What is Ombudsman?

An ombudsman is an official who is appointed by the Government to investigate

individual’s complaints against a company, financial institutions, businesses,
organization, specially a government department or public entities and attempts to
resolve the raised concerns either by process of mediation or giving recommendations.

To discuss the ombudsman in India, we need to describe Lokpal and Lokyukta.

§  The Lokpal and Lokayukta Act, 2013 was enacted to establish Lokpal for the Union
and Lokayukta for States to perform the functions of Ombudsman in India.[1]

What is the need for such institutions?

§  In our country corruption is the main reason of maladministration. The public

organizations are slow and do not have efficiency just because of the corruption.
The anti-corruption agencies are mostly not independent. The CBI has been termed
as a “caged parrot”, which speaks in its master’s voice only.
§  Many of these agencies exist only for giving recommendations, which are not
followed most of the times.
§  There is no superior authority to check the functionality of these institutions.
Moreover the employees are also not accountable for their faults.

Here Lokpal was a very necessary way forward to stop all these hazards and perils.

Historical Backdrop of Institution of Ombudsman:

§  In 1809, the institution of ombudsman was established conventionally for the first

time in Sweden and after Second World War, it emerged in its true sense.
§  In India, law minister Ashok Kumar Sen first proposed the notion of constitutional
ombudsman was in early 1960s and the terms Lokpal and Lokayukta
were brainstormed by Dr. L. M. Singhvi.
§  In 1968, Lokpal bill was passed in Lok Sabha but terminated with the dissolution of
Lok Sabha and it was voided eight times afterwards till 2011.
§  In 2002, Chairman of review commission M.N. Venkatachaliah asked for the
assignation of the Lokpal and Lokayuktas; and he proposed that Prime Minister
of India should not be included with the purview of its authority.
§  The movement by Anna Hazare: “India Against Corruption movement”; created
pressure zone on the United Progressive Alliance (UPA) government at the Centre
and finally in 2013, both the houses of Parliament passed the Lokpal and
Lokayuktas Bill.
§  The bill became the act when it got the assent on 1 January 2014 from Hon’ble
President Pranab Mukherjee and came into effect from 16 January of the same
year.[2]

Structure of Lokpal Body:

§  The Lokpal body consists of one chairperson and a maximum of 8 members where
half will be judicial members and other half will be from SC/ ST/ OBC/ Minorities
class and women. The President appoints the members with the recommendations
of a selection committee and search panel of minimum 8 persons.
§  The former Chief Justice of India or the former Judge of Supreme Court or a
renowned person with having specific knowledge and expertise of minimum 25
years in the field relating to anti-corruption policy, public administration, diligence
and surveillance, law and management etc; will be eligible to become Chairman of
Lokpal. The term of Chairman’s office is 5 years or till the age of 70 years
whichever is earlier.
§  The selection committee is composed of the Prime Minister who is the Chairperson;
Speaker of Lok Sabha, Leader of Opposition in Lok Sabha,  Chief Justice of India or
a Judge nominated by him/her and One eminent jurist..

Authority and Jurisdiction of Lokpal :

§  Lokpal have the power to check upon Prime Minister, Ministers, members of

Parliament, Groups A, B, C and D officers and officials of Central Government
due to any kind of allegation except the ones on corruption relating to security,
sovereignty, integrity of India, the public order, international friendly relations,
atomic energy and space.
§  Although the Lokpal Ministers and MPs in any matter discussed in Parliament or a
vote given there.
§  Its jurisdiction also falls on someone who is or has been director/ manager/
secretary of any organization or society established by central act or any other
body partially or wholly financed or/ and controlled by central government.
§  It also acts as supervisor and superintendent over CBI & it can also give orders and
directs to CBI for betterment of its function.
§  The powers of a civil court have been imposed on the Inquiry Wing of the Lokpal.
So it can confiscate assets, receipts and benefits arisen or got hold of by corrupt
measures, in certain special circumstances.
§  Lokpal has the power to endorse for termination of office, transfer and debarment
of public servant connected with allegation of corruption.

