Anand K - Where was your passport issued?
Anand,
As far as I understand it, if your passport was issued from the AP RPO then, Rule 1 applies. If your passport was issued in another country (e.g. mine was issued in SFO on renewal) then the Rule 2 applies.
One is not applying PCC for another country, the PCC is for the stay in India.
When a new passport is issued or renewed, the issuing office (RPO in India or Consulate if outside India), holds your file and records received from the local police authorities in India (yeah right!!).
It it therefore possible for the issuing office to verify your (dated) records and issue the PCC.
This is what I have understood.. but then I am no expert so please do enquire at the RPO.
HTH.
DJ