White collar crimes decaying the development of India

An analytical study

Submitted in partial fulfillment of the requirements for

the award of the degree of

Bachelor of Arts

And

Bachelor of Law (Integrated)

To
Guru Gobind Singh Indraprastha University, Delhi

Guide: Submitted by:

Guide Name: Ms. Garima Juneja Student Name: Devang Sharma

Designation: Assistant Professor Enroll. No. 35319103818

Centre For Legal Studies

GITARATTAN INTERNATIONAL BUSINESS SCHOOL

DELHI-110085

Batch (2018-2023)
 DECLARATION

I, Mr. Devang Sharma, Enrollment No. 35319103818 certify that the Dissertation

(LLB-502) entitled “White collar crimes decaying the development of India-

An analytical study.” Is completed by me and it is an authentic work carried

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I am enclosing the Plagiarism report of my Dissertation paper to prove it’s

novelty.

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India-An Analytical Study” submitted by Mr. Devang Sharma, Enrollment number-35319103818, has
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As per the norms of the Centre of Legal Studies, Gitarattan International Business School the above work is
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Ms. Garima Juneja

Assistant Professor
CLS, GIBS
Date: 17-05-2023
 Centre for Legal Studies Gitarattan
International Business School,Delhi-85

CERTIFICATE

Certified that the Dissertation (LLB-502) entitled, “White collar crimes decaying

the development of India.” Done by Mr. Devang Sharma, Enrollment

No.35319103818, is completed under my guidance.

Signature of the Guide

Name of the Guide: Ms. Garima

Juneja

Designation: Assistant

Professor

Gitarattan International

Business School,

Delhi – 110085
 ACKNOWLEDGEMENT

The dissertation on “White collar crimes decaying the development of

India-An analytical study.” has been given to me as a part of the

curriculum in 5 years BA.LLB. I have tried my best to present this

information as clearly as possible using basic terms that I hope will be

comprehended by the widest spectrum of researchers, analysts, and

students for further studies. I have completed this research study under

the guidance and supervision of Assistant Professor Ms.Garima Juneja. I

will be failed in my duty if, I do not acknowledge the estimated

scholarly guidance, assistance, and knowledge. I have received them

towards faithful and timely completion of this work. Mere

acknowledgement may not redeem the debt I own to my parents for

their direct/indirect support during the entire course of this research.

This study bears testimony to the active encouragement and guidance

of my friends and well- wishers. This accomplishment would not have

been possible without them.

Devang
Sharma
35319103
818
th
BA LLB 10 Semester
 TABLE OF CONTENTS

Chapter-1 Introduction
1.1 Introduction .............................................................................................................. 2
1.1.1 White Collar Crimes .......................................................................................... 2-3
1.1.2 Types ..................................................................................................................... 4
1.1.3 Causes ................................................................................................................... 5
1.1.4 Relation of White Collar Crimes with the Socio Economic Offences ............... 6-7
1.2 Hypothesis................................................................................................................ 8
1.3 Objectives ................................................................................................................. 8
1.4 Research Methodology ............................................................................................. 8
1.5 Chapterisation........................................................................................................... 9
Chapter-2 Historical Background
2.1 Introduction ............................................................................................................ 10
2.1.1 Differential Association Hypothesis.................................................................... 11
2.1.2 Criticism of Sutherland’s Views on White Collar Crimes .................................. 12
2.2 Current Scenario of White Collar Crimes in Certain Professions .......................... 13
2.2.1 Medical Profession .............................................................................................. 13
2.2.2 Engineering ......................................................................................................... 14
2.2.3 Legal Profession ............................................................................................. 14-15
2.2.4 Educational Institutions ....................................................................................... 16
2.2.5 Higher Education and Academics ....................................................................... 17
2.2.6 White Collar Crimes in Business Deals .............................................................. 17
2.2.7 Deficiency of Service for Making Money ........................................................... 18
2.3 Conclusion.............................................................................................................. 20
Chapter-3 Some Major Scandals Explaining the Magnitude of White Collar or
Economic Crimes
3.1 Introduction .............................................................................................. 21
3.2 Bofors Scandal .................................................................................... 21-22
3.3 Fodder Scam...................................................................................................... 23-26

3.4 Stock Market Scam ................................................................................................ 27

3.4.1 Stock Market Manipulation Scam 1999-2001 ..................................................... 27
3.4.2 The Harshad Mehta 1992 Scam .......................................................................... 28
3.5 Counterfeit Stamp Scam......................................................................................... 30
3.6 Satyam Computer Scam ......................................................................................... 31
3.7 Commonwealth Games Scandal........................................................................ 34-39
3.8 2G Spectrum Allocation Scandal ........................................................................... 39
3.9 Covid-19 Cyber scam ........................................................................................ 43-47
Chapter-4 Law Commission’s Recommendations and the Legislative
Response
4.1 Introduction ............................................................................................................ 48
4.2 Santhanam Committee Report ............................................................................... 49
4.3 Law Commission on the White Collar Crimes ...................................................... 50
4.4 47th Law Commission Report................................................................................ 51
4.4.1 Motive of the criminal is avarice or rapaciousness (not lust or hate).................. 51
4.4.2 Mode of operation of the offender is fraud, not force ......................................... 52
4.5 Legislative Response .............................................................................................. 54
4.6 Sanction for Prosecution of Public Servant............................................................ 55
4.7 Judgments .......................................................................................................... 58-72
Chapter-5 Establishment of Central Vigilance Commission
5.1 Introduction ......................................................................................................... 73-5
5.2 Central Bureau of Investigation (CBI) and Central Vigilance Commission (CVC)
...................................................................................................................................... 76
5.2.1 Enforcement Directorate ..................................................................................... 78
5.2.2 Nodal Agency...................................................................................................... 79
5.2.3 Prosecution Agency............................................................................................. 80
5.3 Attempts of the Government to Nullify the Judgement of Vineet Narain Case..... 81
5.4 Controversy about the Single Directive Clause ..................................................... 82
5.5 Analysis of the CVC Act of 2003........................................................................... 83
5.6 Power Relating to Inquiries: ................................................................................... 85
5.7 Brief History........................................................................................................... 85
5.8 Legal Status ............................................................................................................ 87
5.8.1 Lokpal and Lokayukta......................................................................................... 89
5.9 Ombudsman and Lokpal ................................................................................... 90-94
5.10 Summing UP ................................................................................................... 95-96
Chapter-6 Conclusion and Suggestions ...................................................97-101
Bibliography ...................................................................................................... 101-104
 LIST OF ABBREVIATION

& and
CVC Central Vigilance Commissioner
CBI Central Bureau of Investigation
COVID-19 Corona virus disease 2019
AIR All India Reporter
SCC Supreme Court Cases
SPE Special Police Establishment
DSPE Delhi Special Police Establishment
PSU Public Sector Undertaking
UK United Kingdom
ACC Appointment Committee Of Cabinet
TRAI Telecom Regulatory Authority of India

DMK Dravida Munnetra Kazhagam

NGO Non Governmental Organisation
TV Television
MP Member Of Parliament
PMO Prime Minister Office
PIL Public Interest Litigation
PA Per Annum
PWD Public Welfare Department
MCD Municipal Coporstion Of Delhi
DDA Delhi Development Authority
NDMC New Delhi Municipal Committee
RTI Right To Information
IPL Indian Premier League
ICC International Cricket Council
BCCI Board Of Control For Cricket In India
ICL Indian Cricket League
SCS Satyam Computer Services
IT Information Technology
NYSE New York Stock Exchange
NSE National Stock Exchange
BSE Bombay Stock Exchange
SEBI Securities And Exchange Board Of India
CFO Chief Financial Officer
IAS Indian Administration Service
FDR Fixed Deposit Receipt
Rs Rupees
 TABLE OF CASES

S. NO NAME OF THE CASE CITATION

1. Shambhu Ram Yadav v. Hanuman (2001) 6 SCC 1. 165

Das Khatry

2. Harish Chandra Tiwari v. Baiju 2002 SCC (Cri,) 294 (SC): AIR
2002 SC 548

3. Punjab National Bank v. Tej [1997] CCJ 1165

Rajinder Singh

4. State of Orissa through Kumar (2004) 8 SCC 40

Raghvendra Singh & Others v.
Ganesh Chandra Jew

5. Sankaran Moitra v. Sadhna Das and (2006)4 SCC 584

Another

6. Matajog Dobey v. H.C. Bahari AIR 1956 SC 54

7. Afzalur Rahman v. King Emperor AIR 1943 FC 18

8. Pukhraj v. State of Rajasthan (1973)2 SCC 701

9. Balbir Singh v. D.N. Kadian (1986)1 SCC 410

10. State of Maharashtra v. Atma AIR 1966 SC 1766

Rama

11. S. Dutt v. State of U.P AIR 1966 SC 523

Jaswant Singh v. State of Punjab
12. AIR 1958 SC 124

13. B. Saha v. M.C. Kochar (1979)4 SCC 177

14. Suresh Kumar Bhikamchand Jain v. (1998)1 SCC 205
Pandey Ajay Bhushan

15. Ram Kumar v. State of Haryana (1987)1 SCC 476

16. State of Orissa v. Mrutunjaya (1987) 2 SCC 414

Panda

17. R.S. Naik v. A.R. Antuley (1984)2 SCC 183

18. Vineet Narain v. Union of India (1998) 1 SCC 226

19. R. Balkrishna Pillai v. State of (1996)1 SCC 478

Kerala and Another

20. Kalicharan Mahapatra v. State of (1998)6 SCC 411

Orissa

21. Romesh Lal Jain v. Naginder (2006)1 SCC 294

Singh Rana and Others

22. State of Karnataka v. Ameer Jain AIR 2008 SC 108

23. Vineet Narain v. Union of India (1998) 1 SCC 226

24. N. Kannadasan v. Ajoy Khose and (2009) 7 SCC 1

Others

25. State of MP & Others V Ram (2000) 5 SCC 88

Singh

26. State of Andhra Pradesh V. V. 2003 (9) Scale 569

Vasudeva Rao

27. Lucknow Development Authority (AIR 1994 SC 787)

Vs M.K. Gupta
 INTRODUCTION

1.1 Introduction
An unprecedented number of economic crimes are being seen in our generation. It is really
difficult to escape them. Many people before us have endured such circumstances. The most
crucial question is whether there has ever been a dread of these economic crimes that is so
strong that it prevents us from dealing with them? If so, why have we not experienced this
fear's alarm? Understanding the definition of white collar crimes as given by EDWIN
HARDIN SUTHERLAND—who refers to these economic crimes as socio-economic crimes
because this class of crimes affects the entire society—is crucial in order to arrive at a reasoned
response to these concerns.
1.1.1 White Collar Crimes
White collar crime is a more recent idea. It has a connection to the renowned criminologist,
Sutherland, E. H. In his address to the American Sociological Society in 1939, he introduced
the idea of "white collar" crime, which was eventually published as "white collar criminality"
in the American Sociological Review in 1940. He then penned "White Collar Crimes" in 1949.
Through his comprehension of criminology, he was able to impress numerous criminologists
and sociologists of the day. Given that no theory is ever fully developed, and Sutherland's
white collar crime was no exception, his criticism was unavoidable. Because his research was
based on 70 significant firms, the corporate lobby in the USA threatened him as a result of his
theory. Some of the text had to be left out of his work. Sutherland contends that while
economists are familiar with business practises, they are not accustomed to viewing them
through the lens of crime, whereas many sociologists are familiar with crime but are not
accustomed to viewing it as expressed in business.1 It contrasts crime in the lower class, which
is made up of people with low socioeconomic position, with crime in the upper class, or "white
collar," which is made up of respectable, or at least respected, business and professional men.
To advance his beliefs on criminal behaviour, Sutherland used this connection. Sutherland
asserts that white collar crooks are more slick and cunning.

1
Sutherland, E. H., White collar criminality, (American Sociological Review, Vol 5, 1940) at 1-12
Sutherland asserts that white collar crime can be found in any industry. Commercial bribery,
bribery of public officials directly or indirectly to secure favourable contracts and legislation,
misrepresentation in advertising and salesmanship, embezzlement and misapplication of funds,
short weights and measures and misreading of commodities, tax frauds, misapplication of
funds, and misrepresentation in financial statements of corporations are the most common
ways that white collar criminality in business is expressed.
Sutherland claims that despite being perhaps less criminalistic than some other professions, the
medical industry engages in illegal drug and alcohol sales, abortion, providing illegal services
to mobsters, falsifying accident reports and witness testimony, extreme cases of unnecessary
treatment, hiring phoney specialists, limiting competition, and fee splitting.2 In many places,
fee splitting is against the law, and in every state, it's against the requirements for being
allowed to practise medicine. Instead of sending his patients to the surgeon who will perform
the finest work, the doctor who partakes in fee splitting has a tendency to direct them to the
surgeon who will pay him the highest sum. These numerous white collar crimes in business
and the professions primarily involve breaking an implicit or delegated trust, and many of them
fall into one of two categories: misrepresenting the value of assets or using deceit to
manipulate power.
Sutherland claims that some have used white collar criminality in politics, which is generally
acknowledged to be pretty common, as a rough yardstick by which to assess white collar
criminality in business. Sutherland makes it clear that these claims do not imply that all
businessmen and professionals are criminals, just as the conventional theories do not imply that
all males from the lower classes are criminals.3.
Sutherland argues that the difference between traditional crimes and white collar crimes is that
the financial toll of white collar crimes is likely many times more than that of all traditional
crimes that are collectively referred to as the "crime problem." Even though the financial loss
from white collar crime is significant, he continues, it is less essential than the harm to social
interactions.

2
Supra
3
V. N. Paranjape, Criminology and Penology (14th Edn., Central Law Publication, 2010) at 114-115.
Sutherland characterises people with high social rank and respectability as white collar
criminals in his hypothesis of this type of crime. His argument is that since white collar crime
always breaks the law, it counts as true crime. White collar crime varies from lower class crime
primarily in the way the criminal code is applied, which administratively separates white collar
offenders from other offenders. Sutherland's definition of white collar crimes is argued to be
ambiguous in a number of ways. White collar crimes are no longer limited to commercial
practises, occupational crimes, or professional crimes. In the context of India, it also covers a
significant range of minor offences including hoarding, profiteering, black marketing,
adulterating food, etc. Sutherland's key contribution is to draw a distinct line between
economic crimes and traditional perceptions of crimes like murder, robbery, theft, rape,
kidnapping, etc. His contribution is to make the study of white collar crimes a special subject
for criminologists and sociologists, allowing for the development of an appropriate and
efficient system for punishing those who commit crimes in this category.
1.1.2 Types
There are different types of white collar crimes. Some of them are as follows:
i. Fraudulent activity against a bank or the illicit acquisition of assets held by financial
institutions is referred to as bank fraud.
ii. Blackmail is the practice of demanding money from a victim by endangering their
physical safety or revealing their secrets.
iii. Bribery: Bribery is the act of buying someone's cooperation by providing them with
gifts, gifts of value, or money. Whether someone offers or accepts a bribe, it is illegal.
iv. Computer fraud: This type of fraud involves stealing or hacking into the data of
another individual.
v. Embezzlement is the act of someone who has been given money or property to use for
their personal benefit.
vi. Extortion: The illegal taking of property by means of actual or threatened force.
vii. Insider trading is when a person buys or sells shares of a publicly traded company
using secret information.
viii. Giving false information on tax forms or unlawfully transferring property to avoid paying
taxes are both examples of tax fraud.

003
 ix. Ponzi scheme: A Ponzi scheme is a dishonest financial con that entices investors with
big returns at low risk.
x. Laundering of Money The act of hiding the source of money gained unlawfully is
known as laundering.4

1.1.3 Causes
Since white collar crime has been recognised as a significant topic of study, other causes of its
occurrence in society have also been discovered. Studying the root causes of white collar
crimes is crucial because only then will we be able to recommend solutions to stop the growing
problem of these crimes, which include corruption, bribery, professional misconduct, legal
misconduct, corporate negligence, etc. "In the current context of public opinion, which views
corporate practises as important for successful performance even if they are illegal, white
collar crime has to be treated on the same footing as'mass disobedience' of laws. Law and order
are "mass neutralised," which leads to a social norm that accepts white-collar crime as a
"normal response.".5
The 29th Law Commission Report states that "the inability of all sections of society to fully
appreciate the need for high standards of ethical behaviour) results in the emergence and
growth of white collar and economic crimes, renders enforcement of law more difficult."
The following causes are listed in the aforementioned report as contributing to the rise in white
collar crime:
The growth of'mass society' is being aided by scientific and technical advancements. With a
sizable rank and file and a small, ruling elite, this type of organisation fosters the development
of monopolies, the emergence of the managerial class, and complex institutional structures.
The creation and growth of white-collar and economic crimes are caused by the inability of all
segments of society to fully understand the necessity. 6
One of the main factors contributing to the rise in white collar crime is the global economic
and industrial progress. White collar offenders are shielded from sentencing by virtue of their
socioeconomic background. The most potent tactics are used by white collar offenders to avoid
the legal rigours. It contributes to the spread of white collar crime.

4
Subodh Asthana, “White Collar Crimes in India”, available at https://blog.ipleaders.in/white-collar-crimes/,
last updated, July 31, 2019, Accessed on 25-5-2021
5 004
Ibid
6
Ibid
White collar criminals use their high social status to hide their tact, intelligence, and stability. 7
The social disorganisation brought on by individualistic policies and a competitive market, as
Sutherland correctly stated, "are the real causes for this type of criminality." Without a
question, white collar crimes reflect not just how society views different sorts of criminality,
but also how that culture is guaranteed and accepted.8

1.1.4 Relation of White Collar Crimes with the Socio Economic Offences
Socioeconomic offences are socio-economic crimes, not the other way around for white collar
crimes. As the discussion has demonstrated, white collar crimes have a noticeable or subtle
impact on a country's economy. The majority of the time, these crimes thrive under the cover
of common commercial practises and trade-circle customs. White collar crimes have various
characteristics that set them apart from more common types of crime:
These crimes are carried out by high-ranking members of society, such as lawyers, doctors,
chartered accountants, and government officials, rather than by the types of criminals that are
typically associated with crime, such as rapists, murders, thieves, and dacoits.
The methods used to commit crimes are different from those used to commit classic crimes like
fraud, deception, food adulteration, malpractices, irregularities, etc. These crimes are carried
out by intentional, carefully thought-out plots that lack all human emotion. People typically
condone socioeconomic crimes because they themselves have indulged in them and frequently
identify with those who commit them.9
White collar crimes were formerly thought to be done by middle and upper class
businesspeople as a routine part of their jobs. However, it now covers a wide range of offences
with a work-related focus that can be committed by members of any class.
In contrast to crimes against individuals, socio-economic offences typically target an entire
community, society, or even the entire country. Unlike traditional crimes, which are associated
with shame and immorality, these crimes do not involve or carry any stigma.
These crimes fall under a different category because, in order to control them, "the general
welfare and economic system of the entire society must be protected and preserved against
exploitation and waste."

7
Timothy Holmes, “Professional Criminals and White-Collar Crime in Popular Culture” available at
https://oxfordre.com/criminology accessed on 10-5-2021
8
Supra note 1 , GIBS LAW JOURNAL 005
9
Goswami P.: Criminology (1964 Ed.), p 249.
White collar crimes also include corruption in the government bureaucracy and high public
officials having access to large sums of money for the purpose of carrying out government-
proposed initiatives. There are provisions in the Indian penal code to prevent such despicable
behaviour on the part of public employees. For instance:
Public employee doing business illegally "Whoever, while employed by the government and
legally prohibited from doing so, engages in trade shall be punished with simple imprisonment for
a term that may not exceed one year, or with fine, or with both.".10
Bribery is punishable by either imprisonment of either kind for a term that may not exceed one
year, a fine, or both; provided, however, that bribery by treating is only punishable by a fine.11
The term "treating" refers to bribery if the inducement is provided in the form of food, drink,
entertainment, or other provision.
In 1988, Mr. Rajeev Gandhi, India's prime minister at the time, made the observation that
corruption was so pervasive in India that even if the government releases one rupee for the
common man, by the time it gets to him, it is only worth 15 paise. Our prime leader, Dr.
Manmohan Singh, recently highlighted that the average person currently only receives five
rupees. The sufferings of the average person are endless, especially in recent years as prices for
necessities have been steadily rising. For a very long period, food inflation has been double
digit. In preventing price increases and containing food inflation, the government has
categorically failed. Even though our prime minister has repeatedly stated that "we have
enough stock of the essential commodities," our greatest accomplishment—our public
distribution system—which served as an example and an inspiration for western nations like
the U.S.A.—has turned into our greatest failure. Food is rotting away in government storage
facilities, while stockpiling of food supplies is also at an all-time high. The most regrettable
element is that the Supreme Court of India had to issue an order directing the democratically
elected government of this nation to provide food for its underprivileged citizens. Even worse
is the fact that our prime minister advised the Supreme Court not become involved in policy
concerns, rather than implementing the ruling of the Supreme Court.

10
THE INDIAN PENAL CODE, 1860 ACT NO. 45 OF 1860, S 168
11
Ibid, S 171 (e)

006
 In India nowadays, socio-economic crimes are affecting everyone. We can therefore
confidently state that this is an exception to the threat of socio-economic crimes in this
country, and there is little chance that we will be able to quickly escape it.

1.2 Hypothesis

In this thesis, the researcher will place the following hypothesis to test:-
White collar crimes are a topic that rarely draws attention or indignation since they rarely involve
violence. The current laws don't take a firm stance on the matter. Only passing laws will not
advance the cause; instead, laws and statutes must be carried out much more effectively. Public
awareness via any form of communication is also essential. Therefore, stricter legislation and
severe penalties are required.

1.3 Objectives
In this Dissertation the researcher aims to achieve the following objectives: -
i. To comprehend the idea and consequences of white collar crimes.
ii. to investigate the severity and repercussions of white collar crimes by analysis of
prior fraud and scandals.
iii. To see how lawmakers respond to white-collar offences.
iv. To talk about the efficiency and implementation of the institutions put in place to
combat corruption and other white collar crimes.

1.4 Research Methodology

The Doctrinal Research Method is the main methodology used in the study. The researcher
has used both primary and secondary data, including books, articles, reports from various
authorities, books, websites, and the internet.

007
 CHAPTER-2 HISTORICAL BACKGROUND

2.1 Introduction
White-collar crime is typically linked with E. H. Sutherland, whose in-depth research in this
area brought criminologists' attention to its demoralising impact on the overall criminal
picture. Sutherland emphasised that in addition to typical crimes like robbery, assault,
murder, rape, kidnapping, and other violent acts, there are other anti-social activities that
members of the higher strata engage in as part of their jobs or businesses. These actions were
long recognised as standard business practises required of a cunning expert to succeed in his
line of work or business. As a result, complaints about such techniques were frequently
ignored and unpunished. Sutherland was preceded, however, by other authors who
highlighted the threats to society posed by the elite socioeconomic class, which preyed on the
accepted economic system at the expense of the general populace. Albert Morris called
attention to the need for a shift in focus when it came to crimes in 1934. According to him,
high-status individuals who engage in antisocial behaviour while carrying out their jobs
should be considered criminals and subject to punishment.12
Finally, E. H. Sutherland stressed in his groundbreaking work that these "upper world"
crimes, which are committed by members of higher socioeconomic groups while performing
their jobs and breaking trust, should be referred to as "white-collar crime" in order to
distinguish it from more common crime, which he referred to as "blue collar crime."
Sutherland added that white collar crimes are distinct from the acts carried out by criminal
gangs. This distinction might be made based on how much respectability is assumed to be
present. Therefore, selling subpar goods is a white collar crime if the person is from a
respectable social class and has some level of good reputation. Sutherland thoroughly
investigated the theft committed by about 70 large corporations involved in white collar
crimes and discovered that the accusations against them included contracts, combinations, or
conspiracies in restraint of trade, misrepresentation in advertising, infringement of copyrights,
financial frauds and violation of trust, breach of war-regulations, and other miscellaneous
offences. But because "the legal battles involved therein are dragged out for years in the
courts," people had little knowledge of the deception of these powerful criminals and, even if
they had, they had little interest in taking action.

008
Consequently, the charges are forgotten before they are resolved1. Sutherland used his
differential association hypothesis to attempt to explain the idea of white-collar crimes. It's
critical that we comprehend the differential association theory before we can fully
comprehend the idea of white collar crimes.

2.1.1 Differential Association Hypothesis

A learning theory called differential association focuses on the steps people take to become
criminals. Sutherland claims that criminal behaviour is learnt through conversation and
engagement with other people. Intimate personal groups are where the majority of criminal
behaviour is learned. When criminal activity is taught, it comprises two things: (a) the precise
direction of motives, urges, rationalisations, and attitudes; and (b) the procedures for
completing the crimes, which can be either highly intricate or very simple. The definitions of
the legal codes as favourable or unfavourable teach us the precise direction of motives and
urges. A person becomes delinquent when there are more definitions that support breaking the
law than ones that do not. The frequency, length, priority, and strength of differential
association can change. All of the mechanisms involved in learning other things are also
involved in learning criminal behaviour by connection with criminal and anticriminal
patterns. Criminal behaviour is a manifestation of universal needs and values, but since non-
criminal behaviour also reflects these universal needs and values, it cannot be explained by
them. Differential association is the term for it. Both white collar crime and crime committed
by members of lower social classes can be explained genetically. White collar criminals
typically begin their careers in good neighbourhoods and good homes, graduate from colleges
with some idealism and little personal choice, enter specific business situations where
criminality is practically a folkway, and become inducted into that system of behaviour just
like they would be into any other folkway. The lower class criminals typically begin their
careers in deteriorating neighbourhoods and families, discover delinquents nearby, and learn
the attitudes and methods of crime from them through association with delinquents and in
partial segregation from law-abiding citizens. Both categories of criminals must follow the
same basic steps in the process. This is not solely an assimilation process because creativity
happens frequently—possibly more so in white collar crime than in lower class crime.
Typically, professional criminals are the creative geniuses for the lower classes of criminals.

1
Ibid

12
Supra note 3 009
While lawyers are typically the creative geniuses behind many types of white collar crime.2
The community's social disorganisation is a second broad process. Crimes result from
differential association since the community is weakly organised to stop that behaviour. Other
forces are pushing in the opposite direction from the law, which is pushing in one direction.
In conclusion, he believed that an individual's association is determined in a general context
of social organisation (for example, family income as a factor of determining residence of
family and in many cases, delinquency rate is largely related to the rental value of houses)
and that differential group organisation is consistent with the differential association as an
explanation of various crime rates. Sutherland contends that some white collar crimes are thus
viewed as "normal" practise and are a crucial aspect of the business subculture. Once a person
enters the business, he learns the same and also defends it, and the business practises used are
not seen as transgressions.15

2
Short, James F. “Differential Association as a Hypothesis: Problems of Empirical Testing.” Social Problems,

vol. 8, no. 1, 1960, pp. 14–25. JSTOR, www.jstor.org/stable/798626. Accessed 22-5-2021. 010
15
2.1.2 Criticism of Sutherland’s Views on White Collar Crimes
Sutherland’s definition of white collar crime has evoked criticism from certain quarters.
Coleman and Moynihan pointed out that lack of definite criteria for determining who are
‘persons of respectability and status’ has made Sutherland’s definition of white collar crime
most controversial. It seems likely that what Sutherland meant by this is absence from
convictions for crimes other than white collar crimes. The element of ‘high social status’ as used
in the definition also leads to confusion: clearly it has far narrower meaning than is given to that
term in everyday usage. Sutherland himself did not stick to this meaning and included thefts and
frauds committed by middle or even lower middle-class workers in course of their employment
or work. such detractors have argued that such crimes ought to have been referred to as
"occupational crimes" rather than "white collar crimes." It is further stated that the sort of crime
and the circumstances surrounding its committed, rather than the victim's socioeconomic
standing, are the crucial "elements in the definition of white collar crime. These typically
include theft, falsified records, bribery, embezzlement, etc. According to Sutherland's definition,
tax evasion is not a true white collar crime since, despite being connected to employment, it is
not carried out in the course of a profession. Some detractors further claim that such violations
should be handled by special commissions, tribunals, and boards rather by regular criminal
justice administration. Therefore, strictly speaking, they cannot lead to the offender's conviction,
and as a result, he cannot be referred to as a "criminal" in the true sense of the word.
Commenting on this aspect of the matter, Tappan notes that treating someone who commits a
white collar crime as a criminal would mean departing from the legal definition of crime in that
the administrator's personal values would take precedence over the specificity and clarity of the
law when making such decisions. Sutherland, however, argues that the unique trial process used
by administrative agencies for white collar crimes would shield the perpetrator from the stigma
associated with criminal prosecution.3
Sutherland's definition of white collar crime is frequently criticised for including crimes against
the law that are not committed in the course of a job or profession and for not requiring the
perpetrators to be members of the affluent or 'prestigious groups'. For instance, people from
lower social classes can also engage in tax evasion; it is not just a crime committed by people
with high social rank. Another criticism of the term "white collar crime" is that it does not
always have mens rea, which is a necessary component of a crime.

