INDIA Law and Practice Contributed by: Priyank Ladoia, Asif Ahmed, Puneet Dhanoa and Utkarsh Routh, AZB & Partners
3.3 Corporate Liability The Amendment Act introduced corporate liability to the PCA, under which, “commercial organisation” has been comprehensively defined to include not only Indian companies but also foreign companies that carry on a part of their business in India. These “commercial organisations” are susceptible to standing trial and suffering imposition of a fine if found guilty during trial of the offence of giving or promising to give any “undue advantage” to a public servant, in order to obtain or retain business or to obtain or retain any advantage in the conduct of their business. Further, the commercial organisation can also be held liable for the offence of bribing a public servant, in order to induce the public servant to improperly perform a public duty or to reward the public serv - ant’s improper performance, just as an individual so accused would be held liable. While the BNS does not envisage vicarious liability, the PCA provides for a certain type of vicarious liabil - ity – ie, any person in charge of a company is liable for acts of the company, upon proof that such acts were committed with their consent or connivance. Therefore, individuals and companies can both be held liable for the same offence. The PCA already limits officer liability to cases of con - sent or connivance (Section 10) – ie, no automatic vicarious liability for directors. The Supreme Court reaffirmed this in Sanjay Dutt & Others v the State of Haryana , 2025 INSC 34, and held that directors are not automatically vicariously liable under the PCA solely due to their position, authorisation of acts or super - visory role. The Court clarified that criminal liability of officers arises only if the company itself is found liable and there is personal involvement of the director in the offence. The director’s actions must directly connect to the company’s liability, arising from conduct outside their routine corporate duties, with specific averments linking the director’s conduct to the offence commit - ted by or on behalf of the company In Religare Finvest Limited v the State of NCT of Delhi and Another , reported at 2023 INSC 819, the Supreme Court held that a successor entity can be held liable
mitted to participate in legislative consultative pro - cesses, such participation cannot, however, cross the line drawn by Section 7 of the PCA, which makes it illegal for a “public servant to take gratification other than legal remuneration in respect of an official Act”. In 2015, a private member’s bill – the Disclosure of Lobbying Activities Bill, 2015 – was introduced in the Upper House of the Parliament of India, though it sub - sequently lapsed and never became law. There is no specific statute of limitations under the PCA that prevents any investigating agency from initiating an investigation or launching a prosecu - tion before the court, or that deprives any court from taking cognisance of an offence within a stipulated timeframe. However, the general criminal procedural law in India, under the Bharatiya Nagarik Suraksha Sanhita, 2023 (BNSS), prescribes periods of limita - tion for launching prosecution only in respect of cer - tain categories of offences, based on the quantum of punishment prescribed. For all offences under the PCA concerning more than three years, the limitation period prescribed under the BNSS is not applicable, meaning that prosecution may be launched at any point in time. 3. Scope of Application 3.1 Limitation Period Further, the PCA provides that – as far as practicable – trials shall be held on a day-to-day basis and con - cluded within two years. If the trial is not concluded within two years, it is incumbent upon the court hold - ing trial to record reasons for not being able to com - plete trial, and to extend the period for six months at a time. However, the total time taken to conclude the trial shall not ordinarily exceed four years. 3.2 Geographical Reach of Applicable Legislation The geographical reach of the PCA is the entirety of India, including all its states and Union territories; therefore, it does not have extraterritorial reach.
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