Answer ... The Prevention of Corruption Act, 1988 (PCA) is India’s main anti-corruption law. It outlaws the acceptance of any ‘undue advantage’ by ‘public servants’ and the giving of such undue advantage by others. Any gratification (not only financial) other than the lawful compensation to which a public servant is entitled, either from the state or from any other entity serviced by such public servant, is defined as an ‘undue advantage’ under the PCA.
The Central Civil Services (Conduct) Rules 1964 and the All-India Services (Conduct) Rules 1968 require government employees to operate in accordance with the service rules that apply to various types of officials. Government officials are prohibited from accepting gifts, hospitality, transportation or any other monetary benefit from individuals other than close relatives or personal friends without the permission of the government.
The Foreign Contribution Regulation Act of 2010 (FCRA) prohibits legislators, judges, political parties or their office bearers, government servants and employees of bodies owned or controlled by the government from accepting hospitality or contributions from ‘foreign sources’, unless the central government grants permission. Any foreign person, business, organisation, multinational corporation, trust or foundation is considered a ‘foreign source’ under the FCRA.
The Central Vigilance Commission (CVC) was established by the central government under the Central Vigilance Commission Act of 2003. The CVC is the official agency charged with investigating crimes committed under the PCA. It is also in charge of advising, planning, implementing, evaluating and reforming the supervisory activities of federal agencies. The CVC is supposed to act impartially and independently of the executive branch, and has the authority to recommend inquiries to the RBI.
The Lokpal and Lokayuktas Act, 2013 established new anti-corruption ombudsmen, which are outside the executive branch of government. These organisations have the authority to examine accusations of corruption against public officials, including PCA violations.
The Comptroller and Auditor General (CAG) is an office established under the Constitution that is responsible for auditing all revenue and spending of the federal and state governments, as well as all government agencies and enterprises. The CAG’s observations, inconsistencies and anomalies have triggered numerous alleged cases of corruption; and the CAG acts as a watchdog against corruption despite having no investigative or prosecution authority.
The Companies Act, 2013 is India’s primary corporate law, with a heavy focus on corporate management and the prevention of corporate fraud. Under the act, auditors and cost accountants are obliged to disclose any suspicious fraud (beyond a certain level) to the central government. Certain kinds of businesses must also establish a vigilance system for reporting problems. The word ‘fraud’ is defined extensively under the Companies Act and may include acts of private or commercial bribery. Fraud is a criminal offence under the Companies Act that carries a sentence of six months to 10 years in jail and/or a fine.