011

3
Walter Reckless: The Crime Problem, p. 345.
In India, the common law mens rea doctrine does not apply to statutory crimes, and the necessity
of a guilty mind may be waived in such circumstances either explicitly or implicitly.4

2.2 Current scenario of White Collar crimes in certain Professions

Technical vocations that require technical expertise might lead to white collar crime in some
cases. These include the legal, medical, engineering, and private educational sectors, among
others.

2.2.1 Medical Profession:

The issuance of false medical certificates, assistance with illegal abortion, secret service to
dacoits by providing expert testimony resulting in their acquittal, and selling sample drugs and
medications to patients or chemists are all white collar crimes that members of the medical
profession frequently commit. Particularly with those medical professionals who do not have a
solid practise or make a meagre income, using dilatory techniques to treat patients with the
intention of extracting large quantities of money has become the standard.5

Yet another area in which the white caller crooks operate is false and deceptive advertising.
Through advertisements in newspapers, magazines, radio, and television, they make false and
illegal claims about medical treatments, adding to people's suffering. Many patented
medications are not only hazardous but also worthless. Similar commercials that are harmful to
public health are also frequently seen for contaminated food and cosmetics. Despite the fact that
they may not infringe the letter of the law, these individuals violate its spirit by committing
crimes that are not only anti-social but also harmful to the public's health.6

2.2.2 Engineering
In the engineering profession, underhand dealings with contractors and suppliers, passing of sub-
standard works and materials and maintenance of bogus records of work-charged labour are some
of the common examples of white collar crime. Scandals of this kind are reported in newspapers
and magazines almost every day. Construction of buildings, roads, canals, dams and bridges with
sub-standard material not only-endangers public safety but also results into huge loss to public
exchequer20. ”it is submitted that many projects of common-wealth games could not be completed

4
Coleman & Moynihan: Understanding Criminal Data (1996) pp. 8-10.
5 012
Supra note 4, GIBS LAW JOURNAL
6
Supra note 3, at pp. 122-125.
20
in time because of scandals of this kinds.”

2.2.3 Legal Profession

In modern India, the legal profession is not given much respect. There are two plain
explanations for this. The decline of this profession, which was formerly regarded as one of the
finest careers, is mostly due to the worsening standards of legal education and unethical
practises used by members of the legal profession to gain clientele. Legal professionals
frequently engage in deletory tactics in cooperation with the ministerial staff of the courts,
fabricate false evidence, use professional witnesses, violate ethical rules of the legal profession,
resort to frequent strikes to press their demands, and other common practises.

Professional thieves and criminal organisations frequently have their own trustworthy solicitors
on staff who can be relied upon to make preparations and be ready with a bail bond or a habeas
corpus writ to protect the gangster from being arrested. If the gang members are imprisoned, the
lawyer will need to come up with plans to 'fix' or set up their release. In order to defend the
gangster, some criminal defence lawyers collaborate closely with the police to put together
expert alibis and falsified witnesses. We need to study several judicial decisions on legal
misconduct.

In Harish Chandra Tiwari v. Baiju21, The court upheld the following facts. Since enrolling with
the Bar Council of the State of Uttar Pradesh in May 1982, appellant Harish Chandra Tiwari has
practised law mostly in the Lakhimpur Kheri District of Uttar Pradesh. In a land acquisition
matter where the respondent was a claimant for compensation, respondent Baiju hired the errant
lawyer. The respondent has been characterised by the Disciplinary Committee as "an old,
helpless, poor illiterate person." The State deposited compensation in the amount of Rs. 8118 in
the court for the purchase of the aforementioned Baiju's land. The appellant requested the
money's release, and on September 9, 1987, he withdrew it in accordance with the court's
directions. However, he failed to return it to the customer to whom it was payable or to let the
client know that the money had been received. Long after, when the client learned of it and after
the advocate had not returned the money, a complaint was made by him to the state's bar council
in an effort to have the appellant subjected to appropriate disciplinary punishment. The court
ruled that misappropriating a client's money must be considered one of the most serious sorts of
misconduct among the various offences that are anticipated for a legal practitioner. In this
function, the attorney must either collect money from the client to cover litigation costs, accept
money from the court that is payable to the client, or take money from the client to deposit in
court. When the client's money arrives in his hands in any of these situations, it is a trust. h0e1d
He is certain to be dismissed from service. But if an advocate misappropriates money of the
client, there is no justification in de-escalating the gravity of the misdemeanour. Perhaps the
dimension of the gravity of such breach of trust would be mitigated when the misappropriation
remained only for a temporary period. There may be justification to award a lesser punishment
in a case where the delinquent advocate returned the money before commencing the disciplinary
proceedings.
Shambhu Ram Yadav v. Hanuman Das Khatry22 it was a case where the court upheld the bar
council of India's order from the 31st July 1999, which stated that because the appellant had
been an advocate for 50 years, it was not reasonable to expect him to engage in the corrupting of
the judicial system or bribing judges. He admittedly demanded Rs. 10,000 from his client and
said orally that an order was later passed in his client's favour. He is completely unfit to practise
law as a result of writing the aforementioned letter. We are unable to impose a lighter penalty
than permanently banning him from the profession. His name should be removed from the Bar
Council of Rajasthan's list of solicitors. The appellant will no longer be permitted to appear
before any tribunal, court, or other body. The court orders the appellant to pay a fee of Rs. 5,000
to the Bar Council of India, which must be done within two months.

Even though the legal profession has a clear code of conduct, it is merely a ceremonial
document. However, this does not imply that all lawyers are dishonest and unscrupulous. Many
of them are quite serious and honest in their work, earning them the respect of all societal
groups.23 Lawyers and advocates may be forced to utilise these strategies due to the distinctive
nature of their line of work in order to remain in a field that is growing more and more
competitive with time.

2.2.4 Educational Institutions

Private educational institutes run in this nation are yet another area where white collar criminals
act without consequence. The governing bodies of these institutions are able to get significant
sums through government grants or financial aid by providing inaccurate and false information
about their organisations. The teachers and other staff members in these institutions are paid a
pitiful salary that is significantly less than what they actually agree to, giving the wealthy a
chance to steal a large sum of money in this unlawful manner. Because they worry about losing
their jobs, the instructors can scarcely afford to protest to higher ups about this exploitation. As a
result, they are forced to make a concession to the circumstances. Although the government has
introduced the scheme of treasur0y1-4
Aside from that, they can also make money illegally through the phoney enrollment of students
who live far from where these schools are located. They demand significant contributions or
capitation fees from these poor students. In some institutions, there are even rackets that recruit
students to show up for various exams based on forged citizenship or eligibility documents in
exchange for hefty sums of money. The calibre of education in India has been severely harmed
by these dishonest and unethical practises, and the younger generation is suffering an
irreversible loss as a result.

21
2002 SCC (Cri,) 294 (SC): AIR 2002 SC
548.
22
(2001) 6 SCC 1. 165.

These privately run educational institutions, including those that offer professional training, are
frequently supported by powerful politicians, and many of them are even owned by them. Many
of these institutions are essentially nonexistent and run as businesses, allowing students to
receive degrees in flagrant violation of all laws and government regulations by paying exorbitant
fees. The severity of this white collar criminality has negatively impacted educational standards
in most states, hence the issue must be addressed by strict statutory measures.7

2.2.5 Higher Education and Academics

Higher education and academia have also recently seen an unprecedented rise in white collar
crimes in India. Some students now find it quite simple to obtain bogus degrees for themselves
in exchange for substantial payments. By using these dishonest methods, university students
who don't attend any classes have occasionally been able to earn high grades and even first-class
degrees. Even among academics, some professors and lecturers choose not to routinely teach in
universities despite being paid well for the job. Even after being paid well for their work, some
professors and lecturers fail to review exam papers on time. The faculty administration at Delhi
University's law school spent a significant amount of money renovating their office, but they
didn't even bother to provide drinking water facilities for the students.

015

7
Ibid
Appointment matters are increasingly being decided arbitrarily, which is spawning a new
category of white collar crimes.8

2.2.6 White Collar Crimes in Business Deals

Sutherland first used the term "white collar crimes" to describe a type of criminality that is still
common in the corporate world. There have always been cases of trust violations. Sutherland
conducted a thorough investigation into a number of large businesses and corporations in the United
States and discovered that they had engaged in illegal business transactions, conspiracies and
combinations to restrain trade, false advertising, infringement of copyrights and trade marks, unfair
labour practises, the bribery of public officials, and other wrongdoings. The public barely knows
about corporate criminals' deception because they consider it irrelevant to their objectives.

2.2.7 Deficiency of Service for Making Money

It is defined as any flaw, imperfection, shortcoming, or inadequacy in the quality, nature, and
manner of performance that is required to be maintained by or under any law currently in force or
that has been undertaken to be performed by a person in accordance with a contract or otherwise
in relation to any service under Section 2(1)(g) of the Consumer Protection Act of 19869.
Despite the broad provisions of the consumer protection legislation, many corporations,
including banks and insurance companies, do not provide adequate service to their customers.
Most of the time, these service providers ignore the complaints of the customers. For us to
analyse and comprehend the scope of white collar criminality in this area, there are numerous
judicial rulings.
In Maina Devi Bairlaia v. Life Insurance Corporation of India10, The husband of Maina Devi
purchased a Rs. 50,000 life insurance policy. Due to an unexpected illness, he passed away
before the second premium was due. For up to 14 years, Smt. Maina Devi, the insured's widow,
could not get her claim taken care of. She didn't receive a payment for Rs. 50,310 until after her
woes were highlighted in publications and a few MPs raised the issue in Parliament.
In a case before the National Commission, it was determined that the Corporation had provided its
services with extreme negligence. The complaint, Smt. Maina Devi, experienced hardship and loss as
a result of a lack of service. From the end of the three-month grace period following the assured's death
until the money was given to her, she was considered entitled to interest at a rate of 12% per year.

8
Ibid 016
9
Sec. 2 (G) of Consumer Protection Act 1986.
10
decided by the National Commission of consumer protection on 11.5.1993.
 The Commission also gave her a Rs. 15,000 payment as compensation for harassment and
mental abuse. It is said that insurance companies consistently fail to resolve the claims of their
customers. Additionally, their policies' terms are unclear. The average person frequently finds it
difficult to comprehend them. The government has not yet developed any means to effectively
monitor these insurance companies.
In Skypack Couriers Pvt. Ltd. & Another v. M/s. Anupama Bagla11,the failure of a courier
service company to deliver a video cassette, which caused the complainant to lose admission to
the desired college, was deemed a "deficiency" in service because the complainant suffered severe
hardship and loss as a result of the courier's neglect and failure to deliver the item entrusted to
them for carriage. As a result, the plaintiff received compensation in the amount of Rs.10,000. In
S.P. Dhavaskar v. Housing Commissioner, Karnataka Housing Board12,The complainant paid
a deposit of Rs. 1.66 lakhs to reserve a home with the Karnataka Housing Board. After five years,
the Housing Board notified the complaint that the quality of the houses' construction was below
expectations and that he could choose to either have his deposit returned with no interest or
choose to buy a new home. The claim filed by the complainant was for Rs. 4.65 lakhs. The State
Commission ruled that the Housing Board's actions constituted a deficiency in service, that
returning the deposit amount without interest was unjustified, and that interest at the rate of 18%
per year must be paid. In response to an appeal by the Karnataka Housing Board, the State
Commission as well as the National Commission rejected the Housing Board's claim that allottees
were not entitled to interest under its Rules and Regulations.
In Punjab National Bank v. Tej Rajinder Singh31,Bank issued two FDRs payable to "either or
survivor" in the joint names of two individuals. The complainant's survivor sought the bank to
pay him the money following the passing of one of the joint holders. The deceased had
guaranteed repayment of a debt to a corporation, and a civil lawsuit was still underway when the
bank decided not to release the money. The District Forum accepted his complaint and
determined that the complainant had become the sole owner of the two deposits after one of the
joint holders passed away, making him legally eligible to receive the money. Additionally, it
was decided that the dead had not put a lien on the value of the FDRs. The complainant became
the FDRs' sole owner, and the District Forum and State Commission both agreed to the opinion
that it was a deficiency in service to refuse to pay the proceeds due upon maturity with interest.

11
decided by the National Commission in 1992. 017
12
decided by the National Commission on 27.9.1995. 31
[1997] CCJ 1165.
The National Commission decided that the payment instructions on the FDRs were "either or
survivor" and agreed with the conclusions of the District Forum and the State Commission. Upon
the passing of the FDR's co-holder, the plaintiff succeeded as the sole owner. The forums below
correctly determined that the complainant had acquired complete ownership of the FDRs and had
the right to maintain the complaint due to the omission to make the required payment.

2.3 Conclusion

The understanding of criminology now has a new depth thanks to Sutherland. He was the one
who first began to systematically examine the economic crimes, or crimes perpetrated by
members of the upper class. Most of the time, these crimes go unreported and unpunished. Even
if these offenders receive punishment, the sentence is very light. The judges in the courts are
sympathetic to this group of criminals. Sutherland's theory has a flaw in that it only considers
crimes committed by members of the upper class of society. It is therefore highly challenging to
include numerous offences in it, such as stealing and tax evasion. This category of crimes has
evolved considerably in the modern period. It might be really challenging to find them at times.
These crimes are now not only committed by members of the upper strata of society, but also by
members of the middle class and lower class. Therefore, splitting the offences into two pieces
would be the easier course of action. Traditional crimes like murder, rape, robbery, kidnapping,
and criminal extortion are one thing; economic crimes, which anybody can conduct, including
hoarding and tax evasion, are another. Actually, only members of one certain class cannot
commit economic crimes or traditional crimes. It is vital to raise awareness of economic crimes
like corruption. The rapidly expanding media can be very helpful in raising awareness of the
threat posed by economic crime. It is crucial to develop a unique system to handle these
offences independently. To deal with the threat, those agencies dealing with economic crimes
need specialised training. These organisations ought to be shielded from political interference.
To deal with these crimes, laws ought to be strengthened. The best feasible response to this type
of crime is crucial and in the best interests of the society. Without a larger public's involvement,
combating the threat is difficult. If we want to accomplish the goal quickly, we need to have a
really strong political will.

018
 CHAPTER-3
MAJOR SCAMS AND SCANDALS RELATING TO WHITE COLLAR
CRIMES

3.1 Introduction

No civilization can be described as being free of corruption. The phrase "white collar crimes"
has been used regularly for a very long time due to corruption. We may understand the scope
of white collar crimes by looking at the enormous scandals that India and the rest of the world
have faced over the past 20 years. Due to the involvement of powerful individuals in the
majority of these scandals, it is exceedingly difficult to stop or address them. They are
frequently incredibly cunning individuals who may easily prevail in court. In this chapter, I've
brought up a few of those significant scandals that will help us understand the scope of
economic crimes that have the power to upend society as a whole. India's predicament is not
all that dissimilar from that of the western nations. Actually, the situation is worse here. In
India, corruption has surpassed all bounds in the last 20 years. We have seen so many
significant scandals that we have grown accustomed to them. People in this nation appear to
no longer have faith in the government today. A large number of senior officials and
ministers are connected to the major scandals that have shook the country as a whole. Almost
no one has ever received the justice they deserve. It gives us the sense that corruption is the
dominant force in this nation and that the average person is unable to stop these scandals. The
fact that politicians and government workers have a lot of power may be one cause of these
major controversies. To prosecute them is incredibly difficult, and occasionally impossible. The
powers of ministers and public workers are scarcely ever checked. The Lokpal Bill has not yet
been passed by the parliament, despite numerous attempts. Power corrupts, and absolute power
tends to corrupt totally, as is well known. The following list of significant scandals in India may
help you grasp the scope of economic crime in this nation.

3.2 Bofors Scandal

The Bofors scandal was a significant case of corruption in India in the 1980s; Rajiv Gandhi,
who was the country's prime minister at the time, and several others were charged with
accepting bribes from Bofors AB in exchange for gaining the contract to build the country's
155 mm field howitzer.32

32https://economictimes.indiatimes.com/news/politics-and-nation/bofors-scam-decision-on-ottavio-quattrocchi- case-
today/articleshow/7227847.cms, Accessed on 17-6-2021
The scandal's size was estimated to be around $400 million in rupees. Ottavio Quattrocchi, an
Italian businessman who worked for the petrochemicals company Snamprogetti, was the
intermediary whose name was connected to the affair. According to reports, Quattrocchi was
close to Rajiv Gandhi's family. In the 1980s, he became a key middleman between major
corporations and the Indian government.
Bofors AB, the Swedish producer of the highly regarded howitzer gun, and the
representatives of the Indian defence ministry inked a $285 million contract in March 1986.
The deal included the sale of 420 howitzers to India. After the exposé—first by a Swedish
radio station, then by a Swedish newspaper—which claimed that Bofors AB had paid
enormous sums of money in bribery to Indian government officials and members of the ruling
Congress party, the transaction that appeared to be uncomplicated was abandoned. As a result
of this information, the government took action to revoke the deal and exclude the business
from future bids in India. The case took on significant political connotations, and the
Congress party and the Opposition engaged in conflict. General elections in 1987 saw Prime
Minister Rajiv Gandhi lose, and the Congress party's involvement in the affair was blamed.33
In 1988, a preliminary investigation was filed. Two years later, on January 22, 1990, the CBI
filed a Regular Case under the Indian Penal Code for alleged violations of the Prevention of
Corruption Act's sections as well as criminal conspiracy, cheating, and forgery. The
defendants named included Rajiv Gandhi, the defence secretary S. K. Bhatnagar, the then-
president of Bofors AB Martin Ardbo, middleman Win Chadha, and a few others.34
Ottavio Quattrocchi, an Italian national and executive of Snamprogetti who was based for a
while in Delhi and was well known to be connected to the Gandhi family, was later included
as a middleman over the course of the investigations. The charge sheet's inclusion of Rajiv
Gandhi as a "accused not sent for trial" since he was no longer alive was a significant and
contentious move. 35
The Delhi High Court halted any litigation in the matter in June 2002, but the Supreme Court
of India overturned that decision in July 2003. Charges against Rajiv Gandhi and others were
dropped by the Delhi High Court on February 5, 2004, dealing the CBI another blow.

33
Raghavan R. K., “Guns, Swedes and the Gandhis — how the Bofors scam tested the limits of the CBI’s
power”, available at https://theprint.in/pageturner/excerpt/guns-swedes-and-the-gandhis-how-the-bofors-scam-
tested-the-limits-of-the-cbis-power/531144/, Last updated 26 October, 2020 5:40 pm IST, Accessed on 22-6-
2021
34
Ibid
35
Ibid
The allegations against the three Hinduja brothers were successfully dropped by the same
court on May 31, 2005. There were various reasons why the historic probe did not eventually
succeed in court, but the two biggest ones were the 2004 government change and some
dubious judicial decisions.36
However, it is important to keep in mind that the CBI had to overcome a number of
challenges. The approval of either the External Affairs Ministry, the Department of Personnel
(the CBI's administrative department), or the Law Ministry was required for each step the
CBI took in the process of approaching the governments and courts of other nations, such as
Switzerland, Malaysia, and Argentina (the latter two being the countries where Quattrocchi
found sanctuary). This was made worse by the Narasimha Rao administration's (1991–1996)
apparent indifference to the need to ensure rapid advancement of the CBI inquiry. For
instance, Quattrocchi was the subject of a long-standing red corner alert from Interpol, which
was issued at the CBI's request. Quattrocchi was arrested in Argentina on February 6, 2007,
but the CBI didn't announce his arrest until February 23. The Argentinean police freed
Quattrocchi. The matter was brought to the Argentine Supreme Court because India and
Argentina do not have an extradition treaty. The Indian government lost the extradition case
because it failed to deliver a crucial court order that served as the justification for Quattrochi's
detention. Quattrocchi was released from the case by a Delhi court on March 4 because there
was no solid evidence against him.37.
Thus, the Bofors case will remain an example of how a genuine case can be deliberately
sabotaged by a government run by a party which has a lot to hide from the public.38 The entire
Bofors affair case has been expertly manipulated by the Indian government. Ottavio Quattrocchi,
the lone survivor accused of being involved in the bofors affair, was dropped from the lawsuit, and
this may be directly attributed to the administration. Actually, the government had no intention of
bringing him to court. The government's approach has been consistent in nearly all frauds. So yet,
no powerful officer has been imprisoned.
3.3 Fodder Scam

One fraud in India's history, the fodder scandal, attracted public attention in the latter half of
the 20th century. The chief minister of Bihar was among the several senior government
officials who were allegedly engaged in the scam.

36
Ibid
37
Ibid
38
Ibid
It demonstrates how corrupt the whole Indian political system has gotten over time and how
hard it is to convict corrupt officials and politicians. It also demonstrates how the government
betrays the confidence of the nation's millions of residents and fosters mistrust in their hearts.
An alleged theft of around 950 crore (US$210.9 million) from the government coffers of the
eastern Indian state of Bihar was the subject of the Fodder Scam corruption controversy. The
alleged theft allegedly took place over a long period of time, was carried out by numerous
elected and administrative officials of the Bihar state government under numerous
administrations led by rival political parties, and involved the creation of "vast herds of
fictitious livestock" for which feed, medications, and animal care supplies were purportedly
obtained. Although the issue first surfaced in 1996, the theft had been taking place and
growing in scope for more than 20 years. The scandal was and is still being reported in Indian
media because to the significant connections between tenured bureaucrats and elected
politicians as well as as an illustration of the mafia raj that has permeated various state-run
economies, in addition to its size and the length of time it was said to have existed. According
to sources, the scheme began as a small-scale embezzlement scheme by a few government
officials who submitted fraudulent expense reports. Over time, it increased in scope and
gained other participants, including politicians and corporations, until a full-fledged mafia
had developed.39
When the Bihar state treasury and departments' monthly account submissions were late in
February 1985, the then-Comptroller and Auditor General of India, T.N. Chaturvedi, alerted
Chandrashekhar Singh, who was the chief minister of Bihar at the time, that this might be a
sign of temporary embezzlement. However, the alerts were disregarded in a manner that
suggested a pattern by extremely senior political and bureaucratic officials. In 199240, Bidhu
Bhushan Dvivedi, The director general of the state's anti-corruption vigilance section received
a report from a police officer detailing the fodder fraud and possible chief ministerial
participation. G. Narayan41.
Amit Khare, the deputy commissioner of West Singhbhum district, acted on intelligence to
launch a raid on the animal husbandry department's offices in the town of Chaibasa in the
area under his supervision on January 27, 1996.

39
K. P. Joseph. Lessons from Bihar Fodder Scam. Economic And Political Weekly, Vol. 32, No. 28 (Jul. 12-18
1997), pp. 1686-1687 http://www.jstore.org accessed on 10-5-2021 at 4-30 PM.
40
Ibid, gibs law journal
The formation of a committee to look into the anomalies was ordered by the chief minister.
There were calls for the case to be transferred to the Central Bureau of Investigation (CBI),
which is under federal rather than state authority, since there were concerns that the state
police, which is answerable to the state government, and the inquiry committee would not
conduct a thorough investigation of the matter. Additionally, claims were made that
numerous members of the investigative committee participated in the fraud themselves. A
public interest lawsuit was filed with the Supreme Court of India, which brought the court
into the matter. Based on the Supreme Court's final directives, the Bihar High Court ordered
that the case be turned over to the CBI in March 1996 CBI42.
As the inquiry went on, the CBI discovered connections to Laloo Prasad Yadav, the current
chief minister of Bihar. On May 10, 1997, the CBI formally requested that Laloo be charged.
A few days of uncertainty followed the CBI’s request to the state governor to prosecute the
chief minister. The governor, A. R. Kidwai, was accountable to the federal government, and
had already stated that he would need to be satisfied that strong evidence against Laloo existed
before he would permit a formal indictment to proceed. The federal government, led by newly
appointed prime minister Inder Kumar Gujral who had just succeeded the short-lived
government of the previous prime minister HD Deve Gowda, consisted of a coalition that
depended on support from federal legislators affiliated with Laloo for its survival.
On June 17, the Governor gave permission for Laloo and others to be prosecuted. The CBI also
began preparing a chargesheet against Laloo to be filed in a special court. Expecting to be
accused and imprisoned, Laloo filed an anticipatory bail petition, which the CBI opposed in a
deposition to the court, listing the evidence against Laloo. Also, on June 21, fearing that
evidence and documentation that might prove essential in further exposing the scam were being
destroyed, the CBI conducted raids on Laloo’s residence and those of some relatives suspected
of complicity.
On June 23, the CBI filed chargesheets against Laloo and 55 other co-accused , including
Chandradeo Prasad Verma (a former union minister), Jagannath Mishra (former Bihar chief
minister), two members of Laloo’s cabinet (Bhola Ram Toofani and Vidya Sagar Nishad), three
Bihar state assembly legislators (RK Rana of the Janata Dal, Jagdish Sharma of the

46
Ibid
Congress party, and Dhruv Bhagat of the Bharatiya Janata Party) and some current and former
IAS officers (including the 4 who were already in custody).
As it became clear that Laloo would be implicated in the controversy and subject to legal
action, calls for his removal from the chief ministership gathered traction from both outside
groups and inside Laloo's own Janata Dal party. On July 25, Laloo announced his resignation
from his office, started his own political party called Rashtriya Janata Dal, and succeeded in
appointing his wife Rabri Devi as the new chief minister43.
The CBI filed new charges including fraud and criminal conspiracy based on particular
criminal actions of illicit withdrawals from the Bihar treasury as more evidence was
uncovered over the next years. After the split of Bihar state (into the new Bihar and
Jharkhand states) in November 2000, the majority of new cases were filed in the new
Jharkhand High Court in Ranchi, and numerous cases that had been filed in the Bihar High
Court in Patna were also moved to Ranchi. The majority of the 63 lawsuits the agency has
brought by May 2007 were being heard by the Ranchi High Court.44
Laloo's initial chargesheet, filed by the CBI on April 27, 1996, was based on the Indian Penal
Code sections 420 (cheating) and 120(B) (criminal conspiracy) as well as section 13(2) of the
Prevention of Corruption Act, 1988, and related to case RC 20-A/96, which concerned
fraudulent withdrawals of 37 crore (US$8.21 million) from the Chaibasa treasury of the
(then) Bihar government.45.
On December 12, 1997, Laloo was freed on bail following 135 days in judicial jail. He was
again arrested the following year, on October 28, 1998, in connection with a new conspiracy
case involving the fodder fraud. He was first detained in the guest house, but when the
Supreme Court protested, he was transferred to Patna's Beur prison. On April 5, 2000, he was
detained once more in a case involving excessive assets after being released on bond. On that
day, Rabri Devi, his wife and the chief minister at the time, was also requested to turn herself
in but was then quickly given bail. Laloo spent 11 days in jail, then on November 28, 2000,
he was given another one-day sentence in connection with a different fodder fraud.46
Laloo Yadav, Jagannath Mishra, and the other defendants were remanded several times in the
years following 2000 as a result of the numerous cases. In 2007, 58 former employees and
vendors were found guilty and sentenced to 5 to 6 years in prison apiece. Till May 2007,
about 200 people were punished with jail terms of between 2 and 7 years.

