INDIA Law and Practice Contributed by: Vijayendra Pratap Singh, Asif Ahmed, Bhanu Jindal and Khushi Mittal, AZB & Partners
CVC After investigation, the CVC has to submit a report to a commission that recommends further actions to be taken by the department/authorities. Depending on the course of action recommended, prosecution may be initiated before special courts constituted to prosecute matters (as in the case of PCA offences). ED If the ED has reasonable grounds, supported by doc - umented evidence, it can arrest, conduct searches and seizures, and attach property suspected to be proceeds of crime. Following the issuance of a pro - visional attachment order, the ED is required to file a complaint within 30 days with the AA. Once the com - plaint is filed, properties are attached for 180 days. During this period, the AA may uphold or reject the attachment order. Failure to do so would lead to the setting aside of the attachment. Upon completion of the investigation, the ED must file a complaint. 2.7 Deferred Prosecution India does not allow prosecution of offences without trial. Agreements for deferred prosecution or non- prosecution have no legal standing. However, certain offences can be compounded by an accused. These include offences of a less serious nature, such as regulatory filing violations, or a minor offence under the BNS. Offences punishable with imprisonment for a term of more than seven years, or those involving significant economic consequences, are not com - poundable. Compounding is also permitted for offences punish - able with fines under the Companies Act and SEBI regulations. These include false statements made in a board report or annual accounts, violations of securi - ties law and failure to redress investors’ grievances and insider trading. Compounding of such offences can be either before or after the initiation of prosecu - tion. The relatively recent Jan Vishwas (Amendment of Pro - visions) Act, 2023 (“JV Act”), decriminalised several offences across various statutes that were previously punishable with imprisonment or fines, or involved prosecution for minor offences/technical and proce - dural violations. The JV Act now replaces such pen -
alties with monetary fines for contraventions. The JV (Amendment of Provisions) Bill was introduced in 2025 but has not been passed yet. 3. White-Collar Offences 3.1 Criminal Company Law and Corporate Fraud The Companies Act and the BNS contain provisions related to corporate fraud and criminal company law. They target fraudulent activities, financial misconduct, and breach of trust within corporate structures. Companies Act, 2013 The Companies Act defines corporate fraud as any act, omission, concealment of fact, or abuse of posi - tion by any individual aimed at deceiving or gaining undue advantage at the expense of the company, its shareholders, creditors, or any other person, regard - less of whether actual wrongful gain or loss has taken place. Fraud under the Companies Act is punishable with imprisonment for a minimum term of six months, extendable to ten years, along with a fine of up to three times the amount involved in the fraud. Where the audit of a company is conducted by an audit firm, and a partner of the firm either acts fraudulently or abets the fraud, both the partner and the audit firm may be held jointly and severally liable for civil and criminal consequences. Where a company is under liquidation or in the pro - cess of winding-up, any officer of the company who obstructs the liquidation process by providing false information or concealing the company’s assets will face imprisonment for a term of between three and five years and a fine of between INR100,000 and INR300,000.
Key Offences Under BNS Criminal breach of trust
For criminal breach of trust, there must be entrust - ment of property to a person, and that person must have dishonestly misappropriated or converted the property for their own use. The offence is more severe when the accused holds a fiduciary position – eg, as a
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