CHENNAI

3rd Floor, Creative Enclave,

148-150, Luz Church Road,
Mylapore,
Chennai - 600 004.
Tel: +91 - 44 - 2498 4821

BANGALORE
Suite 920, Level 9,
Raheja Towers,
26-27, M G Road,
Bangalore - 560 001.
CRIMINAL LIABILITY OF A
Tel: +91 - 80 - 6546 2400

COIMBATORE
COMPANY / CORPORATIONS
BB1, Park Avenue,
# 48, Race Course Road,
Coimbatore - 641018.
Tel: +91 - 422 6552921

Lakshminarayanan Alaguraja
Advocate
Altacit Global
EMAIL
info@altacit.com
WEBSITE
www.altacit.com
 Corporate Liability
CHENNAI
3rd Floor, Creative Enclave,
148-150, Luz Church Road,
Mylapore,
In criminal law, corporate liability determines
Chennai - 600 004.
Tel: +91 - 44 - 2498 4821 the extent to which a corporation as a legal
BANGALORE
Suite 920, Level 9,
Raheja Towers,
person can be liable for the acts and
26-27, M G Road,
Bangalore - 560 001.
Tel: +91 - 80 - 6546 2400
omissions of the natural persons it employs.
COIMBATORE
BB1, Park Avenue,
It is sometimes regarded as an aspect of
# 48, Race Course Road,
Coimbatore - 641018.
Tel: +91 - 422 6552921
criminal vicarious liability, as distinct from
the situation in which the wording of a
statutory offence specifically attaches
liability to the company / corporation.
EMAIL
info@altacit.com
WEBSITE
www.altacit.com
 Formation of a Company
CHENNAI
3rd Floor, Creative Enclave,
148-150, Luz Church Road,
Mylapore,
Chennai - 600 004.
Tel: +91 - 44 - 2498 4821 Company = organization of persons and
BANGALORE
Suite 920, Level 9, funds for common purpose.
Raheja Towers,
26-27, M G Road,
Bangalore - 560 001.
Tel: +91 - 80 - 6546 2400
Only an Incorporation makes it a legal
COIMBATORE entity registration under Companies
BB1, Park Avenue,
# 48, Race Course Road,
Coimbatore - 641018.
Act, 1956 conclusive proof of valid
Tel: +91 - 422 6552921
formation.
Memorandum and Articles of Association
also shareholders agreement.
EMAIL
info@altacit.com
WEBSITE
www.altacit.com
 Promoter of a Company
CHENNAI
3rd Floor, Creative Enclave,

Promoter = one who promotes the

148-150, Luz Church Road,
Mylapore,
Chennai - 600 004.
Tel: +91 - 44 - 2498 4821

BANGALORE
Suite 920, Level 9,
formation of the company
Raheja Towers,
26-27, M G Road,
Bangalore - 560 001.
entrepreneur.
Personally liable for contracts before
Tel: +91 - 80 - 6546 2400

COIMBATORE
BB1, Park Avenue,
# 48, Race Course Road,
Coimbatore - 641018.
Tel: +91 - 422 6552921
completion of the incorporation
process.
Fiduciary relationship and
legitimate expenses are payable
EMAIL
info@altacit.com
sweat equity, etc.
WEBSITE
www.altacit.com
 Objects Clause
CHENNAI
3rd Floor, Creative Enclave,
148-150, Luz Church Road,
Mylapore,
MoA Main, Ancillary and Other
Chennai - 600 004.
Tel: +91 - 44 - 2498 4821 Objects.
Investor protection and as caution
BANGALORE
Suite 920, Level 9,
Raheja Towers,
26-27, M G Road,
Bangalore - 560 001.
Tel: +91 - 80 - 6546 2400 to outsiders Doctrine of Ultra
COIMBATORE
BB1, Park Avenue,
# 48, Race Course Road,
Vires exceeding the legal power.
Ultra vires actions are not binding
Coimbatore - 641018.
Tel: +91 - 422 6552921

on the Company.