43
Ibid
44
ANANTH, V KRISHNA. “Fodder Scam, Lalu, and the Conviction.” Economic and Political Weekly, vol. 48,
no. 43, 2013, pp. 12–14. JSTOR, www.jstor.org/stable/23528830. Accessed 22-6-2021.
45
Ibid
46
Ibid
The Ranchi High Court sentenced 35 further individuals to prison sentences ranging from 4-6
years in January 2011. These include a few senior government of Bihar personnel47.
As a result, the Bihar fodder fraud points to both bureaucratic corruption and the
criminalization of politics in India. Despite the fact that some officials were punished, no
politician was imprisoned. After committing significant white collar crimes, these politicians
are still at large today. It is significant to highlight that there are several Indian states where
growth has not occurred due to severe corruption. In these states, no assistance programmes
are adequately implemented. Only because of these politicians are these governments
recognised as rogue states. Because timely decisions about the establishment of the
enterprises were not made, industrial growth has been all but halted in these states for many
years. In these rogue regimes, job creation has entirely halted. Even though corruption has
grown to be a major problem today, neither the Indian federal government nor the states are
doing anything to stop the problem. Actually, the political will to combat the threat of
corruption is inadequate.48

3.4 Stock Market Scam

3.4.1 Stock Market Manipulation Scam 1999-2001

In 2001, there was yet another fraud involving the Indian stock market. A stock market
manipulation hoax is what it is known as. This fraud was orchestrated by Ketan Parekh.
Despite being found guilty, he did not suffer the severe sentence he deserved. That sparked a
number of significant questions concerning the security of stock market investments in India.
Ketan Parekh was interested in the stock market from a young age despite coming from a
family of stockbrokers. He started his career in the late 1980s at NH Securities, a reputable
institutional brokerage business, and went on to become a chartered accountant. He first met
the 'Big Bull', Harshad Mehta, in the early 1990s, and later joined GrowMore Investments,
Harshad's company. He was questioned about his suspected role in the 1992 Harshad Mehta
Scam while employed by the business, but he was not detained. Ketan met important brokers
and bankers along the way, and as the years passed, he gained a lot of expertise in the
industry. He started his career as a stock operator in late 1998.49

47
Ibid
48
Ibid
49
Raghu, “Ketan Parekh Scam - All You Need To Know About 2001 Stock Market Scam”, available at
https://www.pvot.in/blog/ketan-parekh-scam-all-you-need-to-know-about-2001-stock-market-scam/, published
date 24-4-2021, Accessed on 22-6-2021
 The Indian stock market sprung into life between 1999 and 2000 as the technology bubble
engulfed the rest of the world. All were willing to provide Parekh the money, which he used
to manipulate stock prices by making his interest clear, whether they were cooperative banks,
foreign corporate organisations, or investment businesses, the majority of which were owned
by promoters of listed companies. Scrips like Visualsoft increased from Rs 625 to Rs 8,448
per share and Sonata Software increased from Rs 90 to Rs 2,150 in a short period of time.
Price rigging, however, did not put an end to the fraud cycle. He increased the share prices of
Global Teleservices and HFCL from Rs. 85 to Rs. 3,100 and Rs. 42 to Rs. 2,300,
respectively. He would then continue to hold his inflated stocks with banks as security and
get further loans.At the time, the RBI only permitted banks to lend businesses a maximum of
15 crores, but by paying off bank employees, he was able to borrow 800 crores from the
Madhavpura Mercantile Co-op Bank and Rs 100 crores from the Global Trust Bank without
putting up any security. But in February 2001, a day after the Union Budget was announced,
the celebration came to an abrupt stop. By slashing the value of the K-10 stocks, a bear cartel
began interfering with Parekh's party and causing a payment problem in Kolkata50.
Due to the banks' inability to pay back their depositors, the RBI started an investigation into
their business practises, which uncovered the fraud. Following SEBI's investigation, it
became clear that promoter and bank monies were being utilised to manipulate the markets.
Parekh was detained for 53 days after his arrest in March of that year. Ketan Parekh took all
necessary precautions, using the Calcutta Stock Exchange instead of the BSE and timing his
investments in these stocks with the DotCom boom from 1997 to 2001 to avoid drawing
attention to an increase in the stock price of these 10 stocks, but he was still caught. He was
convicted and sentenced to prison in 2008 for his role in the Indian stock market manipulation
scandal that occurred between late 1999 and 2001, and SEBI has since banned him from all
types of trading till 2017. He was prohibited from trading stocks until 2017. The scandal is
thought to have cost close to Rs 40,000 Crores.51 It is significant to note that after receiving a
year in prison from the court for his part in the 1992 stock market fraud, he was still able to
carry out further scams. He had little trouble swaying the decision-makers.

3.4.2 The Harshad Mehta 1992 Scam

50
Khude Deepika, “3 Stock Market Scams that Shook the Nation”, available at
https://www.samco.in/knowledge-center/articles/stock-market-scams-that-shook-the-nation/, created 10-11-
2020, Accessed on 22-6-2021
51
Ibid
Early in the 1980s, Harshad Mehta began his career in the stock market as a jobber for a
stockbroking company. He worked at many brokerage companies for ten years in a variety of
roles with growing responsibilities. In 1986, he actively began trading stocks through his own
brokerage company, Grow More Research and Asset Management. He attained the title of
"The Big Bull of Indian Stock Market" by 1990, according to the media and financial
industry fraternity.52

Bank receipts were by far Harshad Mehta's most profitable tool for heavily inflating the stock
market. In truth, securities were not really exchanged back and forth during BR transactions;
instead, they were ready-forward deals. Instead, the person borrowing the money, or the
person selling the securities to the buyer, issues a BR. The sale of securities is verified by the
BR. It also serves as a receipt for the funds paid to the selling bank and a guarantee that the
buyer will get the securities. The purchasing side's securities are held in trust by the seller (as
a novation). He required banks that could issue bogus BRs or BRs not backed by securities
after working out this strategy. The false BRs were sent to other banks after they were issued,
and the banks in turn loaned money to Mehta under the assumption that they were lending to
other banks in exchange for government securities, which was not the case because the BRs
were fraudulent and unbacked by security. Mehta's buying binge had caused the stock market
to become hot, and the Sensex had increased by 247% in a single year.53

These checks were cashed, and he then utilised the money to raise stock prices. In barely
three months, he increased the share price of ACC Ltd from Rs 200 to Rs 9,000. When it
came time to pay back the bank, he would simply sell the stocks at a profit and return the
principle. In the unlikely event that he was unable to sell his shares, he would go to the third
bank and request that they transfer their cash to the first bank. Due to a lack of fundamental
causes, the stock prices fell once Sucheta Dalal exposed the fraud, as was predicted, and
Harshad Mehta was no longer in a position to pay back these RFD loans.54
He received a 9-year prison term when the 1992 swindle was uncovered. He allegedly
defrauded an Indian bank of 5,000 crore rupees.55

52
Sharma Deepak, “Harshad Mehta - The Big Bull of Indian Stock Market (A Scamster or a Scapegoat),
available at https://niws.in/blog-details/Harshad-Mehta-The-Big-Bull-of-Indian-Stock-Market-A-Scamster-or-a-
Scapegoat, last updated 12-11-2020, Accessed on 22-6-2021
53
Ibid
54
Supra note 50
55
Ibid
3.5 Counterfeit Stamp Scam

Scams were still prevalent in India towards the beginning of the twenty-first century. One
additional fraud was exposed in 2006. This fraud is known as the counterfeit stamp fraud.
Abdul Karim Telgi was the scheme's mastermind. Even though this fraud was of a different
kind, the amount involved was so large that the Indian government lost billions of rupees as a
result. Khanapur, Karnataka, was the hometown of Abdul Karim Telgi. When Telgi was a
little child, his father, an employee of the Indian Railways, passed away. The family was
forced to rely on selling produce, fruit, and peanuts to railway passengers.56 It demonstrates
that anyone from any class may commit crimes of this type. He doesn't need to belong to a
specific class in order to conduct serious economic crimes.
Around the end of the 1990s, Abdul Karim Telgi started making bogus stamp sheets. He
hired 300 employees to work as agents, and they marketed the fakes to wholesale buyers
including banks, insurance companies, and stock brokerage businesses. His monthly earnings
have been reported to be somewhere about Rs 202 crore (just over US $40 million). The
enormity of the scandal, estimated at a staggering Rs 20,000 crore, shocked the whole
country. Other projections varied from Rs. 3,000 billion to Rs. 30,000 billion.57
The Telgi case exposed police corruption in Karnataka, sparking a nationwide controversy in
India. In Ajmer, India, in November 2001, he was arrested. His arrest happened after two
guys nabbed in Bengaluru in 2000 selling bogus stamp papers. The fraud had been discovered
as a result of their arrest. The CBI finally took control of the case. According to reports, he
supposedly had 36 houses around the nation and more than 100 bank accounts in 18
important cities.58
In the end, Telgi and a number of his friends were given a 30-year prison term and a
punishment of Rs 202 crore in 2006. In October 2017, Telgi passed away at the age of 56
from multiple organ failure at a government hospital in Bangalore.59

56
Sharma Divyanshi, “Scam 2003 The Telgi Story. All that we know so far”, available at
https://www.indiatoday.in/binge-watch/story/scam-2003-the-telgi-story-all-that-we-know-so-far-1775529-2021- 03-
04, last updated 4-3-2021, Accessed on 22-6-2021
57
Ibid
58
Ibid
59
Ibid
In any of the phoney stamp paper cases for which Telgi has already received convictions in
Maharashtra and Karnataka.

3.6 Satyam Computer Scam

In a letter to the board of directors of Satyam Computers Limited dated January 7, 2009,
Ramalinga Raju, the chairman and founder-promoter of Satyam Computer Services (SCS),
admitted that "he had been manipulating the company's accounting numbers for years." Mr.
Raju said that he exaggerated assets by $1.47 billion on Satyam's balance sheet. The
organisation did not own the almost $1.04 billion in bank loans and cash that it claimed to.60
At the time, SCS majored in information technology. Its headquarters were in Hyderabad, and
it was listed on the New York Stock Exchange. It had over 45,000 workers and a claimed
annual revenue of over $2 billion. 61
A few days later, Raju reappeared and turned himself in to the police. By that point, anarchy
had taken over. The price of SCS shares has fallen sharply from above Rs 100 to about Rs 5.
Police had questioned dozens of senior SCS managers, and several of them had been taken
into custody. Customers had left. The operations were about to fail. In the US, there was a
class action lawsuit filed by stockholders. "This fraud was successful while real company
growth concealed the falsification,"
Ironically, Raju was regarded as one of India Inc.'s most upright employees. The coveted
Golden Peacock award for Corporate Governance had been given to SCS. Chairman, the
Honourable CLB suspended the former Board of Directors, comprising the former Chairman,
Mr. B. Ramalinga Raju, and the former Managing Director, Mr. B. Rama Raju, with
immediate effect in an order dated January 9, 2009. With effect from January 8, 2009, the
Company also dismissed Mr. Srinivas Vadlamani, its previous chief financial officer.
Additionally fired this year by the company were Mr. G. Ramakrishna, a former vice
president, Mr. V.S.P. Gupta, a former global head of internal audit, Mr. C. H. Srisailam, a
former assistant manager in charge of finances, and Mr. D. Venkatapathi Raju, a former
senior manager in charge of finances.

60
Bhasin Madan Lal, “Corporate Accounting Fraud: A Case Study of Satyam Computers Limited”, Open
Journal of Accounting
Vol.2 No.2(2013), Available at https://www.scirp.org/html/2-2670015_30220.htm#return34, Accessed on 22-6-
2021
61
Abraham Bobins,” Ramalinga Raju and Satyam Scam : All you need to know” last updated on Oct 9, 2020,
14:50 IST available at https://www.indiatimes.com/news/india/ramalinga-raju-satyam-scam-india-biggest-
accounting-fraud-all-you-need-to-know-524758.html, Accessed on 20-6-2021.
Other defendants include managers in the finance department G. Ramakrishna, D.
Venkathapathi Raju, and Srissailam Chetkuru. Prabhakar Gupta, SCS's director of internal
audit, was also found guilty. Was the same true for Telluri Srinivas and S Gopalakrishnan,
both partners at Price Waterhouse Coopers, the statutory auditors?62
It was only tried in November 2010. 216 witnesses had to be interviewed, and hundreds of
papers had to be turned in. The above-mentioned former directors and employees were
charged by the CBI under several sections of the Indian Penal Code (IPC), including Sec.
120B (criminal conspiracy), Sec. 409 (criminal breach of trust), Sec. 420 (cheating), Sec. 467
(forgery of valuable security), Sec. 468 (forgery for cheating), Sec. 471 (using forged
documents as genuine), and Sec. 477-A (falsification of accounts). Raju was given a seven-
year jail term.63
What actually happened? Satyam was a multi-pronged, multi-billion-dollar scam.
SCS was a sizable, prosperous company with a number of Fortune 500 clients and reliable
operations in several IT fields. In fiscal 2008, it "claimed" to have earned more than $2.1
billion (about Rs. 8470 crore) in sales and more than Rs. 1687 crore in net profit. (The
numbers were recast after the swindle but they were accepted by all at the time). For years,
Raju had been manipulating the SCS accounts and exaggerating revenues with the other
accused's complicity. Indian companies frequently falsify records to hide profits and lower
tax exposure. Raju, though, has the option to flip it and boost earnings. Everything was free
from income tax because all of the earnings came from exports.64
That enormous gap in the balance sheet needed to be closed before the release of the next
quarterly figures. SCS faced trouble throughout the July-September 2008 quarter. In October
and December 2008, losses were probable. Mr. Raju spoke of a minor difference that
escalated out of his control. "Over the years, what had initially been a small discrepancy
between the operational profit that was really realised and the one recorded in the books of
accounts, grew. With the expansion of the company's operations, it has grown to
uncontrollable dimensions, he stated. "I didn't know how to get off the tiger without getting
eaten," one person said. Mr. Raju said that he had made attempts to close the gap but had
been unsuccessful, including a December attempt to purchase two construction companies in
which the company's founders owned stock.

62
N Kiran, “Case Study on Satyam Computer Services Limited (SCSL)”, available at
https://www.yourarticlelibrary.com/case-studies/case-study-on-satyam-computer-services-limited-scsl/99569,
Accessed on 22-6-2021
63
Ibid
64
http://www.nja.nic.in/P-948_Reading_Material/P-
948_Audit_of_Fraud_in_economic_crimes/ACCOUNTING%20FRAUD.pdf, Accessed on 21-6-2021
65
Raju made the decision to act desperately. For $300 million, he intended to purchase a 51%
part in Maytas Infrastructure Limited, a prestigious infrastructure development, construction,
and project management firm that belonged to the Raju family. Teja, the son of Raju, oversaw
Maytas. The founder's proposal to purchase the stake in Maytas Infrastructure and all of
Maytas Properties, which were owned by family members of Satyam's Chairman, Ramalinga
Raju, as fully owned subsidiaries for $1.6 billion, was approved by the Satyam board,
including its five independent directors, on December 16, 2008. The directors adopted the
management's choice without obtaining shareholder consent. Twelve hours after investors
dumped Satyam's stock and threatened legal action against the management, the purchase
decision was, however, revoked. The US lawsuits challenging Mayta's transaction then came
after this. Due to improper payments made to employees and a failure to furnish information
requested on invoices, the World Bank barred Satyam from doing business for a period of
eight years. The Satyam board lost four independent directors, and SEBI required the
promoters to disclose pledged shares to the stock exchange.
Every attempt to close the gap has been unsuccessful, and the failed Maytas takeover offer
represented the final effort to replace the phoney assets with actual ones. Since the missing
SCS reserves would be represented as having been "paid" to the Raju family, the issue of
missing SCS reserves would be solved. The real estate bet would eventually provide more
than enough money to replace all the bogus reserves once the Maytas metro transaction was
successful.67
The next strategy Raju used to escape this chakravyuha was to sell Satyam itself. He
requested that DSP-ML take over the mission for finding a buyer when he phoned Hemendra
Kothari of DSP Merrill Lynch. The investment bank DSP Merrill Lynch, which Satyam hired
to find a partner or sale for the business, eventually came clean and ended its participation
with the company as soon as it discovered financial problems.68
When it came to saving Satyam, the government moved swiftly. A fraud in the well-known
IT sector was viewed as shocking and damaging to India's reputation.

66
Supra note 60
67
Ibid
68
R. M. Bowen, A. C. Call and S. Rajgopal, “WhistleBlowing: Target Firm Characteristics and Economic
Consequences,” The Accounting Review, Vol. 85, No. 4, 2010, pp. 1239-1271
Chairman, the Honourable Company Law Board issued an order suspending the Company's
then-existing Board of Directors with immediate effect and granting permission for the
Central Government to propose candidates for the Board. The Government of India's Ministry
of Corporate Affairs appointed six directors to the Company's Board in accordance with the
aforementioned instructions. Inducting notables like Tarun Das, Deepak Parekh, Kiran
Karnik, and T. Manoharan allowed for the creation of an emergency board. The mission of
finding a buyer for SCS fell to this board. In this instance, SEBI loosened the takeover rules
by hastily preparing and advancing the required changes. Forensic accountants were hired by
the attorney to help with the financial statement's preparation and inquiry.69
By the middle of March, a number of significant IT firms had become confident enough in
Satyam's operations to take part in an auction for the company. Justice Bharucha, a former
Supreme Court justice, was chosen by SEBI to supervise the procedure and create trust in the
transaction. Satyam received many bids on April 13, 2009. Before Mr. Raju exposed the scam
and saved its business, the winning bidder, Tech Mahindra, purchased Satyam for $1.13 per
share, or less than a third of its stock market worth.70
It's intriguing how quickly a successful rescue operation can be deployed. It demonstrated the
Indian government's capacity for swift action when necessary. Despite the creation of a
special court, the legal matter has naturally taken its sweet time moving through the justice
system. In mitigation, it should be noted that this was a white-collar crime that was
exceedingly hard to solve, and practically all of the evidence included studying bank records
and other paperwork.
The legal repercussions will not necessarily stop as a result of this decision and the
punishment. The corporation is the subject of unresolved claims from the income tax
division. Additionally, challenges against this decision may be made. However, it does help
to wrap up the entire show.

3.7 Commonwealth Games Scandal

The government claims that India's economy is expanding. Infrastructure development is

progressing quickly. India was eager to host an increasing number of international sporting
events to highlight this progress and draw attention from other nations to its quick economic
development.

69
Supra note 62
70
S. S. Dagar, “How Satyam Was Sold the Untold Story: How the IT Services Major Was Rescued against all
Odds. Business Today Reconstructs the Events of the 14 Crucial Weeks that Led up to the Sale,” Business
Today, 2009, pp. 25-42
India's government has consistently asserted that it is experiencing growth of between 7% and
9% during this time. The Indian government had a golden opportunity to demonstrate that the
investment climate in India is far better than that in America and Europe. India soon had the
opportunity to host the Commonwealth Games 2010, one of the greatest sporting events in
the world after the Olympic Games, giving it the chance to showcase its accomplishments to
the rest of the globe. A whole infrastructure had to be constructed for this. Numerous
stadiums needed to be rebuilt or restored. Roads needed to be fixed. It was necessary to build
new flyovers. The metro rail projects have to be finished on schedule. For the guests to stay
and take part in the games, arrangements had to be made. But after that, things became worse.
The Commonwealth Games in 2010 in New Delhi were hampered by fraud and poor
administration, which damaged India's image as a country plagued by widespread fraud and
abuse. Athletes from the Commonwealth Nations Games compete in the multi-sport
Commonwealth Games, which was established in 1930. The Traditional Wealth Games
Federations oversee the event's organisation every four years. One of the largest frauds in
Indian history was the rounding off of Rs. 70,000 crores. It was projected that just half of the
budget would go to Indian athletes. The athletes allegedly had to relocate from the official
housing units assigned to them to run-down apartments. According to Central Vigilance
Commission reports, Swiss Timings received a contract for 141 crore rupees, which was 95
crore rupees overpriced, from Suresh Kalmadi, the head of the organising committee for the
Olympics. All of the accused, including Kalmadi, have been charged in accordance with the
provisions of the Corruption Prevention Act with criminal conspiracy, stealing, and talking.71
As soon as it seemed that most of the projects wouldn't be finished in time, issues started to
arise. Two significant venues were not completed in time for the games as a result of the
delay. The game's budget rapidly began to go beyond budget. Numerous initiatives started to
show signs of corruption. Engineers and contractors stole billions of rupees. The authorised
budget for the venues was originally supposed to be Rs. 1000 crore, however it was later
amended to Rs. 2460 crore. The stadium for Jawaharlal Nehru cost 961 crore.

71
Verma Ayush, “Commonwealth Games scam – a legal timeline”, available at
https://blog.ipleaders.in/commonwealth-games-scam-legal-timeline/, Last updated 19-2-2021, Accessed on 22-
6-2021
On the stadiums at Ferozshah Kotla ($85 million), Indira Gandhi ($669 million), and Dhyan
Chand ($262 million).72
Facts and numbers, such as infrastructure expenditures connected to CWG by the Delhi
government –73
a. Rs. 670 crores on stadium (Amount directly spent on Commonwealth games)
b. Rs. 3700 crores (Flyovers and Bridges, including Barapulla Nallah)
c. Rs. 450 crores (ROB, RUB* at Indira Gandhi International Terminal Network)
d. Rs. 215 crores (BRTS from Ambedkar Nagar to Delhi Gate)
e. Rs. 1800 crore (Augmentation of DTC fleet)
f. Rs. 900 crores (Construction of resurfacing of roads)
g. Rs. 650 crores (strengthening and resurfacing of roads)
h. Rs. 525 crores (Street- Scaping)
i. Rs. 150 crores (Road signages)
j. Rs. 3000 crores (Metro Connectivity)
M.P. also established an organising committee. President of the IOC Suresh Kalmadi serves
as the head. A budget of Rs. 1620 crores was anticipated, however it finally went over budget
by Rs. 11500 crores. And the estimated price is a staggering Rs. 70.000 crores.74
Amount spent on other facilities and the report of scam stated some of the facts like-75
a) Bus Services: While the Delhi government spent 60 lakhs to purchase a bus, the
original cost of the service was only 40 lakhs, resulting in a cost of Rs. 18000 for the
DTC bus service.
b) Metro Services: During the Games, the Delhi Government spent a significant sum on
the extension of the Delhi Metro line, around $3,000,000,000; however, the real cost
of each pillar was only $7,000,000..
c) Ballon Cose and Service: During the CWG opening ceremony, there was a unique
attraction available to all visitors. Although it is estimated to cost 70 crores, the
Aerostat really cost 40 crores, according to the contract with the U.K.-based
corporation.76
Although the Indian Prime Minister pledged an impartial investigation into this massive
wrongdoing, concerns arose, particularly after Mr. P. J. Thomas was named the Central
Vigilance Commissioner (CVC) of India.
The Commonwealth games committee was as follows:
a) Suresh Kalmadi- Chairman
72
Ibid
73
Ibid
74
Ibid
75
Ibid
76
Ibid
 b) Randhir Singh- Vice Chairman
c) Lalit Bhanot- Secretary General
d) Anil Kumar Khanna- Treasurer
e) Michael Fennell, Mike Hooper, Rakesh Mehta, N. Ramchandran- Members
71 nations took part in the games, which were hosted in the capital city of New Delhi. It was
a 12-day long athletic event. A total of 12 billion Rupees have been spent on improving the
infrastructure. Twenty cities have been made into vacation spots. The "Game Village"
settlement was created especially for the Commonwealth game.77
People began looking at the administration for its pledges against the scandals as soon as the
games were done. Social activists and members of civil society began submitting Right to
Information RTI requests to the CVC. Discrepancies in bids and alleged theft totaling over Rs
8,000 crore have been discovered by CVC. It claims that irregularities include payments to
fictitious parties, willful delays in contract completion, exorbitant prices, and errors in the
procurement of equipment through tendering have been discovered. It further states that the
overall amount of theft might reach 5,000 to 8,000 crore rupees, which is enormous and
scary.
The CVC provided information about projects completed by several government departments
where inconsistencies have been found in response to an RTI request made by PTI. The CVC
received complaints about alleged theft of Rs 1.5 crore in the purchase of HOVA Courts for
the Badminton stadium, irregularities in the tender for the installation of kitchen equipment,
and misappropriation in video board tenders for remodelling and upgrading the Major Dhyan
Chand National Stadium. The RTI response said that the issue about appointments in OC and
workforce consultants without sufficient qualification and experience had been received and
that a report was awaiting from the Sports ministry. At least 22 other Games-related building
and procurement projects carried out by various government organisations in this country are
being investigated by the CVC for possible financial violations.78,Out of the total projects, the
Delhi government's Municipal Corporation of Delhi and Central Public Works Department
each completed two, followed by the Sports Ministry with six, the Delhi Development
Authority with four, the Organising Committee with three, and the Sports Ministry with six.
The Department of Commerce, the Indian Meteorological Department, and the New Delhi
Municipal Council are each the subject of one investigation RTI reply said.

77
Ibid
78
Shrivastava Ashwini, “Discrepancies Found in Tenders for CWG Projects: CVC”, available at
https://www.outlookindia.com/newswire/story/discrepancies-found-in-tenders-for-cwg-projects-cvc/697886, Last
updated 19-10-2010 at 5:50 PM, Accessed on 22-6-2021
The CVC is looking into allegations that the Indian Meteorological Department and some of
its senior personnel manipulated bids, according to the statement. The CVC also received and
looked into a complaint involving possible anomalies in the awarding of contracts for sound
systems, LED display boards, and other communication systems for several Commonwealth
Games stadiums. Although no dollar figure was given, the response said that CVC has seen
losses to the national exchequer of many crores of rupees. In response to the RTI inquiry, the
Commission stated that a report from the Central Public Works Department was requested on
September 8 and is still pending. In 16 building and procurement projects, the Chief
Technical Examination Wing of CVC had already discovered potential financial and
administrative violations. According to a CVC investigation, six of them were completed by
the PWD, three by the MCD, two by the CPWD, DDA, and NDMC, and one by RITES, a
government-owned company in India.79 A committee led by former Comptroller and Auditor
General (CAG) V K Shunglu was established by Prime Minister Manmohan Singh to
investigate the incidents. A final report from CVC based on the Shunglu Committee's
conclusions will be released. As of right now, the Shunglu Committee turned in its findings
on March 29, 2011. Its content has not been made public. Suresh Kalmadi was considered as
the primary accused of the Commonwealth Scam and charged under section 120B80 for the
offense of criminal conspiracy read with sections 420, 467, 468 and 47181 for the offenses of
cheating and forgery, and under the section 13(2) read with section 13(1)(d)82. According to
the charging sheet, Kalmadi is the primary defendant since he possessed all ultimate
authority. In the 2010 Commonwealth Games organising committee, he held absolute
authority.”83
Even though India has the potential to host the Commonwealth Games, it is still unclear if
those responsible for the massive scandal will face harsh punishment or will manage to get
away with it. It's crucial to see how the administration handles scandals of this nature. The
Commonwealth Games have been marred by a major controversy. If the perpetrators are to be
held accountable, it is crucial to look into this massive corruption. Experience with previous
scandals demonstrates that the government took a lax stance in prosecuting the scandal's
offenders. The judiciary was likewise unaware of the gravity of this category of crimes.

79
Ibid
80
THE INDIAN PENAL CODE 1860
81
Ibid
82
THE PREVENTION OF CORRUPTION ACT, 1988
83
Vinay Kumar, CWG scam: Kalmadi named ‘main accused’ in first CBI charge sheet, The Hindu (May 20,
2011), https://www.thehindu.com/news/national/cwg-scam-kalmadi-named-main-accused-in-first-cbi-charge-
sheet.
3.8 2G Spectrum Allocation Scandal

In India, the 2G spectrum allocation scam is referred to be the mother of all controversies till
date. It aided in increasing public uproar against corruption. Social activists and attorneys
appear to have resisted the massive corruption with tenacity. Everyone now believes that
things have gotten to the point where it is no longer viable to strive for a society free from
corruption. Nobody believes the government will successfully combat the threat. People have
come to terms with corruption as a fact of life. In this country, neither a minister nor a
government official appears to be clean. The fall of law has demonstrated its impact. The
level of corruption in India is at an all-time high. One of the biggest scandals to date is the 2G
spectrum scam. We must recognise that corruption and democracy cannot coexist in order to
combat such widespread corruption.
In order to fraudulently undercharge mobile telephony businesses for frequency allocation
licences, which they would use to develop 2G subscriptions for cell phones, government
officials and ministers in India were complicit in the 2G spectrum scam. Based on revenue
received from 3G licences, the Comptroller and Auditor General's report estimates that the
exchequer suffered a loss of rs. 176379 crore (US$39.16 billion). Although the 2G licences
were issued in 2008, the scandal wasn't made public until the Indian Income Tax Department
looked into political lobbyist Niira Radia and the Supreme Court of India officially recorded
Subramaniam Swamy's concerns.84 The case details of the main PIL filed with the supreme
court.85 Arun Shourie, a former telecom minister in the NDA administration, was the
whistleblower who helped reveal the fraud and other flaws in the UPA administration's
approach to giving telecom licences. Following directives from the PMO and the Ministry of
Home, the Income Tax agency started bugging Nira Radia's phones in 2008. The purpose of
doing this was to assist with a current investigation into a situation where it was suspected
that Niira Radia had operated as a spy.86
The media received access to some of the numerous discussions that were taped during a 300-
day period. The Radia tapes issue is the name given by the media to the heated debate around
the leaked tapes. Conversations involving politicians, journalists, and businesses were
recorded on the recordings. In these records, individuals from many fields—politicians like
Karunanidhi, journalists like Barkha Dutt and Vir Sanghvi, and business organisations like
the Tata Group—either took part or were referenced87.

