NATIONAL LAW UNIVERSITY, ODISHA

CRIMINAL LAW I

PROJECT ON

SATYAM SCAM CRIMINAL LIABILY

SEMESTER- V

BBA.LLB

SUBMITTED TO

SUMAN DASH BHATTAMISHRA

NANDITA BATRA

SUBMITTED BY

KIRTI VYAS (15BBA029)

TAMOGHNA SAHA (15BBA057)

 ACKOWLEDGEMENT

On the submission of this research project, I accept this genuine thanks to my subject
professors Prof. Nandita Batra and Suman Bhattamishra Dash for their assistance all
through this research. Your direction, observing and consistent consolation all through has
gone about as a feeling of inspiration for me. I have profound respects for the endeavors that
you have taken. In this, I have taken endeavors to the best of my capacities. Be that as it may,
it could never have been conceivable without your kind help and offer assistance.

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 TABLE OF CONTENTS

ACKOWLEDGEMENT 2

RESEARCH METHODOLOGY 5

SCOPE AND LIMITATION 5

OBJECTIVES 5

METHODOLOGY 5

SOURCES 5

RESEARCH QUESTION 5

MODE OF CITATION 6

INTRODUCTION 6

I. ORIGIN OF CONCEPT OF CORPORATE CRIMINAL LIABILITY 7

II. THE CONCEPT OF WHITE COLLAR CRIMES 8

EVOLUTION OF CORPORATE CRIMINAL LIABILITY 9

CORPORATE CRIMINAL LIABILITY IN INDIA 11

I. LAW ON COMPANIES AND THE CORPORATE CRIMINAL LIABILITY 12

SATYAM SCAM 15

I. FACTS 15

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II. CHARGES WERE FRAMED AGAINST THE ACCUSED AS FOLLOWS: 18

A. Ingredients of criminal conspiracy and proof required: 20

B. Ingredients of Criminal Breach of Trust and proof required: 20

C. Ingredients of cheating by personation and proof required: 20

D. Ingredients of cheating and proof required: 21

E. Ingredients of forgery and proof required: 21

F. Ingredients of forgery for purpose of cheating and proof required: 22

G. Ingredients of using as Genuine a forged document and proof required: 22

H. Ingredients of falsification of accounts and proof required: 22

I. Ingredients of Causing Disappearance of Evidence of offence and proof required: 23

III. ISSUES DECIDED BY THE COURT 23

AFTERMATH OF SATYAM SCAM 34

CONCLUSION AND SUGGESTIONS 36

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 RESEARCH METHODOLOGY

SCOPE AND LIMITATION

The objective of this project is to determine the Jurisprudence of Corporate Criminal Liability
under Indian law with the help of Satyam Scam.The project presents the origin of the
concept of Corporate Criminal Liability around the world and also makes an attempt to throw
a light upon the concept of the same in India law.Authors have attempted to trace down the
trial in the case of Ramalingan Raju v CBI and have shown the aftermath of the said scam
and the development of the law in this respect.The limitation which the authors faced was
regarding the complexity of the judgements in this respect and to trace down the criminal
aspect in these type of cases.

OBJECTIVES

The objective of this project is to determine the implication of theories of criminality to the
corporate firms and to explore the subject of corporate criminal liability in India and around
the world. Furthermore the objective of this project is to make a indepth study on the satyam
scam and to show the changes Indian law went through after this scam.

METHODOLOGY

In this project, the applied research has been done with a goal to provide a comprehensive
understanding of the current scenario. Descriptive method has been adopted along with
qualitative research. There has also been a data analysis from the trend adopted in India and
other countries as well.

SOURCES

The sources adopted for conducting the research for this project are mainly secondary in
nature such as books, journals, data bases, archives, reports and records. Further, articles in
this area of research have been extensively referred to.

RESEARCH QUESTION

The research question that has been dealt with in this project are:

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 What is the concept of Corporate Criminal Liability and how it evolved?
Whether or not a Company can be held criminally liable?
Whether or not an individual acting on behalf of the Company can be held criminally
liable?
What were the impacts of Satyam Scam?

HYPOTHESIS

Coporates are not in a position to commit crimes because they lack requisite mens rea, and
without the mental element a crime cannot be committed.

MODE OF CITATION

The mode of citation is Uniform Citation and this has been uniformly used throughout the
project.

INTRODUCTION

Corporate firms and body corporate of all sizes, over the world, are effortlessly powerful to
commit any sort of wrongdoing anytime. Numerous organization are complicit in
disregarding human rights and condition of people and also misuse their powers to commit

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wrongs to innocent shareholders and other stockholders. Considering Corporation responsible
for their poor practices becomes troublesome in some cases.

Tragically Corporations are working harder in recent memory to cover mishandle in place of
actually counteracting them. For any state or nation, Corporations are important machineries
to keep the economy stable, they help any state or nation for building a better future. In the
21st century, the Corporate phenomenon is fundamental. In the meantime, Corporate has
their Social obligation likewise towards the general public, State, Country. Presently a day in
a newspaper we see at least one Corporate Scandal including big shot personalities by
conferring false statements. By taking the cash of middle-class society they are turned out to
be the extremely rich person. Numerous businesses for the purpose of benefits by giving
minimal effort of an item to the costumer double-dealing the client's confidence. Dangerous
and hazardous industries not take care about the standards of Security and the poor specialist
lost their life likewise some time.

Everything comes under the top of Corporate Crime the individual should be punished for
such wrongdoing. The present situation of Corporate Crime is most extraordinarily awful. To
demonstrate the situation of the neighbourhood and other jurisdictions the researcher by
taking an example of SATYAM SACAM states the problems of Corporate crime and
Corporate Criminal Liability under law.

I. ORIGIN OF CONCEPT OF CORPORATE CRIMINAL LIABILITY

Corporate criminal liability has its starting points in traditional law, and turned into the focal
point of the doctrinal talks toward the finish of the nineteenth century. The development of
corporate criminal liability under law demonstrates that corporate criminal risk is steady with
the standards of criminal law and the basic nature of body corporate.

In the fourteenth century, the teaching perceived that corporate firms had their own will and
power and hence, their criminal obligation and liability was conferred upon them .With a
couple of special cases for example, bigamy, assault, and so on., a firm could carry out any
wrongdoing, which could be carried out by an individual. This hypothesis was preveland in
the mainland European principle until the finish of the eighteenth Century. The medieval
origination depended on the conviction of every one of the companies ought to be guilt if
they commited any crime in the name of the company in both civil and criminal cases. Urban
communities, towns, colleges, exchange, and religious affiliations was required to pay fines
for their wrongdoings and illegal act. The French New Penal Code was first to be founded as

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 a legal framework, where a thorough arrangement of corporate criminal liability standards
and punishments were given, except in the cases of the State, all the juristic people are
criminally at risk for the offenses carried out for their benefit by their organs or
representatives.

France's framework was trailed by various other nations in Europe. In this Belgium Penal
Code also established the criminal obligation of juristic people. Netherlands embraced the
idea of corporate criminal liability under law prior, in 1976. The Dutch Penal Code gives that
normal people and also juristic people can commit offenses. At first, England declined to
acknowledge the possibility of corporate criminal liability for a few reasons. They were
considered lawful fictions, simulated elements that could do only what they are "legitimately
engaged to do1 because companies needed souls, they could not have mens rea and could
be neither reprehensible, nor punishned.