EMAIL
info@altacit.com
WEBSITE
www.altacit.com
 Articles of Association
CHENNAI
3rd Floor, Creative Enclave,

For internal management rules for day-

148-150, Luz Church Road,
Mylapore,
Chennai - 600 004.
Tel: +91 - 44 - 2498 4821

BANGALORE
to-day activities.
Suite 920, Level 9,
Raheja Towers,
26-27, M G Road,
Rule of Constructive notice = presumed
Bangalore - 560 001.
Tel: +91 - 80 - 6546 2400 knowledge of the AoA by anybody dealing
COIMBATORE
BB1, Park Avenue,
with the Company.
# 48, Race Course Road,
Coimbatore - 641018.
Tel: +91 - 422 6552921
Rule of indoor management an
exception of procedural compliance to
protect external interests with reasonable
efforts.

EMAIL
info@altacit.com
WEBSITE
www.altacit.com
 Criminal Liability
CHENNAI
3rd Floor, Creative Enclave,
148-150, Luz Church Road, 1. Nature and seriousness of crime.
Mylapore,
Chennai - 600 004.
Tel: +91 - 44 - 2498 4821 2. Complicity and pervasiveness within the
BANGALORE
Suite 920, Level 9,
Company
Raheja Towers,
26-27, M G Road,
Bangalore - 560 001.
3. History of similar conduct.
Tel: +91 - 80 - 6546 2400

COIMBATORE
4. Corporations timely, voluntary disclosure
BB1, Park Avenue,
# 48, Race Course Road,
Coimbatore - 641018.
and cooperative efforts.
Tel: +91 - 422 6552921
5. Presence of a compliance and ethics code.
6. Prosecution = combined efforts of the
Corporation and the Investigating
Authorities Concern of confidential
EMAIL information.
info@altacit.com
WEBSITE
www.altacit.com
 Criminal Liability
CHENNAI
3rd Floor, Creative Enclave,
148-150, Luz Church Road, 1. Rationale for Criminal liability = enormous
Mylapore,
Chennai - 600 004.
Tel: +91 - 44 - 2498 4821
influence on economy.
BANGALORE
Suite 920, Level 9,
2. Strict degree of Vicarious criminal liability
Raheja Towers,
26-27, M G Road,
Bangalore - 560 001.
attribution of collective mens rea of
Tel: +91 - 80 - 6546 2400
Executives.
COIMBATORE
BB1, Park Avenue,
# 48, Race Course Road,
Coimbatore - 641018.
3. Gross negligence or breach of duty.
Tel: +91 - 422 6552921
4. Test of Organizational approach.
5. Applies to Partnerships/Trusts/Unions too.
6. Statutory compliances also covered for
liability.
EMAIL
info@altacit.com
WEBSITE
www.altacit.com
 Criminal Liability
CHENNAI
3rd Floor, Creative Enclave,
148-150, Luz Church Road,
Mylapore,
Fundamental Rights of a Company
Chennai - 600 004.
Tel: +91 - 44 - 2498 4821

BANGALORE
Fair trial = Procedural safeguards
Suite 920, Level 9,
Raheja Towers,
26-27, M G Road,
Bangalore - 560 001.
Issue of Political funding
Punishments for Company:
Tel: +91 - 80 - 6546 2400

COIMBATORE
BB1, Park Avenue,

Restitution; Fines; Probation under

# 48, Race Course Road,
Coimbatore - 641018.
Tel: +91 - 422 6552921

Court supervision; Forfeiture clauses;

and Public apologies

EMAIL
info@altacit.com
WEBSITE
www.altacit.com
 Culpability of Company
CHENNAI
3rd Floor, Creative Enclave,
148-150, Luz Church Road,
Mylapore,
Crime committed by an employee
Chennai - 600 004.
Tel: +91 - 44 - 2498 4821 despite strong Corporate policy
BANGALORE
Suite 920, Level 9,
Raheja Towers,
against it?
26-27, M G Road,
Bangalore - 560 001.
Tel: +91 - 80 - 6546 2400 Crimes committed by contractors/
COIMBATORE
BB1, Park Avenue,
# 48, Race Course Road,
consultants?
Crimes committed in ignorance or
Coimbatore - 641018.
Tel: +91 - 422 6552921

wrong understanding of law?

