The Lokpal and Lokayuktas Bill, 2011, which has been pending in the House for the last two years, was approved by voice vote after a five-hour debate.
Samajwadi Party, which was strongly opposed to such a measure, boycotted the House proceedings after staging a walkout as soon as the debate began this morning.
The proposed law, aimed at dealing with the menace of corruption, will bring under its purview the Prime Minister with certain safeguards and other public servants.
The Bill, which was already passed by the Lok Sabha in December 2011, will now be considered by the Lower House afresh on Wednesday as it has undergone a number of official amendments.
The Bill was brought back to the Upper House after being considered by the Parliamentary Select Committee which recommended several amendments to make it widely acceptable among political parties.
Among the amendments accepted by the government are delinking of the mandatory creation of Lokayuktas by the state governments, one of the provisions which had stalled the passage of the Bill in December 2011.
Replying to the debate, Law Minister Kapil Sibal said it was a "historic" day and hoped that all states would pass similar legislations to set up Lokayuktas modelled on this Bill.
"The Centre can't give directions to the states," he said, allaying apprehensions that the Union government was dictating.
Sibal, who had initiated discussion on the issue, said the law alone would not eliminate corruption but it could help deal with those who are corrupt.
On the issue of bringing the Prime Minister under the purview of the new law, he said the overall consensus was in this favour although there were some "discordant individual views" disfavouring it.
Government accepted all but three recommendations of the Select Committee.
The accepted recommendations included not transferring a CBI official investigating a case referred by the Lokpal.
The selection process of the Lokpal has also been changed. It now provides for appointment of the Lokpal by a committee comprising the Prime Minister, the Lok Sabha Speaker, Leader in Opposition in Lok Sabha and Chief Justice of India, besides an eminent jurist appointed by the President on their recommendation.
Among the recommendations not accepted by the government was an accused public servant should not be given any chance to present his or her view before initiation of investigation.
The government said the accused official should be given a chance to be heard before initiation of formal investigation but the "suspense" element would be maintained in case of search and seizure.
CPI(M) leader Sitaram Yechury had moved an amendment to bring public-private-partnership (PPP) projects but it was defeated overwhelmingly by 151 against 19 votes.
The passage of the Bill had become a mere formality as almost all parties, except SP, were in support.
The urgency of pushing the Bill is seen in the context of the drubbing Congress faced in the just-held Delhi assembly polls at the hands of Aam Aadmi Party whose main plank was the enactment of Lokpal.
Sibal sought to allay any apprehension over the new measure, saying there will be no element of government interference in investigation that would be carried out against corruption under the Lokpal.
"I don't think it is time to laugh or snigger... it is time for us to rise to the occasion," said Sibal, who piloted the Bill in place of Minister of State for Personnel V Narayanasamy who could not attend the proceedings because of his wife's illness.
He said the government intended to bring more legislations like Prevention of Corruption Bill to fight corruption and they could be passed if the House functions properly.
Leader of the Opposition Arun Jaitley, while supporting the Bill, said he was happy that the government had accepted all the changes in "this changed environment".
He did not elaborate but was apparently referring to the drubbing Congress faced in the just-held assembly elections.
Holding that there is a lot of scope for improvement in this Lokpal Bill, Jaitley objected to the provision of religious-based appointments in Lokpal, saying such kind of reservations were not permitted by the Constitution.
Sibal, however, said the provision was in tune with the Constitution.
Defending the inclusion of judges in the Lokpal panel, Sibal said it was done as "complex legal" issues are involved.
Lawmakers cannot be part of the Lokpal. Sibal said it was done to avoid a conflict of interest.
The government also decided to exempt only such bodies or authorities established, constituted or appointed by or under any Central or State or Provincial Act providing for administration of public religious or charitable trusts or endowments or societies for religious or charitable purposes registered under the Societies Registration Act.
The Select Committee had recommended exclusion of bodies and institutions receiving donations from the public from the purview of Lokpal.
The government decided not to accept it and seek an official amendment in the Bill as reported by the Select Committee.
The Committee recommended that in clause 20(2) of the Bill, the seeking of comments from the public servant during the preliminary inquiry should not be mandatory and has accordingly suggested the addition of the word "may" in the said clause.
The government opposed this arguing that affording of an opportunity to the public servant and to the government/ competent authority at this stage, would help clear doubts in several cases and would substantially reduce the number of cases going for regular investigation.
The Select Committee recommended that the power to grant sanction for prosecution of public servants could be shifted to the Lokpal in place of the Government. The Select Committee has also recommended that Lokpal may be required to seek comments of the competent authority and the public servant before taking such decision. Government decided to accept this recommendation.


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