84
Writ Petition (Civil),Case No:10, Year:2011
85
Writ Petition (Civil),Case No:423, Year:2010
86
Nero Priya, “Corporate Lobbying: Do We Need a Law to Regulate Whistle Blowing?”, available at
http://www.legalservicesindia.com/article/610/Corporate-Lobbying:-Do-We-Need-a-Law-to-Regulate-Whistle-
87
Four groups of individuals came into focus as a result of the licence sales: politicians with the
power to sell licences, bureaucrats who implemented and influenced policy decisions,
businesses purchasing the licences, and media professionals who acted as a middleman
between the politicians and the businesses on behalf of one or more interest groups88.
The contentious second round of spectrum allocations was overseen by Raja, the former
Minister of Communications and Information Technology. Following the public outrage, Mr.
Raja, a Dravida Munnetra Kazhagam MP from the Nilgiris seat, was compelled to resign.
Despite strong opposition from economists and other political parties, he was reappointed as
the minister of telecommunications for the second time after the UPA won the most recent
general elections. This resulted from the DMK, one of the Congress' key allies, applying
pressure. Raja was detained on February 2nd, 2011 for his suspected part in manipulating the
regulations to provide select cellular operators advantageous spectrum at bargain prices.
Following Raja's detention on February 2nd, DMK party members and staff swiftly passed a
resolution stating that Raja is not guilty and that the opposition parties were targeting him for
political reasons. He is now incarcerated at Outer Delhi's Tihar Jail. The Indian Central
Bureau of Investigation (CBI) has conducted raids at his residences, offices, and other
locations connected to A. Raja's NGOs and beneficiaries.89
Daughter of DMK leader and Tamil Nadu Chief Minister Karunanidhi, Kanimozhi is a
member of parliament. The recordings of six discussions between Kanimozhi and lobbyist
Niira Radia from May 2009 were revealed by Outlook in November 2010. These talks,
according to India Today, show that Kanimozhi filtered the information going to her father
and "tipped the scales in favour of" A. Raja, who served as minister of communications and
information technology during the contentious 2008 allocations of 2G wireless spectrum. The
DMK is "more closely resembling a sprawling family business empire than a political party,"
according to Lydia Polgreen, the Delhi correspondent for The New York Times, who also
emphasised Mr. Raja's "close relationship" with Kanimozhi. Raja's rise to the position of
telecommunications minister was described as "emblematic" of how politics in India actually
operate. Kanimozhi asserted that the DMK party will be exonerated in the CBI investigation
following the raid on Tamil Maiyam, an NGO of which she is a director. She stated, "The law
has to run its own course. It is a procedure to establish our innocence.”90

88
Ibid
89
Ranjan Harshita, “2G Spectrum Scam’, available at https://thecompany.ninja/2g-spectrum-scam/, last updated
14-6-2020, Accessed on 22-6-2021
90
Ibid
It is alleged that Pradip Baijal recommended policies that favour particular telecom
businesses while he was in charge of the TRAI. Baijal joined the consulting firm Noesis after
retirement. Raja has been under fire from media commentators Arun Shourie and others for
basing his 2008 conclusions on Baijal's rulings from 2003. Recently, as part of their
investigations, the Central Bureau of Investigation raided the bureaucrat's residences and
offices. Siddhartha Behura, a former telecom secretary who worked for the DOT at the time
of the 2G allocation.91
When the 2G spectrum was allocated, P. J. Thomas was the Secretary of the Department of
Telecommunications. Raja's personal secretary under the I UPA, when the licences were
issued, was R K Chandolia. He was an Indian Economic Service officer from the 1984
graduating class. When Raja took over as Telecom Minister once more during the UPA-II,
Chandolia was promoted to the position of Joint Secretary. Raja's new position as Economic
Adviser gave him authority over all key responsibilities pertaining to policy. All licence
holders communicate with Chandolia. It is said that while working from A K Srivastava's
room at DDG-access services, Chandolia delivered letters of intent to representatives of many
companies. These are a few of the ministers and officials that are reportedly involved in the
2G scandal. A. raja, who was at the time the telecom minister, has lately been accused of a
crime.92
A few companies are also taking part. Unitech Group, a real estate corporation that joined the
telecom market with its 2G bid, sold 60% of its company ownership to Telenor at a large
profit after obtaining licencing (including land prices locations for towers). Swan Telecom
made a sizable profit when it sold Emirates Telecommunications Corporation (Etisalat) 45%
of its business after acquiring licencing.93
Tata Communications, Essar, Dishnet Wireless, Loop Mobile, Videocon Telecommunications
Limited, S Tel, Reliance Communication, Sistema Shyam Mobile (MTS), and Allianz Infra
are some of the other firms taking part. Some people from business participated as well. They
are Anil Ambani of the Reliance Group (ADAG), Vinod Goenka of the Dynamix Group,
Prashant Ruia of the Essar Group, and Venugopal Dhoot of the Videocon Group. Etisalat DB
Telecom, formerly Swan Telecom, and DB Realty are both represented by Shahid Balwa.
Each of them is either a suspect in the scam or is being questioned by the CBI.94

91
Putul Kiran, “2g Scam and Its Effect”, https://www.termpaperwarehouse.com/essay-on/2g-Scam-and-Its-
Effect/42860, Accessed on 22-6-2021
92
Supra note 89
93
Ibid
94
Ibid
The Supreme Court has received petitions from a number of attorneys, social activists, and
members of the civil society protesting this widespread corruption. Subramaniam Swamy, an
activist lawyer and politician, brought the matter to public attention with his letters to the
Prime Minister requesting action as well as with his affidavits and Supreme Court lawsuits.
Journalist Paranjoy Guha Thakurta was one of the first to report on the discrepancies in the
Telecom Ministry's allotment of 2G spectrum. He also filed a plea in the 2G PIL that the
Supreme Court is now hearing. For the Centre for Public Interest Litigation, Prashant
Bhushan. Several prominent individuals, including former chief election commissioners J.M.
Lyngdoh, T.S. Krishnamurthy, and N. Gopalaswami and former central vigilance
commissioner (CVC) P. Shankar, have also submitted petitions in the lawsuits brought by
civil society organisations on behalf of Anil Kumar.95
A. Raja negotiated for the 2G spectrum licences to be sold for less than market rate. Swan
Telecom, a startup business with limited assets, paid 1537 crore (US$341.21 million) for a
licence. Shortly after, the board agreed to pay Etisalat 4200 crore (US$932.4 million) for 45%
of the business. Similar to this, the Unitech Group, a business that had previously engaged in
real estate rather than telecom, paid 1661 crore (US$368.74 million) for a licence, and the
corporate board subsequently sold a 60% interest in their wireless division to Telenor for
6200 crore (US$1.38 billion). The fact that the licences were soon resold at a significant
profit suggests that the selling agents granted the licences below market value since the
licences have to be offered at market value according to the terms of the sale.96
Nine firms paid the Ministry of Communications and Information Technology's telecoms
division 10772 crore (US$2.39 billion) in total for the licences they obtained. The
Comptroller and Auditor General of India anticipated spending 176700 crore (US$39.23
billion) on this licencing. According to media outlets including OPEN and Outlook, Barkha
Dutt and Vir Sanghvi were aware that business lobbyist Nira Radia was influencing A. Raja's
judgements. The critics said Dutt and Sanghvi were complicit in corrupt behaviour between
the government and the media, backed it, and obstructed news coverage of the corruption's
revelation.97
Nira Radia and Ratan Tata's chats are on the tapes that were disclosed to the public. Tata
petitioned the government to recognise his right to privacy and to hold the CBI, Indian
Income Tax Department, and Minister of Home Affairs accountable for the leak.

95
Supra note 91
96
Supra note 89
97
Ibid
As respondents in the petition, the Department of Telecommunication and the Department of
Information Technology. Early in November 2010, the opposition demanded Raja's
resignation and accused Congress of shielding him from corruption accusations. A. Raja
resigned by mid-November.98
Vinod Rai, the comptroller, demanded explanations from Unitech, S Tel, Loop Mobile,
Datacom (Videocon), and Etisalat in mid-November after alleging that all 85 licences issued
to these businesses were illegal in other ways and lacked the up-front capital required at the
time of the application. Given that these businesses are presently offering certain consumer
services, various media sources have predicted that they will pay hefty penalties but avoid
having their licences suspended. The Indian government replaced the previous telecom
minister, A Raja, with Kapil Sibal in reaction to the multiple accusations. Sibal also serves as
the union minister for human resources development. Mr. Sibal argues that the actual losses
are zero and that the "notional" losses mentioned are the consequence of incorrect
computations.99
On December 8, 2010, the CBI launched searches on Raja and four other telecom officials:
Siddharth Behura, a former telecom secretary; R K Chandolia, Raja's personal secretary; K
Sridhar, a member of the telecom; and A K Srivastava, the deputy director general of the
DoT. On February 2nd, 2011, Raja, Behura, and Chandolia were detained100.
The CBI and the court are looking into this significant issue. Raja is still detained at Tihar.
Numerous of his colleagues are also the subject of inquiries. Mr. Batcha's associate was
discovered deceased under enigmatic circumstances. The CBI is also looking into this matter.
Recently, the Supreme Court mandated that the Patiala House Court hold daily hearings in
the 2G scam case. It is significant to highlight that there are more controversies of this nature
every day. The average person seldom has any recourse against the widespread corruption in
the government. The government doesn't appear devoted to fighting corruption. We can
appreciate the growing opposition to this threat from civic society and the public. People have
high expectations for this nation's judicial system. In such cases, it is anticipated that the
corrupt ministers and bureaucrats would be prosecuted in accordance with the law.

3.9 Covid-19 Cyber Frauds

98
Supra note 91
99
Ibid
100
Ibid
Cybercriminals are working nonstop to exploit the situation as India struggles with the second
COVID wave. There have already been several instances of fraud involving contributions,
vaccinations, etc. The previous year was the same. Cybercriminals offered a loan moratorium
in exchange for a "fee" while posing as bank officials. There were phoney PM CARES Fund
UPI (unified payment interface) handles. In the period between February 2020 and February
2021, about 120 million individuals were victims of cybercrime, according to the Norton
Cyber Safety Insights Report from cybersecurity company NortonLifeLock. As more
individuals utilise internet services and continue to work from home, it could get worse this
year.101
Following the start of the immunisation push, the government let people to make
appointments online. Additionally, it established the Co-WIN registration platform. Co-WIN
began to appear in the titles of programmes that were released by cybercriminals. In certain
cases, fraudsters created phoney websites that demanded payment in advance for vaccination
reservations. Insufficient medications like remdesivir have been sold on fake websites.102
Few prizes are more sought-after amid the world's deadliest coronavirus epidemic than an
empty oxygen canister. As patients throughout the nation struggle for air, India's hospitals are
in urgent need of the metal cylinders to store and deliver the life-saving gas. So when one
supplier more than quadrupled the price, to over Rs 15,000 per, a local charity responded
indignantly. The charity notified the police, who investigated what may have been one of the
most blatant and hazardous frauds in a nation rife with fraud connected to the coronavirus and
black market profiteering. The supplier, described by the police as Varsha Engineering,
which is effectively a scrapyard, allegedly repainted fire extinguishers and sold them as
oxygen canisters. The results might be fatal: If loaded with high-pressure oxygen, the less
durable fire extinguishers might blow up. Some of the products are fake, while others might
be dangerous. Police in Uttar Pradesh accused a particular group last week of snatching worn
burial shrouds from deceased and selling them as brand-new. More than 100 bogus vials of
remdesivir, an antiviral medication that many physicians in India are prescribing despite
concerns about its efficacy, were found by authorities in the same state the day before. Ad
hoc systems have limitations. After hospitals run out of essential resources like oxygen,
patients continue to perish.

101
Bhasin Tinesh, “Protect yourself from cyber fraud in the time of covid-19”, available at
https://www.livemint.com/money/personal-finance/protect-yourself-from-cyber-fraud-in-the-time-of-covid19-
11619727266648.html, Last Updated: 30 Apr 2021, 01:51 AM IST, Accessed on 20-6-2021
102
 In certain countries, politicians intimidate those who openly request supplies.103
That strengthens the black market, which is known for its high costs and dubious products.
Many people believe they have no other option. A graduate student in New Delhi named
Rohit Shukla said that an ambulance driver charged him Rs 5,000 for the three-mile trip from
the hospital to the cremation site after his grandmother passed away there in late April, more
than ten times the going rate. Workers wanted Rs 5,000 from the household although the
firewood only needed to cost Rs 500.104
Many doctors in India have utilised illegal plasma, which has a thriving market, to treat
COVID-19 patients. On Wednesday, police in the Uttar Pradesh city of Noida detained two
individuals they suspected of selling plasma for more than Rs 70,000 per unit. The authorities
claim that one of the individuals used social media to plead for plasma donors for his personal
purposes before selling the plasma through an intermediary. The antiviral medication
Remdesivir has been the target of several con games. Recently, the police in New Delhi said
that they had detained four individuals who were employed by hospitals and who had been
caught stealing unused vials of remdesivir from deceased patients and selling them for
roughly Rs 30,000 apiece. Hospitals in India were charging roughly Rs. 4,750 for the
medication before it became so rare.105
The Lucknow-based Surin family recently paid a broker more than Rs 1,000,000 for six
tablets of Remdesivir. Event manager Lucky Surin claimed that the family was left with little
options. Both her mother and her sister-in-law had severe illnesses. Later, her mother passed
away.
Anirudh Singh Rathore, a 59-year-old textile merchant in New Delhi, was seeking remdesivir
badly for his sick wife, Sadhna. At the regulated price of roughly Rs 5,000 per vial, he bought
two. He still required four. He discovered a supplier on social media who was prepared to sell
him four additional vials for around five times that amount. Two arrived first. He observed
the packing was different from the first batch when the second two were arrived. The
merchant said that many businesses had created them. Although Sadhna's oxygen levels were
plummeting and they were in a critical situation, the Rathores had their worries. Singh
Rathore said they gave the doses to the doctors, who injected them without being able to
determine whether they were real or fake.

103
Kumar Hari and Gettleman Jeffrey, “A desperate India falls prey to COVID scammers Last Updated: May 17,
2021, 10:21 PM IST”, available at https://economictimes.indiatimes.com/news/india/a-desperate-india-falls- prey-to-
covid- scammers/articleshow/82698790.cms?utm_source=contentofinterest&utm_medium=text&utm_campaign=cppst
, Accessed on 19-6-2021
104
Ibid
105
Ibid
On May 3, Sadhna Rathore died. 106

Loan App Scam

Sudeep, an assistant manager at a private insurance company in Bengaluru, endured pain for
eight months as a result of a loan he obtained through many applications. He became stuck
because of his desperate need for rapid cash to pay for his mother's medical care.107
He began by taking a modest quantity from one of the applications that a buddy had suggested.
He was compelled to seek out loans from other apps to cover the exorbitantly rising interest
rate. The final total with interest was Rs 6.38 lakh, despite the fact that the actual amount he
loaned was just Rs 73,000. The cities of Chennai, Hyderabad, Mumbai, and Delhi-NCR have
all reported similar incidents. These Chinese applications have access to the loanee's contact
information and may potentially misuse it in the event of a payment delay. 'Defaulters' are
under pressure by receiving fictitious legal notices. There have been a number of reported
suicides and arrests in India. The method of receiving money using the "iCredit" app is very
simple. Simply download the app, provide PAN and Aadhaar information, upload a selfie, and
enter the information for the bank where the money is to be credited. Sudeep was given 92 days
by the app to pay back the Rs 3,050 he borrowed. However, he had to provide the app access to
his camera and contact information. In 3–4 days, he paid the debt back. He was asked to pay Rs
5,800 within a week the very next day. Processing costs of Rs. 1,200, GST of Rs. 400, and
handling fees of Rs. 400 were included.108 He said that only "Cash Free" and "Razor Pay" were
acceptable methods of repayment for the sum. Additionally, heavy fees including default costs
of Rs 750 per day would be levied every time he didn't pay within the allotted seven days. He
was under such much pressure that he was forced to put up Rs 4,80,000 in jewels belonging to
his mother and daughter. He received threatening calls all day long, as did the people on his
contact list. Sudeep had even considered committing suicide.109
Four suspects, including two Chinese nationals Wu Yuvan Lun and Xia Ya Mau, were
detained on January 2 by the Tamil Nadu Central Crime Branch for operating an internet loan
application scam in the region. For giving 1,000 SIM cards to run the scam, four additional
Indians were detained. The gang was running a 110-person contact centre and eight lending
applications out of Bengaluru.

106
Ibid
107
Pinto Nolan and Pandey Ashish, "Harassed for eight months, Bengaluru man paid Rs 6.4L for Rs 73K he
took from Chinese loan apps”, available at https://www.indiatoday.in/india/story/bengaluru-man-pays-rs-6-4-
lakh-for-rs-73-thousand-he-took-from-chinese-loan-apps-1759119-2021-01-14, Last Updated: January 14, 2021
19:22 IST, Accessed on 19-6-2021
108
Ibid
109
Ibid
In conjunction with its investigation into rapid loan applications, Hyderabad police detained a
Chinese national from Mumbai on January 13th. Due to the harassment by these lenders, six
persons committed suicide in Hyderabad.110
He Jian @ Mark, a citizen of China, was named as the 26-year-old victim from the Jiangxi
province. Vivek Kumar, a 26-year-old Indian national, was also detained. He Jian joined as a
representative on behalf of Chinese citizens Xu Nan, Xu Xinchang, and Zhao Qiao in July
2019 after arriving in India on a business visa. They serve as directors for several
microfinance organisations. The group was running a number of apps that offered loans,
including Krazy Bean, Krazy Rupee, Cashplus, Rupee Pro, Gold Bowl, First Cash, Rupee
Most, Credit Rupee, Real Rupee/Rupee Bear, Cool Cash, Money Now, Pocket Rupee,
CashGO, Cash Star, Rupee Day, Cash Bowl, Cash Just, Cool Rupee, Money Rupee, Gold
Rupee, Money Helper, R Cash, and Money Bell. They were operating call centres in
Maharashtra's Thane and Pune. The above-mentioned firms' bank accounts included Rs 30
crore, which Hyderabad police have now confiscated.111
190 incidents of loan application fraud have been reported to the Hyderabad Central Crime
Station. The linguistic barrier is preventing police from questioning the detained Chinese
nationals. A Chinese national was detained by Hyderabad police in August 2019 after they
broke up an internet gambling ring.112
According to an initial investigation, around 1.4 million transactions totaling Rs 21,000 crore
have already occurred. These exchanges took place through payment gateways and bank
accounts connected to these businesses. Additionally, a significant number of overseas
transactions were made using bitcoin.113

***************X***************

110
Ibid
111
Ibid
112
Ibid
113
Ibid
 CHAPTER-4
LAW COMMISSION’S RECOMMENDATIONS AND THE
LEGISLATIVE RESPONSE
4.1 Introduction

One of the most corrupt nations in the world is India. The international watchdog placed us
87th out of 178 nations in its most recent assessment for 2010. Others also inform us of the
same reality. According to a recent investigation by the Washington-based Global Financial
Integrity (GFI), between 2000 and 2008, dishonest politicians and business executives stole
over $125 billion in monies intended for the poor's welfare and unlawfully sent them abroad.
In reality, the common person in this nation is already aware of how corrupt the entire system
has become because he lives with it every day. Bofors, Fodder, CWG, Hawala, IPL, Koda,
Provident Fund, Raja, Ramalinga, Recruitment, Security, Sugar, Sukhna, Telgi, Telecom, and
Urea are just a few examples of the frauds the nation has seen since gaining its independence.
All facets of the public sphere have been overcome by the scourge of corruption. The Army,
the bureaucracy, the customs, the military, the education system, health care, income tax,
judiciary, police, the parliament, politics, and sports. No division or organisation is
untarnished.114 Since the country's independence, the Indian government has been aware of
the corruption inside the government agencies and bureaucracy. It has tried a number of
different things to stop the threat. Different law commissions were tasked with the crucial
responsibility of proposing strong legislation. In its 29th report, the Law Commission made
recommendations about whether socio-economic crimes should be added to the Indian Penal
Code. While the prosecution and punishment of socio-economic offences were the focus of
the 47th report. These papers have given careful consideration to white-collar crime in India
and other nations. The first report was that of the Santhanam Committee, which focused on
central vigilance commission establishment and corruption prevention.115
Several laws have been passed by our legislatures as a response to the rising corruption.
White collar offenders still don't receive adequate punishment for these activities. Because
the government frequently refuses to permit the prosecution of public servants, it is
exceptionally difficult to prosecute a public official for corruption.

114
Joshi GP,” A brief history of some developments”, at
https://www.humanrightsinitiative.org/publications/police/cvc_cbi_some_developments_a_brief_history.pdf,
accessed on 15-6-2021
115
Agrawal, Arun Kr. “CORRUPTION IN HISTORICAL PERSPECTIVE: A CASE OF INDIA.” The Indian
Journal of Political Science, vol. 68, no. 2, 2007, pp. 325–336. JSTOR, www.jstor.org/stable/41856330.
Accessed 10-6-2021
Even if the sanction is granted, it is granted so late that the bureaucrats are able to get
themselves out of the rigors of law.116
There are three sections to this chapter. The law commissions' comments on white collar crimes
have been examined in part (a). A number of laws have been suggested as instances of
government anti-corruption initiatives in section (b). The page constraint of this publication
prevented a thorough discussion of these laws. Only their names will imply that we have
extensive legislation to combat corruption. Issues pertaining to the penalties for prosecuting
public employees have been covered in section (c). On this subject, there is a tonne of case law.
It has been thoroughly examined how the judiciary has changed the law throughout time.

4.2 Santhanam Committee Report

In India, white-collar crime is widespread. The Santhanam Committee study provides a

thorough and in-depth analysis of the illegal activity of the so-called men of respectability,
including business moguls, industrialists, contractors, high-ranking government officials, etc.
As I go through the report's pages, I see the following:117:
Only those who are willing and capable of corrupting may allow corruption to exist. The
industrial and commercial elites are largely responsible for this motivation and capacity to
corrupt. They are the ones who engage in tax avoidance and evasion, amass large sums of
unaccounted money through a variety of means, such as obtaining licences under fictitious
names for businesses and individuals, and trafficking in licences that suppress profits through
the manipulation of immovable property transactions. They are in charge of maintaining an
army of liaison and contact men, some of whom ostentatiously live, spend, and socialise.
The major and small merchant business groups in India are essentially a dishonest group of
thieves; nowhere else in the world do businessmen become wealthy as rapidly as they do in
India.
The traders have seriously hurt the Indian economy and harmed the general populace. These
traders are antisocial criminals who ought to face consequences.118
The committee had suggested that certain offences be included inside the IPC's framework.
This suggestion was turned down because it would have damaged the IPC's structure.119.

116
Ibid
117
Santhanam Committee Report on Prevention of Corruption, 1964.
118
Ibid
119
Ibid
4.3 Law Commission on the White Collar Crimes:

As was already said, the socio-economic crimes and white collar crimes are the focus of the
29th Law Commission Report. The commission's crucial role was to determine if the socio-
economic crimes may be included in the Indian penal code. It has made a comment on the
reasons behind White Collar Crimes120:
The rise and expansion of white-collar and economic crimes makes it harder to police the law
since all segments of society are unable to fully understand the necessity for high standards of
ethical behaviour.
The creation of "mass society" is being aided by scientific and technical advancements. With
a sizable rank and file and a tiny ruling elite, this situation promotes the development of
monopolies, the emergence of the managerial class, and complex institutional mechanisms.
The rise and expansion of white-collar and economic crimes are caused by society's
incapacity to recognise this requirement fully. One of the main reasons why white-collar
crime is on the increase is the global economic and industrial advancement. White-collar
offenders are protected from the snares of punishment by their socioeconomic background.
The most potent tactics are used by white-collar offenders to avoid the strictures of the law. It
contributes to the spread of white-collar crime121.
White-collar offenders are supposedly given a free pass by judges and criminal law
administrators because of their sympathies. The research acknowledges that White-collar
criminals are cunning, clever, and stable while operating under the guise of high social
position and can elude the legal system.122
The crime problem is complicated.—In conclusion, it is important to underline the challenge
of preventing crime in general and white-collar crime in particular.123, is a complex one. It
goes much further than the structure, substance, or location of the criminal code. The
inhibitions that normally keep someone from committing crime may have their roots in a
number of elements that support the development of conscience and a sense of guilt.

120
29th Law Commission Report.
121
Ibid
122
See the Conclusion of 29th Law Commission Report.
123 Ibid
Only one type of these inhibitions is represented by the penalties imposed by the penal code.
The issue of crime is social and economic, not legal. Sanctions aren't limited to the law in
order to effectively reduce crime.
Social values are among the fundamental components of every civilization. These have been
created as a result of each society's historical experience. Experiences and behavioural
tendencies that have made the group happy are highly regarded. Experiences that have left
you unsatisfied are not positively appreciated. In order to "encourage approved behaviour and
discourage disapproved behaviour," the community establishes sanctions. These punishments
can be encouraged via education and are incorporated in a society's laws, public opinion,
religious beliefs and taboos, folkways, mores, customs, and mores. Every community must
select which behaviours should be prohibited by legislation and which should be addressed
by other punishments. Our culture has demonstrated a strong dependence on the law while
also showing a lot of disregard for numerous rules. In a strict sense, criminology only
addresses behaviours that are sanctioned by the criminal code.
The issue becomes even more complicated when we consider how to stop a specific class of
crimes because we then have to take into account both the criminal instinct generally and the
more specific question of why the desire to commit crimes of that specific class arises.124.

4.4 47th Law Commission Report

As previously mentioned, the 47th Law Commission Report addressed the issues surrounding
the prosecution and punishment of socio-economic offences in great detail. It has the
opportunity to highlight some of the key characteristics of the socio-economic misdeeds.
Here are a few examples of those:

4.4.1 Motive of the criminal is avarice or rapaciousness (not lust or hate).

Background of the crime is non-emotional (unlike murder, rape, defamation etc.). There is no
emotional reaction as between the victim and the offender.
The victim is often the State or a segment of the population, especially the consuming public
(i.e., the group that purchases shares, stocks, or other intangibles, consumes products or
services, etc.). Even when there is a single victim, injury to society is the most crucial
component of the act.
 4.4.2 Mode of operation of the offender is fraud, not force.

Usually, the act is deliberate and wilful.

Interest protected is two-fold—
The social interest in protecting national resources, the general economic system, and the
property, wealth, or health of its individual members against exploitation or waste by people
or organisations.
By executing the laws pertaining to taxes and customs, foreign exchange, international trade,
industries, and the like, the public interest in increasing the country's wealth is served.
The most significant aspect of these crimes is that they typically do not have a single direct victim
but are nevertheless punished because they do harm to society as a whole. The main justification
for why extra measures must be taken to enforce them stems from this. Someone will want to see
the perpetrator punished if a man or woman is robbed, attacked, or defrauded; moreover, because
the crime was physical and had an immediate and direct effect, both personal and collective
revenge are likely to be stirred. However, this component is missing when, for instance,
necessities are hoarded, money is unlawfully removed from the nation, or prohibited items are
imported. Undoubtedly, a "victim" is involved in certain social misdeeds. For instance, the
immediate consumer suffers when contaminated food is sold. But the primary goal of punishing
the crime is to prevent it from possibly affecting a huge number of people. 125.
According to the research, social offences are crimes that impact the community's health or
material wellbeing as a whole, rather than only the victim as an individual. Similar to this,
economic misdeeds impact the nation's economy rather than just the riches of the victim.
Along with white-collar crimes and offences with absolute culpability, socio-economic
offences constitute an overlapping circle. Thus, socioeconomic violations and white collar
offences may cross. Again, an intersecting circle might also be used to depict strict
responsibility crimes and socioeconomic misdeeds126.
The necessity of preventing social and financial crimes in any contemporary community is
clear, according to the report. Regulation of activities with an economic impact by or
according to legislation is a necessary component of the shift from a rural and simple society
to an industrialised and complicated one. The same process of transition from a simple to
complex and a rural to urban society also necessitates an increasing attack on
malpractices which were previously unknown, but which now emerge as a result of the
process.

125
Chapter 1 of the 47th Law Commission Report.
Gibs law journal
The process results in a two-fold increase in these malpractices—an increase in both the
quantity and diversity of socio-economic malpractices. As a result, emerging, previously
unknown detrimental behaviours like unfair competitiveness rear their ugly heads.
Additionally, frauds that were once of a straightforward, predictable, and boring nature now
take on a variety of and varied appearances. One illustration is the adulteration of foods and
medications.127
This has taken place in every contemporary civilization. It takes on even more significance in
a growing economy since behaviour that, while illegal, may previously have been ignored—
like minor smuggling—must now be treated seriously. In an economic crisis or in a
tremendous endeavour to build up a society with a solid and healthy social structure, the
purity of every grain must be maintained and every dot of evil must be eradicated, just as in
battle every inch of land must be defended, no matter the risk.128.
Offences against the laws intended to counteract these problems are not adequately addressed
in the societal awareness for psychological reasons. Our thoughts are accustomed to
traditional crimes like murder, rape, and theft when a real person or piece of property belongs
to the victim. However, it takes time for people to comprehend the gravity of non-
conventional crimes when intangible property, in the sense of the community's economic
resources, is involved or if the harm produced is indirect and remote and there is no
immediate, obvious concrete object of the injury visible to the mind. Because there is no
direct victim, neither the perpetrator nor society fully comprehends the harm.129.
Amendments to several legislation, including the intricate tax laws, were suggested in the
47th report. The report had also advocated shifting the burden of evidence for socioeconomic
crimes from the prosecution to the perpetrator. Due to the seriousness of these crimes, even in
a democratic system, solitary imprisonment was deemed necessary to address socioeconomic
transgressions. Bureaucracy of this country is one of the least trusted bureaucracies in the
world.

