Kerala HC holds Charitable Society Members running Nazareth Pharmacy College to be ‘public servants’ under PC Act

Kerala High Court: In a writ petition seeking inquiry into misappropriation and corruption allegations in the Nazareth Pharmacy College (‘the College’) based in Kerala, a Single Judge Bench of K. Babu, J., held that the accused members of the charitable society who were the final authority with regard to the grant of admission, collection of fees, etc. in the College (‘accused persons’) fell under the ambit of ‘public servants’ as defined under the Prevention of Corruption Act, 1988 (‘the PC Act’). It was also held that the alleged acts do not come under the ambit of Section 17-A of the PC Act as they were not relatable to any recommendations made or decisions taken by a public servant in the discharge of his official functions or duties.

Background

In the present matter, the petitioner filed a complaint to the Director of Vigilance, alleging that the accused persons had hatched a conspiracy wherein they denied admission to eligible students in the Pharmacy College for the seats allotted to the Government and instead, sold the seats to private students and misappropriated the capitation amount so obtained to their credit causing wrongful loss to the society and wrongful monetary gain to them.

It was further alleged that the aforementioned acts by the accused persons violated Section 5 read with Section 15 of the Kerala Professional Colleges or Institutions (Prohibition of Capitation Fee, Regulation of Admission, Fixation of Non-Exploitative Fee & Other Measures to Ensure Equity & Excellence in Professional Education) Act, 2006 (‘the 2006 Act’). The accused persons were also alleged to have committed offences punishable under Section 13 of the PC Act, and Sections 406 ¹ and 409 ² of the Penal Code, 1860.

When the Vigilance and Anti-corruption Bureau (‘VACB’) refused to act on the complaint, the petitioner filed a complaint before the Court of Enquiry Commissioner and Special Judge, Kottayam, under Sections 190 ³ and 200 ⁴ of the Code of Criminal Procedure, 1973 (‘CrPC’). Upon being asked for a report by the Special Judge, the VACB claimed that as approval under Section 17-A of the PC Act is required, they are not in a position to enquire into or investigate the allegations.

Thereafter, the petitioner filed an application seeking investigation under Section 156(3)⁵ CrPC, but the Special Judge dismissed the prayer and adjourned the matter, instructing the petitioner to produce Section 17A approval under the PC Act from the competent authority.

The VACB then sought prior approval from the competent authority, wherebyGovernment passed an order and decided that since the allegations were pending before the Admission Supervisory Committee for Medical Education, no vigilance inquiry was required. The petitioner challenged the legality of this order in the present writ petition.

Analysis

The Court noted that the College was managed by a society registered under the Travancore-Cochin Literary, Scientific, and Charitable Societies Registration Act, 1955 and the accused persons managed the educational institution. It was also noted that it would have to be seen, in the present petition, whether the alleged acts of the accused persons would come within the ambit of the discharge of ‘public duty’ under the PC Act

Further, the Court noted that ‘public duty’ is a ‘public function’ or a legal obligation discharged by a ‘public servant’ under the command of ‘public right’. In the discharge of ‘public duty’ by an organ of the State or a private body, there is an element of ‘State function’ or ‘public function’. If the ‘State function’ or ‘public function’ is discharged under a legal obligation or by a governmental or statutory direction, such ‘State function’ is treated as ‘public duty’.

The Court stated that ‘public duty’ as defined in Section 2(b) of the PC Act, means a duty in the discharge of which the State, the public, or the community at large has an interest. Thus, a ‘public servant’ must be under the positive command of a State law or valid executive direction to discharge such a ‘public duty’. If a body or a corporation exercises a State function under the obligation of the existing laws, it is to be treated as a discharge of ‘public duty’.

The Court noted that the admission and fixation of fees to the College were governed by the provisions of the Kerala Medical Education (Regulation and Control of Admission to Private Medical Educational Institutions) Act, 2017 (“the 2017 Act”), as per which, the empowered committee shall determine the fees that may be charged by a private medical educational institution and no institution shall fix fees in violation of the prescriptions made by the Committee. Therefore, it was said that the duty discharged by the management of the College was based on the positive law of the State or the governmental directions.

The Court stated that the Explanation 1 to Section 2 of the PC Act clarifies that any person who falls in any of the categories stated under Section 2 is a public servant whether or not appointed by the Government. Furthermore, Explanation 2 expands the ambit to include every person who de facto discharges the functions of a public servant and states that he should not be prevented from being brought under the ambit of ‘public servant’ due to any legal infirmities or technicalities.

Noting the above, the Court stated that in the present facts, it appeared that the accused persons were the final authority regarding the grant of admission, collection of fees etc. Thus, it was held that theduty discharged by the accused persons was ‘public duty’ and hence they were ‘public servants’ as defined under the PC Act.

Further, the Court stated that the alleged acts did not come under the ambit of Section 17-A of the PC Act as they were not related to any recommendations made or decisions taken by a public servant in the discharge of his official functions or duties. The Court also held that prior approval, as provided in Section 17-A of the PC Act, was not applicable in the present facts and that the same has also been decided in Sankarabhat and Others v. State of Kerala⁶ and Venugopal V. and Others v. State of Kerala and Another⁷.

Regarding the aforementioned order of the Government, the Court concluded that approval under Section 17A was not required for conducting a preliminary enquiry in the matter and thus, quashed the same and directed the VACB to conduct a preliminary enquiry and proceed as per law.

[A.K. Sreekumar v. The Director, Vigilance and Anti-Corruption Bureau, 2024 SCC OnLine Ker 7281, decided on 12-12-2024]

Advocates who appeared in this case :

For the petitioner: Advocate Sooraj T. Elenjickal, Advocate Renoy Vincent, Advocate Shahir Showkath Ali, Advocate Aleesha Shereef, Advocate Helen P.A., and Advocate Arun Roy

For the respondent: Spl. Government Pleader (Vigilance) A. Rajesh and Sr. Public Prosecutor Rekha. S