Serious frauds committed by senior
EMAIL
management?
info@altacit.com
WEBSITE
www.altacit.com
 Offences under Companies Act
CHENNAI
3rd Floor, Creative Enclave,
148-150, Luz Church Road,
Mylapore,
Chennai - 600 004.
Tel: +91 - 44 - 2498 4821
Section Offences
BANGALORE
(Companies Act 1965)
Suite 920, Level 9,
Raheja Towers, Section 169 Failure to table accounts.
26-27, M G Road,
Bangalore - 560 001.
Tel: +91 - 80 - 6546 2400
Section 364(2) Making false and misleading statement.
COIMBATORE
BB1, Park Avenue,
# 48, Race Course Road, Section 131 Disclosure of interest in contracts, property,
Coimbatore - 641018.
Tel: +91 - 422 6552921
officers etc
Section 132 Breach of duty and liability of officers.

Section 132E Substantial property transactions involving

directors.

EMAIL
info@altacit.com
WEBSITE
www.altacit.com
 Offences under Companies Act
CHENNAI
3rd Floor, Creative Enclave,
148-150, Luz Church Road, Section Offences
Mylapore,
Chennai - 600 004. (Companies Act 1965)
Tel: +91 - 44 - 2498 4821

BANGALORE Section 167 Failure to keep accounts for 7 years.

Suite 920, Level 9,
Raheja Towers,
26-27, M G Road,
Bangalore - 560 001.
Tel: +91 - 80 - 6546 2400
Section 125 Undischarged bankrupt acting as
director.
COIMBATORE
BB1, Park Avenue,
# 48, Race Course Road, Section 133A Prohibition of loan to persons
Coimbatore - 641018.
Tel: +91 - 422 6552921 connected with directors

Section 135 General duty to make disclosure

Section 174 Powers and duty of auditors as to

reports on accounts
EMAIL Section 367 Use of a company name in business
info@altacit.com prior to incorporation.
WEBSITE
www.altacit.com
 CHENNAI
3rd Floor, Creative Enclave,
148-150, Luz Church Road,
Mylapore,
Chennai - 600 004.
Tel: +91 - 44 - 2498 4821

BANGALORE
Suite 920, Level 9,
Raheja Towers,
26-27, M G Road,
Bangalore - 560 001.
Tel: +91 - 80 - 6546 2400

COIMBATORE
CASE STUDY
BB1, Park Avenue,
# 48, Race Course Road,
Coimbatore - 641018.
Tel: +91 - 422 6552921

EMAIL
info@altacit.com
WEBSITE
www.altacit.com
 Iridium India Telecom Ltd. vs. Motorola
Inc. 2011(1) SCC 74
CHENNAI
3rd Floor, Creative Enclave,
148-150, Luz Church Road,
The Honble Supreme Court allowed the prosecution against
Mylapore,
Chennai - 600 004. the Motorola setting aside the defence plea that it could not
Tel: +91 - 44 - 2498 4821
have the necessary mens rea. A Company/Corporation is
BANGALORE
Suite 920, Level 9, virtually in the same position as any individual and may be
Raheja Towers,
26-27, M G Road, convicted of offences including those requiring mens rea. It
Bangalore - 560 001.
Tel: +91 - 80 - 6546 2400 cannot escape liability for a criminal offence merely because
COIMBATORE
BB1, Park Avenue,
the punishment prescribed is that of imprisonment. The
# 48, Race Course Road,
Coimbatore - 641018.
criminal intent of the alter ego of the company i.e. the persons
Tel: +91 - 422 6552921
or group of persons that guide the business of the Company,
would be imputed to the corporation, depending upon degree
of control exercised by persons in charge of affairs of company.
Held if degree of control is so intense that a corporation may be
said to think and act through a person or body of persons, mens
EMAIL rea of person or persons in control is attributable to the
info@altacit.com corporation.
WEBSITE
www.altacit.com
 CHENNAI
3rd Floor, Creative Enclave,
148-150, Luz Church Road,
Mylapore,
Chennai - 600 004.
Tel: +91 - 44 - 2498 4821

BANGALORE
Suite 920, Level 9,
Raheja Towers,
26-27, M G Road,

Thank You
Bangalore - 560 001.
Tel: +91 - 80 - 6546 2400

COIMBATORE
BB1, Park Avenue,
# 48, Race Course Road,
Coimbatore - 641018.
Tel: +91 - 422 6552921

EMAIL
info@altacit.com
WEBSITE
www.altacit.com