B., Nidhi Balachandran, Vijaykrishnan S. Menon, Rajesh A. – Special Public Prosecutor – VACB, Rekha S. – Senior Public Prosecutor – VACBClick to Read/Download Judgment

Previous Sanction Under Section 17A Not Required To Prosecute Public Servants for Benami Deals: Kerala High Court

K. Salma Jennath

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K. Salma Jennath

Previous Sanction Under Section 17A Not Required To Prosecute Public Servants for Benami Deals: Kerala High Court

K. Salma Jennath

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K. Salma Jennath

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