In the midst of the sixteenth and seventeenth hundreds century, enterprises turned out to be
more typical and their significance in the financial life expanded. A requirement for
controlling corporate illegal acts turned out to be increasingly self-evident. Organizations
have been perceived as free, which possessed property distinctive from that of their
individuals. The initial phase in the English law of corporate criminal liability was made in
the 1840s when the courts forced risk on companies for strict obligation offenses. Before
long, by obtaining the theories related to 'vicarious liability' from the tort law, the courts
forced vicarious criminal liability of the corporate companies.

II. THE CONCEPT OF WHITE COLLAR CRIMES

In the traditional time the wrongdoings were conferred for the most part by poor people and
the penniless people, which was a direct result of need, but the recent trends have shown the
new kind of criminal mind was one which emerged not as a result of the need but rather the
voraciousness of people who were involved in such exercises to facilitate the reason for their
business or occupation by snare or evildoer. The customary sort of culpability in this manner
secured law breaking among the centre and upper classes; however the new sort of culpability
was seen in the higher strata of society. In certain lawful frameworks these Crimes are known
as Welfare offense or Socio Economic offenses and in India, they are known as social and
economical offenses.

1
Guy Stessens, Corporate Criminal Liability: A Comparative Perspective, (1994), 43, Intl and Comp.L.Q.,
pp. 493,494.

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On the basis of these kinds of criminal behaviour law has into two categories:

(a) Conventional crimes- Punishments for such kind of offences can be traced from
traditional rules and concept of criminal law.

(b) White collar crimes - Punishments for such kind of offences can be traced new
principles and procedures and traditional rules of law.

For instance, a detainee might be rebuffed by the Jail experts with a fine or departmental
activity, a lawful professional might be rebuffed by his administration association through
repudiation of his permit; the business related perople might be rebuffed by the discipline of
common and civil law , suspension of permit to work together, the seizure or annihilation of
items.

EVOLUTION OF CORPORATE CRIMINAL LIABILITY

Nullu poena sine lege implies no individual might be punished aside from in provisions of a
statue, which settles a punishment for criminal conduct.2 The Origin of nulla poena sine lege
can be found in 39th provision of Magna Cart which last built up the idea of "Due Process".
Et actus non facit reum nisi mens sit rea implies that the object and the act should
demonstrate an agreement to constitute the crime. This particular maxim perceives that
there are two vital components of a crime that are, a physical component and mental
component. Actus non facit reum nisi mens sit rea is standard of common law and
precedent-based law which is cardinal tenet of criminal law.3

There can be no crimre without a guilty mid and to make a person criminally responsible for
an act his demonstration should be blameworthy.In this manner, there are two parts of each
wrongdoing specifically called "actus reus" and "mens rea".

In spite of the fact that the general govern as expressed above is appropriate to every criminal
case yet the criminal law Jurisprudence has seen one exemption to the above said idea in
from of the principle of strict liability in which one might be made obligated without guilty
mid of a person. The official may, however make an offense of Strict or Outright obligation

2
Jerome Hall, op, cit.,.p.20
3
Younghusband v. Luftig, [1949] 2 K.B. 354.

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where mens rea isn't important. Strict liability infers legitimate duty regardless of the
absence of mens rea of the person.

For over fifty years, most criminal law and corporate researchers in the US have been against
corporate criminal obligation, contending that it ought to be removed.4

Numerous law and financial researchers have contended that corporate criminal liability is
wasteful and ought to be rejected for civil liabilityand also for criminal obligation for
person's corporate officers and agents. Researchers starts from the premises that they are
subjective which have no presence separated from the people who follow up for the benefit of
them.These premises can lead rapidly to the conclusion that corporate liability is crooked on
the grounds that it adequately punishes the honest third persons (investor, workers) for the
demonstrations of people who commit offenses while utilizing these corporate firms. What
this record misses is the truth that organizations are definitely not fictions. Or maybe, they are
gigantically intense and genuine, on-screen characters whose lead frequently causes mischief
both to people and to society all in all. In addition, the power employed by organization is
both huge and remarkable in mankind's history. It misses a great deal to think about
partnerships like Exxon Mobil, Microsoft, or AIG to horse or a truck that was dealt with as
deodand under antiquated

In the todays world , the solid impact of exercises of organization is mind boggling on the
general public. In the everyday life, not exclusively do the enterprises influence the lives of
the general population as a gift yet in addition numerous a times demonstrates shocking
which at that point falls under the class of violations.

For example, the Uphar Cinema misfortune or, on the other hand a great many
embarrassments particularly the salaried and sorted out wrongdoings can come inside the
class that requires quick concern. Prof Sutherland featured the genuine repercussions of
white collar crimes in1940 decade. Since financial offenses are always on the ascent 2000s
decades are the times of high profile shame. Defilement in Telecom 2G permit, Delhi
Common Wealth Games 2011, and Pune's Hasan Ali tax avoidance keeps running into
centers of cash by governments people. Ramalinga Reddys manipulation of Satyam
Computers accounts and financial statements have demonstrated that danger of wrongdoings

4
Sara Sun Beale, Is Corporate Criminal Liability Unique?, 44 AM Crim L.Rev, (2004), p.1503-1504.

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by organizations are more genuine risk to the presence of society than industrial
wrongdoings.

In spite of such huge numbers of catastrophes, the law was unwilling to force criminal
liability upon companies for quite a while.

Two reasons for the same were-

that companies can't have the mens rea or the blameworthy personality to submit an offense

that company can't be detained

These two impediments were present till late twentieth and mid 21st century. The general
presumption in the mid sixteenth and seventeenth century was that company couldn't be held
criminally liable .

Corporate criminal Liability looked no less than hindrance:

In 18th century courts and egitimate scholars moved toward corporate risk with a
fanatical concentrate on hypotheses of corporate identity; a more realisitic approach
was created in the twentieth century.
The lawful scholars did not trust organization could posses a criminal intent.
The courts exacting comprehension of criminal method, e.g. judges required the
charged to be brought physically under the steady gaze of the court.

CORPORATE CRIMINAL LIABILITY IN INDIA

As on account of a few different nations of the world, in India likewise the issue of corporate
violations has made loads of issues to the specialists of State; further, it has caused harm to
the business interests from one viewpoint and made harm to public interest also.In this part an
examination has been made of the issues associated with corporate wrongdoings in India.
Like the enterprises of different nations, organizations and companies in India do various
exercises; in this way we discover an collection of organizations associated with corporate
wrongdoings.

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The private foundations attempt distinctive sorts of capacities for the government and include
the administrative foundations into criminal action. They embrace the chip away at the
premise of an agreement or a rent or some such business relationship which at last influences
the notoriety and validity of the administrative foundations. As in the past section concerning
the outside administrations of different nations this section additionally takes after the
philosophy of giving first the lawful structure of the law on corporate wrongdoings and
afterward features the issues which have emerged in our nation by virtue of corporate
wrongdoings.

The improvement of law through enactment and legal choices has been featured first and
afterward the particular cases which have emerged making harm the business interests of the
pertinent organizations and harm to the notoriety of the legislature has been featured. Such an
approach exposes the idea of law from one viewpoint and the idea of the wrongdoing existing
at introduce in different foundations then again. In the determination of cases the example
took after is to present such of the cases which have raised a caution against the organizations
or companies which were engaged with the wrongdoing, regardless of whether deliberate or
careless. Determination has likewise been made of such of the cases in which the gatherings
were people working in their formally mindful position as pastors yet they mishandled their
position and made mischief social intrigue other than getting engaged with the wrongdoing.

