Anti-Corruption Laws in India

Corruption has become a threat to the prosperity & growth of any country, as it lets the outflow of federal aid to some foreign countries as Benami trades and holds black money in the country without the Government's knowledge. In both cases, the growth and Economy of a nation or place are poorly affected.

Presently, Corruption has become a common element in day-to-day life and has become a critical sensation. It has created an adverse effect on India's growth. Corruption hits the root of democracy and tries to disobey economic and social justice. To reduce this evil in Indian society, the Indian Parliament has enacted various acts/laws to simplify the system, which is declining. Let's understand these anti corruption laws in depth.

Foreign Contribution Regulation Act (FCRA), 2010

The Act mainly aims to ban foreign dealings and hold foreign grants in the nation by some specified ones as said in the Act, which contains Government workers, Judges, and Legislature members of the State along with the Parliament and political societies.

The Act grows in all parts of India, having all the people living outside India who is getting foreign aid on behalf of the abovementioned ones.

Section 6 of this Act curbs favor of any foreign hospitality by any people, as mentioned above, without the Government's prior consent.

The Act develops strict penalties for not completing any above provisions, which hold and form the basis of the framework of India, protecting the dealings.

Source:- https://fcraonline.nic.in/home/PDF_Doc/FC-RegulationAct-2010-C.pdf

Central Vigilance Commission Act, 2003

The Central Government set the Central Vigilance Commission under the Act to keep control of the country's corruption tools and CBI. 

The Act mainly plans, briefs, and directs the policies of the country's corruption tools, along with examining the complaints obtained against the public workers as per the provisions of the PC act, 1988. 

The Act has general control over the CBI. It can refer matters to it, and the Act is assigned the power of a civil court as per the Act, so it can impartially ask the corruption cases without any obstacles and loads.

Source - https://www.cvc.gov.in/sites/default/files/cvcact_0.pdf

Fugitive Economic Offenders Act, 2018

The Act mainly aims to work with the cases of momentary culprits, who are the convicts against whom the case for economic crimes has been filed and who flew away and escaped outside India.

The Act covers all the culprits against whom a case is filed for an amount of Rs. One hundred crores or more, and for the one who has left the country temporarily or permanently.

The financial crimes as per the Act cover cases of Benami trades, corporate scams, evasion of income tax, PMLA, and PCA.

Black Money (Undisclosed Foreign Income and Assets) and Imposition of Tax Act, 2015:

The Act mainly sets high penal rates of tax on any unknown investment or evasion of any pay held abroad by one who lives in India.

Apart from that, it lays down a penalty for a person for non-disclosure of foreign income, intended to avoid tax and loss in giving the needed recoveries. 

The Act targets the assets that have arisen by illegal means and corruption rules by the civil and political workers, even if they are made and kept offshore by the culprits.

Source: https://incometaxindia.gov.in/pages/acts/black-money-undisclosed-income-act.aspx

Indian Penal Code, 1860:

The IPC defines "public workers" as government workers, an officer in the airforce, navy, military, judges, police, officers of the Court of power, and any local rule set by a state or central Act. 

Section 169 states about a public worker's illegal purchasing or bidding for the property. The public workers must be penalized with the detention of up to two years and a heavy fine (or both). If the property is bought, it shall be seized. 

Section 409 states the illegal violation of trust by public workers. The public worker must be penalized with life detention or detention of up to 10 years and a heavy fine.

The Prevention of Corruption Act, 1988 

Along with the types stated in the Indian Penal Court, 1860, the meaning of "public worker" contains office-bearers of cooperative associations getting financial help from the State, employees of institutes, banks, and the public service commission.

If a public worker takes financials other than his legal income with an official act or control. That can punish the public worker for at least six months or at most five years and a fine. The Act also punishes a public worker for taking financial gain to control the public by illicit means and exerting their power over a public worker. 

If a public worker gets a valuable thing without paying for it or improperly from a person with whom he is involved in a business trade in his official power. In that case, one can be punished with at least detention of six months and at most five years or a fine.

Getting prior approval from the State or central Government to charge a public worker is essential.

