STATE OF MAHARASHTRA & ORS. versus BRIJLAL SADASUKH MODANI
[2015] 10 S.C.R. 1158, Supreme Court of India, 2015
Outcome: Appeal(s) allowed (Granted)
Segment: Facts
A 
B 
[2015] 1Q S.C.R. 1158 
STATE OF MAHARASHTRA & ORS. 
v. 
BRIJLAL SADASUKH MODANI 
(Criminal Appeal No. 1329 of 2009) 
DECEMBER 15, 2015 
[DIPAK MISRA AND ADARSH KUMAR GOEL, JJ.] 
Prevention of Corruption Act, 1988: s. 2(c) - Respondent 
C worked in Osmanabad Janata Sehkari Bank Ltd. - While he 
was in service, notice was issued by Anti Corruption Bureau 
requiring him to give details of the properties acquired by 
him - Respondent replied that the provisions of 1988 Act 
were not applicable to him - High Gou. t quashed the notices 
o accepting the plea of respondent that there was no control of 
the State Government or the Central Government or any other 
authority on the functioning of the bank and therefore he could 
not be termed as a public servant as defined under 1988 Act 
- Whether respondent be treated as a public servant under 
E the purview of 1988 Act - Held: Any grant or any aid at the 
time of establishment of the society or in any construction or 
in any structural concept or any aspect would be aid - High 
Court was swayed by the concept of Article 12 of the 
Constitution, the provisions contained in 1949 Act to hold 
F that multi-state society is not controlled or aided by the 
Government- In the facts of the case, it is left to be dealt with 
in the course of trial whether the society concerned was ever 
been granted any kind of aid or not - Impugned order set 
aside and issue whether the respondent is a public servant 
G or not to be gone into during
the trial - Constitution of India, 
1950-Art. 12 - Banking Regulations Act, 1949 - Multi-State 
Cooperative Societies Act, 2002. 
S.S. Rana v. Registrar, Coop. Societies & Anr. 
H 
(2006) 11 sec 634: 2006 (1) Suppl. SCR 311; 
1158
STATE OF MAHARASHTRA v. BRIJLAL SADASUKH 
MO DANI 
Ajay Hasia v. Khalid Mujib Sehravardi (1981) 1 
SCC 722: 1981 (2) SCR 79; Zoroastrain Coop. 
Housing Society Ltd. v. District Registrar, Coop. 
Societies (Urban) & Ors. (2005) 5 SCC 632: 2005 
(3) SCR 592; State of Maharashtra v. Laljit.Rajshi 
Shah AIR 2000 SC 937: 2000 (1) SCR 1239; 
Ramesh Balkrishna Kulkarni v. State of 
Maharashtra (1985) 3 SCC 606: 1985 (2) Suppl. 
SCR 345; Federal Bank Ltd. v. Sagar Thomas 
(2003) 10 sec 733: 2003 (4) Suppl. SCR 121; 
Govt. of A.P. v. P. Venku Reddy (2002) 7 SCC 
631: 2002 (2) Suppl. SCR 538; Almitra H. Patel 
v. Union of India (2000) 2 SCC 679: 2000 (1) 
SCR 841; State of M.P. v. Rameshwar(2009) 11 
SCC 424: 2009 (5) SCR 510; Samrao Vitthal 
Cooperative Bank Ltd. & Anr. v. Padubidri 
Pattabhiram Bhat & Ors. AIR 1993 Born. 91; State 
of U.P. v. Vishwanath Kapoor & Ors. 1980 CrLJ 
494; Hanmant Janardhan Patil v. State of 
Maharashtra 1993 Mh.LJ 511; Executive 
Committee, Vaish Degree College, Shamli & Ors. 
v. Lakshmi Narain & Ors. (1976) 2 SCC 58; S.S. 
Dhanoa v. Municipal Corporation, Delhi & Ors. 