What is seen in the cases emerging in India is that the issue of corporate wrongdoing isn't
quite recently because of the disregard or default of the organization chiefs, however
attributable to the agreement of the administration authorities and others from the common
society with the authorities of the organizations. The different arrangements of law and the
different establishments which are working for the reason for upholding the law have been
talked about in this part.India follows the insider model of corporate governance, which is
characterized by cohesive groups of "insiders" who have a closer and more
long-term relationship with the company5.

I. Law on Companies and the Corporate Criminal Liability

5
Nestor & Thompson, supra note II, at 9.

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With respect to the laws on corporations and their criminal obligation might be made first to
the Indian Penal Code it characterizes the term organizat Company as indicated by the
Penal Code the term 'person' as characterized in Section 11 of the Penal Code6 and Section
2 of the General Clauses Act7 incorporates a Company which is a juristic individual. The
general law hence wipes out the refinement between common people and conceptual
elements to the extent the utilization of the arrangements of the Penal Code is concerned. The
Penal Code likewise contains arrangements with respect to obligation of organizations and
enterprises for specific offenses characterized in the Penal Code. Be that as it may, there are
sure standards and techniques which are pertinent to the subject of corporate risk.

The Penal Code is a general law of wrongdoings, and concerning certain extraordinary
subjects, place or things there are the arrangements of the unique laws. In this manner, aside
from the arrangements of general law there are a plenty of Statutes which constitute the group
of extraordinary laws. These unique laws manage particular issues; if an organization is to be
conveyed to book under the criminal law then the arrangements of the these special and
specific laws should be taken after. at this phase the researchers are mentioning about the
arrangements of Companies Act which characterizes what an organization is and what are its
powers and capacities.

The Act has been revised a few times to present certain new arrangements and to cover
certain new circumstances. The most vital part of these unique laws is the approach received
by it towards the working of administrative offices. So, the structure of law on corporate
criminal obligation in India isn't just like that in English law, however has been incredibly
affected by the English Law. At a certain point of time, corporations were seen as a helpful
shield to dodge obligation among all the authoritative instruments regarding the matter of
corporate obligation the principal law managing the foundation furthermore, which has been
revised a few times is the Companies Ac.

The key arrangements of the Act which manage organization matters are the accompanying:-

Part IVA of the Companies Act, 1956 manages the Powers of Central Government to expel
administrative work force from office on the suggestion of the Company Law Board. Under
PART 388B the Central Government has the ability to allude to the Company Law Board
(CLB) any protest against any administrative work force under the accompanying conditions;

6
Section 11, Indian Penal Code.
7
Section 2 , General Clauses Act.

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a) When any individual worried about the administration of the undertakings of the
organization is liable of extortion misfeasance tenacious carelessness or default in completing
his commitments and works under the law;

b) When the matter of the organization has not been directed by the individual according to
sound business principals;

c) Section 388 C of the Companies Act gives that amid the pendency of the case the CLB has
the ability to pass a break arrange on the use of the Central Government in light of a
legitimate concern for its individuals this between time request can coordinate the concerned
administrative individual not to release his obligations till additionally arrange. The CLB can
likewise arrange an arrangement of a reasonable individual to play out the obligations of the
individual concerned and can likewise determine the terms and guidelines with respect to the
same.

Segment 388 D gives that at the finish of the hearing the CLB should record its
discoveries demonstrating whether the individual is fit and appropriate to hold the
workplace of chief or some other office about the lead and administration of the
organization.

Under segment 388 E, the Central Government may expel the reprobate individual
from his office and after his expulsion he should not hold any administrative office of
any organization for a time of five years from the date of the request of expulsion nor
will he be paid any pay for loss of office because of expulsion

Part VI manages Prevention of Oppression and Mismanagement of Companies and

the Powers of Company Law Board. 397 gives that alleviation against the Oppression
will be given by the CLB on application when it is under the accompanying
supposition That the organization's undertakings are led in a way that is onerous to
any part or individuals and the fair conclusion would have been to twist up the
organization However doing as such would unreasonably preference such a part or
individuals. According to Part 398 reliefs against fumble will be given by the CLB on
application when it is under the accompanying conclusion. At that point there are the
Statutes like the Prevention of Corruption Act, the Foreign Exchange Administration

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 Act, the Prevention of Money Laundering Act, the National Stock Exchange Act, and
so forth which discuss the counteractive action and indictment of corporate violations.

SATYAM SCAM

I. FACTS

The accused are as follows:

A1 ByrrajuRamalinga Raju, aged 59 years, S/o Late B. Satyanarayana Raju

The then Chairman, M/s Satyam Computer Services Ltd, Hyderabad

R/o Plot No. 1242, Road No. 62, Jubilee Hills, Hyderabad8

A2 Byrraju Rama Raju, aged 55 years, S/o Late B. Satyanarayana Raju

The then Managing Director, M/s Satyam Computer Services Ltd, Hyderabad

R/o Plot No. 1326, Road No. 66, Jubilee Hills, Hyderabad.

A3 VadlamaniSrinivasu Srinivas, aged 54 years, S/o V. Kanakaiah

The then Sr. Vice President & Chief Financial Officer

M/s Satyam Computer Services Ltd, Hyderabad.

R/o H. No. 2-62/A, Road No. 3, Kakatiyanagar, Habsiguda, Hyderabad

A4 SubramaniGopalakrishnan, aged 64 years, S/o Late R.S. Mani

Partner of M/s Price Waterhouse, Hyderabad

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R/o 6B, Shangrila Apartments, Road No. 2, Banjara Hills, Hyderabad

A5 Talluri Srinivas, aged 53 years, S/o Narasimha Rao

Partner of M/s Price Waterhouse, Hyderabad, R/o Unit No. 6,

SKR Enclave, Plot No. 47, Road No. 70, Jubilee Hills, Hyderabad

A6 ByrrajuSuryanarayana Raju, aged 57 years, S/o Late B. Satyanarayana Raju

Director, M/s SRSR Advisory Services Pvt Ltd, Hyderabad

R/o H. No. 17, Flat No. 203, Tulasi Apartment, Madhuranagar, Hyderabad

A7 G. Ramakrishna, aged 53 years, S/o Late G. Bhaskar Rao

The then Vice President (Finance), My Home Hub, M/s Satyam Computer

Services Ltd, Hyderabad, R/o Flat No. 40, Vayunagar, New Bowenpally,

Secunderabad

A8 D. Venkatapathi Raju, aged 53 years, S/o Late D. Soma Raju

The then Sr. Manager (Finance), My Home Hub, M/s Satyam Computer

Services Ltd, Hyderabad, R/o Flat No. 304, Madhu Mansion,

D. No. 1-11-208, Shamlal Building, Begumpet, Hyderabad

A9 Ch. Srisailam, aged 39 years, S/o Ch. Rajaiah,

The then Asst. Manager (Finance) My Home Hub, M/s Satyam Computer

Services Ltd, Hyderabad, R/o H. No. 29-1465/2/6A,

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Kakatiyanagar, Neredmet, Hyderabad