127
Ibid
128
Ibid
129
Ibid
Even ministers, who serve as the people's spokesmen, are not respected. The democratic
situation in India is not in an acceptable place. To restore the public's confidence in the
democratic system, socio-economic transgressions must be dealt with properly. The necessity
for swift development of Indian law is due to the increasing severity of the penalties for
socio-economic offenders.

4.5 Legislative Response

India has been dealing with a problem with socio-economic misdeeds ever since it gained
independence. Even in the early years of India's freedom, scandals surfaced. The entire
system appears to have become worse over time. Nowadays, one of the difficult
responsibilities is governance. Because of the widespread corruption in the government, in
the ministries, and even at the lower levels, all social programmes have either failed or have
not been able to generate the expected results. People appear to have come to terms with
corruption as a fact of life. Private investment has been impeded in numerous industries due
to widespread corruption. It was only recently that one Australian company cut off its support
for the Commonwealth Games organising body after huge corruption was exposed even
before the competition.130
However, it is equally untrue that the Indian government has made no effort to address the
threat. The early years of independence show the government's commitment to dealing with
the problem when it gave several law commissions a crucial task: suggesting modifications to
the laws to deal effectively with socio-economic misdeeds. The government has periodically
passed a variety of legislation to ensure that socioeconomic crimes and white collar crimes
are punished. Unfortunately, there is yet no way to codify both white collar crimes and
socioeconomic offences under a single statute.131
To comprehend the steps taken by the government to combat socio-economic offences and
white-collar crimes, we must study the actions that are mentioned in this section rather than
focusing on any one act in particular. The government has taken some of these measures to
address socio-economic infractions, some of which are listed below.
i) Prevention of Food Adulteration act of 1954.
ii) Prevention of Corruption Act of 1988.
iii) Foreign Exchange Regulation Act of 1973.

130
Supra note 4
131
Ibid
iv) Consumer Protection Act of 1986.
v) Prevention of Money Laundering Act of 2002.
vi) Immoral Trafic Prevention Act of 1956.
vii) Dowry Prohibition Act of 1961.
viii) The Scheduled Castes and the Scheduled Tribes (Prevention of Atrocities) Act of 1989.

The government has passed some of the following laws to address socioeconomic violations.
Some of these actions are referred to as social legislations, and those who break the law are
subject to strict responsibility. The Prevention of Food Adulteration Act of 1954 is a prime
example of such.

It is asserted that our judicial system is enough to deal with both socioeconomic crimes and
white collar crimes. The adoption of heavier sanctions that will allow the prosecution of
people who commit crimes in this category may be facilitated by certain changes.
Even though several laws have been passed, the government hasn't shown a willingness to
enforce strict punishments for offenders since, frequently, ministers and lawmakers are also
implicated in white collar crimes.
It is imperative that the government take a proactive stance in enforcing harsh penalties to
ensure that no white collar criminal escapes justice. A citizen of this nation has a
responsibility to be protected against the rising threat of white collar crimes, according to our
legislature. Our constitution has obligated our legislators to carry out this obligation.

4.6 Sanction for Prosecution of Public Servant

One significant issue that has been making headlines for a while now is the fact that the
government does not authorise the prosecution of a public employee. Even if it does, the
government takes years to implement the punishments. We have a provision regarding it in
section 197132. there are several judicial pronouncements which helped the development of
law on the point.
The expression “Public Servant” has not been defined in Section 21133. It lists all of the
different employees that have been given the title of public servant. It still holds true today.
"Public Servant" (Section 21) —The term "public servant" refers to any anyone who meets
one of the following criteria:

Sec. 21's opening provision was removed.

Second.—Each and every Commissioned Officer of the Indian Military, Navy, or Air Force;
Third.—Each and every judge, as well as anybody authorised by law to carry out any
adjudicatory duties on their own or as a part of any group of individuals;
Fourth, each officer of a Court of Justice, including a liquidator, receiver, or commissioner,
whose duty it is to carry out any judicial process, administer any oath, interpret the law, or
maintain order in the Court, or make, authenticate, or keep any document, or take charge of
or dispose of any property, and each individual specifically authorised by a Court of Justice
to carry out any of such functions
Fifth.—Every juryman, assessor, or member of a panchayat assisting a Court of Justice or
public servant;
Sixth: Every arbitrator or other individual to whom any subject has been referred by any court
of justice or other appropriately placed public authority for a judgement or report; Seventh—
Anyone who occupies a position that gives him the authority to imprison someone or detain
them in custody;
Eighth.—Every officer of the Government whose duty it is, as such officer, to prevent offences
to give information of offences, to bring offenders to justice, or to protect the public health,
safety or conveyance.
Ninth.—Every officer whose responsibility it is to take, receive, keep, or expend any property
on behalf of the government, or to conduct any survey, assessment, or contract on behalf of
the government, or to carry out any revenue process, or to investigate, or to report, on any
matter affecting the financial interests of the government, or to make, authenticate, or keep
any document relating to those financial interests of the government, or to prevent the
violation of any of the preceding
Tenth: Every officer whose job it is to take, receive, keep, or spend any property, make any
assessments or surveys, levy any rates or taxes for any secular common purposes of any
village, town, or district, or create, authenticate, or maintain any documents for determining
the rights of the people of any village, town, or district.
Eleventh.—Every person who holds any office by virtue of which he is empowered to prepare,
publish, maintain or revise an electoral roll or to conduct an election or part of an election.
Twelfth.— somebody employed by the government, receiving government compensation, or
receiving fees or commissions in exchange for performing government business; in the
service or pay
of the local authority, or corporation established by or under a Central, Provincial or State Act
or a Government Company as defined in Section 617134.
An example of a public servant in this area is a municipal commissioner. For the purpose of
our discussion, the first two explanations in this section are crucial. These justifications are:
Explanation 1.—Persons falling under any of the above descriptions are public servants,
whether appointed by the Government or not.
Wherever the phrase "public servant" is used, it refers to any anyone who is really in that
position, regardless of any legal issues with that individual's eligibility to hold that
position.135.
Sec. 197136 reads as follows:
197. Judges and government employees are being prosecuted. (1) No Court shall take
cognizance of such offence except with the prior sanction when any person who is or was a
Judge or Magistrate or a public servant not removable from his office except by or with the
sanction of the Government is accused of any offence alleged to have been committed by him
while acting or purporting to act in the discharge of his official duty.
(a) in the case of a person who is employed or, as the case may be, was at the time of
commission of the alleged offence employed, in connection with the affairs of the Union, of
the Central Government;
(b) in the case of a person who is employed or, as the case may be, was at the time of
commission of the alleged offence employed, in connection with the affairs of a State, of the
State Government:
1 [However, if the alleged act was committed by a person listed in clause (b) when a
proclamation made under article 1 clause (1) was in effect, 356137 was Clause (b) will apply if
it's in effect in a State as if "Central Government" were used instead of "State Government"
whenever it appears there.
(4) The prosecution of such a judge, magistrate, or public servant may be carried out by the
Central Government or the State Government, depending on the circumstances. The Central
Government or State Government may also specify the Court before which the trial is to be
held.138.

134
THE COMPANIES ACT, 1956
135
Supra note 10, s 21
136
Supra note 132, s 197
137
THE CONSTITUTION OF INDIA, 1950
138
Ibid
Therefore, the following requirements must be met in order to trigger section 197(1) of the
Criminal Procedure Code, which mandates prior sanction for prosecution of, among others,
public servants: A public worker is or was one who was not permitted to leave his position
without the consent of the government;
He must have committed the claimed infraction while acting or pretending to act in the course
of his official job;
If at the time of the alleged offence the accused person is or was employed in connection with
the affairs of the union, the previous sanction for taking cognizance of any such offence must
have been given by the Central Government; similarly, if the accused person is or was
employed in connection with the affairs of a state, the previous sanction would have to be
accorded by the state government.
It is also provided by section 197(4)139 that the Depending on the circumstance, the Central
Government or the State Government may decide who will prosecute the public worker, how
the prosecution will proceed, what offence or offences will be the focus of the investigation,
and which court the trial will take place in. The ability to designate the court provided by
subsection (4) need not always be used. It is granted due to practicality, case intricacy, or
seriousness. Additionally, it is probably done to protect the dignity of high-ranking
government employees and to prevent them from having to face an embarrassing trial by less-
qualified judges.
It is submitted that section 197140. Sadly, it does not outline the process to follow once the
government withholds the sanction before prosecuting the public official. It is unclear if the
government is required to inform the party seeking to prosecute the public worker that the
sanction to do so has been withdrawn. The government is under no obligation to explain why
it is not prosecuting the public worker. According to the CVC, there is "a necessity for
prosecution sanctions even in those violations which have no link to the performance of
official tasks and excessive delays in penalizing ”141 is one of the specific impediments
preventing the CBI from operating effectively. This bottleneck undermines justice since it hinders the
CBI's ability to do its job and gives the accused impunity.

4.7 Judgments

139
Id, ss (4)
140
Id, s 197
141
CVC’s National Anti-Corruption Strategy, Final Draft, September 2010; p. 22
In State of Orissa through Kumar Raghvendra Singh & Others v. Ganesh Chandra Jew142, It
was noted that the definition of cognizance in Black's Law Dictionary is "jurisdiction," "the
exercise of jurisdiction," or "power to try and determine causes." Accordingly, if a complaint
is made against a public worker who is suspected of an offence allegedly committed while
performing his official duties, a court is prohibited from considering it, taking notice of it, or
exercising its authority. Given the nature of the clause, it is unclear how to interpret the
phrase "any offence alleged to have been committed by him while acting or purporting to act
in the discharge of his official duty." Why does that matter? According to the definition, the
word "official" refers to something that relates to an office, and an official act or duty is
something that an officer performs while acting in that role. The phrase "official duty"
suggests that the public must have performed the act or omission during the course of his
employment and that it must have been done in the performance of his duties. The Section
limits its area of operation to only those acts or omissions that are committed by a public
servant while they are in service and does not extend its protective cover to all of their
actions. Its protection has been expanded by including actions or inactions committed ostensibly in
the course of official business. That is listed under "office colour." As a result, doing an act or
omission as part of official duties, which must also have been official in character, means that the
public servant must have done so during the course of his employment. Therefore, while assessing
whether the Section applies to any conduct or omission during the course of employment, it must be
interpreted carefully. Its use must be restricted to obligations that are met in the course of
employment. However, once a public worker has been determined to have committed a crime while
performing his duties, that crime must be given a broad and open interpretation insofar as its official
nature is concerned. For example, a public employee has no right to engage in illegal activity. To
that extent, the Section must be read strictly and with limitations. However, once it is proven that a
public servant committed an act or omission while performing his duties, the extent of its official
nature should be interpreted in a way that advances the Section's goals while also favouring the
public servant. If not, the entire goal of providing protection to a public official without
consequence will be defeated. For instance, a police officer may be required to use force while
performing their duties, which may be a crime that requires prosecution and possible
punishment.

142
(2004)8 SCC 40
An act in course of service but not in discharge of his duty and without any justification
therefor then the bar under Section 197143 is not attracted.
It has been held in Sankaran Moitra v. Sadhna Das and Another144, The primary object of the
Legislature behind Section 197145 is to protect public officers who have acted in discharge of
their duties or purported to act in discharge of such duties. However, it is also well
established that the alleged act of a public official must have a reasonable link to the duty that
the public officer attempted to fulfil. He cannot get protection under Section if the alleged act
has no linkage, reasonable relationship, or relevance to the official act or duty of such public
servant and is instead illegal, criminal, or in the nature of an offence under section197146.
Thus, the protection provided by the aforementioned section is limited and subject to certain
conditions. In such cases, when the issue of whether Section 197 is applicable or not is
brought up for discussion before a court of law,147, The Court has the ability and the
obligation to consider all relevant factors in the case at hand. If the matter is covered by
Section 197, it should make sure that the public servant is safeguarded on the one hand.148
And on the other hand, if the provision is not followed and he is attempting to take unfair
advantage of his position as a public worker, appropriate action may be taken.
The main goal of this law provision is to shield more important groups of public employees
from erroneous, pointless, or malicious charges so they can perform demanding and
responsible duties without fear. But it's equally crucial to stress that people' rights must be
upheld and that no abuses should be tolerated. It is also appropriate that the public worker
needs protection under this clause just as much after retirement as it did before retirement. If
it were possible for a private individual with a grievance to wait until the public servant lost
his or her official job before filing a complaint, the protection provided by the provision
would become illusory. The public interest in preventing official actions from resulting in
superfluous or vexatious prosecution serves as the ultimate reason for the protection granted
by section 197. From that perspective, the decision of whether to prosecute any public
employee should be left up to the government. Before the public worker is actually brought
before a court, the sanction's goal is to get a thoughtful opinion from a superior authority.
Public servants have to be protected from

143
Supra note 136
144
(2006)4 SCC 584.
145
Supra note 136
146
Ibid
147
Ibid
148
Ibid
harassment in the discharge of official duties while ordinary citizens not so engaged do not
require the safeguard. The Supreme Court ruled in Matajog Dobey v. H.C. Bahari that section
197(1) should be repealed for this reason.149 is not violative of Article 14150 as the
discrimination is based on rational classification151.
Section 197152 contemplates a difference between public employees who can only be fired by
the government or with its permission and those who can be fired by a lower authority. Even
while the government's delegation of the right to remove someone to a subordinate authority
is in certain ways equal to the government actually removing someone via the use of that
authority, it has been determined that section 197153 must be interpreted in the light of certain
well known features of the administrative system prevailing in India. It appears to be the
policy of the legislatures to make the protection under section 197154 available to a limited
class of officers, and not to all public servants (Afzalur Rahman v. King Emperor)155.
There is no definition of "public servant" in the code. Therefore, by virtue of clause (y) of
section 2156, the definition of ‘public servant’ as given in section 21157 will have to be relied
upon while determining the meaning of the expression ‘public servant’ as used in section
197158.
It was observed in Pukhraj v. State of Rajasthan159, that in order to attract section 197160, The
accused individual must have committed the crime while acting—or pretending to act—in the
course of performing his official duties. Again in Balbir Singh v. D.N. Kadian161, it was held
that It is not every offence committed by public servant which require sanction for prosecution
under section 197(1)162, not even all of the actions he took when he was really carrying out
his official job. But regardless of whether the act complained of was actually a lawful
fulfilment of his responsibilities or not, a punishment would be required if it directly related
to official duties and could be shown to have been done as a result of the office.

149
Id, ss (1)
150
Supra note 137
151
AIR 1956 SC 54.
152
Supra note 135
153
Ibid
154
Ibid
155
AIR 1943 FC 18.
156
Supra note 10
157
Ibid
158
Supra note 136
159
(1973)2 SCC 701.
160
Supra note 136
161
(1986)1 SCC 410.
162
Supra note 136, ss (1)
It has been held that the sine qua non for the applicability of the section 197163 is that the
public servant must have committed the offence, whether it be one of act or omission, either
in the course of his official duties or under the colour of the office to which he was elected.
Some crimes cannot, by definition, be considered to have been committed by public
employees while they were acting or ostensibly acting in the course of their official duties. As
an illustration, accepting a bribe (an offence punishable under section 161164) is one of them,
and the crime of aiding and abetting it in another. When a public employee cheats or aids
another in cheating, he is not acting or purporting to act in the performance of his official
duties because such offences have no necessary connection to the performance of public
employee duties; rather, the official status only provides the occasion or opportunity for the
commission of the offence. A governmental employee cannot properly assert that he is selling
contaminated food items since it is against the Prevention of Food Adulteration Act to do so.
He can, therefore, be prosecuted without obtaining any sanction under section 197165 of the
Code.166
In State of Maharashtra v. Atma Rama167, The IO attacked four people, imprisoned them
unlawfully, removed one of his clothes, and held him hanging from a tree throughout the
course of an investigation into an alleged murder. Two of the people gave false confession
statements as a result of this mistreatment. As soon as the police officers were charged with
violating sections 330, 342, 343, 348168, They argued that the actions were taken illegally or beyond
the call of duty. The Supreme Court rejected the argument, noting that the clauses of sections 161 and
163169. emphasize the fact that a police officer is prohibited from beating or confining persons
with a view to induce them to make statements. Given the legislative ban, it is impossible to
claim that the actions in question were taken by police officers acting in the course of their
official duties or powers. The court concluded that there was no relationship between the
alleged activities, the police officers' positions, and the responsibilities set forth by law in this
case.

163
Supra note 136
164
Supra note 10, s 161
165
Supra note 136
166
Supra note 159
167
AIR 1966 SC 1766.
168
Supra note 10, s 330, 342, 343 and 348
169
Supra note 132, s 161 and 163
The alleged acts fell completely outside of the scope of the duties of the police officers.
In S. Dutt v. State of U.P170. It was decided that it is well established that when a person
commits multiple offences during one transaction, the prosecution cannot choose to focus on
the less serious offences that don't call for a special complaint or prior punishment while
ignoring the more serious offences.
No specific defined form of punishment is envisioned, but courts often demand proof that the
sanctioning authority considered the circumstances of the case before imposing punishment
and that the punishment is not arbitrary. (Jaswant Singh v. State of Punjab)171.It is firmly
established that imposing sanctions is an executive, rather than a judicial, action. Before
imposing sanctions, the sanctioning authority must feel satisfied, yet this pleasure is subjective
rather than objective. Additionally, no hearing is required before a punishment is given to
prosecute a public employee. The punishment need not be as specific about the offences as a
charge, and the prosecution's ability to prove the pertinent facts does not appear to be hindered
by the need to specifically name a particular legal punishment.
In B. Saha v. M.C. Kochar172, It was noted that the issue of a sanction under section 197173
may be brought up and taken into account at any point in the proceedings. Even if there is a
202174 investigation, the plea of penalty under section 197175 can be raised by the accused.
The court does not have to limit itself to the claims in the complaint when determining
whether or not a sanction for prosecution was warranted; instead, it may take into account all
the materials or the record available at the time the subject is presented and comes up for
discussion. Again in Suresh Kumar Bhikamchand Jain v. Pandey Ajay Bhushan176, The
Supreme Court said that there should not be any obstacles to the accused presenting
pertinent data and records that are ifso facto acceptable for the determination of whether
section 197177 has any application to the case at hand.

170
AIR 1966 SC 523.
171
AIR 1958 SC 124.
172
(1979)4 SCC 177.
173
Supra note 136
174
Supra note 10, s 202
175
Supra note 136
176
(1998)1 SCC 205.
177
Supra note 136
The Supreme Court in Ram Kumar v. State of Haryana178, has said that two conditions must
be met before a public official tasked with maintaining public order be charged with using
excessive force in the course of their duty. Without receiving permission to pursue charges
under clause (i), he cannot be prosecuted 132179; (ii) No court can take cognizance of the
offence in the absence of previous sanction under section 197180. Before taking legal action
against a public official, both of these conditions must be met.
In State of Orissa v. Mrutunjaya Panda181, According to the court, if a public employee has
been investigated but not given a proper penalty, section 465182 may be used to correct the
irregularity and states, among other things, that the appellate court may not reverse a
conviction order unless it finds that the irregularity caused a failure of justice.
The sanction for a prosecution must be articulated with enough specificity to identify the
topic that will be the focus of the case, and it should be obvious from the sanction order that
the sanctioning authority gave careful consideration to the facts forming the crime or
offences. The government is supposed to behave honestly and make an unbiased judgement
when asked to impose sanctions since it is an independent party unrelated to the conflict
between the complainant and the accused. If the government arbitrarily refuses to impose a
consequence, such action can always be contested in the proper forum.
Even with its revision and the suggestions made in the Santhanam Committee report, the
Prevention of Corruption Act of 1947 is no longer effective. The Prevention and Corruption
Bill was submitted in Parliament with the goal of tightening the provisions and broadening
the scope of the anti-corruption legislation to increase their effectiveness. The following is the
bill's statement of objects and justifications:
The Bill, inter alia, envisaged widening the scope of definition of the public servant,
incorporation of offences under sections 161 to 165183 into the addition of the clause that the
trial court's ruling sustaining the award of sanction for prosecution would be final if it has not
previously been contested and the trial has not yet begun, as well as the new law
strengthening the punishments for criminal violations. In order to expedite the proceedings,
provision for day-to-day trial of cases and prohibitory provisions with regard to grant of stay
and exercise

178
(1987)1 SCC 476.
179
Supra note 132
180
Supra note 136
181
(1987) 2 SCC 414.
182
Supra note 132
183
Supra note 10, s 161-165
of powers of revision of interlocutory orders have also been included. Since the provisions of
section 161(9)184 were removed from the IPC and included in the proposed law with a harsher
sentence.
The Supreme Court decided some of the very important points in R.S. Naik v. A.R. Antuley185.
The relevant date with reference to which a valid sanction is sign-qua-non for taking
cognizance by an offence committed by a public servant is the date on which the court is
called to take cognizance of which he is accused if, therefore, when the alleged offence was
committed, the accused was a public servant, but by the time the court was called to take
cognizance of the offence committed by him as a public servant, he had ceased to be one. In
this instance, the accused had resigned as Chief Minister and was no longer employed by the
government as of the day the cognizance was made. As a result, no penalty under Section
6186 of the Act was required before bringing the accused into custody for violations allegedly
committed in his previous role as a public employee.
Where offences as set out in section 6187 of the If a public worker was found to have violated
the law, just the authority with the power to remove him from office needed to approve the
action. This authority must have been utilised for legitimate purposes. The office's holder
would have the chance to abuse or misuse the position. The authority granted to the office is
closely related to and derives from the proper behaviour. He has a position that is significant
and non-severable in terms of interdependence and relationships with other people. To be
eligible to receive punishment, the authority must be able to remove the public servant from
his position once they have violated the law by abusing or misusing their powers in that
position.188
A sanction's granting is a serious act that eliminates protection from baseless lawsuits, not
just a formality. As a result, before imposing a penalty, the authority with the jurisdiction to
do so must consider the case's circumstances, the evidence gathered, and any other relevant
factors. When presented with the facts and the evidence, the removal authority alone would
be able to determine whether a significant criminal was committed or whether the prosecution
was baseless or speculative.

184
Supra note 10, s 161(9)
185
(1984)2 SCC 183.
186
THE CENTRAL VIGILANCE COMMISSION ACT, 2003
187
Ibid
188
Supra note 185
Therefore, even though he may be holding another office on the pertinent date that could
make him a public servant as understood in section, no sanction would be necessary if the
accused has ceased to hold the office by the date the court is asked to take cognizance of the
offences allegedly committed by such public servant 21189 if There is no claim that the office has
been misused or abused for the right reasons because the competent authority with the power to
remove a public employee from a position where neither misuse nor abuse is claimed would not be
able to determine whether the accusation is baseless or tendentious. In this instance, the accused had
left his position as Chief Minister by the time the court was asked to take notice of the alleged
charges. As a former Chief Minister, no punishment or legal action was therefore required. The court
noted that even if the accused were to be considered a public employee under section 21 of the Act as
an MLA, the absence of any claims that he exploited or misused his position would render that fact
irrelevant. The court noted that MLA is not paid by the government in the sense of the executive
government and is not compensated in any way for the executive government's fulfilment of any
public obligation. He does not fit the definition of the term "public servant" as it is used in clause
12(a), and as a result, does not fall under that clause's definition.190
Having regard to the history of evolution of section 21191, Insofar as the amendment of clauses
ninth and twelfth did not result in any change in the coverage and construction of the two
clauses prior to and since their amendment, it is evident that MLA was not a public servant
within the meaning of the expression prior to the Amendment Act (40) of 1964 and the law
has not changed since the said amendment.192
The use of the word ‘or’ in clause twelfth (a) of section 21193 of the Act seems to be
incongruous. In contrast to "a person in the government's service" or "a person paid by fees or
commission for performing any public duty by the government," "a person in the
government's pay" refers to a distinct and independent type of public servant.

189
Supra note 10
190
Supra note 185
191
Supra note 10
192
Supra note 185
193
Ibid
The phrase "in the pay of" in clause 12(a) does not imply a master-servant or command-
obedience relationship between the government as the payer and the public servant as the
payee. Instead, it may refer to a situation in which a person is paid by the government without
also being employed by it or in a master-servant relationship. The court noted that our
constitution has a broad distribution of powers between the executive, legislative, and judicial
branches. 'Government' is used in section 21194 IPC means the executive, not the legislature,
is obvious. MLA is unquestionably not paid by the executive. The MLA cannot be considered
to be employed by the executive branch of government even though he receives pay and
benefits. That is only a method of payment, but the MLA was maintained by a vote to have
been designated for the distribution of salary and allowances due to them under the applicable
legislation. The aforementioned conclusion would apply to clause 12(a)'s third half,
"remuneration by fee for performance of any public duty by the government." Therefore, the
executive branch of government, or the government, does not pay the MLA's salary. The
court did not think it essential to decide whether or not the MLA is performing any public
duties. However, the court ruled emphatically that he does not carry out any official duties on
behalf of or at the direction of the government. He performs constitutional duties for which
the Constitution provides him with compensation, not the executive. Additionally, an MLA
does not perform any judicial duties as defined by section 21(3)195 of the Act. A MLA does
not become a member of a body that performs adjudicative responsibilities by participating in
a discussion over a motion of violation of privilege or by taking action for contempt of the
House and voting on it. The Prevention of Corruption Act of 1947's provision and similar
measures in other statutes that attempt to sanction prosecution of public employees are
motivated by the principle that such employees should not be subjected to needless
harassment. The goal is to protect the public worker from becoming the target of malicious
and baseless accusations. Therefore, the existence of a legal penalty is a need before the
offence may be recognised. Without such a consequence, the court would lack the authority
to recognise the violations. A trial without a legal punishment when one is required is a trial
without the authority of the court.196
In the case of Vineet Narain v. Union of India197, The Supreme Court noted that the three-
month deadline for granting sanctions for prosecution must be scrupulously followed.

194
Supra note 10
195
Ibid
196
Supra note 185
197
(1998) 1 SCC 226.
However, if consultation with the Attorney General (AG) or any other legal officer in the
AG's office is necessary, an extra month may be granted. State of Kerala and Others198,
Chief Justice Sen and Justice A. M. Ahmadi cited paragraph 15 of the findings of the 41st law
commission, which addressed Sec. 197199. as it earlier stood. It reads:
We believe that the necessity for protection under this clause exists both before and after the
public worker retires. If a private individual with a grievance could wait until the public
servant lost his official position before filing a complaint, the protection provided by the
provision would become illusory. The main argument for the protection provided by Section
197200 is the public interest in seeing that official acts do not lead to needless or vexatious
prosecutions. The decision of whether to prosecute any public employee should be left up to
the government from that perspective.
Due to this discovery, the word "was" began to be used after the word "is" to make the
punishment enforceable even when a retired public worker is being sought for prosecution.201
Taking note of the provisions of Article 167202 (Article 164 for Ministers), It was brought up
that the Chief Minister gets paid from the public coffers for carrying out a public function and
is, as a result, a public servant as defined by Section 197203 of the Code. As a result, on the
example of the remarks related to the Chief Minister, the Minister must likewise be deemed to be a public
servant. A Minister of a State is paid from its public exchequer. He is paid for performing the function
assigned to him as a Minister. He would qualify as a "public servant not removable from his office except
by or with the sanction of the Government" since he is hired or fired by the Governor. As was previously
said, the General Clauses Act of 1897's requirements apply to the present issue, and the word
"Government" used in Section 197204 would mean the Governor in the case of a Chief Minister or
a Minister.205
It was held in Kalicharan Mahapatra v. State of Orissa206, that Remember that, despite
making such a big alteration to Section 197 of the Code in 1973, Parliament was cautious
enough to leave Section 19 of the new Prevention of Corruption Act of 1988's wording
unchanged. This section deals with sanctions.