(1981) 3 SCC 431: 1981 (3) SCR 864; Pradeep 
Kumar Biswas v. Indian Institute of Chemical 
Biology (2002) 5 sec 111: 2002 (3) SCR 100; 
Gayatri De v. Mousumi Cooperative Housing 
Society Ltd. and others (2004) 5 SCC 90: 2004 
(1) Suppl. SCR 356; State of Maharashtra v. Laljit 
Rajshi Shah (2000) 2 SCC 699: 2000 (1) SCR 
1239 - referred to. 
Case Law Reference 
2006 (1) Suppl. SCR 311
referred to. 
Para 3 
1159 
A 
B 
c 
D 
E 
F 
G 
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1160 
SUPREME COURT REPORTS 
[2015] 10 S.C.R. 
A 
1981 (2) SCR 79 
referred to. 
Para 3 
2005 (3) SCR 592 
referred to. 
Para 3 
2000 (1) SCR 1239 
referred to. 
Para 3 
B 
1985 (2) Suppl. SCR 345 referred to. 
eara 3 
' 
2003 (4) Suppl. SCR 121 referred to. 
Para 3 
2002 (2) Suppl. SCR 538 referred to. 
Para4 
c 
2000 (1) SCR 841 
referred to. 
Para 7 
2009 (5) SCR 510 
referred to. 
Para 7 
AIR 1993 Born. 91 
referred to. 
Para 8 
D 
1980 CrLJ 494 
referred to. 
Para 8 
1993 Mh.LJ 511 
referred to. 
Para 8 
(1976) 2 sec 58 
referred to. 
Para 8 
E 
1981 (3) SCR 864 
referred to. 
Para 8 
2002 (3) SCR 100 
referred to. 
Para 10 
2004 (1) Suppl. SCR 356 referred to. 
Para 11 
F 
2000 (1) SCR 1239 
referred to. 
Para 19 
CRIMINALAPPELLATE JURISDICTION: Criminal Appeal 
No. 1329 of 2009 
G 
From the Judgment and Order dated 05.02.2008 of the 
. High Court of Judicature of Bombay, Bench atAurangabad in 
Criminal Writ Petition No. 729 of 2006] 
Shankar Chillarge, Aniruddha P. Mayee for the Appellants. 
H
STATE OF MAHARASHTRA v. BRIJLAL SADASUKH 
1161 
MODANI 
Sudhanshu S. Chaudhari, A. .M. lrpatgire, Vatsalya Vigya, A 
Naresh Kumar for the Respondent. 
The Judgment of the Court was delivered by 
OIPAK MISRA, J. 1.The respondent served in different B 
capacities in Osmanabad Janata Sehkari Bank Ltd., 
Osmanabad (for short, "the Bank") since 1972. On attaining 
the age of 58 years, he stood superannuated iri June 2004. 
The Managing Committee of the Bank, however, extended 
service of the respondent for a further period of two years and c 
after completion of ~me year, he sought leave of the Bank to 
be allowed to retire as he was in ill-health and accordingly he 
retired in the month of June, 2005. As the factual matrix would 
unveil, he was appointed as an Accountant in the Bank in the 
year 1972 and was promoted to the post of Manager in 1981 o 
and eventually to the post of General Manager, which post he 
held till his retirement. Be it stated, while he was in service, he 
received a notice signed by the Deputy Superintendent of 
Police, Anti Corruption Bureau, Osmanabad requiring him to 
give details of the property acquired by him. In response to the E 
said letter, the respondent on 15.2.2001 replied that the 
provisions of Prevention of Corruption Act, 1988 (for short, "the 
1988Act") was not applicable to him. After his superannuation, 
he received two letters from the same investigating authority 
to attend an enquiry so that his statement could be recorded 
F 
in
respect of his properties and expenditure, to which he 
replied. Thereafter, he preferred Criminal Writ Petition No. 729 
of 2006 before the High Court of Judicature of Bombay, Bench 
atAurangabad, assailing the notices which were in the realm 
of investigation. 
