India: Officers Of Private Telecom Companies Are Public Servant Under The Provisions Of The Prevention Of Corruption Act, 1988

Recently in the matter of Criminal Bureau of Investigation, Bank Securities and Fraud Cell v. Ramesh Gelli & Others, in Criminal Appeal No. 1077-1081 of 2013 vide order dated 23.02.2015, the Hon'ble Supreme Court of India inter alia held as under:

"38. In the light of law laid down by this Court as above, it is clear that object of enactment of P.C. Act, 1988, was to make the anti-corruption law more effective and widen its coverage. In view of definition of public servant in Section 46A of Banking Regulation Act, 1949 as amended the Managing Director and Executive Director of a Banking Company operating under licence issued by Reserve Bank of India, were already public servants, as such they cannot be excluded from definition of 'public servant'. We are of the view that over the general definition of 'public servant' given in Section 21 of Indian Penal Code, it is the definition of 'public servant' given in the P.C. Act, 1988, read with Section 46-A of Banking Regulation Act, which holds the field for the purposes of offences under the said Act. For banking business what cannot be forgotten is Section 46A of Banking Regulation Act, 1949 and merely for the reason that Sections 161 to 165A of Indian Penal Code have been repealed by the P.C. Act, 1988, relevance of Section 46A of Banking Regulation Act, 1949, is not lost.

39. Be it noted that when Prevention of Corruption Act, 1988 came into force, Section 46 of Banking Regulation Act, 1949 was already in place, and since the scope of P.C. Act, 1988 was to widen the definition of "public servant". As such, merely for the reason that in 1994, while clarifying the word "chairman", legislature did not substitute words "for the purposes of Prevention of Corruption Act, 1988" for the expression "for the purposes of Chapter IX of the Indian Penal Code (45 of 1860)" in Section 46A of Banking Regulation Act, 1949, it cannot be said, that the legislature had intention to make Section 46A inapplicable for the purposes of P.C. Act, 1988, by which Sections 161 to 165A of Indian Penal Code were omitted, and the offences stood replaced by Sections 7 to 13 of P.C. Act, 1988."

Based on the observation of the Hon'ble Supreme Court in the above case, it is of importance that the chairperson, director, or other officers of the private banks are 'Public Servant' as mentioned in Section 2(c) (viii) of the Prevention of Corruption Act of 1988 (hereinafter referred to as the P.C. Act, 1988) read with Section 46A1 of Banking Regulation Act, 1949.

Now, the question arises similarly whether the officers of private telecom companies are public servant under the provisions of the P.C. Act. Therefore, the present article restrict to this aspect of law.

To analyse the above proposition, it is seen that primarily the business functioning of private telecommunication companies are governed by the Telecom Regulatory Authority of India Act, 1997 (hereinafter referred to as the TRAI Act) and the Indian Telegraph Act, 1885 (hereinafter referred to as the Telegraph Act).

For the purpose of providing telecommunication services to the public at large, the Department of Telecommunication under the Ministry of Communication and Information, Government of India issues licenses to private telecom companies. As such, the private telecom companies are the licensee. Licensee has been defined in Section 2(e) of the TRAI Act as any person licensed under sub-section (1) of section 4 of the Indian Telegraph Act, 1885 for providing specified public telecommunication services. In the matter of Reliance Infocomm Limited v. Union of India, the Telecom Dispute Settlement and Appellate Tribunal, New Delhi (hereinafter referred to as TDSAT), held that nature of duty in telecommunication is such that any licensee under Section 4 of the Telegraph Act could be said to have undertaken to perform public duty.

Telegraph Officer has been defined in Section 3(2) of the Telegraph Act as any person employed either permanently or temporarily in connection with at telegraph established, maintained or worked by the Central Government or by a person licensed under the Act. The term 'person' referred in the said definition inter alia includes any company whether incorporated or not in terms of Section 3(42) of the General Clauses Act, 1897(hereinafter referred to as General Clauses Act).

Section 31 of the Telegraph Act defines that a telegraph officer shall be deemed a public servant within the meaning of sections 161,162,163,164 and 165 of the Indian Penal Code, 1860 (45 of 1860); and in the definition of "legal remuneration" contained in the said section 161, the word "Government" shall, for the purposes of this Act, be deemed to include a person licensed under this Act.

Since, Section 161 to 165 of the Indian Penal Code, 1860 (hereinafter referred to as IPC) have been repealed and incorporated as section 7 to 12 in the P.C. Act, the issue arises whether the reference of the provisions of IPC in section 31 of the Telegraph Act can be substituted for the provisions of P.C. Act, 1988 as aforesaid.

For this purpose, section 82 of the General Clauses Act is relevant which deals with the construction of references to repealed enactments. The Hon'ble Supreme Court had occasioned to deal with the said section in the matter of State through S.P., New Delhi v. Ratan Lal Arora observed that the object of Section 8, obviously and patently made known is that where any Act or Regulation is repealed and re-enacted, reference in any other enactment to provisions of the repealed former enactment must be read and construed as references to the re-enacted new provisions, unless a different intention appears.3 Thus, Section 7 to 12 of the P.C. Act when read along with Section 8 of the General Clauses Act may substitute the repealed sections 161-165 of the IPC while construing Telegraph Officers as public servants for the purposes of Section 314 of the Indian Telegraph Act, 1885.

Therefore, based on the above legal position, it becomes evident that the officers of the private telecom companies are public servants performing public duty and are covered


1. Section 46A, Banking Regulation Act, 1949: Chairman, director, etc., to be public servants for the purposes of Chapter IX of the Indian Penal Code-

[Every Chairman who is appointed on a whole-time basis, managing director, director, auditor]liquidator, manager and any other employee of a banking company shall be deemed to be a public servant for the purposes of Chapter IX of the Indian Penal Code(45 of 1860).

2. Section 8, General Clauses Act, 1897: Construction of references to repealed enactments-

[(1) Where this Act, or any [Central Act] or Regulation made after the commencement of this Act, repeals and re-enacts, with or without modification, any provision of a former enactment, then references in any other enactment or in any instrument to the provision so repealed shall, unless a different intention appears, be construed as references to the provision so re-enacted.

[(2)][Where before the fifteenth day of August, 1947, any Act of Parliament of the United Kingdom repealed and re-enacted], with or without modification, any provision of a former enactment, then reference in any2[Central Act] or in any Regulation or instrument to the provision so repealed shall, unless a different intention appears, be construed as references to the provision so re-enacted.]

3. State through S.P., New Delhi v. Ratan Lal Arora, A.I.R. 2004 S.C. 2364 at p. 2367 : 2004 (2) R.C.R. (Cr.) 870 (S.C.) : (2004) III D.L.T. 250 (S.C.).

4. Section 31, Indian Telegraph Act, 1885: Bribery-
A telegraph officer shall be deemed a public servant within the meaning of sections 161,162,163,164 and 165 of the Indian Penal Code, 1860 (45 of 1860); and in the definition of "legal remuneration" contained in the said section 161, the word "Government" shall, for the purposes of this Act, be deemed to include a person licensed under this Act.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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