Supreme Court brings Deemed Universities Under the Scope of Prevention of Corruption Act

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The ambit of the Prevention of Corruption Act was extended once again as the Supreme Court of India ruled that deemed universities will come under the scope of the said Corruption Act, and so will the trustees who run those universities through some trust. Further, the Trustees can now be prosecuted under the Prevention of Corruption Act for their wrongdoings.

What are Deemed Universities?

Provisions relating to Deemed Universities can be found in Section 3 of the UGC Act of 1956. They enjoy complete freedom in designing their course curriculum, fee structures, etc. Ministry of Human Resource and Development (MHRD) has termed deemed universities as

“Any institution of higher education, other than the universities, working at a very high standard in a specific area of study, can be declared by the Central Government on the advice of the UGC as an Institution Deemed-to-be university.”

Currently, in India, we have nearly 130 Deemed Universities, Tamil Nadu having the most of them.

Background

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Recently, there was a charge of corruption under the Prevention of Corruption Act against ‘Sumandeep Vidyapith’, which is a deemed university in Gujarat. There was an allegation that they charged 25 Lakh Rupees from one of their students to allow her to write the final examination in MBBS, despite charging her for the full fees earlier.

The Gujarat High Court discharged the accused on the ground that Deemed universities are not covered under the Prevention of Corruption Act. The State of Gujarat appealed against the High Court decision before the Apex Court.

Supreme Court’s Decision

In the matter of State of Gujarat v. Mansukhbhai Kanjibhai Shah, the Apex Court believed that as far as the definition of “University” is concerned under the Prevention of Corruption Act, deemed universities are covered under them. It made a further observation that a trustee who runs a university through some trusts will be treated as a public servant under section 2(c) of the Corruption Act.

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This judgment by a three-judge bench of the Apex Court, comprising of Justice N V Ramana, Mohan M Shantanagoudar, and Ajay Rastogi reversed the Decision of the Gujarat High Court.

We are of the opinion that the High Court was incorrect in holding that a “Deemed University” is excluded from the ambit of the term “University” under Section 2(c)(xi) of the PC Act,”

observed the Supreme Court.

The main argument of the respondent in front of the Supreme Court was based on the narrow interpretation of the term “University.” It was argued that the term “University” and “Deemed Universities” bear completely different meanings under the UGC Act. So the term “University” under the PC Act needs to be read strictly in accordance with the UGC Act.

But the Apex Court unanimously rejected this position and decided to take a much broader view.

The UGC Act and PC Act are enactments which are completely distinct in their purpose, operation, and object. As such, the extension of technical definitions used under one Act to the other might not be appropriate, as the two Acts are not in part material with one another,”

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as observed by the Supreme Court. The Apex Court adopted the firm position that when the nature and purpose of two statutes are entirely different from one another, then the meaning of a term in one statute should not be used in the other statutes narrowly. The Court felt the need to develop a new independent meaning for the term “University” under the PC Act.

In the course of the proceeding, the Apex Court also took notes of the rampant corruption which is prevalent in India.

There is no dispute that corruption in India is pervasive. Its impact on the Nation is more pronounced due to the fact that India is still a developing economy. Presently, it can be stated that corruption in India has become an issue that affects all walks of life. In this context, we must state that although anti-corruption laws are fairly stringent in India, the percolation and enforcement of the same are sometimes criticized as being ineffective. Due to this, the Constitutional aspirations of economic and social justice are sacrificed daily. It is in the above context that we need to resolve the issues concerned herein”.

Another important question of law was whether the trustees who run the deemed universities through various trusts could be considered as “Public servants” under the PC Act.

The Apex Court opined that the term “Public Servant” under the PC Act is not exhaustive or conclusive. It does not interpret the term in its strictest senses but covers all those who perform a duty, which is of public importance in nature. The decision of CBI v. Ramesh Gelli was also referred by the Supreme Court, where it was held that officers or employees of a private bank could also be brought under the umbrella of the term “Public servant” as far as PC Act is concerned. So as we can see, the PC Act also covers those who would not be termed as public servants otherwise.

The object of the PC Act was not only to prevent the social evil of bribery and corruption but also to make the same applies to individuals who might conventionally not be considered as a public servant. The purpose under the PC Act was to shift focus from those who are traditionally called public officials, to those individuals who perform public duties. Keeping the same in mind, as rightly submitted by the senior counsel for the appellant-state, it cannot be stated that a “deemed university” and the officials therein, perform any less or any different public duty, than those performed by a university simpliciter, and the officials therein

~ the bench held

The Court also said that a duty can be called a public duty if the State, society, or community has a larger interest in that. The appellant was discharging a public duty. There can be no doubt that society as a whole has a great interest in education. The duty of the appellant to provide education is too essential to be not considered as a public duty.

There is no doubt that the Apex Court was correct to interpret both the term “Universities” and “Public Servant” in a much broader sense. The PC Act was enacted by the legislature to curb the menace of corruption at its root. Limiting the meaning of those terms to a much narrower position would have defeated the very purpose of the Act itself.


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