G, 
2. The principal plank of submission in the writ petition 
was that he was not a public servant as defined under sub-
section (c) of Section 2 of 1988 Act and he cannot by any 
means of interpretation of Section 21 of the Indian Penal Code 
H
1162 
SUPREME COURT REPORTS 
[2015) 10 S.C.R. 
A 
(IPC) be treated as such. On behalf of the State and the 
investigating agency it was contended that the writ petitioner 
would come under the definition of public servant as per 
Section 2( c) (iii) and (ix) of the 1988 Act. It was also urged that 
the Bank is governed by Multi-State Cooperative Societies 
B Act, 2002 (for short, "the 2002 Act") inasmuch as it has been 
registered as a multi-state cooperative bank on 12.7.2000. 
Reliance was also placed on Section 56 of the Banking 
Regulations Act, 1949 (hereinafter referred to "the 1949Act") 
for the purpose of bolstering the stand in view of the amendment 
C to Section 56, the provisions of the 1949 Act would be 
applicable to the cooperative bank. It was also highlighted that 
as per the 1949 Act, the Reserve Bank of India has direct 
control and supervision over the cooperative banks and the 
0 
same is evincible from Section 35A and 26 of the 1949 Act. In 
addition to the aforesaid, emphasis was laid on Section 122 
and 123 of the 2002 Act to highlight the power of the Central 
Government to issue directions to the multi-state cooperative 
banks is in public interest. 
E 
F 
3. The High Court referred to certain provisions of the 
Maharashtra Cooperative Societies Act, 1960 (for short "the 
1960 Act"), 2002 Act, 1988 Act and 1949 Act, took note of the 
submissions of the learned counsel for the petitioner which 
was to the effect that there is no control of the State
Government 
or the Central Government or any other authority on the 
functioning of the Bank and, therefore, he could not be termed 
as a public servant, as is defined under the 1988 Act, and 
perused the bye-laws of the Bank on the bedrock of various. 
G provisions of different Acts which have been referred to 
herein before; and thereafter referring to the decisions rendered 
in S.S. Rana v. Registrar, Coop. Societies & Anr. 1, Ajay 
Hasia v. Khalid Mujib Sehravardf·, Zoroastrain Coop. 
H 
1 (2006) 11 sec 634 
2 (1981) 1 sec 122
STATE OF MAHARASHTRA v. BRIJLAL SADASUKH 
1163 
MODANI [DIPAK MISRA, J.] 
Housing Society Ltd. v. District Registrar, Coop. Societies A 
(Urban) & Ors. 3, State of Maharashtra v. Laljit Rajshi 
Shah 4 , Ramesh Balkrishna Kulkarni v. State of 
Maharashtra5, Federal Bank Ltd. v. Sagar Thomas6 came 
to hold that so far as the Bank is concerned, the Central 
Government has not purchased any share of the Bank. 
B 
4. Be it stated, the High Court distinguished the decision 
rendered in Govt. of A.P. v. P. Venku Reddy7, and proceeded 
further to state as follows:-
"We are, therefore, of the opinion that the petitioner who C 
discharged his duties as General Manager could not be 
termed as a 'public servant' as defined in the Prevention 
of Corruption Act, 1988. Under the provisions of the 
Banking Regulation Act 1949 the Central Government 0 
or any authority of the Government, the Reserve Bank of 
India exercise regulatory control over the Bank which is 
registered under the multi-State Cooperative Societies 
Act. The said control exercised by these authorities would 
not be termed as deep and pervasive one. The day to E 
day activities, the internal management are not at all 
governed and controlled by the Government or its 
authorities. The Bank is not aided one or funded in any 
manner by the Government or its authorities. The service 
conditions of its employees are not regulated by the State F 
or the Central Government or its authorities. Respondent 
No.3 is, therefore, not
competent to initiate action under 
the provisions of the Prevention of Corruption Act against 
. ' (2005) 5 sec 632 
4 AIR 2000 SC 937 
. • (1985) 3 sec 606 
• AIR 2003 SC 4325 = (2003) 10 sec 733 
1 (2002) 7 sec 631 
G 
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1164 
SUPREME COURT REPORTS 
[2015] 10 S.C.R. 