The Benami Transactions (Prohibition) Act, 1988 

The Act bans any benami trade, that is, buying an asset or property in the false name or in the name of the person who doesn't pay for the property except when a person buys the property in the name of his wife or daughters, who are unmarried.

Anyone joining a benami trade shall be penalized with a detention of up to three years, a fine (Or both).

A prescribed authority can acquire all properties held to be Benami money must be paid for such purchase.

source: https://dea.gov.in/sites/default/files/Benami%20Transaction_Prohibition_%20Act1988.pdf

The Prevention of Money Laundering Act, 2002 

It is stated as the most valuable and effective law in the area of Corruption in India.

The Act states that the crime of laundering money is said to be achieved if a person is linked with the returns of crime and tasks such as untainted possessions. 

"Profits of crime" means any profit obtained by a person after doing any criminal activity linked to some crimes stated in the Act. 

A person can be charged with laundering money only if he has been charged with engaging in a planned crime. 

The penalty for doing this offense may put the person in strict detention for at least three to almost seven years and a fine that may go up to 5 lacks. If a person is sentenced for a crime as on the Narcotics Psychotropic and drugs Substances Act, 1985, the term of detention can continue for ten years.

The present power, set by the Government, must determine if any of the possessions tied or held is involved in money laundering. A judge shall hear pleas against the orders of the required Authority and other powers as per the Act.

Every financial institution, banking sector, and negotiator shall record all trades of a similar value & nature, verify and keep records of all its buyers, and give those details to the selected controls.

Source: https://www.indiacode.nic.in/bitstream/123456789/2036/1/A2003-15.pdf

The right to information & Corruption, 2005

The Right to Information is a basic Right of every human being. It provides:

Growth.

• Offering participatory democracy sense.
• Promoting people-centered growth.
• Fighting Corruption.
• Improving the capacity of media.
• Creating trust in the State.
• Promoting equitable economic development.

The Right to Information Act 2005 has given everyone the right to get details from the State about the happening of a Nation. By this, we can reveal Corruption and explain the obligations of the official neglect.

Following are the rights that were given to every individual under the act 2005:

• Ask for details from the State or ask any queries.
• Inspect the records created by the Government.
• Check any work of the Government.
• Grab samples of things from any piece of the Government.
• Make copies of any state documents.

The three main powers involved in examining, analyzing, and charging corrupt public workers are

I. The state Anti-Corruption Bureau (ACB). 

Ii. Central Vigilance Commission (CVC).

Iii. The Central Bureau of Investigation (CBI).

a) The Financial Intelligence Unit and the Directorate of Enforcement, under the Ministry of Finance, examined and charged cases related to money laundering by public workers.

b) The Central Bureau of Investigation and state Advisory Committee on Borderline Substances investigate corruption-related cases under the PC 1988 and the IPC act 1860. The CBI's authority is the Union Territories and the central Government, while the State ACBs examine matters within the states. Conditions can refer cases to the CBI. 

c) The CVC is a statutory body that handles corruption cases in state units. The CBI is under its control. The CVC can refer patients either to the CVO or to the CBI. The CVC or the CVO urges action against public workers. Yet, the conclusion to take corrective action against a civil worker depends on the power of that department.

d) The lawyer can be created by an agency only after it has the prior order of the State or Central Government. Government-appointed lawyers to embark on the proceeding in the courts. 

e) All cases, as on the PC Act of 1988, are tested by Special Judges selected by the State or Central Government. 

Source: https://www.indiacode.nic.in/bitstream/123456789/2036/1/A2003-15.pdf

About The Author

Paromita Majumdar, Advocate on Record at the Supreme Court of India, has over 12 years of experience in Litigation and Dispute Resolution. A first-generation lawyer, she specializes in Quashing Petitions, Insolvency, SARFAESI, Banking, Insurance, Trademark Infringement, and more. Paromita has represented both private and public sector clients in courts and tribunals across Delhi NCR, consistently securing favorable outcomes. Prior to establishing her law office, she worked with top lawyers and law firms, assisting senior advocates in high-profile cases. She is committed to delivering tailored and ethical legal solutions for her clients.