A10 V. SuryanarayanaPrabhakar Gupta, aged 60 years

S/o V.L. SuryanarayanaSresty, The then Global Head, Internal Audit,

M/s Satyam Computer Services Ltd, Hyderabad, R/o Plot No.8,

Madhupala Enclave, Bowenpally, Hyderabad

On the premise of a grievance stopped by Mrs. LeenaMangat against the blamed Ramalinga
Raju, different Directors, Auditors and others CBCID has enlisted a case in wrongdoing No.
2 of 2009 on 09.01.2009 for the offense culpable under Sections 120-B, 406, 430, 467, 471,
and 477-A of Indian Penal Code on the assertion that, the complainant has put her cash in
acquiring the offers of M/s. Satyam Computer Services Limited (from this time forward
alluded as M/s. SCSL) on observing the execution of the organization spoke to in and
reflected through the accounting report and with the conviction that, the portrayals made by
the Chairman, the Managing Director and different Directors of M/s. SCSL to be valid and
obtained 100 offers of M/s. SCSL around 4 years back and later because of the fudging of the
organization records and control of records indicating off base monetary records of the
organization by the Chairman, Managing Director and different Directors of the organization
which was affirmed by the Auditors, the offer estimation of the organization all of a sudden
dropped making misfortune the complainant and different financial specialists and this was
happened due to the deceptive and fake acts submitted by the above people who are dealing
with the undertakings of the organization and the Chairman of the organization has put forth
a deliberate expression in the press and conceded the false deeds and acts conferred by him
and others with the help of the Auditors who are managing the issues of the organization and
they all plotted together with an unscrupulous expectation and conferred misrepresentation to
make wrongful misfortune the investors and to make a wrongful pick up for themselves and
the blamed conceded that, the money and bank adjusts were expanded to the tune of Rs. 5040
crore and the obligation was stifled to the tune of Rs. 1230 crore and the indebted person
position was exaggerated and submitted FIR to sixth ACMM, Hyderabad and later CBCID
documented an update in the said court on 12.01.2009 including Section 468 of Indian Penal
Code notwithstanding Section 467 of Indian Penal Code and substituted Section 409 of
Indian Penal Code in the place of Section 406 of Indian Penal Code.

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 Along these lines, the CBI took up the examination according to the warning dated
16.02.2009 issued by Government of India at the demand of Government of Andhra Pradesh
and re-enrolled a case vide RC 4 (S)/2009-CBI/HYD on 20.02.2009 and presented the FIR to
fourteenth ACMM, Hyderabad and led examination for the situation and on consummation of
the examination documented a charge sheet on 07.04.2009 in the Court of fourteenth ACMM,
Hyderabad and the said Court had taken awareness of the offense on 09.04.2009 in C.C. No.
187 of 2009 against A1 to A9 for the situation on the document of the said Court and from
that point, the respondent recorded an application under Section 173 (8) of Code of Criminal
Procedure, on 13.04.2009 in the said Court and the respondent was allowed to lead encourage
examination vide Orders dated 25.04.2009 and afterward the respondent directed further
examination and recorded a supplementary charge sheet on 22.11.2009 in the Court of
fourteenth ACMM, Hyderabad and the said Court had taken awareness of the offense
affirmed in the said charge sheet on 24.11.2009 in C.C. No. 2770 of 2009 against the
denounced A1 to A10 for the situation on the record of the said Court and consequently, the
respondent directed further examination and documented another charge sheet in the said
Court on 07.01.2010 and the Court had taken the insight of the offense on 16.01.2010 against
blamed A1 to A5 and A7 for the situation in C.C. No. 81 of 2010 on the document of the said
Court and hence the said cases were exchanged to this Court and C.C. No. 187 of 2009 was
re-numbered as C.C. No. 1 of 2010 on the document of this Court, C.C. No. 81 of 2010 was
re-numbered as C.C. No. 2 of 2010 on the document of this Court. It is related to note down
that, when the cases were pending in fourteenth ACMM's Court Hyderabad, C.C. No. 2770 of
2009 was clubbed with C.C. No. 187 of 2009.

Later the denounced A1 to A10 in the cases were analyzed under Section 239 of Code of
Criminal Procedure and heard the two sides on charges according to Sections 239 and 240 of
Code of Criminal Procedure.

II. CHARGES WERE FRAMED AGAINST THE ACCUSED AS FOLLOWS:

In the first place, the denounced A1 to A10 were charged for the offense culpable under
Section 120-B of Indian Penal Code.

Furthermore, the blamed A1 to A3 were charged for offense culpable under Section 409 of
Indian Penal Code (two checks) with respect to installment of profit or on the other hand for
the offense culpable under Section 406 of Indian Penal Code and the denounced A1 to A5
and A7 were charged for offense culpable under Section 409 of Indian Penal Code (five

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tallies) in regards to installment of Income Tax or then again for the offense culpable under
Section 406 of Indian Penal Code. Advance the denounced A1, A2 and A6 were charged for
the offense culpable under Section 409 of Indian Penal Code with respect to installment of
sum to M/s. Elem Investments Pvt. Ltd., then again offense culpable under Section 406 of
Indian Penal Code.

Thirdly the blamed A4 and A5 were charged for the offense culpable under Section 419 of
Indian Penal Code with respect to utilization of the name M/s. Value Waterhouse and the
denounced A7 were charged for the offense culpable under Section 419 of Indian Penal Code
with respect to pantomime of seven non existing organizations.

Fourthly the blamed A1 to A10 were charged for the offense culpable under Sections 420
read with 120-B of Indian Penal Code and the denounced A1 to A5 and A7 were charged for
the offense culpable under Sections 420 read with 120-B of Indian Penal Code in regards to
fake acts identifying with swelling of the cost of offers, solicitations, bank adjusts, money
and premium, settled stores, salary expense, records and the speculators.

Fifthly the blamed A1 to A5 and A7 to A9 were charged for the offense culpable under
Section 467 of Indian Penal Code in regards to phony of archives indicating to be profitable
securities, solicitations, yearly explanations, reviewer reports, bank proclamations, FDRs,
FDR letters, bank adjust articulations, bank adjust affirmation letters, board resolutions,
messages, wage assessment forms, pay impose installments receipts, charge derivation
endorsements, FDR reestablishment letters and so forth.

Sixthly the denounced A1 to A5 and A7 to A9 were charged for the offense culpable under
Section 468 of Indian Penal Code identifying with above alluded reports with the end goal of
carrying out rupture of trust and bamboozling in promotion of the criminal intrigue.

Seventhly the blamed A1 to A5 and A7 to A9 were charged for the offense culpable under
Section 471 of Indian Penal Code identifying with the above archives.

Eighthly the A1 to A5 and A7 to A9 were charged for the offense culpable under Section
477-A of Indian Penal Code for adulterating the records of the organization and different
archives alluded previously.