198
(1996)1 SCC 478.
199
Supra note 136
200
Ibid
201
Supra note 198
202
Supra note 137
203
Supra note 136
204
Supra note 136
205
Supra note 198
206
(1998)6 SCC 411.
The reason is obvious. The sanction contemplated in Section 197207 of the Code addresses
public employees who "are accused of any offence alleged to have been committed by him
while acting or purporting to act in the discharge of his official duty," whereas offences
covered by the PC Act are those that cannot be considered acts directly or even ostensibly
performed in the course of performing official duties. Despite the modification made in
Section, the wording of the relevant section in the previous PC Act was significantly
incorporated into the new PC Act, 1988, indicating that Parliament wanted to retain the
distinction. 197208 of the Code.
Thus a public servant, who committed an offence mentioned in the Act, while he was a public
servant, can be prosecuted with the sanction contemplated in Section 19209 of theAct if he is
still working for the government when the court recognises the infraction. However, if he no
longer works for the government by then, the court may still declare the offence committed.
In other words, whether or not the public servant is still employed as a public servant at the
time of the trial or while the prosecution is pending, he or she is still subject to prosecution
for the crime committed while acting in that capacity.210
It was observed in Romesh Lal Jain v. Naginder Singh Rana and Others211, Sanction required
under Section 197212 and The 1988 Act's requirements for sanctions have diverse foundations.
While a sanction under the Indian Penal Code must be issued by the State in accordance with
the Code of Criminal Procedure, under the 1988 Act, it may also be granted by the authorities
listed in Section 19213 thereof. Additionally, it was decided that the 1988 Act's crimes and the
Penal Code's offences are separate and distinct. The standard that must be used in this
situation is whether the offences for one reason or another that are criminal under the Penal
Code must also be proven in regard to the offences that are punishable under the 1988 Act.
The same test can be used in respect to a penalty issue if the answer to the aforementioned
question is determined to be negative.
Whereas an order of sanction in terms of Section 197214 is needed to be obtained where the
offence levelled against the public servant is connected directly or indirectly to the
performance of that duty, but not essential when the offence levelled against the public
servant has no connection to that duty.

207
Supra note 136
208
Ibid
209
Supra note 186
210
Supra note 206
211
(2006)1 SCC 294.
212
Supra note 136
213
Supra note 186
214
Supra note 136
Although it would be ideal for the court to accept a plea about a lack of sanction at an early
stage of the proceedings, this does not preclude the accused from making the plea or the court
from doing so at a later time. Every case needs to be evaluated based on its unique facts. In
certain circumstances, it may not be feasible to decide whether the sanction was necessary to
attain or not without collecting some evidence; in these circumstances, the issue may still
need to be taken into account after the witnesses have been questioned.215
In State of Karnataka v. Ameer Jain216,It was decided that a punishment order shouldn't be
read too literally. But it is also widely accepted that one should always keep in mind the
reason why a punishment order needs to be granted. The sanctioning authority is often the
most qualified individual to determine whether the public servant in question should be
granted protection under the Act by declining to sanction his prosecution or not.
Unquestionably, the sanctioning authority must use their judgement for the aforementioned
reason. The order imposing sanctions must be evidence that the sanctioning body used its
judgement in an appropriate manner..
The Prevention of Corruption Act was passed to make bribery and corruption prevention
more effective. Therefore, the Act's provisions must be interpreted in a way that advances the
goals and purposes behind it, and they must not be thwarted in any way. To sum up, the law
commission extensively investigated the issue of socio-economic offences and white collar
crimes before making suggestions in a number of law commission reports. It is significant to
note that the 47th Law Commission Report recommended amending a number of laws to
increase the severity of the penalties for offenders of this category of crimes. It is said that we
still don't have any laws that work to address the problem of socio-economic offences and
white collar crimes, which is on the rise.
Several laws have been passed by legislatures to address the transgressions. We still don't
have a single, universal code to address socioeconomic crimes. It is crucial to remember that
the 29th Law Commission Report correctly noted that adding all socio-economic offences to
the scope of the Indian Penal Code would only make the issue more complicated. As a result,
it is asserted that the average man has very little recourse against bureaucrats and other public
employees at a time when we are under the greatest threat from the threat of corruption and
white collar crimes.

215
Supra note 211
216
AIR 2008 SC 108.
The widespread corruption is making everyone in the nation restless and upset. The nation
must be shielded from this issue. We cannot permit taxpayer funds to go into the wrong
hands. To safeguard the ministers and the public officials, the government cannot always take
a passive stance. All socio-economic misdeeds should be included in a single code with
strong rules, according to the government. Because these laws are social regulations, the
burden of evidence must be placed on the violators. The punishment for this group of crooks
should be quite harsh. It is time to reduce the well-known requirement of criminal law that an
accused person's guilt must be established beyond a reasonable doubt. The judge should keep
in mind that beyond a reasonable doubt should not become beyond a reasonable doubt, even
if the standard is not eased. The legislature should respond appropriately by enacting stout
legislation in the statutes in reaction to convictions of socioeconomic offenders.

Several difficulties with the punishment for prosecuting the public workers have come to
light. On these grounds, the Supreme Court has given a favourable response. Although it is
argued that public employees require protection against bogus complaints so they can do their
duties courageously. Additionally, it is crucial to remember that the government should
always authorise prosecution in cases where corrupt public officials are suspected. If the
government chooses to withhold penalties in this situation, it shall inform the party requesting
the sanctions of its decision. Actually, it is the responsibility of the government to inform the
person of the status of his application for the sanction. The minister is not a public servant in
the sense of the definition of "public servant" specified in section 21217. He receives
compensation for his constitutional obligations in accordance with the Indian Constitution,
not as a result of a master-servant relationship. In the Rajas case, the Supreme Court was
presented with this dilemma once more. The Prime Minister's Office was criticised by the
Supreme Court for not approving Swami Subramanyam's request to prosecute A Raja. If the
government receives an application asking for permission to prosecute a state or central
minister, it must inform the person that such permission is not needed. Government has to
reconsider protecting public employees even after they retire, especially now that corruption
has gone beyond all reasonable bounds. It's crucial to win back the general public's trust in
the Indian judicial system. In order to tackle the threat of white collar crimes, the government
must take a proactive approach. It should foster an atmosphere in which the government and
civil society can work together to fight corruption.

217
Supra note 10
The judiciary has always responded appropriately to cases that have been brought before it.
However, it should still be aware of the seriousness of socioeconomic crimes and white collar
crimes. Lighter penalties should be the exception rather than the rule for white collar crimes.
To ensure that no white collar criminal escapes punishment is an extremely challenging duty
for the judiciary. It is essential to remember that it takes years to establish sound legal
precedents. To handle these intricate difficulties, lower judiciary has to get sufficient
instruction. The judiciary may be a key player in helping the average person regain trust in
democracy. After the emergency of 1975, it was judicial activity that contributed to the
ordinary man's trust in democracy being restored. Instead, it had assisted in saving the
democracy at that trying period. The same kind of judicial activism can aid in the battle
against the socioeconomic and corruption threats.

***************X***************
 CHAPTER-5
ESTABLISHMENT OF CENTRAL VIGILANCE COMMISSION

5.1 Introduction

On the advice of the Santhanam Committee on Prevention of Corruption, the Government of

India formed the Central Vigilance Commission in 1964. The Committee gave the
government its interim recommendations in two sections before completing its report. The
creation of the Central Vigilance Commission was advised in the first. The second proposed
giving the Commission authority to conduct investigations into transactions when it was
believed that public employees had acted unlawfully or corruptly, comparable to Sections 4
and 5 of the Commission of Enquiry Act, 1952.
The Committee planned for the CVC to have a broad role. The Committee feels that the Central
Vigilance organisation should be expanded so that it can deal with complaints of failures of
justice, oppression, or abuse of authority suffered by the citizens even though it may be difficult
to attribute them to any particular official or officials. "While this is indispensable, the Committee
feels that the Central Vigilance organisation should be expanded so that it can deal with
complaints of corruption and abuse of authority by individual officers218.
In light of this, the Committee recommended that the CVC be given the authority and power
to, among other things, "inquire into and investigate: (a) complaints against acts or omissions,
decisions or recommendations, or administrative procedures or practises on the grounds that
they are: (i) wrong or contrary to law; (ii) unreasonable, unjust, oppressive, or improperly
discriminatory; (iii) in accordance with a rule of law or a provision of any enactment, or
(iv) based wholly or partly on a mistake of law or fact219.
This suggestion was not accepted by the Indian government. This provision was absent from
the CVC's charter of duties in the resolution that established it. Its absence was justified by
the following statement: "It is fully acknowledged the need and urgency of having a
mechanism for looking into complaints of people against the administration and for
guaranteeing just and fair use of administrative authority. The Central Vigilance Commission
would be overburdened if this responsibility were placed on it, and as a result, the
Commission may be less effective in addressing the issue. However, it is believed that the
problem is significant enough to require a separate agency or machinery

218
Santhanam Committee report on Prevention of Corruption 1964.
219
Paragraph 6 of the Scheme of the CVC forwarded by the Chairman to the Union Home Minister vide his DO
Letter dated 22 February 1963
of corruption220. The CVC Act was passed in 2003, putting into effect the Committee's second-
part recommendation that the CVC be given powers to enable it to conduct investigations
through appropriate legislation. Despite the fact that the Commission currently has access to
these authorities, they are not used by it221.
Consequently, in 1964, the Central Vigilance Commission was created. For over three
decades, from 1964 to 1993, the CVC was instrumental in addressing the corruption issue.
When the Supreme Court issued its ruling in the case known as Vineet Narain v. Union of
India, also known as the Hawala Case or Vineet Narain v. Hawala Case, it marked an
extremely significant turning point in the country's history.
In Vineet Narain v. Union of India222, the The CVC was the subject of multiple Supreme Court
remarks. This matter has been adequately handled. Below are some quick facts related to this
case.
One Ashfak Hussain Lone, suspected of being a member of the terrorist group Hizbul
Mujahideen, was detained in Delhi on March 25, 1991. The Central Bureau of Investigation
(CBI) launched searches on Surrender Kumar Jain, his siblings, relatives, and companies after
questioning him. The CBI also removed two notebooks and two diaries from the location in
addition to cash in both Indian and international currencies.
The CBI and the revenue authorities are examples of government organisations that have
fallen short of their duties and legal obligations by failing to investigate issues related to the
seizure of the "Jan diaries"; the fact that the capture of terrorists resulted in the discovery of
their receiving financial support through covert and illegal means using tainted money
obtained through havala' transactions;

220
Statement laid by the Government of India on the tables of the Lok Sabha and Rajya Sabha about the scheme
on 16 December 1963
221
These powers can be found in the CVC Act, 2003, Section 11.
222
(1998) 1 SCC 226
That the situation revealed a connection between crime and corruption at the highest levels of
public life and that it posed a serious threat to the nation's integrity, security, and economy;
that the government agencies were required to uphold the rule of law and maintain democracy
by carrying out their legal obligations and taking legal action against everyone involved,
regardless of where they stood in the political hierarchy.223
Court issued the following temporary orders. No one was above the law in order to avoid
being investigated; the CBI and other agencies had not performed their public duty to
investigate the offences; and the CBI and other agencies should swiftly wrap up their
investigations without informing anyone, not even the person holding the highest office in the
political executive, of their progress. The Court concluded that in cases where the suspected
criminal was a strong person, inertia was the usual norm. To avoid the agencies' reverting to
inaction in these problems, it became important to take action to guarantee the corrective
impact was permanent. Probity in public life is extremely important, and everyone who is
suspected of committing a crime must be handled fairly and identically by the law. The
structure and operation of the investigative agencies exposed their flaw, which was their
incapacity to carry out their duties if powerful people were involved. This makes a detailed
evaluation of these agencies' organisational structures and management important. A plan that
provides the necessary protection from outside influences, including those of the controlling
executive, is necessary even while the overall control of the agencies and responsibility for
their operation must unquestionably be in the exhaustive. This exercise was important in
these procedures going forward.224
It was noted that the facts and circumstances of the current case do suggest that it is of the
utmost public importance that this Court thoroughly examine this matter to ensure that all
Government agencies, charged with the duty to discharge their functions and obligations in
accordance with the law, do so while continually keeping in mind the concept of equality
enshrined in the Constitution and the fundamental tenet of rule of law: "Be you ever so high,
the law is above you."

223
Ibid
224
Ibid
Furthermore, it was decided that regardless of a person's position or standing, an inquiry into
any allegations made against them on a reasonable basis must be opened and concluded
quickly. This is essential to maintain the public's faith in the government agencies' unbiased
operations.225
The Court recommended a number of actions in its final judgement, which was issued on
December 18th, 1997. In addition to ordering the establishment of institutional and other
measures aimed at shielding the CBI and the Directorate of Enforcement of the Ministry of
Finance from outside pressures, the Court ruled the Single Directive null and unlawful. The
Court's instructions were divided into four sections. The Central Bureau of Investigation and
the Central Vigilance Commission were discussed in Part I. The Ministry of Finance's
Enforcement Directorate was included in Part II's instructions. Part III addressed the Nodal
Agency's constitution and operations, while Part IV provided guidance on how to strengthen
and enhance the Prosecution Agency's operations.226

5.2 Central Bureau of Investigation (CBI) and Central Vigilance Commission (CVC)

1. The Central Vigilance Commission (CVC) shall be given statutory status.

2. The Cabinet Secretary shall provide a list of exceptional public officials and other
individuals with spotless integrity for consideration by a Committee made up of the
Prime Minister, the Home Minister, and the Leader of the Opposition. On the basis of
the Committee's recommendations, the President will make the nomination. This will
be carried out right away.
3. The effective operation of the CBI is the CVC's responsibility. While the government
will still be held accountable for how the CBI operates, the CVC will be given the
duty of overseeing how the CBI operates in order to bring about evident objectivity in
the system that will be developed for doing so. The CBI must inform the CVC of the
cases it has chosen for investigation, the status of those investigations, and the
instances in which charge sheets have been filed. The CVC will assess the status of
each case that the CBI has filed with the appropriate authorities seeking approval to
prosecute public employees, especially those where approval has been delayed or
denied.

225
Ibid
226
Ibid
4. The Central Government shall take all necessary steps to ensure that the CBI operates
successfully and efficiently and is recognised as a non-partisan organisation.
5. Following the transfer of the supervisory duty to it, the CVC will include a distinct
part in its annual report on the operation of the CBI.
6. A committee featuring the Home Secretary and Secretary (Personnel) as members and
the Central Vigilance Commissioner as its chairman would recommend candidates for
the position of Director, CBI. The Committee will take the current Director's opinions
into account while making its decision. A panel of IPS officers will be selected by the
Committee based on seniority, honesty, and expertise in investigation and anti-
corruption activity. The panel suggested by the Selection Committee will be used as
the basis for the ultimate decision made by the Appointments Committee of the
Cabinet (ACC). If none of the panellists are deemed acceptable, the Committee will
be requested to form a new panel after recording the reasons why.227
7. Regardless of when he retires, the CBI Director must serve for a minimum of two years.
This would ensure that an officer who is qualified in every way is not passed over only
because he has less than two years till his retirement from his position.
8. The transfer of an encumber Director, CBI in an extraordinary situation, including the
need for him to take up a more important assignment, should have the approval of the
Selection Committee.
9. The CBI Director will have complete discretion over how to assign tasks inside the
organisation and form teams for inquiries. Any change in the Director of CBI's
investigating team's leader should be made for compelling reasons that would
strengthen the inquiry, and the justifications should be documented.
10. A Board made up of the central Vigilance Commissioner, the Home Secretary, and
the Secretary (Personnel), with the Director of the CBI providing the appropriate
inputs, would decide on the selection of officers up to the rank of Joint Director (JD)
and the extension of their term. Officers up to the level of Joint Director may not
extend their contracts or return home too soon without the Board's final consent. The
Appointments Committee of the Cabinet (ACC) will only be consulted in matters
involving the appointment or extension of tenure of personnel with the level of Joint
Director or higher.

227
Center For Pil & Ors vs Union Of India & Ors on 2 February, 2012 available at
https://indiankanoon.org/doc/23377337/, Accessed on 16-6-2021 at 9 pm
11. Decisions about suggestions for infrastructure, investigative techniques, etc., should
be made quickly. Professionals from the banking, revenue, and security industries
should be hired by the CBI to bolster its internal competence.
12. The CBI Manual, which is based on statutory provisions of the Cr. P.C., offers crucial
instructions on how the CBI should operate. Regarding its investigative activities,
including as raids, seizures, and arrests, the CBI must follow strictly to the
requirements of the Manual. Any departure from the established protocol should be
handled seriously, and the offending authorities should face harsh disciplinary action.
13. The Director, CBI shall be responsible for ensuring the filing of charge sheets in courts
within the stipulated time limits, and the matter should be kept under constant review
by the Director, CBI.
14. To offer the general public with feedback on investigations and information for
resolving real concerns in a way that does not conflict with the operating requirements
of the CBI, a paper about the CBI's operation should be released within three months.
15. There is a stringent three-month deadline for granting sanctions for prosecution.
However, if consultation with the Attorney General (AG) or any other legal officer in
the AG's office is necessary, an extra month may be granted.
16. To avoid corruption and/or inefficiency inside the organisation, the CBI Director
should regularly evaluate the performance of the staff.228

5.2.1 Enforcement Directorate

1. A panel for the appointment of the Director, Enforcement Directorate, will be prepared by
a selection committee with the Central Vigilance Commissioner as its chairman and
the Home Secretary, Secretary (Personnel), and Revenue Secretary as members. The
panel suggested by the Selection Committee will be used by the Appointments
Committee of the Cabinet (ACC) to nominate someone to the position of Director.
1 Like the Director of the CBI, the Director of Enforcement will have a two-year
minimum term in office. The aforementioned Selection Committee, which is led by
the Central Vigilance commissioner, must authorise any premature transfer in his
instance as well if there are any unusual circumstances.

228
Vineet Narain & Others vs Union Of India & Another on 18 December, 1997, (1 SCC 226), available at
https://indiankanoon.org/doc/1203995/, Accessed on 16-6-2021 at 9 pm
3. The position of Director of the Enforcement Directorate will be promoted to that of
Additional Secretary/Special Secretary to the Government due to the position's
importance.
4. Officers of the Enforcement Directorate handling sensitive assignments shall be
provided adequate security to enable them to discharge their functions fearlessly.
5. The aforementioned Committee, which is presided over by the Central Vigilance
Commissioner, should make decisions about term extensions up to the level of Joint
Director in the Enforcement Directorate.
6. There shall be no premature media publicity by the CBI/Enforcement Directorate.
7. Adjudication/commencement of prosecution shall be made by the enforcement
Directorate within a period of one year.
8. The Enforcement Directorate Director is responsible for overseeing and ensuring the
prompt opening of investigations, adjudications, and prosecutions. The Revenue
Secretary must routinely assess their progress.
9. The approval process for Letters Rogatory applications will be expedited to allow for
quick completion of investigations overseas, and the Revenue Secretary will be
permitted to approve applications as needed.
10. To ensure openness, the Directorate must publish a thorough circular informing the
public of its operating methods and systems.
11. In-house legal advice mechanism shall be strengthened by appointment of competent
legal advisers in the CBI/Directorate of Enforcement.
12. A thorough explanation of the Enforcement Directorate's operations must be included
in the Department of Revenue's annual report.229

5.2.2 Nodal Agency

1. For coordinated action in situations involving a political-bureaucratic-criminal nexus,

the Home Secretary must establish a nodal agency comprising the Member
(Investigation), Central Board of Direct Taxes, Director General, Revenue
Intelligence, Director, Enforcement, and Director, CBI as members.
2. The Nodal Agency shall meet at least once every month.
3. It is important to monitor the Nodal Agency's performance for around a year so that it
may be improved based on the knowledge obtained during that time.230

229
Ibid
230 Ibid
5.2.3 Prosecution Agency

1. With the Attorney General's guidance, a team of qualified solicitors with years of
expertise and a sterling reputation will be assembled. In matters of significance, their
services will be used as prosecuting counsel. The CBI/Enforcement Directorate
should heed the counsel of a lawyer selected from the panel even while conducting an
inquiry into an infraction.
2. Every prosecution that results in the release or acquittal of the accused must be
assessed by a lawyer on the panel, and responsibility should be assigned for any duty
neglect on the basis of the opinion presented. In these circumstances, the officer found
to have violated his or her obligations should face harsh punishment.
3. The preparation of the panel of lawyers with approval of the Attorney General shall be
completed within three months.
4. As soon as possible, steps must be taken to establish a competent, impartial
organisation with individuals of unquestionable integrity that will carry out duties
similar to those of the Director of Prosecutions in the United Kingdom. When such a
body is established, it will be tasked with overseeing prosecutions brought by the
CBI/Enforcement Directorate.
5. On the proposal of the Attorney General or any other legal representative he
designates, Special Counsel shall be appointed for the conduct of major trials up until
the formation of the aforementioned body.231

The Supreme Court also issued the following observations in order to ensure the investigative
officials in States operated independently. "Given that the issue in the States is now much
more serious, as is fully covered in the Report of the National Police Commission (1979), it is
vital for the State Governments to establish a reliable system for choosing the State's police
chief. The Central Government must pursue the issue with the State Governments and make
sure that each State has a system in place for the selection/appointment, tenure, transfer, and
posting of all police officers with the rank of Superintendent of Police and above, not just the
Chief of the State Police. It is alarming to learn that transfers are frequently made for arbitrary
reasons and that a superintendent of police's term in certain states is typically just a few
months. It has the negative impact of politicising the staff in addition to demoralising the
police force.

233
Ibid
Therefore, it is crucial that the Central Government respond quickly and within the scope of
its constitutional authority in the federation to convey to the State Governments that such a
practise is incompatible with the intended constitutional framework. The situation was
disturbing when it was outlined in the National Police Commission's Report (1979), and it has
since gotten significantly worse. A disturbing scenario that must be resolved if the rule of law
is to prevail is shown by the Union Home Minister's desperation in his letters to the State
Governments, which were presented to us during the hearing. In these situations, there is no
constitutional provision that prohibits taking the appropriate corrective measures.

5.3 Attempts of the Government to Nullify the Judgement of Vineet Narain Case

The government made many attempts to overturn the consequences of the Vineet Narain case
above, even after the Supreme Court's pointed criticisms. In a cabinet meeting, the
government resolved to request a report from the Law Commission of India. On August 13,
1998, the Law Commission gave the Government its findings and a draught of the CVC Bill.

On August 20, 1998, the Union cabinet had a meeting to consider the issue. The cabinet was
notified in the memo sent at this meeting by the secretariat that the Law Commission's report
was still pending. The draught of an ordinance created by the Secretaries was presented to the
cabinet for approval in the interim. The draught of the ordinance will be settled by a
committee of four ministers, including Mr. Ram Jethmalani, who was then the Union
Minister for Urban Development232.
When Mr. Jethmalani phoned Justice Jeevan Reddy, then Chairperson of the Law
Commission of India, on August 21, 1998, he discovered that the draught and report had been
sent to the government a week earlier, on August 13, 1998.
The evidence suggests that the Law Commission's draught was with the government when the
cabinet convened to debate the matter on August 20, 1998, and that it was purposefully
concealed. An alternative draught, created by the Secretaries, was sent to the cabinet for
approval since it was more suited to the needs of their respective services. The Central
Vigilance Commission Ordinance, 1998 was hastily proclaimed by the government on
August 25, 1998, less than five days after the cabinet meeting, in accordance with the draught
created by the bureaucrats233.

232
http://www.thehindu.com accessed on 2-6-2021 at 5.30 PM.
233
Ibid
The inclusion of the Secretary of the Department of Personnel as an ex-officio member of the
Commission and the restriction on the selection of members to civil employees exclusively
were the two aspects of the Ordinance that instantly sparked debate and media criticism.
When Chairman of the Law Commission of India, Justice B. P. Jeevan Reddy, questioned the
way the government had handled the CVC Ordinance, the debate around the law intensified.
He expressed his concern at the government's failure to give the Law Commission's draught
and report on the matter adequate consideration. When Shri Anil Dewan, the amicus curiae in
Writ Petition (Civil) No. 38/97, submitted written objections to specific portions of the
Ordinance, the Supreme Court became aware of the situation. On September 22, 1998, Mr.
Soli J. Sorabjee, who was the Attorney General at the time, gave the Court the assurance that
the government will review the situation and revise the Ordinance.
Another law, the Central Vigilance Commission (Amendment) law, 1998 (No. 18 of 1998),
was published on October 27, 1998. Thus, the Amendment decreased the number of
Vigilance Commissioners, eliminated the ex-officio member from the Commission,
broadened the selection of Commission members to include people from public sector
organisations, and repealed the section about the Single Directive234.

5.4 Controversy about the Single Directive Clause

In the Vineet Narain case mentioned above, the Supreme Court ruled that the Single Directive
was invalid. The Court ruled that it was unlawful. It was against the law for a police agency
to request the executive's approval before opening an inquiry into a criminal act.
Additionally, it went against the principle of legal equality in application. "The law does not
penalise criminals differently based on their socioeconomic position. According to the law,
which is equally applied to everyone, any individual accused of committing the same crime
must be treated equally.37 By reviving the Single Directive, the CVC Act violated these
fundamental rules of legal jurisprudence. What was earlier a part of executive instruction was
now given a statutory wrap235.
The CVC Act of 2003 goes further than what the CVC Ordinance of 1998 tried. While the
Ordinance required the CBI to acquire consent from the CVC before beginning any inquiries
or investigations into personnel of the level of joint secretary and above, the Act specifies that
this approval must be sought from the central government.

234
Ibid
235
The Supreme Court's judgement in Writ Petition (Criminal) Nos. 340-343 of 1993; p. 81
The CVC must exert supervision over the operation of the Delhi Special Police Establishment
Act insofar as it relates to the investigation of offences under the Prevention of Corruption
Act, 1988, according to Section 8(a) of the Act itself.
The Joint Committee of Parliament, led by Shri Sharad Pawar, added the single directive
section to the Act. This section wasn't in the original version of the bill that was sent to the
committee. The Joint Committee attempted to use the claim that "no protection is available to
the persons at the decision-making level" to defend the reintroduction of the Single Directive.
This is the same argument that the Supreme Court had rejected. It didn't seem to bother the
Joint Committee, which recommended that the Single Directive's protection "should be
restored in the same format that was there earlier and...that the power of giving prior approval
for taking action against a senior officer of the decision-making level should be vested with
the central government by making appropriate provision in the Act." This was accomplished
through the CVC Act, which added new provisions and revised the Delhi Special Police
Establishment Act of 1946. Section 6 (A) of the CVC Act included a clause that integrated
the Single Directive's provisions.
According to the argument, Section 197 of the Criminal Procedure Code and Section 19 of
the Prevention of Corruption Act of 1988 already provide all public employees with
immunity from prosecution. Even at the beginning of an inquiry or probe into claims of
corruption against top officials, the Parliamentary Committee chose to offer protection. Thus,
the top officials would be shielded from both a probe and prosecution. In actuality, the law
offers a third safeguard. Under Section 321 of the CrPC, the government may always drop the
case even after filing for prosecution with the court's approval. Additionally, the government
has occasionally utilised this clause.

5.5 Analysis of the CVC Act of 2003

The 2003 Act was passed to establish a Central Vigilance Commission as an institution to
conduct inquiries into alleged violations of the Prevention of Corruption Act, 1988 by
specific categories of Central Government employees, corporations created by or under any
Central Act, Government companies, societies, and local governments owned or controlled
by the Central Government, and for other purposes236.

236
See the Preamble to the CVC Act 2003.
These are the key components of the CVC legislation of 2003. CVC receives legislative
protection. It is recognised as a legitimate institution. The CVC was created to look investigate
any violations that any of the public workers listed above are alleged to have committed in
violation of the Prevention of Corruption Act, 1988. The Central Vigilance Commissioner and the
Vigilance Commissioners must be selected in accordance with Section 3(3)(a) from among
individuals who have held or are currently holding positions in the All India Service, any civil
service of the Union, or in a civil post under the Union and who have knowledge and experience
in matters relating to vigilance, policy development, and administration, including police
administration. The individual holding office as a public servant or who has held such office is
referred to by the terms "who have been or who are" in Section 3(3)(a).
In the case of N. Kannadasan v. Ajoy Khose and Others237,According to the ruling, the
aforementioned terms highlight the eligibility requirements and further imply that any previous or
current eligible individuals should be free of any impurities and should not be appointed only
because they are eligible to be considered for the office. CVC is an institution, as evidenced by its
creation as a legislative body under Section 3. Institution is the crucial phrase.
The appointment of the Central Vigilance Commissioner and Vigilance Commissioners is
discussed in Section 4. They must be appointed by the President by warrant bearing her
signature and seal in accordance with Section 4(1). The significance of the position is
indicated in Section 4(1). There is a proviso in Section 4(1). Every appointment made in
accordance with Section 4(1) must first be approved by a committee made up of (a) the Prime
Minister, who serves as the committee's chair; (b) the Minister of Home Affairs; and (c) the
Leader of the Opposition in the House of the People. The term "recommendation" is the
important phrase in the proviso. The High Powered Committee fulfils a legal obligation by
making the suggestion. The Central Vigilance Commissioner's tenure in office is set at 4
years under Section 5(1). According to Section 5(3), the Central Vigilance Commissioner
must take an oath or affirmation in the manner described in the Schedule to the Act before
beginning his duties. According to Section 6(1), the Central Vigilance Commissioner may
only be removed from his position by the President, and only on the basis of demonstrated
misconduct or incapacity, and only after the Supreme Court, upon the President's referral to
it, has conducted an inquiry and issued a report recommending the Central Vigilance
Commissioner's removal. These rules show that the Central Vigilance Commissioner's office
is provided more than just independence and protection from outside interference; It also
suggests that these safeguards are provided so the CVC Institution may operate in a free and
impartial atmosphere.

