Society getting state funds cannot claim its staffer not public servant: Karnataka High Court

The High Court of Karnataka has directed a co-operative society to consider within a month the Lokayukta police’s request to prosecute its secretary in a disproportionate assets (DA) case. 

Justice R Nataraj held that the society, which received funds/grants from governments, cannot claim that its employee is not a public servant under the Prevention of Corruption (PC) Act. 

In 2012, the Lokayukta police had booked Keerthi Kumar, secretary of the Hirekadalur Primary Agricultural Credit Cooperative Society, Hassan taluk. The police investigation covered the check period between August 18, 1998, and December 19, 2012.

The final report stated that Kumar possessed Rs 27.10 lakh in assets, beyond his known sources of income. 

The Lokayukta police filed a request with the society under Section 19 of the PC Act, seeking consent to prosecute Kumar. However, on February 6, 2015, the society passed a resolution rejecting the request on the grounds that it is not funded by the government and that Kumar was not a public servant. 

The Lokayukta police moved the high court contending that the society has received assistance from the state and union governments from time to time.

Therefore, as an assisted society its employee, the secretary in the case at hand, would fall within the definition of a ‘public servant’ under Section 2(c) of PC Act, it argued. 

The society, however, claimed that it paid the salary from its own funds and that it’s not getting any financial assistance or funds from governments. 

The court perused the definition of a public servant under the PC Act as well as documents pertaining to funds received by the society, about Rs 13.5 lakh as share amount, rehabilitation fund from the union government. It noted that the society  had received separate periodical financial assistance from the state government. 

“A perusal of the resolution passed by the respondent No 1 (society) shows that there was no application of mind to the above facts but the respondent No 1 blindly proceeded to hold that it was not funded by the state government and therefore, respondent No 2 (Keerthi Kumar) was not a public servant. In view of the material placed before this court, the impugned resolution passed by the respondent No 1 is faulty and without application of mind and the same is liable to be quashed,” Justice Nataraj ruled and directed the society to consider afresh the requisition sent by the Lokayukta police.