A 
the petitioner.The impugned notices issued to the. 
petitioner by the respondent No. 3 are without jurisdiction 
and null and void. The notices are required to be quashed 
and set aside." 
B 
5. On the basis of the aforesaid analysis, the High Court 
c 
quashed the two notices issued by the Deputy Superintendent 
of Police, Anti-Corruption Bureau, Osmanabad. Hence, this 
appeal, by special leave, by the State of Maharashtra and its 
functionaries. 
6. We have heard Mr. Shankar Chillarge, learned counsel 
for the appellants and Mr. Sudhanshu S. Chaudhari, learned 
counsel for the respondent. 
0 
7. It is submitted by Mr. Shankar Chillarge, learned counsel 
for the State that regard being had to the broad definitions of 
public servant under Section 2(c)(iii) of the 1988 Act, the 
respondent should have been treated as a public servant under 
the purview of the 1988Act and the High Court has fallen into 
E 
grave error by treating him not to be one by misconstruing the 
provision. It is urged by him that ifthe statutory scheme of the 
1949 Act and the 2002 Act is seen, it will be quite clear that he 
comes within the dictionary clause of the 1988 Act. Learned 
counsel for the appellants would further submit that purposive 
F interpretation should be placed on the provision but the 
excessively narrow construction placed by the High Court is 
absolutely erroneous and hence, the order impugned deserves 
to be dislodged. Learned
counsel for the State has relied on 
Almitra H. Patel v. Union of lndia8 and State of M.P. v. 
G Rameshwar9. 
8. M,r. Sudhanshu S. Chaudhari, learned counsel forthe 
respondent, per contra, has submitted that when reply was 
H • (2000) 2 sec 679 
• (2009) 11 sec 424
STATE OF MAHARASHTRA v. BRIJLAL SADASUKH 
1165 
MODANI [DIPAK MISRA, J.] 
given by the respondent in 2001 and the Deputy Superintendent A 
of Police, Anti-Corruption Bureau, kept quiet for five years till 
10.11.2006, it is to be presumed that he was satisfied with the 
explanation and there was no justification to issue further notice. 
It is his submission that to bring the respondent within the 
purview of Section 2( c) (iii) and (ix) of the 1988 Act, it is B 
obligatory on the part of the appellants to establish that the 
respondent is an employee of a body or a cooperative society 
owned and controlled or aided by the Goverr:ment as defined 
in Section 617 of the CompaniesAct, 1956. Learned counsel 
would contend that the admitted position is that the bank in 
C 
question has not received any financial aid either from the 
Central Government or the State Government and, therefore, 
the provisions would not apply to him. It is urged by Mr. 
Chaudhari that the provisions of Banking Regulation 0 
(Amendment) and Miscellaneous Provisions Act, 2004 would 
not be attracted to this case inasmuch as the administration 
of the multi-state cooperative sodety vests in the general body 
and by virtue of the powers enum~rated under the 1949 Act to 
be exercised by the Reserve Bank of India would not E 
tantamount to control over the cooperative bank and hence, 
he cannot be treated as a public servant. To bolster his 
submissions, he has placed reliance on Samrao Vittha/
Cooperative Bank Ltd. & Anr. v. Padubidri Pattabhiram 
Bhat & Ors. 10 , State of U.P. v. Vishwanath Kapoor & Ors. 11 , 
F 
Hanmant Janardhan Patil v. State of Maharashtra12 , 
Executive Committee, Vaish Degree College, Shamli & 
Ors. v. Lakshmi Narain & Ors. 13, Federal Bank (supra), S.S. 
Dhanoa v. Municipal Corporation, Delhi & Ors.14, and S.S. 
Rana (supra). 
G 
10 AIR 1993 Born. 91 
11 1980 CrLJ 494 
12 1993 Mh.LJ 511 
" (1976) 2 sec 58 
1• (1981) 3 sec 431 
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SUPREME COURT REPORTS 
[2015] 10 S.C.R. 