Ninthly the blamed A1 and A2 were charged for the offense culpable under Section 201 of
Indian Penal Code for causing certain proof of the offense culpable under previously

19 | P a g e
mentioned Sections of Indian Penal Code vanish with an expectation of screening the
denounced specified in the main charge from lawful discipline. Assist the denounced A7 was
charged for the offense culpable under Section 201 of Indian Penal Code for causing certain
proof accessible on his tablet and training the blamed A8 and A9 to erase prove identifying
with board reports accessible in electronic frame and passages in Oracle Financials utilized
by the organization. The blamed A9 was charged for the offense culpable under Section 201
of Indian Penal Code for causing proof identifying with certain electronic records, data from
the servers of the organization on specific passages in Oracle Financials after
Maytasbargain.Ingredients of the provisions of penal law relating to charges in the case

A. Ingredients of criminal conspiracy and proof required:

"i) An agreement between two or more persons.

ii) The agreement should be to do or cause to be done some illegal

act or some act which is not illegal, by illegal means, provided that where the agreement is
other than one to commit an offence, the prosecution must further prove.

iii) That some act besides the agreement was done by or more of the parties in pursuance of
it."9

B. Ingredients of Criminal Breach of Trust and proof required:

"i. An offence under this Section has following essentials:

ii. That the accused was entrusted property in any manner or that such property was in his
dominion in this capacity of a public servant, or as banker, merchant, factor, broker, attorney
or agent, in the way of his business in such capacity:

iii. That the accused committed breach of trust in respect of that property."10

C. Ingredients of cheating by personation and proof required:

"1. That the accused cheated someone:

20 | P a g e
2. That he did so by impersonation."11

Elements of cheating by impersonation

"1. pretension by a person to be some other person,

2. knowingly substituting one person for another

3. representation that he or any other person is a person other than he or such other person
really is."12

D. Ingredients of cheating and proof required:

"1. There must be deception i.e. the accused must have deceived

someone:

2. That by the said deception.

3. The accused must induce a person to deliver any property; or to make, alter or destroy the
whole or part of the valuable security or anything which is signed or sealed and which is
capable of being converted into a valuable property.

4. That the accused did so dishonestly."

E. Ingredients of forgery and proof required:

"1. That the accused committed forgery:

2. That such forgery was committed in relation to a document which passports be, a valuable
security; or a will;

3. or an authority to adopt a son; or which passports to give authority to any person to make
or transfer any valuable security; or

4. to receive the principal, interest or dividends thereon; or

21 | P a g e
5. to receive or deliver any money movable property or valuable security or any documents
purporting to be an acquittance or receipt acknowledging the payment of money; or

6. an acquittance or receipt for the delivery of any movable property or valuable security."

F. Ingredients of forgery for purpose of cheating and proof required:

"1. That the accused committed forgery;

2. That he did so intending that the document or electronic record forged shall be used for the
purpose of cheating."13

G. Ingredients of using as Genuine a forged document and proof required:

"1. Fraudulent or dishonest use of a document as genuine:

2. The person using it must have knowledge or reason to believe that the document is a
forged one."

The essential ingredients of Section 471 Indian Penal Code are

"(a) fraudulent or dishonest use of a document as genuine, and

(b) knowledge or reasonable belief on the part of the person using the document that it is a
forged one."

H. Ingredients of falsification of accounts and proof required:

"1. The person coming within its purview must be a clerk, an officer, or a servant, or acting in
the capacity of a clerk, an officer, or a servant.

2. He must wilfully and with intent to defraud:

3. Destroy, alter, mutilate, or falsify, any book, paper, writing,valuable security, or account
which belongs to or is in the possession of his employer; or

4. has been received by him for or on behalf of his employer;

5. make or abet the making of any false entry in or omit or alter or abet the omission or
alteration of any material particular from or in any such book, paper, writing, valuable
security or account."

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 I. Ingredients of Causing Disappearance of Evidence of offence and proof
required:
"i. That an offence has been committed;

ii. That the accused knew or had reason to believe the commission of such an offence;

iii. That with such knowledge or belief he;

iv. Caused any evidence of the commission of that offence to disappear, or

v. Gave any information relating to that offence which he then knew or believed to be false

vi. That he did so as aforesaid with the intention of screening theoffender from legal
punishment."14

III. ISSUES DECIDED BY THE COURT

1) Whether the accused A1 to A10 during the period between the years 1999-2009 and
prior to 09-01-2009 at Hyderabad, Secunderabad and other places to gain wrongfully by
inflating the price of the shares of M/s. SCSL agreed to do or caused to be done illegal acts or
legal acts by illegal means punishable under Sections 409, 406, 419, 420, 467, 468, 471, 477-
A, of Indian Penal Code, such as creating false/fake invoices to inflate sales, to show non-
existent cash, bank balances, accrued interest, fixed deposits, under state the liabilities of M/s.
SCSL, paying dividends on non-existent profits, publishing false and inflated balance sheets
and financial statements, forged documents showing false rosy picture about the company to
deceive investors to purchase shares of M/s. SCSL, to offload the shares of the accused at
opportune times to gain wrongfully crores of rupees and caused wrongful loss to the investors
to a tune of around fourteen thousand crores of rupees in pursuance of agreement under the
criminal conspiracy?

2) Whether the accused A1 to A10 fraudulently or dishonestly in pursuance of the

criminal conspiracy referred in point number (a), during the period between the years 1999-
2009 and prior to 09-01- 2009 at Hyderabad, Secunderabad and other places created
false/fake invoices to inflate sales, shown non-existent cash, bank balances, accrued interest,
fixed deposits, under state the liabilities of M/s. SCSL, paid dividends on non-existent profits,

23 | P a g e
published false and inflated balance sheets and financial statements, forged documents
showing false rosy picture about the company to inflate share price, if so, induced and
deceived investors to part with their money to purchase shares and investments in M/s. SCSL,
and cheated them to a tune of around fourteen thousand crores of rupees?"

3) Whether the accused A1, A2 as agents of M/s. SCSL entrusted with the funds or
with the dominion over the funds of M/s. SCSL and accused A6 as agent of M/s. Elem
Investments Pvt. Ltd., on or about April 1999 in pursuance of the criminal conspiracy in point
number (a), dishonestly in violation of law committed Criminal Breach of Trust by diverting
a sum of rupees 30 lakhs from the funds of M/s. SCSL the same to M/s. Elem Investments
Pvt. Ltd., showing the said amount under doubtful advances?
The swelling of offers by raising phony solicitations has been initiated from the year 2003 as
a piece of the criminal scheme to blow up the benefits by distortion of records. While this
exchange was happened long back in the year 1999. The certainties and conditions make a
sensible uncertainty concerning in the case of exchanging the propel add up to dubious
advances account adds up to misappropriation and furthermore a sensible uncertainty that the
blamed A6 was the Director for M/s. Elem Investments Private Limited on the date of
exchange of the assets to the said organization from M/s. SCSL, It was held that the
indictment neglected to bring home the charge for the offense culpable under Section 409 or
under Section 406 of the Indian Penal Code past sensible uncertainty identifying with the part
of exchanging assets to M/s. Elem Investments Private Limited.

4) Whether the accused A1 to A3 in the capacity of agents of M/s. SCSL entrusted with
the funds or with the dominion over the funds of M/s. SCSL during the years 2006 and 2007
and if so, whether the said accused in pursuance of the agreement covered by the criminal
conspiracy in point number (a) dishonestly in violation of law, committed Criminal Breach of
Trust acquired M/s. Nipuna BPO a loss making company by making payment of Rs. 229
crore to M/s. Olympus BPO Holdings Ltd., and M/s. Intel Capital Corporation, from the
funds of M/s. SCSL and willfully made M/s. SCSL to suffer wrongful loss?
At the season of procurement of Nipuna adequate assets were accessible and they made the
Board to pass a determination favoring the obtaining and later cash was brought from the
claimed front organizations by appearing as deal continues and after that paid the sums to
M/s. Olympus BPO Holdings Limited and M/s. Intel Capital Corporation. Under the light of
above dialog, it was held that the arraignment neglected to demonstrate that the
24 | P a g e
demonstrations of the charged A1 to A3 by making an instalment of US $46.5 million adds
up to misappropriation of the assets of M/s. SCSL to bring home the blame of the charged for
the offense culpable under Section 409 or under Section 406 of the Indian Penal Code. Along
these lines, the indictment neglected to bring home the blame of the denounced A1 to A3 for
the offense culpable under Section 409 or under Section 406 of the Indian Penal Code
identifying with the charge of securing of the offers of M/s. Nipuna Services Limited.

