The court held that employees of societies receiving government assistance qualify as public servants under the Prevention of Corruption Act, allowing prosecution for disproportionate assets.

ORDER :

R. Nataraj, J.

The petitioner has challenged an order dated 06.02.2015 in No.HK/PACAS/2014-2015 passed by the respondent No.1 by which consent under Section 19 of the Prevention of Corruption Act, 1988 (henceforth referred to as 'P.C.Act' for short) to prosecute respondent No.2 was rejected.

2. The petitioner registered Cr.No.14/2012 against the respondent No.2 under Section 13 (1)(e) read with Section 13 (2) of the P.C.Act the check period from 18.08.1998 till the date of registration. The respondent No.2 was working as a secretary in the respondent No.1.

3. After completion of the investigation, a final report was prepared which indicated that the respondent No.2 had wealth beyond his known source of income. The petitioner sent a request to the respondent No.1 for sanction to prosecute the respondent No.2. The respondent No.1 in terms of a resolution dated 06.02.2015 declined to grant sanction on the premise that the respondent No.2 was not a public servant. The petitioner is therefore before this Court challenging the rejection of its request to grant sanction to prosecute the respondent No.2.

4. The learned counsel for the petitioner has placed on record the balance sheet of the respondent No.1 for the year ending 31.03.2014 and submits that the respondent No.1 has received assistance from the State and Central Government from time to time and therefore, the respondent No.1 is an assisted society and since the respondent No.2 is an employee of such society, he would fall within the definition of a 'public servant' as defined under Section 2 (c) of P.C. Act. He contends that the impugned resolution passed by the respondent No.1 is without appreciating the above facts and hence, the impugned resolution as well as the impugned order passed by the respondent No.1 is liable to be set at nought. He also referred to a judgment of a division bench of this Court in W.A.No.255/2022 where this Court had recognized that the Lokayukta has institutional locus-standi to challenge an order passed by the competent authority refusing to grant sanction under Section 19 of P.C. Act, to prosecute a Government servant. He therefore, contends that the petitioner is entitled to prosecute the respondent No.2 and the respondent No.1 is bound to grant the sanction.

5. The petition is opposed by the respondent No.2 who contends that the respondent No.1 being a sanctioning authority has absolute discretion to grant or not to grant the sanction and that in the instant case, the respondent No.1 after going through the material placed by the petitioner, felt it not necessary to prosecute the respondent No.2. He also contends that the sanction was sought under P.C. Act and therefore, the provisions of the Karnataka Lokayukta Act, 1984 could not be applied regarding granting sanction, as the investigation conducted by Lokayukta is different and unconnected with the investigation conducted under the Lokayukta Act. It is also contended that the respondent No.2 was the then secretary of the respondent No.1 who was not provided with basic amenities let alone the benefits given to a public servant. He also contends that the respondent No.1 after considering the request of the petitioner for sanction had rightly held that the respondent No.2 is not a public servant. He also contends that the salary paid to the respondent No.2 was borne out of the funds of the respondent No.1 and that the respondent No.1 is not getting any financial assistance or funds from the Central Government or State Government. He therefore, contends that the impugned order passed by the respondent No.1 is just and proper and no interfe