A 
9. Firstly, we shall refer to some of the authorities cited at 
the Bar. In Samrao Vittha/ Cooperative Bank Ltd. (supra), 
High Court of Bombay was dealing with the issue whether the 
appellant Bank was "State" within the meaning of Article 12 of 
the Constitution. The Full Bench, after referring to various 
B 
provisions of the Multi-State Cooperative Societies Act, 1984 
and the 1960Act, came to hold as follows:-
c 
D 
E 
F 
G 
H 
"24. A Multi-State Co-operative Bank cannot be 
compared, in the manner of its functioning, with the State 
Bank of India at all. As set out earlier, the Central 
Government does not have any all pervasive control over 
a Multi-State Co-operative Bank. Hence, merely because 
banking function is of public importance, this factor itself 
is not sufficient to make the appellant bank "State" or 
"other authority" under Article 12. 
25. In the case of Narayan ~- Maharashtra State Co-
operative Land Development Bank Ltd., reported in 1991 
( 1) BomCR 469 the Nagpur Bench of our High Court held 
that the Maharashtra State Co-operative Land 
Development Bank Limited was "State" or "other 
authority" under Art. 12. In doing so, the Nagpur Bench 
relied upon the judgment of the learned single Judge in 
the present case. The Nagpur Bench relied upon two 
factors only for the purpose of holding that the 
Maharashtra Slate Co-operative Land Development 
Bank was "State" within the meaning of Art. 12. It said
(at 
page 4 7 4) that the Maharashtra State Co-operative Land 
Development Bank Limited is a creature of the statute 
. and it is discharging public functions which the State could 
have discharged through its agency. Hence it held that 
the Bank was a State. In our opinion, the Division Bench, 
over emphasised the fact that the Bank was a creature 
of the statute. As the Supreme Court has repeatedly said,
• •STATE OF MAHARASHTRA v. BRIJLAL SADASUKH 
1167 
MODANI [DIPAK MISRA, J.] 
the manner in which an organisation is created is not of A 
any direct relevance. What is required to be seen is 
whether there is pervasive State control over its 
management and functioning. Moreover, merely because 
an organisation performs functions of public importance, 
one cannot hold that the organisation is "State" under B 
Article 12. The only otherfactorwhich the Nagpur Bench 
looked at was the fact that the Bank was regulated by 
laws enacted by the State. Such regulatory laws as we 
have said earlier, are enacted to cover a large number 
of organisatipns. The laws which regulate the functioning C 
of such organisations are presumably enacted in public 
interest. This does not mean that any of these 
organisations, if they perform public functions, 
automatically become "State" under Article 12. In our view 0 
the above decision does not apply tests to determine 
when an organisation can be considered as "State" under 
Art. 12 correctly". 
1 O.ln S.S. Rana (supra), while dealing with the 
maintainability of a writ petition by an employee working in a E 
Cooperative Bank urider the Himachal Pradesh Cooperative 
Societies Act, 1968, this Court referred to the earlier decisions, 
namely, Ajay Hasia (supra) and Pradeep Kumar Biswas v. 
Indian Institute of Chemical Biology15, opined that the 
F 
society did not satisfy the tests laid down in t~e case of Pradeep 
Kumar Biswas (supra) and
hence, the High Court was not in 
error in arriving at the conclusion that the society was not a 
State under Article 12 of the Constitution. 
11.ln this regard, it is profitable to refer to Gayatri Dev. G 
Mousumi Cooperative Housing Society Ltd. and others16 
wherein the Court held as follows:-
1• (2002) s sec 111 
16 (2004 > s sec go 
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1168 
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B 
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SUPREME COURT REPORTS 
[2015] 10 S.C.R. 
"54. In the case of S.R. Tewariv. Distt. Board, Agra 17 this 
Court held that the powers of statutory authorities are 
always subject to the statute which has constituted it and 
must be exercised consistently with the statute, and the 
courts have, in appropriate cases, the power to declare 
an action of the body illegal or ultra vires, even if the 
action relates to determination of employment of a 
servant. 