5) Whether the accused A1 to A3 in the capacity of agents of M/s. SCSL entrusted with
the funds or with the dominion over the funds of M/s. SCSL during the years 2006-2007 and
2007-2008 and if so, whether the said accused in pursuance of the agreement covered by the
criminal conspiracy dishonestly in violation of law and thereby committed Criminal Breach
of Trust and paid declared dividends on non-existent profits during the said years and made
payments of Rs. 235.20 crore and 67.37 crore respectively, from the funds of M/s. SCSL and
willfully made M/s. SCSL to suffer wrongful loss?
A1 and A2 being the Chairman and the Managing Director separately of M/s. SCSL and
Directors on the Board of M/s. SCSL having territory over the assets and properties of M/s.
SCSL and they knowing about non-existent benefits and adulteration of records of M/s.
SCSL and stifled the same from the Board and enabled the Board to announce between time
profits for the year 2007-2008 and 2008-2009 and in this way making wrongful misfortune
M/s. SCSL adds up to an untrustworthy go about as characterized under Section 405 of
Indian Penal Code adding up to Criminal Breach of Trust as set down under Section 409 of
Indian Penal Code and consequently, as it would see it the conflict of the denounced A1 and
A2 that Section 409 of Indian Penal Code has no application to them with respect to
installment of profits isn't valid in law or on realities. Under the light of above actualities and
conditions, It was held that the indictment past all sensible uncertainty demonstrated the
charge against the blamed A1 and A2 for the offense culpable under Section 409 of Indian
Penal Code on both the checks identifying with the statement of profits for the money related
years 2007-2008 and 2008-2009.

6) Whether the accused A1 to A5 and accused A7 in the capacity of agents of M/s.

SCSL entrusted with the funds or with the dominion over the funds of M/s. SCSL during the
years 2003-2004, 2005-2006, 2006-2007, 2007-2008 and 2008-2009 respectively and if so,
whether the said accused in pursuance of the agreement covered by the criminal conspiracy in
point number (a) dishonestly in violation of law and thereby committed breach of trust and
25 | P a g e
paid income tax on non existent profits during the said years and by made payments of Rs.
11,46,48,646, Rs. 2,48,71,379, Rs. 39,05,37,959, Rs. 45,62,27,345 and Rs. 27,94,94,786
respectively, from the funds of M/s. SCSL and willfully made M/s. SCSL to suffer wrongful
loss?"

7) Whether the accused A1 to A5 and accused A7 fraudulently or dishonestly in

pursuance of the criminal conspiracy referred in point number (a), during the period between
the years 1999-2009 and prior to 09-01-2009 at Hyderabad, Secunderabad and other places
created documents to show that a sum of rupees 329,58,09,565 crores as if tax paid in foreign
countrieswithout actually making the said payment to offset additional tax liability aroused
on account of income shown on accrued interest on non-existent fixed deposits and deceived
and induced M/s. SCSL to pay 126,57,80,115 crores of rupees by way of payment of income
tax and caused wrongful loss and thereby cheated M/s. SCSL?
The above certainties and conditions examined with respect to charges identifying with the
installment of salary impose demonstrates that the denounced swindled the organization by
their deceitful demonstrations to pay extra assessment risk erroneously made on the
organization and furthermore made the organization to surrender the legitimate claim for the
discount and in this manner M/s. SCSL endured loss of Rs. 126,57,80,115/ - and along these
lines, the denounced A1 to A5 and A7 in this manner swindled the organization and its
investors and thus it was held that the indictment demonstrated the offense culpable under
Section 420 read with 120-B of the Indian Penal Code past all sensible uncertainty.

8) Whether the accused A1 to A5 and A7 to A9 with dishonest or fraudulent intention

in pursuance of the criminal conspiracy, during the period between the years 1999-2009 and
prior to 09-01-2009 at Hyderabad, Secunderabad and other places, forged documents like
invoices, bank statements, bank balance statements, bank balance confirmation statements,
bank balance confirmation letters, fixed deposit receipts, fixed deposit letters, books of
accounts of M/s. SCSL, e-mails pertaining to 7 non-existent companies, income tax returns,
foreign income tax payment receipts, tax deduction at source certificates, FDR renewal
letters, financial statements and balance sheets of M/s. SCSL with an intention to use such
documents for cheating in furtherance of conspiracy for transfer of valuable securities,
payment of dividends, receiving money or delivery of money, movable property, acquittance
or receipt acknowledging payment of money, or an acquittance or receipt of the delivery of
any movable property or valuable security?
26 | P a g e
9) Whether the accused A1 to A5 and A7 to A9 with dishonest or fraudulent intention
in pursuance of the criminal conspiracy, during the period between the years 1999-2009 and
prior to 09-01-2009 at Hyderabad, Secunderabad and other places, forged documents like
invoices, bank statements, bank balance statements, bank balance confirmation statements,
bank balance
confirmation letters, fixed deposit receipts, fixed deposit letters, books of accounts of M/s.
SCSL, e-mails pertaining to 7 non-existent companies, income tax returns, foreign income
tax payment receipts, tax deduction at source certificates, FDR renewal letters, financial
statements and balance sheets of M/s. SCSL intending that the said documents forged shall be
used
for the purpose of cheating?

10) Whether the accused A1 to A5 and A7 to A9 with dishonest or fraudulent intention

in pursuance of the criminal conspiracy, during the period between the years 1999-2009 and
prior to 09-01-2009 at Hyderabad, Secunderabad and other places, used forged documents
like invoices, bank statements, bank balance statements, bank balance confirmation
statements, bank balance confirmation letters, fixed deposit receipts, fixed deposit letters,
books of accounts of M/s. SCSL, e-mails pertaining to 7 non-existent companies, income tax
returns, foreign income tax payment receipts, tax deduction at source certificates, FDR
renewal letters, financial statements and balance sheets of M/s. SCSL, if so, whether they
know or has reason to believe to be forged documents?