237
The Central Vigilance Commissioner is required by the specified form of oath under Section
5(3) to preserve the sovereignty and integrity of the nation and to carry out his responsibilities
without fear or favour. All of these clauses show that CVC is a trustworthy organisation.
The Central Vigilance Commission's duties and authority are covered in Chapter III of the
Act. Insofar as it relates to the investigation of offences allegedly committed under the
Prevention of Corruption Act, 1988, or an offence with which a public servant specified in
sub-section (2) may be charged at trial under the Code of Criminal Procedure, 1973, CVC
supervises the operation of the Delhi Special Police Establishment. CVC is therefore given
the authority to supervise CBI's operations. Additionally, it has the authority to direct CBI.
Additionally, it has the authority to assess the results of CBI investigations into alleged public
employee corruption charges under the Code of Criminal Procedure or the Prevention of
Corruption Act of 1988. Additionally, the CVC has the authority to supervise the vigilance
operations of several Central Government departments, PSUs, and Government-owned
businesses etc238. The primary justification for granting the organisation administrative
autonomy, independence, and protection from outside pressures is the powers and functions
carried out by CVC.

5.6 Power Relating to Inquiries:

The Commission would have all the authority of a civil court trying a case under the Code of
Civil Procedure, 1908 when conducting any investigation referred to in clauses (c) and (d) of
sub-section (1) of section 8, in particular, with regard to the following issues:
a) Summoning and enforcing the attendance of any person from any part of India and
examining him on oath;
b) Requiring the discovery and production of any document;
c) Receiving evidence on affidavits;
d) Requisitioning any public record or copy thereof from any court or office;
e) Issuing commissions for the examination of witnesses or other documents; And
f) Any other matter which may be prescribed239.

5.7 Brief History

238
SEE Section 8 of the Act.
239
SEE Section 11 of the Act.
The Delhi Special Police Establishment (SPE), which the government created in 1941 to
combat corruption involving purchases and supplies for the war effort, is responsible for the
formation of the CBI. The Department of War established the SPE by an executive decree,
and it has its main office in Lahore. The necessity for a single organisation to look into
allegations of corruption involving members of the central government persisted even after
the conflict. The Delhi Special Police Establishment Act was passed in 1946 by the Indian
government to provide the group legal protection. The organisation was placed under the
Home Department, and Delhi became the location of its new headquarters. The IGP position
was established in 1948 to serve as the organization's leader240.
Through a Resolution53 of the Ministry of Home Affairs, Government of India, the SPE
served as the foundation upon which the CBI was founded on 1 April 1963. In addition to
investigating crimes handled at the time by the Delhi Special Police Establishment (DSPE),
including those with interstate implications, it was felt that this organisation was needed to
gather crime intelligence, communicate with INTERPOL, maintain crime statistics,
disseminate crime and criminal information, conduct police research, and coordinate laws
relating to crime. The Anti-Corruption Division (DSPE), Technical Division, Crime Records
and Statistics Division, Research Division, Legal and General Division, and Administration
Division were the first six divisions that made up the organisation.
The CBI's charter underwent changes throughout time. While some of its responsibilities
were passed to new bodies, such the National Crime Records Bureau and the Bureau of
Police Research and Development, its criminal investigative activity considerably grew. A
committee led by the Cabinet Secretary examined the CBI's operations and suggested that the
criminal investigation division be reorganised. When it was decided that the Special Crimes
Division would look into major conventional crimes like murder, kidnapping, rape, rioting,
arms smuggling, hijacking, illegal immigration, etc. and economic offences like banking and
other financial frauds, customs offences, currency counterfeiting, narcotics and drug
peddling, black marketing, etc., this was done in 1987. An independent Economic Offences
Division took over the investigation of economic crimes in 1994241.
Thus what was initially an anti-corruption agency developed over a period into a specialised
agency with a comprehensive charter to investigate a wide variety of crimes. Presently, the CBI
comprises of Anti-Corruption Division, Economic Offences Division, Special Crimes

240
http://www.cbi.nic.in/history/hist.php Accessed on 01-06-2021 at 4.30 PM
241
Ibid
Division, Central Forensic Science Laboratory, Legal Division, Technical Division, Policy and
Coordination Division, and Administration Division. The CBI is a department of the
Government of India's Ministry of Personnel, Public Grievances and Pensions. It has offices all
around the country, but its headquarters is in Delhi242.

5.8 Legal Status

As was already noted, the Delhi Special Police Establishment Act of 1946 is where the CBI
gets its legal authority. This Act was passed "to provide for the establishment of a special
police force in Delhi for the purpose of investigating certain offences in the Union Territories,
for the supervision and management of the said force, and for the extension to other areas of
the powers and jurisdiction of members of the said force with regard to the investigation of
said offences243.
There are just seven parts total in the Act of 1946, including the final one regarding "repeal,"
making it a very short piece of law. The Act may be extended by the central government to
other states and railway regions; therefore it is not limited to just union territory244. The Act
has been expanded to include all states with the approval of the state legislatures. According
to the Act, the investigative agency is only permitted to look into violations that the central
government has reported245. Almost all-important transgressions have been included in
numerous notices that the government issues on a regular basis. The Act permits the officers
to exercise all of the same rights, obligations, privileges, and responsibilities as local police
officers246. The organisation cannot exercise its powers and jurisdiction in any area in a state
without the consent of the state government247. Therefore, the CBI lacks the initial authority
to conduct state-level criminal investigations. The CBI can only operate in a state if the state
government invites it, and then only when the Supreme Court or High Court requests that it
do so. The courts are granted this authority as a result of the Constitution's requirement that
they uphold people' basic rights. Last but not least, there is the clause that gives the central
government control of this significant investigative body248, However, following the Vineet
Narain case, it now partially vests in the CVC as well.

242
Ibid
243
The Delhi Special Police Establishment Act, 1946, Preamble.
244
Ibid., Section 5 (1)
245
Ibid., Section 3
246
Ibid., Sections 2 (2) & 5 (2) & (3)
247
Ibid., Section 6
248
Ibid., Section 4
The CBI is the country's top investigative institution. It is listed in the Seventh Schedule of
the Indian Constitution's Union List. It is identified as "Central Bureau of Intelligence and
Investigation" at Serial No. 8 of the List. Given the significance that the Constitution's
creators placed on this institution, it is odd—even ironic—that its operations are currently
controlled by a law that was passed during British rule with a very specific intent. The CBI is
not what the Delhi Special Police Establishment was in 1946 since India is no longer the
same country it was back then. The organisation has grown in size, the patterns and
occurrences of crime that it must investigate have changed, the political environment in
which it operates has changed, the citizens' expectations of this agency have increased, and on
top of all that, the norms and standards of police investigation work around the world have
undergone a radical transformation.
An major body like the CBI must be governed by laws that take these advancements into
account. It must acknowledge that adhering to the Constitution's standards is the
organization's top priority. It must be required to function in a way that upholds and advances
the rule of law. To protect the organisation from unwelcome and illegal outside control,
pressures, and influences, institutional and other procedures must be established by
legislation that defines the term "superintendence" and other related terms. It must make sure
that the agency is subject to strong governmental oversight to guarantee that its operations
comply with the law. The Act must mandate that the government create a system of inquiry
that is unbiased, effective, and professionally efficient. In addition to outlining the nature,
philosophy, and practises required of the agency, it should also set objectives, specify
performance criteria, develop monitoring tools, and specify procedures to guarantee the
agency is held accountable. There shouldn't be any clauses that allow for legal immunity.
It is puzzling that the government is reluctant to pass separate legislation for such a
significant body. The only way to describe it is that it opposes the CBI operating in a manner
that is professionally effective, transparently fair, and unbiased, and that operates in
accordance with the principles of the rule of law rather than what the administration want.
The anti-corruption law namely, Section 13249 of requires the CBI to obtain sanction from the
concerned government before prosecuting public servants involved in corruption cases. In other
cases, the provision of the CrPC Section 197250 is applicable. Receiving the sanction
frequently takes a long time, and occasionally it never happens.

249
THE PREVENTION OF CORRUPTION ACT 1988
250
Supra note 136
This concerned the Supreme Court as well, which ruled in the Vineet Narain case (see above)
that the three-month maximum time restriction for granting sanctions must be carefully
adhered to. An extra month might only be permitted in extraordinary circumstances if
consulting with the Attorney General became required. The Parliamentary Standing
Committee of the Ministry went a step further and suggested that the appropriate sanction be
issued within 15 days after the investigative agency determined that prosecution was required
and the director of prosecution agreed. If it is not issued within that time frame, it should be
considered a "deemed sanction," and the CBI should submit a charge sheet to the court251.
The administration has endeavoured to incorporate retired public employees within the scope
of the law's provisions on impunity since it is not content with just guaranteeing impunity to
serving officials. By revising Section 19 of the Prevention of Corruption Act, 1988, it
attempted to expand the application of such restrictions to former public employees in 2008.
This effort aimed to overturn the Supreme Court's 2006 ruling in Badal v. State of Punjab,
which determined that Section 19 of the Prevention of Corruption Act, 1988, did not provide
protection for former public employees. Fortunately, although being approved by the Lok
Sabha, the amendment was not passed by the Rajya Sabha.
The CBI website only provides information for instances where sanctions are still pending; it
does not display the number of cases when sanctions are denied252.

5.8.1 Lokpal and Lokayukta

"Bureaucratic corruption functioned like a subterranean monster, helping, encouraging, and

collaborating with the political masters. With a workplace culture reminiscent of the nobility
of the 19th century, careerism has long replaced public service, with people being treated as
"subjects." "Among people, generally corrupt, liberty cannot last long," warned Burke.
The Supreme Court also stated that corruption in a civilised society is a sickness similar to
cancer that, if left unchecked, can destabilise the nation's political system and have grave
repercussions. It spreads like a fire in a jungle and is contagious, much like the plague. Its
virus is likened to HIV, which causes AIDS and is an incurable disease. State of MP & Others
V Ram Singh253.

251
The Ministry's Department-Related Parliamentary Standing Committee, Thirty-seventh Report presented to
Parliament on 9 March 2010; Chapter IV, Paragraph 11
252
http://www.cbi.gov.in/performance/pending_sanction.php Accessed on 16th may at 11.15 PM
253
(2000) 5 SCC 88.
Also see State of Andhra Pradesh V. V. Vasudeva Rao254. Human rights are gravely violated
when there is corruption in public life. It is against individuals, progress, and the nation.
Unchecked corruption is a serious national ill. Despite enormous amounts of money being
spent on development, it is the one major factor holding back the advancement of our nation
and is to blame for millions of people living below the poverty line. It is waste that must be
eliminated in order to prevent the country's progress and d.
Supreme Court observed in Lucknow Development Authority Vs M.K. Gupta255: "Harassment
of a common man by public officials is morally repugnant and illegal. Although it may hurt
him personally, society as a whole will suffer far worse consequences. Because there is no
public opposition to crime and corruption, they flourish and thrive in society. The powerless
sensation is the worst emotion there is. An average citizen gives in to the pressure of
unwanted office functioning rather than protesting and fighting against it.

5.9 Ombudsman and Lokpal

The Ombudsman institution that exists in Scandinavian nations is equivalent to the Lokpal in
India. The position of ombudsman was first established in Sweden in 1809 AD, and it was
subsequently adopted by a large number of countries "as a bulwark of democratic government
against the tyranny of officialdom." In Swedish, the term "ombudsman" refers to a person
chosen by the legislature to resolve grievances against administrative and judicial actions.
Traditionally, all political parties supporting the appointment of the ombudsman must agree
on it. Although the legislature appointed the incumbent, he or she is an independent
functionary, reporting to the legislature but not to either of the other two state institutions.
The Ombudsman has two options for taking action: suo moto or on the basis of citizen
complaints. He has the ability to investigate both claims of corruption and poor
administration.
There are both implicit and explicit ways for citizens to express their complaints and call for
change in the daily operation of government. But they are frequently challenging. Any
decision made by a lower official inside administrative departments, for instance, can be
challenged all the way up to the department head. However, this technique is flawed from the
start. Higher officials sail in the same boat as those who are the subject of complaints and
enjoy departmental camaraderie.As a result, their objectivity in reviewing appeals is often
questioned. On the legislative side, a person can make their requests known to the legislator
who represents his or her district.

254
2003 (9) Scale 569.
255
However, because an average person cannot easily approach his or her representative, this has
mostly remained a fiction. The judiciary has established itself as having the most reputation
among the state's institutions for upholding individual rights. However, due to the
complicated judicial procedures, there will inevitably be delays in the administration of
justice, which frequently also result in the denial of justice256.
The functionary goes by several names and has varying powers and functions depending on
the country. He is known as the "Ombudsman" in the Scandinavian nations of Sweden,
Denmark, Finland, and Norway. He has the option of directly hearing complaints from the
general public or acting on his own after obtaining information from interested parties,
journalists, etc. The official, known as the Parliamentary Commissioner, may only accept
complaints through members of parliament in the UK. The ombudsmen have the option of
conducting their own independent or collaborative investigations into complaints. After an
inquiry, the Ombudsman has the authority to punish dishonest public employees in Sweden
and Finland but not in Denmark. However, the ability to bring charges is rarely employed.
The office's exposure and the unfavourable perception that permeates everything the
ombudsman examines give the position its power. Ombudsmen have additional court
supervision authority in Sweden and Finland. They only have control over non-judicial public
employees in other nations. They deal with allegations including both corruption and poor
administration in the majority of cases.257
The increasing number of corruption cases in India suggests that the mechanisms in place to
check on elected and administrative officials have not been successful. The Central Vigilance
Commission (CVC), as was already noted, is exclusively intended to look into claims of
corruption against administrative officials. The CBI, the nation's top investigative agency, is
subject to the Prime Minister's Ministry of Personnel, Public Grievances, and Pensions'
oversight and is thus not immune to political influences when conducting an investigation.
The Supreme Court has recently been critical of CBI's lack of independence and
professionalism rather frequently. All of them factors made it necessary to establish Lokpal as
soon as possible, along with a dedicated investigation team.258
Therefore, a system that would use extremely straightforward, independent, quick, and less
expensive methods of administering justice through resolving the people's complaints is
required.

256
Baisakh Pradeep, “The Lokpal cycle”, available at http://indiatogether.org/articles/lokpal-laws/print,
Accessed on 22-6-2021
257
Ibid
258
Ibid
Many nations claim that the institution of the ombudsman has been highly effective in
battling against public workers' dishonest administrative choices and acts of corruption,
acting as a true defender of democracy and civil rights.
Early in the 1960s, rising public corruption began to shift the tide in support of an Ombudsman in
India as well. The Administrative Reforms Commission (ARC), which was established in 1966,
advocated for the establishment of a two-tier system with a Lokpal at the federal level and
Lokayukt(a)s at the state level. In addition to being justified for eliminating the sense of
unfairness from the minds of those who had been negatively impacted, the ARC was convinced
that the establishment of the Lokpal was vital to boost public trust in the effectiveness of the
administrative system. The Lokpal Bill was then tabled for the first time during the fourth Lok
Sabha in 1968 and was approved there in 1969.259 The Lok Sabha was dissolved while the bill
was still pending in the Rajya Sabha, which led to the measure's first demise. In 1971, 1977,
1985, 1989, 1996, 1998, and most recently in 2001, the measure was brought back to life. Before
the government could make a decision, the house was disbanded after the measure was brought to
the house and referred to a committee for revisions, such as a joint committee of parliament or a
departmental standing committee of the Home Ministry260.
The Lokpal was envisioned as the organisation that would monitor ministerial integrity. In
general, the clauses of several legislation gave the Lokpal the authority to look into Central
corruption allegations involving political figures. The Lokpal Bill has undergone several
significant changes over the years, but in its most recent incarnation, it has the following
features:

Objective is to provide speedy, cheaper form of justice to people.

Members: The Lokpal will consist of three people: the chair, who is or was a chief justice or
judge of the Supreme Court; and the other two, who are or were judges or chief justices of
high courts across the nation.
On the advice of a committee made up of the following people, the President shall designate
the chairperson and members by warrant signed by him and bearing his seal. It's unclear if the
committee must reach a unanimous judgement or if a majority vote will suffice. (a) The Vice-
President (Chairman) (b) The Prime Minister (c) The Speaker of Lok Sabha (d) Home
Minister
(e) Leader of the House,

259
Ibid
260
“Triloknath Mishra, Lokpal in India-An Analysis“ http://www.wisdomblow.com/?p=689 accessed on 1-6-
2021 at 9.30 PM
other than the house in which PM is a member. (f) Leaders of Opposition of both the houses.
Independence of the Office: The following clauses have been included to safeguard the
independence and proper operation of the august office.
Appointment is to be made on the recommendation of a committee.
After retirement, the Lokpal is not permitted to hold any lucrative positions with the
Indian or state governments, or positions of a comparable nature.
Fixed term of three years; only those who have demonstrated misbehaviour or
incompetence may be dismissed following an investigation by the Chief Justice of the
Interior and the two most senior SC justices.
The Lokpal would have its own administrative framework for carrying out inquiries.
The Consolidated Fund of India will be taxed with the salary of Lokpal.

Jurisdiction of Lokpal:261

The central level political functionaries like the Council of Ministers including the Prime
Minister, the Members of Parliament etc.
He can not inquire into any allegation against the PM in relation to latter's functions of national
security and public order.
Complaints of offence committed within 10 years from the date of complaint can be taken up
for investigation, not beyond this period.
Anyone who is not a government employee may file a complaint. Within six months, the
Lokpal is expected to conclude the investigation. The Lokpal can summon any individual or
organisation with the same authority as a civil court. Following an investigation, the
ombudsman can simply suggest that the competent authority take certain steps. Several
measures have been implemented to deter fake complaints or complaints with malicious
intent.

He can order search and seizure operations.

He is required to give the President the investigation reports once a year, and the President is
then required to deliver the action taken report to both Houses of Parliament.
It should be remembered that the Lokpal is only designed to look into incidents of corruption;
he is not expected to deal with complaints about unfairness and suffering brought on by poor
governance262.

261
Supra note 256
262
Supra note 260
It is said that the absence of governmental commitment to combat corruption and repeated
attempts to enact the Lokpal bill in the parliament have made the role of civil society
increasingly crucial. India's civil society appeared to understand what it needed to do to
combat the threat. Social activist Mr. Anna Hazare led members of civil society who
participated in a hunger strike to demand that the government pass the Lokpal law. Following
that, the government appointed representatives of the civil society to the drafting committee
in order for the Lokpal institution to become a reality.This is a brand-new trial of its sort in
Indian democracy. In order to combat corruption and bad administration, it is anticipated that
the Lokpal institution will soon become a reality and that the period of collaboration between
the government and civil society would continue.263
While many States have established Institutions of Lokayuktas/Lokpals through State
Legislations, they provide for inquiry/investigation into complaints of corruption against
public servants. He protects Citizens' Rights against mal-administration, corruption, delay,
inefficiency, non-transparency, abuse of position, improper conduct, etc. The procedure to be
followed is described in the following statement: But it is not anti-administration; rather, it
advances the establishment of a "Open Government" that ensures respect for the rule of law
and serves as a propagandist for the reduction of corruption, inefficiency, and bad
administration in government. Therefore, he acts as a check on corruption264.
The Karnataka Chief Minister and his son were recently exposed by Karnataka Lokayukta
Justice Santosh Hegde as being implicated in a significant land fraud scandal. Even there,
politics has been quite influential. Due to the Lokayukta's proactive position in the state,
scams might be exposed. In order to combat the threat of corruption and poor governance, it
is crucial to strengthen the Lokayukta institution throughout all of the states in the nation.

263
Supra note 256
264
http://www.hp.gov.in/lokayukta/page/Role-of-Lokayukta.aspx accessed on 18-5-2021 at 10.00 AM
5.10 Summing UP

The two most well-known anti-corruption organisations at the Centre, the CVC and CBI,
have been around for a while. This analysis of the administration of these two institutions by
the central government reveals that it has never desired for them to become professionally
powerful and successful.265
As was previously said, the Centre needed an investigating agency as early as 1948. The CBI,
however, wasn't founded until April 1st, 1963. No law has been passed as of yet to control
how it operates. The majority of the country's police forces are still governed under the Police
Act of 1861, which is just as antiquated. The central government has been equally obstinate in
rejecting the need for new law to manage and strengthen the police, much like the state
governments have been reluctant to accept the National Police Commission's
recommendations to replace the colonial-era legislation with a new Police Act that is framed
in accordance with the requirements of a modern democratic Constitution. The political
executive needs total control over police organisations so that it may abuse them for partisan
reasons, and this is why it is hesitant to alter in both situations. There is a tonne of proof that
the CBI has been abused quite frequently.
The CVC's tale is comparable. It wasn't formed by legislation but rather by presidential orders
in 1964. Though every effort was made to prevent the execution of that decision, it wasn't
until the Supreme Court issued directives in 1997 to provide it with a legislative cover that
action had to be taken. The CVC Act of 2003 was not introduced by the government for six
years after the previous efforts. However, it made sure that the Act included enough flaws and
gaps to undermine its usefulness. This was seen most recently when the central government
chose a man to lead the CVC in spite of his past transgressions and vehement criticism from
the opposition party and others. A petition asking for his dismissal from the important
position due to allegations of corruption challenged the appointment at the Apex Court. His
appointment has been cancelled by the Supreme Court.
The CVC Act established a system of dual control over the CBI and significantly reduced
CVC's super-intendence over it. The Single Directive was also resurrected. The illegality that
was previously carried out by presidential orders is now carried out with the support of the
law.

265
Chopra Aditya, “Lokpal Bill- An Analysis”, available at https://www.lawyersclubindia.com/articles/Lok-pal-
bill-An-Analysis-1560.asp, Accessed on 23-6-2021
 Even though Lokayukta has been adopted in various states, there haven't been any sincere
attempts to pass the Lokpal Bill. It is proposed that the CVC institution be reinforced and the
illegalities that have been perpetrated in the CVC legislation abolished. Single Directive
ought to be taken out of the Act. A special law should be created to regulate the CBI for
optimal operation. It has to be modernised as soon as possible in order to fully equip itself to
combat corruption. To make the CBI an effective anticorruption agency, the government's
control over its operations should be abolished, and it should be let to operate independently.
Similar to this, the Lokpal law should be passed as soon as possible, and this organisation
should be reinforced to combat bureaucratic corruption. The prime minister's office ought to
be included in the Lokpal's purview. The Lokayukta Act should be adopted by all the states in
the nation in order to combat corruption in state bureaucracies.
As someone once observed, "a ball of snow; once it's set a rolling, it must increase" is a good
analogy for corruption. If the ball must stop rolling, the Indian government must demonstrate
more earnestness and resolve to address the threat than it has in the past.

***************X***************
 CHAPTER-6
CONCLUSION AND SUGGESTIONS
In the late 1930s and early 1940s, criminologists began to study white collar crimes.
Sutherland deserves credit for directing criminologists' attention to the region that has up till
now gone unexplored. The knowledge of criminology now has new dimensions because to
Sutherland. He was the one who first began to systematically examine the economic crimes,
or crimes perpetrated by members of the upper class. Most of the time, these crimes go
unreported and unpunished. Even if these offenders get punishment, the sentence is relatively
mild. The judges in the courts are sympathetic to this group of offenders. Sutherland's thesis
has a flaw in that it only considers crimes committed by members of the top class of society.
It is therefore highly challenging to include numerous offences in it, such as stealing and tax
evasion.
These categories of crimes have evolved significantly in the modern period. It might be really
challenging to find them at times. In addition to being cunning, the criminals who commit
crimes in this category also use new technology.
These crimes are now not only committed by members of the highest strata of society, but
also by members of the middle class and lower class. Therefore, it is proposed that splitting
the offences into two pieces would be the easier course of action. Traditional crimes like
murder, rape, robbery, abduction, and criminal extortion are on the one hand, whereas
economic crimes, such hoarding and tax evasion, can be committed by anybody. In reality, a
certain class of individuals cannot conduct conventional crimes or economic crimes alone. It
is vital to raise awareness of economic crimes like corruption. The rapidly expanding media
may be very helpful in raising awareness of the threat posed by economic crime. It is crucial
to develop a unique system to handle these offences independently. To deal with the threat,
the authorities dealing with economic crimes need specialised training. These organisations
ought to be shielded from political interference. To cope with these crimes, laws have to be
strengthened. The judiciary has to show more consideration for the issue of white collar
crimes. Wherever the maximum sentence is specified, judges should not be hesitant to impose
it in situations of socioeconomic crimes. The judiciary has always responded appropriately to
cases that have been brought before it. However, it should still be aware of the seriousness of
socioeconomic crimes and white collar crimes. Lighter penalties should be the exception
rather than the rule for white collar crimes. To ensure that no white collar criminal escapes
punishment is an extremely challenging duty for the judiciary.
It is essential to remember that it takes years to establish sound legal precedents. To handle
these intricate difficulties, lower judiciary has to get sufficient instruction. The judiciary may
be a key player in helping the average person regain trust in democracy. After the emergency
of 1975, it was judicial activity that contributed to the ordinary man's trust in democracy
being restored. Instead, it had assisted in saving the democracy at that trying period. The
same kind of judicial activism can aid in the battle against the socioeconomic and corruption
threats. The best feasible response to this type of crime is crucial and in the best interests of
the society. Without a larger public's involvement, combating the threat is difficult. If we
want to accomplish the goal quickly, we need to have a really strong political will.
Since India gained independence, white collar crime has been an issue. Even in the early
years of our democracy, we have seen a number of controversies. Over the past 25 years,
there has been an increase in the proclivity of bureaucrats, government employees, and
ministers to commit economic crimes. These days, especially in light of the "2G scam" and
"common wealth games irregularities scam," there is public criticism against them. The issue
of white collar crimes and corruption has been thoroughly researched by the Law
Commission of India for its 29th and 47th reports as well as the Santhanam Committee report
on prevention of corruption. Even though various laws have been passed by legislators to
address the widespread corruption, the threat has not been adequately addressed. The laws
still contain enough loopholes for white collar offenders like ministers and bureaucrats to
readily evade the application of the law. In this sense, it is suggested that a single code be
created to include all socio-economic infractions. Statutes shouldn't be overly favourable to
the accused. Because these laws are social regulations, the burden of evidence must be placed
on the violators. The punishment for this group of crooks should be quite harsh. It is time to
reduce the well-known requirement of criminal law that an accused person's guilt must be
established beyond a reasonable doubt. The judge should keep in mind that beyond a
reasonable doubt should not become beyond all reasonable doubts, even if it is not eased.
Additionally, the judiciary should get the necessary training to pursue white collar crimes.
The legislature should respond appropriately by enacting stout legislation in the statutes in
reaction to convictions of socioeconomic offenders. The minimum and maximum penalties
under the 1988 Prevention of Corruption Act, for example, ought to be increased. If public
employees and ministers are proved to have engaged in corruption, they should face harsher
penalties. The minimum and maximum penalties under other socioeconomic laws, aside from
the Prevention of Corruption Act of 1988, need to be increased.
It is important to take precautions to ensure that white collar offenders do not escape
punishment. The process for bringing white collar offenders to justice has to be streamlined.
The Criminal Procedure Code of 1973 should be appropriately amended to give law
enforcement authorities the authority they need to prosecute white collar crimes. To ensure
that the punishment has a deterrent impact, it is important to raise the conviction rate for
white collar crimes. The penalty for prosecuting public employees is one of the crucial issues.
The legislation contain some of the most contentious provisions, including Section 197 of the
CR.P.C. of 1973 and Section 19 of the Prevention of Corruption Act of 1988. On these
grounds, the Supreme Court has given a favourable response. Although it is argued that
public employees require protection against bogus complaints so they can do their duties
courageously. It is also crucial to remember that the government should sanction prosecution
in any situation when there is suspicion of corruption among public officials. If the
government chooses to withhold penalties in this situation, it shall inform the party requesting
the sanctions of its decision. Actually, it is the responsibility of the government to inform the
person of the status of his application for the sanction. The government must now relax the
sanctions requirements so that the prosecution of the guilty public employees will be
straightforward. In the Vineet Narain case, the Supreme Court correctly noted that a sanction
to prosecute public employees must be given within three months after the application.
The minister is not a public servant in the sense that the word "public servant" is defined
under section 21 of the Indian criminal code, it is crucial to highlight. He receives
compensation for his constitutional obligations in accordance with the Indian Constitution,
not as a result of a master-servant relationship. In the recent A Rajas case, the Supreme Court
was presented with this dilemma once more. The Prime Minister's office has received
criticism from the Supreme Court for refusing to give Swami Subramanyam permission to
bring charges against A Raja. If the government receives an application asking for permission
to prosecute a state or central minister, it must inform the person that such permission is not
needed. Government has to reconsider protecting public employees even after they retire,
especially now that corruption has gone beyond all reasonable bounds. It's crucial to win back
the general public's trust in the Indian judicial system. In order to tackle the threat of white
collar crimes, the government must take a proactive approach. It should foster an atmosphere
in which the government and civil society can work together to fight corruption.
The two most well-known anti-corruption organisations at the Centre, the CVC and CBI,
have been around for a while. The government never wished for them to develop into
powerful professionals.
As early as 1948, it was thought that the Centre needed to establish an investigating agency.
The CBI, however, wasn't founded until April 1st, 1963. No law has been passed as of yet to
control how it operates. The majority of the country's police forces are still governed under
the Police Act of 1861, which is just as antiquated. The central government has been equally
obstinate in rejecting the need for new law to manage and strengthen the CBI, just as the state
governments have shown resistance to accepting the National Police Commission's
recommendations to replace the colonial-era legislation with a new Police Act that is framed
in accordance with the requirements of a modern democratic Constitution. The political
executive needs total control over police organisations so that it may abuse them for partisan
reasons, and this is why it is hesitant to alter in both situations. There is a tonne of proof that
the CBI has been abused quite frequently.
The CVC's tale is comparable. It wasn't formed by legislation but rather by presidential orders
in 1964. Though every effort was made to prevent the execution of that decision, it wasn't
until the Supreme Court issued directives in 1997 to provide it with a legislative cover that
action had to be taken. The CVC Act of 2003 was not introduced by the government for six
years after the previous efforts. However, it made sure that the Act included enough flaws and
gaps to undermine its usefulness.This was seen most recently when the central government
chose a man to lead the CVC in spite of his past transgressions and vehement criticism from
the opposition party and others. This was seen most recently when the central government
chose a man to lead the CVC in spite of his past transgressions and vehement criticism from
the opposition party and others.
The CVC Act established a system of dual control over the CBI, greatly reducing the super-
intendency of the CVC. The Single Directive was also resurrected. The illegality that was
previously carried out by presidential orders is now carried out with the support of the law.
SUGGESTIONS
I. Sincere attempts have not being made to enact the Lokpal bill for a long time although
several states have enacted Lokayukta.
II. It is submitted that the illegalities which have been committed in the CVC act should
be removed and the institution of CVC should be strengthened.
 III. Single Directive ought to be taken out of the Act. A special law should be created to
regulate the CBI for optimal operation. It has to be modernised as soon as possible so
that it can fight corruption to the best of its capacity.
IV. In order for the CBI to become a significant anticorruption agency, the government's
control over its operations should be abolished and it should be let to operate
autonomously. Similar to this, the Local Bill should be implemented as soon as
possible, and this institution should be reinforced to combat bureaucratic corruption.
The Prime Minister's Office ought to fall under the purview of Lokpal.
V. All the states in country should enact Lokayukta act so that corruption in the
bureaucracy can be checked in the states.
VI. Stopping these socio-economic crimes is urgently needed in these terrible times of
Covid-19, when the economy is already suffering, to save our country's way of living.
It is necessary to improve how strict laws are applied.
VII. Public awareness is a must to tackle these Crimes. Sufficient appreciation and
recognition should be duly given to those people who expose such criminals.

