The Minister said the process has been initiated to amend this law to provide for a distinction that any punishment is meted out under the Prevention of Corruption Act for "a corrupt decision not merely for an erroneous decision".

"... This Prevention of Corruption Act of 1988 is a pre -liberalisation era law. It's fundamentally a defective law because it did not distinguish between an erroneous decision and a corrupt decision," Jaitley said in an interview. He was replying to a question on action initiated by  agencies like CBI against various bureaucrats and top officials of regulatory bodies like Sebi, including its former Chairman C B Bhave and some current officials.

 In most of these instances, the cases have been later dropped against the officials under scrutiny, including in the case of Bhave, who were under the lens for decisions taken during their tenures allegedly to benefit some entities. Asked whether the much-publicised initial action against these persons has affected the decision-making process, the Minister said the Act "put an erroneous decision at par with the corrupt decision and that is why decision making has become extremely difficult in government, post-1991".

"Now, many governments have felt that need for changing it, but they were moving slowly on this. This exercise started in the UPA government. We are now completing the exercise. We have brought the amendment and the Cabinet has cleared it," he added.
Jaitley hoped that the amendment bill would soon get through in Parliament. It would provide for a "distinction that you punish people under that Act on a corrupt decision, not merely for an erroneous decision."

Concerns have been raised that the working of Sebi (Securities and Exchange Board of India), other regulators and bureaucrats in key positions has got affected because of CBI launching various 'preliminary enquiries' into the decisions taken by them.

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