Limitations of Jurisdiction of Lokpal :

 As all other organizations in world Lokpal body also have its own loopholes and
drawbacks.
§  The Lokpal act extolled to appoint a Lokayukta within a year after it came in force.
But till date only 16 states have successfully built up the Lokayukta. There are no
restrictions and guidelines regarding the appointment of Lokayukta and these
have been left completely on the separate rules and regulations of respective
States.
§  Though Lokpal was formed to keep the public institutions isolated from political
and other kinds of filthy corruption but Lokpal cannot be perceived outside of
political influence as the members of the appointing committee itself forms with
the members from political parties.
§  The clauses of the membership of Lokpal can be tampered with easily. It can be
manipulated because there is no specific criterion to decide who is an ‘eminent
jurist’ or ‘a person of integrity’ and there is a chance that deserving candidate for
this position is not chosen due to nepotism or other reason.
§  The biggest lacuna of this system is that supreme judiciary is excluded from the
purview of the Lokpal.
§  There is no proper system of proceedings to appeal against the Lokpal if anyone is
not satisfied with its decision, as of now.
§  There is a restriction in the time limit of complaining. Even if there is any valid
reason of not complaining, the complaint against the alleged incident of corruption
cannot be cataloged after a period of seven years from the date of the
offence committed which is mentioned in the complaint letter.[3]

Suggestions to Overcome the Limitations :

As per my view, each and every flaw in the system can be meted out with full proof
planning and in this case my suggestion for better administration of ombudsman will
be:

§  Lokpal and Lokayukta should be independent monetarily, administratively and

legally, of those over whom they have the jurisdiction to investigate and prosecute.
§  The process of appointment of Lokpal and Lokayukta must not be vague but
transparent with proper set of guidelines of whoever can be appointed strictly in
various posts in accordance with their merit and experience.
§  Several dispersed and decentralized or regional institutions should be there with
efficient answerability mechanism to avoid the intensification of too much power
on anyone, any one institution or organization.

Except the Lokpal and Lokyukta Act the other kind of ombudsman authority in India
is conducted through Banking Ombudsman Scheme :
This scheme is a prompt and overpriced forum for customers of bank for settlement of
complaints relating to certain services rendered by banks, which was introduced under
the Banking Regulation Act of 1949 by RBI with effect from 1995, through Banking
Ombudsman Scheme 2006.

·         The Banking Ombudsman is an official, who is appointed by the Reserve Bank of
India to recompense customer complaints related to the lacunae of the services
provided by bank.

·         Scheduled Commercial Banks, Primary Co-operative Banks and Regional Rural
Banks are subjected to this scheme.

·         If any aggrieved person does not get reply from the bank itself within one month
after the receipt of the complaint or if it gets overturned by the bank, complaint can
be filed directly before the Banking Ombudsman.

·         Complaints can be filed on online platform and it is not required to file a direct
physical complaint.

Complaints can be filed on the following matters:

·         Inconsistency in the prescribed working hours;

·         If bank is refusing to open new deposit accounts without providing valid legal
reason to refuse;

·         If bank is refusing to close any customer’s account without any valid reason.

·         If any excess service charge is incumbent on customers without sending them
prior notice.

·          If recovery agents by banks are acting beyond the guidelines provided by RBI.[4]

The Reserve Bank of India issued an ombudsman scheme for non-banking finance
companies (NBFCs) too. 
Who will be appointed as the ombudsman inNBFCs :
An RBI officer who is not below the rank of general manager will be appointed as
the ombudsman with certain territorial jurisdiction.
·      Tenure of office- the maximum tenure of the office of ombudsman is three years
but it can be lowered down by the regulator, who appoints the ombudsman as per
the situation requires
·      The complaint procedure in NBFC is same as that of the procedure followed
in bank.
·      Compensation:
The ombudsman may award compensation not more than one hundred
thousand rupees to the complainant, to neutralize the loss of time, cost
incurred, mental agony suffered by the complainant.[5]

Conclusion:

Lastly it is very important to know that the Ombudsman authority has been imposed
with huge power and responsibilities in every sense but the Lokpal body and the
Banking ombudsman scheme, as the case may be, need to be more accountable and
transparent for efficient performance and supervision and the controlling as well as the
appointment set up should be more strict to fulfill the purpose for which these were
formed.