55. We have, in paragraphs supra, considered the 
judgments for and agair.st on the question of 
maintainability of writ petition. The judgments cited by 
the learned Senior Counsel appearing for the 
respondents are distinguishable on facts and on law. 
Those cases are not cases covered by the appointment 
of a Special Officer to manage the administration of the 
Society and its affairs. In the instant case, the Special 
Officer was appointed by the High Court to discharge 
the functions of the Society, therefore, he should be 
regarded as a public authority and hence, the writ petition 
is maintainable." 
The said decision has been distinguished in S.S. Rana 
case (supra). 
F 
12. In P. Venku Reddy(supra),the assail was to an order 
of the Division Bench of the High Court of Andhra Pradesh 
where it had quashed the criminal proceeding instituted under 
the 1988 Act in respect of a supervisor working in District 
Cooperative Central Bank Limited. In that context, the Court 
G observed:-
"12. In construing
the definition of "public servant" in clause 
( c) of Section 2 of the 1988 Act, the court is required to 
H 
17 AIR 1964 SC 1680
STATE OF MAHARASHTRA v. BRIJLAL SADASUKH 
1169 
MODANI [DIPAK MISRA, J.] 
adopt a purposive approach as would give effect to the A 
~ intention of the legislature. In that view the Statement of 
Objects and Reasons contained in the Bill leading to 
the passing of the Act can be taken assistance of. It gives 
the background in which the legislation was enacted. The 
present Act, with a much wider definition of "public B 
servant", was brought in force to purify public 
administration. When the legislature has used such a 
comprehensive definition of "public servant" to achieve 
the purpose of punishing and curbing growing corruption 
in government and semi-government departments, it C 
would be appropriate not to limit the contents of the 
definition clau.se by construction which would be against 
the spirit of the statute. The definition of "public servant", 
therefore, deserves a wide construction. (See State of 0 
M.P v. Shri Ram Singh 18.) 
13. As a matter of fact, we find that the point arising before 
us on the definition of "public servant" that it does include 
an employee of a banking cooperative society which is 
"controlled or aided by the Government" is clearly covered 
E 
against the respondent-accused by the judgment in the 
case of Sta'fe of Maharashtra v. Prabhakarrao19." 
13. In Rameshwar (supra), the issue that arose before 
this Court was whether the respondent therein was a public F 
servant for the purposes of the 1988Act, regard being had to 
the fact
that he was a Director of Indore Premier Cooperative 
Bank Ltd. On behalf of the State, reliance was placed on 
Section 87 of the M.P. Cooperative Societies Act, 1960 which 
provides that Registrar and other officers as well as employees G 
of a cooperative bank or a cooperative society would be 
deemed to be public servants under the 1988 Act and on that 
1• (2000) s sec. 88 
1• (2002) 7 sec 636 
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SUPREME COURT REPORTS 
[2015] 10 S.C.R. 
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basis the Court came to hold that the Chairman and the 
Executive Officer of the Bank would come within the definitiQfl 
of "public servant" under Section 2(c)(ix) of the 1988 Act. On a 
perusal of the judgment it appears that the Court has been 
persuaded by the conferment of status on the officers of the 
B bank as public servants and the definition of the "public servant" 
underthe 1988Act. 
14. As far as State of Madhya Pradesh is concerned, 
there is no difficulty as the M.P. Cooperative Societies Act, 
c 1960 itself declares the authorities as public servant. The issue 
that arises for consideration in the present case is whether a 
multi-State society which handles crores of rupees and the 
persons who handle such huge amounts of money should be 
allowed to escape the rigour of corruption charges under the 
D 
1988 Act on the ground that they do not come under the ambit 
and sweep of Article 12 of the Coristitution or solely because 
of construction placed under Section 2( c)(ix) of the 1988 Act. 