In conclusion, it can be claimed that my hypothesis—that white collar crimes have a negative
impact on the economy and the general well-being of society—is true, and that the severity of
such crimes is increasing daily in India. Not enough has been done to solve the issue.
Academic interest is waning. The legal system is proven to be inadequate. This thesis has
been adequately demonstrated in this paper. Because white collar crimes have the capacity to
destroy the whole social fabric of the country, it is crucial to investigate and prosecute this
threat.

Dr. S. Radhakrishnan, the Second President of India, in this context once had observed:

The biggest adversaries of our nation are those who practise evil, such as white-collar and
socioeconomic criminals, as well as hoarders, profiteers, black marketers, and speculators.
Regardless of how well-positioned, significant, and influential they may be, we must deal
with them firmly because if we condone wrongdoing, our reputation will suffer.

***************X***************
 BIBLIOGRAPHY
Primary source

Acts
■ Consumer Protection Act 1986
■ The Indian Penal Code
■ The Code of Criminal Procedure 1973
■ Prevention of Corruption 1964.
■ The Chief Vigilance Commission Act, 2003
■ The Delhi Special Police Establishment Act, 1946

Reports
■ Santhanam Committee Report on Prevention of Corruption, 1964
■ 29th Law Commission Report
■ 47th Law Commission
■ The Ministry's Department-Related Parliamentary Standing Committee, Thirty-seventh
Report

Secondary Source
Books

■ V. N. Paranjape, Criminology and Penology (14th Ed., Central Law Publication, 2010)
■ Walter Reckless : The Crime Problem,2 Sage Publication, 1956
■ Coleman & Moynihan: Understanding Criminal Data 2ND ED., Open University
Press, Buckingham(1996)
■ Goswami P.: Criminology (1964 Ed.)

Articles
■ “White Collar Crimes in India”
■ Sutherland Edwin H, White Collar Criminality, Published by American sociological
Review, Vol. 5, No. 1. Feb. 1940. pp. 1-12. Published by American Sociological
Association.
■ “Differential Association as a Hypothesis: Problems of Empirical Testing.” Social
Problems, vol. 8, no. 1, 1960
■ K. P. Joseph. Lessons From Bihar Fodder Scam. Economic And Political Weekly, Vol.
32, No. 28 (Jul. 12-18 1997)
 ■ ANANTH, V KRISHNA. “Fodder Scam, Lalu, and the Conviction.” Economic and
Political Weekly, vol. 48, no. 43, 2013
■ “Seymour Martin Lipset Encyclopedia of Democracy” ‘corruption’ Vol. 1, P. 310
■ "Harassed for eight months, Bengaluru man paid Rs 6.4L for Rs 73K he took from
Chinese loan apps”,
■ “A brief history of some developments”
■ “CORRUPTION IN HISTORICAL PERSPECTIVE : A CASE OF INDIA.” The
Indian Journal of Political Science, vol. 68, no. 2, 2007
■ “A desperate India falls prey to COVID scammers”
■ “Protect yourself from cyber fraud in the time of covid-19”
■ ”Ramalinga Raju and Satyam Scam : All you need to know”
■ “Guns, Swedes and the Gandhis — how the Bofors scam tested the limits of the CBI’s
power”
■ “Ketan Parekh Scam - All You Need To Know About 2001 Stock Market Scam”
■ “3 Stock Market Scams that Shook the Nation”
■ “Harshad Mehta - The Big Bull of Indian Stock Market (A Scamster or a Scapegoat)”
■ “Scam 2003 The Telgi Story. All that we know so far”
■ “How Satyam Was Sold the Untold Story: How the IT Services Major Was Rescued
against all Odds. Business Today Reconstructs the Events of the 14 Crucial Weeks that
Led up to the Sale,”
■ “WhistleBlowing: Target Firm Characteristics and Economic Consequences,”
■ “Case Study on Satyam Computer Services Limited (SCSL)”
■ “Corporate Accounting Fraud: A Case Study of Satyam Computers Limited”, Open
Journal of Accounting Vol.2 No.2(2013)
■ “Discrepancies Found in Tenders for CWG Projects: CVC”
■ “Commonwealth Games scam – a legal timeline”
■ CWG scam: Kalmadi named ‘main accused’ in first CBI charge sheet
■ “Corporate Lobbying: Do We Need a Law to Regulate Whistle Blowing?”
■ “2G Spectrum Scam”
■ “2g Scam and Its Effect”
■ “The Lokpal cycle”
■ “Lokpal Bill- An Analysis”

Websites
■ http://www.jstore.org
■ http//www.asociatedcontent.com
■ www.iimcal.ac.in
■ https://thecompany.ninja
■ https://www.termpaperwarehouse.com
■ http://www.articles.timesofindia.indiatimes.com
■ http://www.managementparadise.com
■ https://www.outlookindia.com
■ http://indiatogether.org
■ http://www.legalserviceindia.com
■ http://www.cbi.nic.in
■ https://www.scirp.org
■ https://www.indiatoday.in
■ https://indiankanoon.org
■ https://www.humanrightsinitiative.org
■ www.jstor.org
■ https://economictimes.indiatimes.com
■ https://www.livemint.com
■ https://blog.ipleaders.in
■ https://www.indiatimes.com
■ https://theprint.in
■ https://www.pvot.in
■ https://www.samco.in
■ https://niws.in
■ https://www.yourarticlelibrary.com
■ https://www.thehindu.com
■ http://www.legalservicesindia.com
■ http://www.hp.gov.in
■ https://www.lawyersclubindia.com

***************X***************
 BIBLIOGRAPHY
Primary source

Acts
■ Consumer Protection Act 1986
■ The Indian Penal Code
■ The Code of Criminal Procedure 1973
■ Prevention of Corruption 1964.
■ The Chief Vigilance Commission Act, 2003
■ The Delhi Special Police Establishment Act, 1946

Reports
■ Santhanam Committee Report on Prevention of Corruption, 1964
■ 29th Law Commission Report
■ 47th Law Commission
■ The Ministry's Department-Related Parliamentary Standing Committee, Thirty-seventh
Report

Secondary Source
Books

■ V. N. Paranjape, Criminology and Penology (14th Ed., Central Law Publication, 2010)
■ Walter Reckless : The Crime Problem,2 Sage Publication, 1956
■ Coleman & Moynihan: Understanding Criminal Data 2ND ED., Open University
Press, Buckingham(1996)
■ Goswami P.: Criminology (1964 Ed.)

Articles
■ “White Collar Crimes in India”
■ Sutherland Edwin H, White Collar Criminality, Published by American sociological
Review, Vol. 5, No. 1. Feb. 1940. pp. 1-12. Published by American Sociological
Association.
■ “Differential Association as a Hypothesis: Problems of Empirical Testing.” Social
Problems, vol. 8, no. 1, 1960
■ K. P. Joseph. Lessons From Bihar Fodder Scam. Economic And Political Weekly, Vol.
32, No. 28 (Jul. 12-18 1997)
 REFERENCES

218
Santhanam Committee report on Prevention of Corruption 1964.
219
Paragraph 6 of the Scheme of the CVC forwarded by the Chairman to the Union Home Minister vide his DO
Letter dated 22 February 1963

220
Statement laid by the Government of India on the tables of the Lok Sabha and Rajya Sabha about the scheme
on 16 December 1963
221
These powers can be found in the CVC Act, 2003, Section 11.
222
(1998) 1 SCC 226

223
Ibid
224
Ibid

225
Ibid
226
Ibid

227
Center For Pil & Ors vs Union Of India & Ors on 2 February, 2012 available at
https://indiankanoon.org/doc/23377337/, Accessed on 16-6-2021 at 9 pm

228
Vineet Narain & Others vs Union Of India & Another on 18 December, 1997, (1 SCC 226), available at
https://indiankanoon.org/doc/1203995/, Accessed on 16-6-2021 at 9 pm

229
Ibid

232
http://www.thehindu.com accessed on 2-6-2021 at 5.30 PM

. 234 Ibid
235
The Supreme Court's judgement in Writ Petition (Criminal) Nos. 340-343 of 1993; p. 81

236
See the Preamble to the CVC Act 2003.

237
(2009) 7 SCC 1

. 238 SEE Section 8 of the Act.

239
SEE Section 11 of the Act.

237
(2009) 7 SCC 1.

238
SEE Section 8 of the Act.
239
SEE Section 11 of the Act.

240
http://www.cbi.nic.in/history/hist.php Accessed on 01-06-2021 at 4.30 PM
241
Ibid

Gibs law journal

242
Ibid
243
The Delhi Special Police Establishment Act, 1946, Preamble.
244
Ibid., Section 5 (1)
245
Ibid., Section 3
246
Ibid., Sections 2 (2) & 5 (2) & (3)
247
Ibid., Section 6
248
Ibid., Section 4

249
THE PREVENTION OF CORRUPTION ACT 1988
250
Supra note 136

251
The Ministry's Department-Related Parliamentary Standing Committee, Thirty-seventh Report presented to
Parliament on 9 March 2010; Chapter IV, Paragraph 11
252
http://www.cbi.gov.in/performance/pending_sanction.php Accessed on 16th may at 11.15 PM
253
(2000) 5 SCC 88.

254
2003 (9) Scale 569.
255
(AIR 1994 SC 787).

256
Baisakh Pradeep, “The Lokpal cycle”, available at http://indiatogether.org/articles/lokpal-laws/print,
Accessed on 22-6-2021
257
Ibid
258
Ibid

259
Ibid
260
“Triloknath Mishra, Lokpal in India-An Analysis“ http://www.wisdomblow.com/?p=689 accessed on 1-6-
2021 at 9.30 PM

261
Supra note 256
262
Supra note 260

263
Supra note 256
264
http://www.hp.gov.in/lokayukta/page/Role-of-Lokayukta.aspx accessed on 18-5-2021 at 10.00 AM

265
Chopra Aditya, “Lokpal Bill- An Analysis”, available at https://www.lawyersclubindia.com/articles/Lok-pal-
bill-An-Analysis-1560.asp, Accessed on 23-6-2021
 ■ ANANTH, V KRISHNA. “Fodder Scam, Lalu, and the Conviction.” Economic and
Political Weekly, vol. 48, no. 43, 2013
■ “Seymour Martin Lipset Encyclopedia of Democracy” ‘corruption’ Vol. 1, P. 310
■ "Harassed for eight months, Bengaluru man paid Rs 6.4L for Rs 73K he took from
Chinese loan apps”,
■ “A brief history of some developments”
■ “CORRUPTION IN HISTORICAL PERSPECTIVE : A CASE OF INDIA.” The
Indian Journal of Political Science, vol. 68, no. 2, 2007
■ “A desperate India falls prey to COVID scammers”
■ “Protect yourself from cyber fraud in the time of covid-19”
■ ”Ramalinga Raju and Satyam Scam : All you need to know”
■ “Guns, Swedes and the Gandhis — how the Bofors scam tested the limits of the CBI’s
power”
■ “Ketan Parekh Scam - All You Need To Know About 2001 Stock Market Scam”
■ “3 Stock Market Scams that Shook the Nation”
■ “Harshad Mehta - The Big Bull of Indian Stock Market (A Scamster or a Scapegoat)”
■ “Scam 2003 The Telgi Story. All that we know so far”
■ “How Satyam Was Sold the Untold Story: How the IT Services Major Was Rescued
against all Odds. Business Today Reconstructs the Events of the 14 Crucial Weeks that
Led up to the Sale,”
■ “WhistleBlowing: Target Firm Characteristics and Economic Consequences,”
■ “Case Study on Satyam Computer Services Limited (SCSL)”
■ “Corporate Accounting Fraud: A Case Study of Satyam Computers Limited”, Open
Journal of Accounting Vol.2 No.2(2013)
■ “Discrepancies Found in Tenders for CWG Projects: CVC”
■ “Commonwealth Games scam – a legal timeline”
■ CWG scam: Kalmadi named ‘main accused’ in first CBI charge sheet
■ “Corporate Lobbying: Do We Need a Law to Regulate Whistle Blowing?”
■ “2G Spectrum Scam”
■ “2g Scam and Its Effect”
■ “The Lokpal cycle”
■ “Lokpal Bill- An Analysis”
Websites
■ http://www.jstore.org
■ http//www.asociatedcontent.com
■ www.iimcal.ac.in
■ https://thecompany.ninja
■ https://www.termpaperwarehouse.com
■ http://www.articles.timesofindia.indiatimes.com
■ http://www.managementparadise.com
■ https://www.outlookindia.com
■ http://indiatogether.org
■ http://www.legalserviceindia.com
■ http://www.cbi.nic.in
■ https://www.scirp.org
■ https://www.indiatoday.in
■ https://indiankanoon.org
■ https://www.humanrightsinitiative.org
■ www.jstor.org
■ https://economictimes.indiatimes.com
■ https://www.livemint.com
■ https://blog.ipleaders.in
■ https://www.indiatimes.com
■ https://theprint.in
■ https://www.pvot.in
■ https://www.samco.in
■ https://niws.in
■ https://www.yourarticlelibrary.com
■ https://www.thehindu.com
■ http://www.legalservicesindia.com
■ http://www.hp.gov.in
■ https://www.lawyersclubindia.com

***************X***************
 References

32 https://economictimes.indiatimes.com/news/politics-and-nation/bofors-scam-decision-on-ottavio-quattrocchi- case-

today/articleshow/7227847.cms, Accessed on 17-6-2021

33
Raghavan R. K., “Guns, Swedes and the Gandhis — how the Bofors scam tested the limits of the CBI’s
power”, available at https://theprint.in/pageturner/excerpt/guns-swedes-and-the-gandhis-how-the-bofors-scam-
tested-the-limits-of-the-cbis-power/531144/, Last updated 26 October, 2020 5:40 pm IST, Accessed on 22-6-
2021
34
Ibid
35
Ibid

36
Ibid
37
Ibid
38
Ibid

39
K. P. Joseph. Lessons from Bihar Fodder Scam. Economic And Political Weekly, Vol. 32, No. 28 (Jul. 12-18
1997), pp. 1686-1687 http://www.jstore.org accessed on 10-5-2021 at 4-30 PM.
40
Ibid

43
Ibid
44
ANANTH, V KRISHNA. “Fodder Scam, Lalu, and the Conviction.” Economic and Political Weekly, vol. 48,
no. 43, 2013, pp. 12–14. JSTOR, www.jstor.org/stable/23528830. Accessed 22-6-2021.
45
Ibid

47
Ibid
48
Ibid
49
Raghu, “Ketan Parekh Scam - All You Need To Know About 2001 Stock Market Scam”, available at
https://www.pvot.in/blog/ketan-parekh-scam-all-you-need-to-know-about-2001-stock-market-scam/, published
date 24-4-2021, Accessed on 22-6-2021

50
Khude Deepika, “3 Stock Market Scams that Shook the Nation”, available at
https://www.samco.in/knowledge-center/articles/stock-market-scams-that-shook-the-nation/, created 10-11-
2020, Accessed on 22-6-2021
51
Ibid

52
Sharma Deepak, “Harshad Mehta - The Big Bull of Indian Stock Market (A Scamster or a Scapegoat),
available at https://niws.in/blog-details/Harshad-Mehta-The-Big-Bull-of-Indian-Stock-Market-A-Scamster-or-a-
Scapegoat, last updated 12-11-2020, Accessed on 22-6-2021
53
Ibid
54
Supra note 50
55
Ibid

56
Sharma Divyanshi, “Scam 2003 The Telgi Story. All that we know so far”, available at
https://www.indiatoday.in/binge-watch/story/scam-2003-the-telgi-story-all-that-we-know-so-far-1775529-2021- 03-
04, last updated 4-3-2021, Accessed on 22-6-2021
57
Ibid
58
Ibid
59
Ibid
 60
Bhasin Madan Lal, “Corporate Accounting Fraud: A Case Study of Satyam Computers Limited”, Open
Journal of Accounting
Vol.2 No.2(2013), Available at https://www.scirp.org/html/2-2670015_30220.htm#return34, Accessed on 22-6-
2021
61
Abraham Bobins,” Ramalinga Raju and Satyam Scam : All you need to know” last updated on Oct 9, 2020,
14:50 IST available at https://www.indiatimes.com/news/india/ramalinga-raju-satyam-scam-india-biggest-
accounting-fraud-all-you-need-to-know-524758.html, Accessed on 20-6-2021.

62
N Kiran, “Case Study on Satyam Computer Services Limited (SCSL)”, available at
https://www.yourarticlelibrary.com/case-studies/case-study-on-satyam-computer-services-limited-scsl/99569,
Accessed on 22-6-2021
63
Ibid
64
http://www.nja.nic.in/P-948_Reading_Material/P-
948_Audit_of_Fraud_in_economic_crimes/ACCOUNTING%20FRAUD.pdf, Accessed on 21-6-2021
65
Supra note 62

66
Supra note 60
67
Ibid
68
R. M. Bowen, A. C. Call and S. Rajgopal, “WhistleBlowing: Target Firm Characteristics and Economic
Consequences,” The Accounting Review, Vol. 85, No. 4, 2010, pp. 1239-1271

69
Supra note 62
70
S. S. Dagar, “How Satyam Was Sold the Untold Story: How the IT Services Major Was Rescued against all
Odds. Business Today Reconstructs the Events of the 14 Crucial Weeks that Led up to the Sale,” Business
Today, 2009, pp. 25-42

71
Verma Ayush, “Commonwealth Games scam – a legal timeline”, available at
https://blog.ipleaders.in/commonwealth-games-scam-legal-timeline/, Last updated 19-2-2021, Accessed on 22-
6-2021

72
Ibid
73
Ibid
74
Ibid
75
Ibid
76
Ibid

77
Ibid
78
Shrivastava Ashwini, “Discrepancies Found in Tenders for CWG Projects: CVC”, available at
https://www.outlookindia.com/newswire/story/discrepancies-found-in-tenders-for-cwg-projects-cvc/697886, Last
updated 19-10-2010 at 5:50 PM, Accessed on 22-6-2021

79
Ibid
80
THE INDIAN PENAL CODE 1860
81
Ibid
82
THE PREVENTION OF CORRUPTION ACT, 1988
83
Vinay Kumar, CWG scam: Kalmadi named ‘main accused’ in first CBI charge sheet, The Hindu (May 20,
2011), https://www.thehindu.com/news/national/cwg-scam-kalmadi-named-main-accused-in-first-cbi-charge-
sheet.

84
Writ Petition (Civil),Case No:10, Year:2011
85
Writ Petition (Civil),Case No:423, Year:2010
86
Nero Priya, “Corporate Lobbying: Do We Need a Law to Regulate Whistle Blowing?”, available at
http://www.legalservicesindia.com/article/610/Corporate-Lobbying:-Do-We-Need-a-Law-to-Regulate-Whistle-
Blowing?.html, Accessed on 20-5-2021
87
Ibid
 88
Ibid
89
Ranjan Harshita, “2G Spectrum Scam’, available at https://thecompany.ninja/2g-spectrum-scam/, last updated
14-6-2020, Accessed on 22-6-2021
90
Ibid

91
Putul Kiran, “2g Scam and Its Effect”, https://www.termpaperwarehouse.com/essay-on/2g-Scam-and-Its-
Effect/42860, Accessed on 22-6-2021
92
Supra note 89
93
Ibid
94
Ibid

95
Supra note 91
96
Supra note 89
97
Ibid

98
Supra note 91
99
Ibid
100
Ibid

101
Bhasin Tinesh, “Protect yourself from cyber fraud in the time of covid-19”, available at
https://www.livemint.com/money/personal-finance/protect-yourself-from-cyber-fraud-in-the-time-of-covid19-
11619727266648.html, Last Updated: 30 Apr 2021, 01:51 AM IST, Accessed on 20-6-2021
102
Ibid

103
Kumar Hari and Gettleman Jeffrey, “A desperate India falls prey to COVID scammers Last Updated: May
17, 2021, 10:21 PM IST”, available at https://economictimes.indiatimes.com/news/india/a-desperate-india-falls-
prey-to-covid-
scammers/articleshow/82698790.cms?utm_source=contentofinterest&utm_medium=text&utm_campaign=cppst
, Accessed on 19-6-2021
104
Ibid
105
Ibid

106
Ibid
107
Pinto Nolan and Pandey Ashish, "Harassed for eight months, Bengaluru man paid Rs 6.4L for Rs 73K he
took from Chinese loan apps”, available at https://www.indiatoday.in/india/story/bengaluru-man-pays-rs-6-4-
lakh-for-rs-73-thousand-he-took-from-chinese-loan-apps-1759119-2021-01-14, Last Updated: January 14, 2021
19:22 IST, Accessed on 19-6-2021
108
Ibid
109
Ibid

110
Ibid
111
Ibid
112
Ibid
113
Ibid

114
Joshi GP,” A brief history of some developments”, at
https://www.humanrightsinitiative.org/publications/police/cvc_cbi_some_developments_a_brief_history.pdf,
accessed on 15-6-2021
115
Agrawal, Arun Kr. “CORRUPTION IN HISTORICAL PERSPECTIVE: A CASE OF INDIA.” The Indian
Journal of Political Science, vol. 68, no. 2, 2007, pp. 325–336. JSTOR, www.jstor.org/stable/41856330.
Accessed 10-6-2021
116
Ibid
117
Santhanam Committee Report on Prevention of Corruption, 1964.
118
Ibid
119
Ibid

125
Chapter 1 of the 47th Law Commission Report.

127
Ibid
128
Ibid
129
Ibid

130
Supra note 4
131
Ibid

132
THE CODE OF CRIMINAL PROCEDURE 1973
133
Supra note 10

134
THE COMPANIES ACT, 1956
135
Supra note 10, s 21
136
Supra note 132, s 197
137
THE CONSTITUTION OF INDIA, 1950
138
Ibid

139
Id, ss (4)
140
Id, s 197
141
CVC’s National Anti-Corruption Strategy, Final Draft, September 2010; p. 22

142
(2004)8 SCC 40

143
Supra note 136
144
(2006)4 SCC 584.
145
Supra note 136
146
Ibid
147
Ibid
148
Ibid

149
Id, ss (1)
150
Supra note 137
151
AIR 1956 SC 54.
152
Supra note 135
153
Ibid
154
Ibid
155
AIR 1943 FC 18.
156
Supra note 10
157
Ibid
158
Supra note 136
159
(1973)2 SCC 701.
160
Supra note 136
161
(1986)1 SCC 410.
162
Supra note 136, ss (1)

163
Supra note 136
164
Supra note 10, s 161
 165
Supra note 136
166
Supra note 159
167
AIR 1966 SC 1766.
168
Supra note 10, s 330, 342, 343 and 348
169
Supra note 132, s 161 and 163
Gibs law journal

170
AIR 1966 SC 523.
171
AIR 1958 SC 124.
172
(1979)4 SCC 177.
173
Supra note 136
174
Supra note 10, s 202
175
Supra note 136
176
(1998)1 SCC 205.
177
Supra note 136

178
(1987)1 SCC 476.
179
Supra note 132
180
Supra note 136
181
(1987) 2 SCC 414.
182
Supra note 132
183
Supra note 10, s 161-165

184
Supra note 10, s 161(9)
185
(1984)2 SCC 183.
186
THE CENTRAL VIGILANCE COMMISSION ACT, 2003
187
Ibid
188
Supra note 185

189
Supra note 10
190
Supra note 185
191
Supra note 10
192
Supra note 185
193
Ibid

194
Supra note 10
195
Ibid
196
Supra note 185
197
(1998) 1 SCC 226.

198
(1996)1 SCC 478.
199
Supra note 136
200
Ibid
201
Supra note 198
202
Supra note 137
203
Supra note 136
204
Supra note 136
205
Supra note 198
206
(1998)6 SCC 411.

207
Supra note 136
208
Ibid
209
Supra note 186
210
Supra note 206
211
(2006)1 SCC 294.
212
Supra note 136
213
Supra note 186
214
Supra note 136

215
Supra note 211
216
AIR 2008 SC 108.

217
Supra note 10
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12
2
Supra
3
V. N. Paranjape, Criminology and Penology (14th Edn., Central Law Publication, 2010) at 114-
115.
4
Subodh Asthana, “White Collar Crimes in India”, available at
https://blog.ipleaders.in/white-collar- crimes/,last updated, July 31, 2019, Accessed on 25-
5-2021
5
Ibid
6
Ibid
7
Timothy Holmes, “Professional Criminals and White-Collar Crime in Popular
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8
Supra note 1
9
Goswami P.: Criminology (1964 Ed.), p 249.
10
THE INDIAN PENAL CODE, 1860 ACT NO. 45 OF 1860, S 168
11
Ibid, S 171 (e)
1
Ibid

12
Supra note 3
1
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15

1
Walter Reckless: The Crime Problem, p. 345
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Coleman & Moynihan: Understanding Criminal Data (1996) pp. 8-10.
1
Supra note 4
1
Supra note 3, at pp. 122-125.
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1
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114