11) Whether the accused A1 to A5 and A7 to A9 being clerk, officer or servant, or

employed in M/s. SCSL or acting in that capacity with intend to defraud, in pursuance of the
criminal conspiracy, during the period between the years 1999-2009 and prior to 09-01-2009
at Hyderabad, Secunderabad and other places destroyed or altered, mutilated or falsified
electronic records, books of accounts of M/s. SCSL and other documents mentioned in above
points which belongs to or is in the possession of M/s. SCSL or willfully, and with intent to
defraud, makes or abates the making of any false entry in or omits or alters or abates the
omission or alteration of any material particular from or in, any such above documents?
Statutory evaluators knowing completely well that they contained false data adds up to
offense under Section 471 of the Indian Penal Code conferred by the denounced A4 and A5
as the actualities and conditions as of now talked about by me in the above paras of the
27 | P a g e
judgment demonstrates that they deceitfully or insincerely utilizing the adjust affirmation
letters contained false data as honest to goodness records knowing completely well that they
were fashioned archives and educating the examining individuals to depend upon the said
reports for the review.
A1 to A10 in the offenses culpable under Sections 120-B and 420 of Indian Penal Code and
found that they have assumed a dynamic part in distortion of records of M/s. SCSL in
encouragement of scheme and they submitted the offenses culpable under Sections 420 of
Indian Penal Code worried to them and on considering the actualities and conditions in light
of the confirmation created by the indictment, it was discovered that the charged A1 to A10
are on the whole having full information about the deceitful exercises conferred in M/s.
SCSL over a period and they likewise assumed their separate parts in misrepresentation of
records and tricking in encouragement of criminal scheme and they knew about the
manufacture, fabrication of the reports and they additionally gathering to a portion of the
archives produced in facilitation of the connivance.
The charged A1 to A4 are gatherings to the yearly statements. The denounced A1 to A3 and
A5 are gatherings to yearly articulation for the year 2007-08. The realities and conditions
examined past all sensible uncertainty built up that the distortion of records in M/s. SCSL
occurred principally amid the budgetary years 2003-04 to 2008-09. Thusly the yearly
explanations identifying with the said years contained false data as they contained data about
expanded benefits amid that period in M/s. SCSL.
The blamed A4 and A5 subscribed their marks to the evaluator reports. Every one of these
reports contained benefit and misfortune account articulations marked by the charged A1 to
A5 for the particular years expressed above separated from the Company Secretary.
A1 to A5 carried out falsification of yearly explanations and examiner reports planning that
they should be utilized with the end goal of tricking in facilitation of the criminal connivance
and along these lines, the said demonstration of the charged A1 to A5 falls under Section 468
of Indian Penal Code.
The actualities and conditions clinchingly demonstrate that the charged A1 to A5 falsely and
in addition untrustworthily utilized the said yearly articulations as certifiable archives
knowing completely well that they are produced reports and in this way, their demonstrations
fall under the domain of Section 471 of Indian Penal Code. When going to the offense
culpable under Section 477-A of Indian Penal Code the charged A1, A2, A4 and A5 in their
contentions raised a supplication that they don't go under the classification of representative,

28 | P a g e
officer or worker as set down under the said Section and all things considered they are not
subject for the offense culpable under Section 477-A of Indian Penal Code.
A1 as Chairman and the denounced A2 as Managing Director, were selected by the investors
of the organization to serve the organization and the investors. In fact the blamed A4 and A5
went about as outer inspectors of M/s. SCSL for the benefit of M/s. Value Waterhouse which
was selected by the investors. Thusly by their exceptionally arrangement, the charged A1, A2
and additionally the blamed A4 and A5 obligation is to serve the organization and investors
and further without a doubt they got compensation for their administration from the assets of
M/s. SCSL and in this way the M/s. SCSL is the compensation ace of the said charged and
thusly as it would see it they will go under the meaning of hireling as set down under Section
477-A of Indian Penal Code and acting in that limit they will undoubtedly keep up
appropriate records of M/s. SCSL which has a place with M/s. SCSL or has been gotten by
them for or in the interest of M/s. SCSL.
A1 to A5 conferred falsification of yearly explanations and examiner reports separately
which has a place with M/s. SCSL and consequently unshakably misrepresented the said
records which has a place with M/s. SCSL with plan to swindle its investors and financial
specialists and all things considered their demonstrations likewise falls inside the domain of
Section 477-A of Indian Penal Code.
Income Tax returns of M/s. SCSL were marked by the blamed A2 and the profits for money
identifying with appraisal years 2003-04, 2006-07 and 2008-09 were additionally contained
marks of the charged A7 in full learning about the adulteration of records of M/s. SCSL and
accordingly, it can securely be inferred that the blamed A2 and A7 has conferred the offense
of falsification relating to the said returns of salary documented with Income Tax division.
Promote the certainties and conditions examined past all sensible uncertainty sets up that the
blamed A2 and A7 perpetrated phony for money expense forms meaning that they might be
utilized with the end goal of swindling in facilitation of the criminal connivance and hence,
the said demonstration of the charged A2 and A7 falls under Section 468 of Indian Penal
Code.
A2, A7, A8 and A9 assumed a dynamic part in formation of sites for the sake of the 7 non-
existent clients, sending messages utilizing the said areas to the administrators of the
organization for the sake of the said 7 non-existent clients and making buy arranges for the
sake of the said clients which came about bringing of solicitations up for the sake of the 7
non-existent clients at last prompting swelling of the deals amid the concerned monetary year
2006-2007, it is one reason for distributing false and erroneous data in the yearly explanation
29 | P a g e
for the money related year 2006-07 as because of bringing solicitations up for the sake of 7
non-existent organizations expanded the income to a degree of Rs. 430 crores amid the said
monetary year.

12) Whether the accused A4 and A5 partners of M/s. Price Waterhouse, Banglore during
the period from the years 2001-2009 at Hyderabad and Secunderabad conducted audit of M/s.
SCSL as External Auditors pretending as partners of M/s. Price Waterhouse though M/s.
Price Waterhouse, Banglore is a different entity, if so, whether the accused A4 and A5
cheated M/s. SCSL, its share-holders, investors including the complainant and financial
organizations, by impersonation?
13) Whether the accused A7 being Vice President of M/s. SCSL during the period from
the years 2006-2007 at Hyderabad and Secunderabad in pursuance of the conspiracy
mentioned in point (a) sent e-mails pretending as representative of seven companies namely
e-Care Inc, MobitelInc, CellnetInc, SynonyInc, Auto Tech Services Inc, North Sea Inc. and
Hargreaves Inc. non-existent companies and thereby cheated M/s. SCSL, its share-holders,
investors including the complainant and financial organizations, which resulted artificial
inflation of shares to a tune of rupees 430.66 crore, by impersonation?
The Court contemplated that the cash contributed by the above said organizations has a place
with lakhs of blameless individuals who put their cash in the assets oversaw by the said
organizations with a partial to trust that their cash will be sheltered if put resources into
organizations like M/s. SCSL yet tragically their trust and conviction was double-crossed by
the blamed by distributing false financials with swelled benefits and there is no wavering to
state that because of the beguiling means played by the blamed in dealing with the
undertakings for the organization, pure speculators were tricked to put resources into the
supply of M/s. SCSL and eventually supported misfortune when reality became visible as the
announcement of the denounced A1 made on 07-01-2009. The denounced made endeavor to
escape from their obligation and risk towards the lakhs of financial specialists on details and
the suitability of reports and minor inconsistencies in the proof of the witnesses which is
normal for a situation of this extent which included exceptionally entangled specialized and
bookkeeping subtle elements. The blamed were charged to attempt to smother reality about
the issue with respect to the misfortune managed by the financial specialists by putting
resources into the supply of M/s. SCSL in light of monetary proclamations distributed with
expanded benefits over a period. The charged can't escape obligation on the pretense that the
Board endorsed monetary proclamations of M/s. SCSL, when the actualities and conditions
30 | P a g e
examined above in a securing way past all sensible uncertainty demonstrate that the blamed
assumed dynamic part in every one of the exercises which eventually prompt distribution of
budgetary explanations of M/s. SCSL with false and mistaken data.

