INDIA Law and Practice Contributed by: Vijayendra Pratap Singh, Asif Ahmed, Bhanu Jindal and Khushi Mittal, AZB & Partners
the ambit of reporting entities (REs) under the PMLA. These include entities that deal with cryptocurrencies and/or VDAs through exchange, transfer, safe-keeping and any other participation in providing financial ser - vices related to such assets. VDASPs are required to be registered as an RE with the Financial Intelligence Unit (FIU) and must comply with reporting require - ments. VDASPs must report details of all transactions, including suspicious transactions with the FIU within the prescribed timelines. Failure to comply with these reporting requirements can attract a show-cause notice from the FIU direc - tor for non-compliance and penalties ranging from INR10,000 to INR100,000 for each violation. Various sectoral regulators, such as SEBI, have laid down guidelines on KYC and anti-money laundering compliance. These guidelines and the SEBI Act allow revocation of licences of reporting entities in case of non-compliance. 4. Pleas and Defences 4.1 White-Collar Defences A strong defence strategy for a criminal offence has two hallmarks: • the version of facts pleaded needs to be plausible; and • the version of facts must be backed by credible and admissible evidence. During trial, an accused person has a chance to estab - lish their defence against the charges brought by the prosecution, including by cross-examining witnesses and bringing witnesses of their own. The burden of proof must be discharged beyond all reasonable doubt. The onus of proof rests on the pros - ecution. Even in cases where there is a reverse burden of proof, such as under the PMLA, the prosecution still needs to prove the foundational facts. Defendants may also challenge the chain of custo - dy of evidence or procedural irregularities under the BNSS. The two statutes have ample safeguards and
provisions regarding the procedure for the seizure of case-related property and articles. In cases under the PCA, a company accused of vicarious liability can defend itself by proving it had adequate compliance procedures in place to prevent persons associated with it from undertaking such conduct. Similarly, in prosecutions involving vicarious liability, an individual may avoid punishment by dem - onstrating that they were not in charge of or respon - sible for the contravention, or that it occurred without their knowledge, or that they exercised due diligence to prevent such contravention. 4.2 De Minimis There are no general de minimis exceptions for white- collar offences. However, some statutes impose reporting thresholds or define liability based on mini - mum value criteria – for example, monetary thresholds under the PMLA or tax laws. Similarly, under the PCA, gifts below INR5,000 received by a public servant are not considered bribes. The BNS statutorily prescribes general exceptions, which are the defences provided to the accused that absolve criminal liability. Under Indian law, acts or omissions by children, a person of unsound mind, committed by a person justified by law, commit - ted under the influence of intoxication, by a person in good faith, or acts committed by a person under threat or duress are either exempt from prosecution or prosecuted to a lesser degree than what the offence would have otherwise attracted. However, the threshold for successfully invoking these exceptions is high. The accused must present credible evidence demonstrating that the mitigating circum - stances or influences genuinely existed, and the court will draw inferences based on the overall facts and circumstances of the case. 4.3 Plea Agreements, Co-Operation, Self- Disclosure and Leniency Plea bargaining is permitted in limited circumstances. It is not allowed in cases where the prescribed punish - ment is death, life imprisonment or imprisonment for a term exceeding seven years. Plea bargaining also does not apply where the offence affects the socio-
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