That apart, another significant issue also arises for 
consideration. Section ~(ix) to make an employee of a 
E cooperative society provides certain conditions or conditions 
precedent to be satisfied and, therefore, the question would 
be, whether the High Court by only stating that it is the admitted 
position should have quashed the proceeding. There are 
various stages and hence, the thrust of the matter is in a 
F
corruption case whether exercise of jurisdiction under Section 
482 of the Code of Criminal Procedure, 1973 is warrantable. 
In this regard, the relevant paragraphs from the Statement of 
Objects and Reasons are requisite to be reproduced. It is as 
follows:-
G 
"2. The Prevention of Corruption Act, 1947, was 
amended in 1964 based on the recommendations of the 
Santhanam Committee. There are provisions in Chapter 
IX of the Indian Penal Code to deal with public servants 
H 
and those who abet them by way of criminal misconduct.
STATE OF MAHARASHTRA v. BRIJLALSADASUKH 
1171 
MODANI [DIPAK MISRA, J.] 
There are also provisions in the Criminal Law A 
Amendment Ordinance, 1944, to enable attachment of 
ill-gotten wealth obtained through corrupt means, 
including from transferees of such wealth. The Act seeks 
to incorporate all these ~revisions with modifications so 
as to make the provisions more effective in combating B 
corruption among public servants. 
3. The bill, inter alia, envisages widening the scope of 
the definition of the expression 'public servant', 
incorporation of offences under Sections 161 to 165-A C 
of the Indian Penal Code, enhancement of penalties 
provided for these offences and incorporation of a 
provision that the order of the trial court upholding the 
grant of sanction for prosecution would be final if it has 
not already been challenged and the trial has D 
commenced. In order to expedite the proceedings, 
provisions for day-to-day trial of cases and prohibitory 
provisions with regard to grant of stay and exercise of 
powers of revision on interlocutory orders have also been 
included." 
E 
15. Section 2(c)(ix) on which immense thrust has been 
given by the learned counsel for the State on the basis oPc:ertain 
authorities of this Court, reads as follows:-
F 
"(ix) any personwho is the president, secretary or other 
office-bearer of a registered cooperative society 
engaged in agriculture, industry, trade or banking, 
receiving or having received any financial aid from
the 
Central Government or a State Government or from any G 
corporation established by or under a Central, Provincial 
or State Act, or any authority or body owned or controlled 
or aided by the Government or a Government company 
as defined in Section 617 of the Companies Act, 1956 
(1 of 1956);" 
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SUPREME COURT REPORTS 
[2015) 10 S.C.R. 
A 
16. On a perusal of the decisions of this Court, it is manifest 
that stress has always been laid on Section 2(c)(ix) of the 1988 
Act as a consequence of which the fall out is that the registered 
cooperative society must have received financial aid from the 
Central Government or the State Government or any other 
B 
institution mentioned therein. 
c 
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H 
17. The High Court has referred to various provisions of 
the 1949 Act and proceeded on the status of cooperative 
society and eventually has held that:-
" So far as. the Bank is concerned, the Central 
Government has not purchased any share of the Bank. It 
is argued by the learned A.P.P. that the power conferred 
on the Reserve Bank of India and the Central Registrar 
under the provisions of the Banking Regulation Act are 
sufficient proof to arrive at conclusion that the functioning 
of the Bank is regulated and controlled by the Reserve 
Bank of India. We do not accept the proposition 
advanced by the learned APP. It is settled position that 
general regulations under an Act, like the Companies 
Act or Cooperative Societies Act, would not render the 
activities of a company or a society as subject to control 
at the State. Whatever control exercised by the 
Government or its authorities under the provisions of the 
Act are meantto ensure proper functioning of the society. 
The Government or in this case the Reserve Bank of India 
or any other statutory
authorities have no role to play in 
day-to-day functioning of the societies/banks much less 
control over the recruitment of the staff, it~ service 
conditions etc. Considering the provisions of the different 
enactments more particularly the provisions of the 
Banking Regulation Act 1949, we are of the view that the 
Reserve Bank of lndi.a or the Government or its 
authorities do not exercise any direct, deep and pervasive 
control over the functioning of the Bank.
