'Sanction Under Section 19(1)(c) PC Act Must Be Granted By Removing Authority': Supreme Court Sets Aside Conviction

"What is contemplated by Section 19(1)(c) of the Act of 1988 is the grant of sanction by an authority competent to remove the concerned public servant from office." Supreme Court, in a significant ruling delivered on August 19, 2026, held that prosecution under the Prevention of Corruption Act, 1988 is vitiated when sanction is granted by an authority lacking the statutory competence to remove the public servant from office.

A bench comprising Justice Ujjal Bhuyan and Justice Atul S. Chandurkar observed that under the Gujarat Panchayats Act, 1961, the District Development Officer alone was competent to remove a substantive Talati-cum-Mantri, rendering a prosecution sanction accorded by a Deputy District Development Officer invalid under Section 19(1)(c) of the PC Act.

The appellants, serving as a Talati-cum-Mantri and a Gram Panchayat Peon, were convicted by the Special Court under Sections 7, 12, and 13(1)(d) of the Prevention of Corruption Act, 1988 for allegedly demanding and receiving an illegal gratification of ₹120 for issuing an income certificate. The High Court of Gujarat subsequently dismissed their criminal appeals and affirmed the conviction along with the sentence of one year rigorous imprisonment. Aggrieved by the concurrent findings of guilt, both appellants approached the Supreme Court in appeal.

The primary question before the court was whether the sanction for prosecution granted under Section 19(1)(c) of the Prevention of Corruption Act, 1988 by the Deputy District Development Officer was legally valid when the substantive removing authority was the District Development Officer. The court was also called upon to determine whether the conviction could stand in the absence of conclusive proof of prior demand.

Sanction Under Section 19(1)(c) Must Flow From Competent Removing Authority

Examining the validity of the prosecution sanction under Exhibit 25, the Supreme Court emphasized that cognizance under Sections 7 and 13 of the PC Act is strictly barred without the previous sanction of the authority competent to remove the public servant from office. The bench noted that while the appellant held the substantive post of Talati-cum-Mantri, the sanction was accorded by PW-2, who was merely discharging duties as a Deputy District Development Officer.

The court analyzed the statutory framework of the Gujarat Panchayats Act, 1961 and the admissions made during trial, noting that the competent authority vested with the power of removal for a substantive Talati-cum-Mantri was the District Development Officer.

Ad-Hoc Appointing Authority Lacks Jurisdiction To Grant Removal Sanction

The bench rejected the prosecution's contention that an initial ad-hoc appointment made by the Deputy District Development Officer cured the defect in the sanction order. The court clarified that the statutory mandate under Section 19(1)(c) is anchored to the authority empowered to remove the public servant at the time sanction is sought, not an initial ad-hoc appointing officer.

"When the sanction was sought, A1 was holding the substantive post of Talati-cum-Mantri and, hence, it was only the District Development Officer under the Gujarat Panchayats Act, 1961 who could have removed him from office. On this count, the sanction granted to the prosecution of A1 by the Deputy District Development Officer is found to be invalid."

No Statutory Presumption Under Section 20 Without Conclusive Proof Of Demand

On the merits of the corruption charge, the bench observed that the prosecution evidence fell woefully short of establishing the foundational requirement of demand beyond reasonable doubt. Reaffirming the three-judge bench decision in N. Vijayakumar vs. State of Tamil Nadu, the court held that statutory presumption under Section 20 cannot be invoked merely upon the recovery of tainted currency notes unless the initial demand is independently established.

The court noted glaring discrepancies in the complainant's testimony, including inconsistent versions regarding whether the initial demand was ₹200 or ₹120, and the uncorroborated recovery of ₹20 from the peon after the income certificate had already been handed over. Relying on State of Lokayuktha Police, Davanagere vs. C.B. Nagaraj, the bench held that handing over money after the delivery of a service does not ipso facto prove that the payment was made pursuant to an illegal demand.

Setting aside the concurrent judgments of the trial court and the High Court, the Supreme Court acquitted both appellants and discharged their bail bonds. The judgment firmly establishes that prosecution sanctions must strictly conform to the statutory removing authority defined under governing state panchayat legislations and reinforces that proof of demand remains an indispensable condition precedent in corruption trials.

Date of Decision: August 19, 2026