Economic Offenses Harming Public Exchequer Can’t Be Quashed Despite Settlement: SC
Last Updated on December 30, 2024 by Amit Patra
In a landmark ruling in corruption cases, the Supreme Court has laid down that economic offenses resulting in losses to the public exchequer cannot be quashed on the ground of settlement between parties, even after restitution is made.
The case was filed by the directors of Sun Infrastructure Pvt. Ltd. and the SBI employees, seeking a quashing of the corruption case after the settlement with the bank at the Debt Recovery Tribunal. The alleged fraud had caused losses to the tune of around Rs. 6.13 Crores to the bank through fund diversion, fraudulent collateral valuation, and irregular loan repayment practices.
Justices Vikram Nath and Prasanna B. Varale emphasized that economic offenses hold a distinct status due to their broader societal impact. The Court, citing the Parbatbhai Aahir case (2017), highlighted that such offenses threaten the nation’s financial health and public confidence in institutions.
The reason by the Court was based on two aspects, firstly, the financial crimes under the Prevention of Corruption Act transcend the persons directly involved in it to society at large; secondly, the settlement cannot go against the public interest in the prosecution of corruption.
This underlines the commitment of the judiciary toward dealing with economic offenses due to their severity, acting on the realization that losses transcend isolated monetary sums and affect the entire social-economic fabric. By declining the settlement-based quashing in such cases, the court has sent a clear message as to its view about the seriousness with which crimes impacting public funds are entertained.
This decision is an important precedent for lower courts and enforcement agencies and brings into the spotlight the fact that private settlement cannot be an escape route in corruption and misappropriation of public funds cases. It sets apart the private disputes that can be settled from criminal acts in which the larger public interest is hurt.