STATE OF MAHARASHTRA v. BRIJLALSADASUKH 
1173 
. MODANI [DIPAK MISRA, J.] 
18. And again:-
A 
" ... Therefore it would not be reasonable and proper now 
to relegate the petitioner to alternative forum by asking 
him to appear before respondent no.3 and agitate the 
same issues." 
B 
19. In Prabhakarrao (supra) the Court was dealing with 
the issue whether the High Court was justified in holding that 
the accused was not a public servant. In the said case, the 
High Court had placed heavy reliance on the authority of State c 
of Maharashtra v. Laljit Rajshi Shah20. In P. Venku Reddy 
(supra), the Court has distinguished the said decision and 
referred to Section 2 of the 1988 Act and in that context 
observed thus:-
D 
"3. Under clause (iii) of Sectiqn 2(c), any person in the 
service or pay of a corporation established by or under 
a Central, Provincial or State Act or an authority or a body 
owned or controlled or aided by the Government and 
under clause {ix) the President, Secretary and other E 
office-bearers of a registered cooperative society 
engaged in agriculture, industry, have been included in 
the definition of "public servant". 
4. The question for consideration is whether the accused 
F 
in the present case comes within the purview of the 
aforementioned clauses or any other clause of Section 
2(c) of the Prevention of Corruption Act, 1988. For 
determination of the question, enquiry into facts, relating 
to the management, control and funding of the society,
is G 
necessary to be ascertained." 
20. As we notice, the High Court has really been swayed 
by the concept of Article 12 of the Constitution, the provisions 
,, (2000) 2 sec 699 
H
1174 
SUPREME COURT REPORTS· 
[2015] 10S.C.R. 
A 
contained in the 1949 Act and in a mercurial manner taking 
note of the fact that the multi-state society is not controlled or 
aided by the Government has arrived at the conclusion. In our 
considered opinion, even any grant or any aid at the time of 
establishment of the society or in any construction or in any 
B structural concept or any aspect would be an aid. We are 
inclined to think so as the term 'aid' has not been defined. A 
sprinkle of aid to the society will also bring an employee within 
the definition of 'public servant'. The concept in entirety has to 
be understood in the backdrop of corruption. In Shri Ram 
C Singh (supra), this Court had to say this:-
D 
E 
F 
"Corruption in a civilised society is a disease like cancer, 
which if not detected in time, is sure to maliganise (sic) 
the polity of the country leading to disastrous 
consequences. It is termed as a plague which is not only 
contagious but if not controlled spreads like a fire in a 
jungle. Its virus is compared with HIV leading to AIDS, 
being incurable. It has also been termed as royal thievery. 
The socio-political system exposed to such a dreaded 
communicable disease is likely to crumble under its own 
weight. Corruption is opposed to democracy and social 
order, being not only anti-people, but aimed and targeted 
against them. It affects the economy and destroys the 
cultural heritage. Unless nipped in the bud at the earliest, 
it is likely
to cause turbulence -
shaking of the socio-
economic-political system in an otherwise healthy, 
wealthy, effective and vibrating society." 
.. 
21. We share the said perception, and reiterate with 
G agony. The ingemination has to be realized with sanctity. 
Therefore, we are of the convinced opinion that it was entirely 
unnecessary on the part of the High Court to enter into elaborate 
deliberation to arrive at the conclusion that the respondent was 
H not a public servant. Regard being had to the facts of the case,

STATE OF MAHARASHTRA v. BRIJLAL SADASUKH 
1175 
MODANI [DIPAK MISRA, J.] 
we think it would be apposite that it is left to be dealt with in the A 
course of trial whether the society concerned has ever been 
granted any kind of aid or not. 
22. In view of the aforesaid premises, we allow the appeal, 
set aside the judgment and order passed by the High Court B 
and directthatthe issue i.e. whether the respondent is a public 
servant or not, shall be gone into during the trial. 
Devika Gujral 
Appeal allowed.