The denounced A1 and A2 were Directors on the Board of M/s. SCSL and further the
charged A1 was the Chairman and the blamed A2 was the Managing Director for M/s. SCSL
and in the limit of Directors they would go about as specialist of investors and the
organization and in that limit they will have territory over the property of M/s. SCSL and
hence over the span of their obligations as a specialist, they are having obligation to shield
and secure the assets and properties of M/s. SCSL to the best of their capacity. In any case,
the charged A1 and A2knowing about swelling of the benefits and adulteration of records and
that the working edges of the organization was negative making misfortunes amid the
monetary years 2007-2008 and 2008-2009 stifled reality from the Board and made the Board
to pronounce between time profit against Section 205 of Companies Act making wrongful
misfortune M/s. SCSL. According to Section 409 of Indian Penal Code whoever, being in
any way depended with property, or with any territory over property in the limit of an
operator carries out Criminal Breach of Trust in regard of that property. Criminal break of
trust was characterized under Section 405 of Indian Penal Code. A1 and A2 being the
Chairman and the Managing Director individually of M/s. SCSL and Directors on the Board
of M/s. SCSL having domain over the assets and properties of M/s. SCSL and they knowing
about non-existent benefits and adulteration of records of M/s. SCSL and smothered the same
from the Board and enabled the Board to pronounce between time profits for the year 2007-
2008 and 2008-2009 and along these lines making wrongful misfortune M/s. SCSL adds up
to an unscrupulous go about as characterized under Section 405 of Indian Penal Code adding
up to Criminal Breach of Trust as set down under Section 409 of Indian Penal Code and
thusly, arraignment past all sensible uncertainty demonstrated the charge against the blamed
A1 and A2 for the offense culpable under Section 409 of Indian Penal Code on both the
tallies identifying with the affirmation of profits for the money related years 2007-2008 and
2008-2009.

When going to the body of evidence against the denounced A3 on the charge relating to
profits as expressed over the reports secured by display P2947 minutes of the Board of
Directors or Annual General Meeting identifying with the money related years 2007-2008
and 2008-2009 does not uncover anything that it is possible that he went about as Director on
the Board around then or he assumed any dynamic part implying the Board in regards to the

31 | P a g e
swelled benefits making the Board to pass a determination proclaiming profits. The proof on
record demonstrates that the blamed A3 assignment in the organization was Director and
Chief Financial Officer at the applicable point in time. "Director" does not imply that he was
Director on the Board of Directors of M/s. SCSL to state that he was one of the Directors on
the Board of Directors at the season of passing the determination announcing profits at the
important point in time.

The indictment prove does not indicate anything that the blamed A3 assumed dynamic part in
the profit announcement and in the composed contentions of the arraignment additionally
there isn't assertion against the denounced A3 about his part in the profit presentation. Under
the said conditions, there was no delay to state that the indictment did not demonstrate the
charge against the blamed

A3 in regard of the profit affirmation for the offense culpable under Sections 409 or 406 of
Indian Penal Code on both the tallies i.e. for the year 2007-2008 and 2008-2009. The
indictment demonstrated the charge against the denounced A1 and A2 for the offense
culpable under Section 409 of Indian Penal Code on both the tallies past all sensible
uncertainty and not demonstrated the said charge against the blamed A3 on the two checks
past all sensible uncertainty.

The Court was of the view that the demonstrations charged against the blamed A10 are
demonstrated past sensible uncertainty demonstrating that the pretended by him in
concealment of the data from the review advisory group and conclusion of perceptions
prompts a conclusion that he is likewise one of the plotter and further his demonstrations
adds up to misdirecting M/s. SCSL and its clients with an untrustworthy aim and thusly, the
fixings required to demonstrate the offense culpable under Section 120-B of the Indian Penal
Code and for the culpable under Section 120-B read with 420 of the Indian Penal Code are
demonstrated against him past all sensible uncertainty.

14) Whether the accused A1 and A2 during the years 1999-2009 at Hyderabad and
Secunderabad and other places knowing or having reason to believe that offences under
Sections 120-B, 406, 409, 419, 420, 467, 468, 471, 477-A of Indian Penal Code, were
committed in pursuance of the criminal conspiracy, got destroyed the forged fixed deposit
receipts and other such documents with an intention to cause disappearance of the evidence
relating to the said offences to screen the accused in the case from legal punishment?

32 | P a g e
The actualities and conditions examined past all sensible uncertainty demonstrated that the
denounced A1 was completely mindful and had learning that the offenses for the situation
have been submitted and every one of these certainties and conditions additionally builds up
that with the aim of screening the guilty party from the lawful discipline he got organized
MO3 portable PC having a place with him gave by M/s. SCSL, on 07-01-2009 to cause any
confirmation of the commission of the offense culpable under Sections 120-B, 406, 409, 419,
420, 467, 468, 471, 477-A for the situation to vanish and along these lines he has conferred
the offense culpable under Section 201 of Indian Penal Code.

15) Whether the accused A7 prior to 07-01-2009 i.e. before the statement of the accused
A1 on 07-01-2009 at Hyderabad and Secunderabad and other places knowing or having
reason to believe that offences under Sections 120-B, 406, 409, 419, 420, 467, 468, 471, 477-
A of Indian Penal Code, were committed in pursuance of the criminal conspiracy, destroyed
incriminating evidence like forged fixed deposit receipts, fake invoices, forged bank
statements and other such documents available on his laptop with an intention to cause
disappearance of the evidence relating to the said offences to screen the accused in the case
from legal punishment ?
A7 past all sensible uncertainty set up that he assumed imperative and crucial part in the
misrepresentation of records of M/s. SCSL over a period and he was associated with a few
demonstrations like bringing of phony solicitations up for the sake of 7 non-existent clients,
adulteration of settled store receipts and bank adjust affirmations amid the time of extortion
conferred in M/s. SCSL. Accordingly, every one of these conditions prompts a conclusion
that the charged A7 got organized MO1 portable PC having a place with him gave by M/s.
SCSL, knowing completely well that the offenses culpable under Sections 120-B, 406, 409,
419, 420, 467, 468, 471, 477-An of Indian Penal Code have been conferred and to cause any
confirmation of commission of the said offenses to vanish, with the expectation of screening
the wrongdoers from lawful discipline and subsequently he submitted the offense culpable
under Section 201 of Indian Penal Code.

16) Whether the accused A7 prior to 07-01-2009 i.e. before the statement of the accused
A1 on 07-01-2009 at Hyderabad and Secunderabad and other places knowing or having
reason to believe that offences under Sections 120-B, 406, 409, 419, 420, 467, 468, 471, 477-
A of Indian Penal Code, were committed in pursuance of the criminal conspiracy got
destroyed incriminating evidence like forged electronic records and certain entries in Oracle
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Financials by instructing the accused A8 and A9 with an intention to cause disappearance of
the evidence relating to the said offences to screen the accused in the case from legal
punishment?

17) Whether the accused A9 after Maytas deal was aborted at Hyderabad and
Secunderabad and other places knowing or having reason to believe that offences under
Sections 120-B, 406, 409, 419, 420, 467, 468, 471, 477-A of Indian Penal Code, were
committed in pursuance of the criminal conspiracy destroyed incriminating evidence like
forged electronic records and certain entries in Oracle Financials with an intention to cause
disappearance of the evidence relating to the offences to screen the accused in the case from
legal punishment?
Prosecution neglected to demonstrate the charge against the blamed A7 that he educated A8
and A9 to cause vanishing of the proof identifying with the offenses to screen the guilty party
from legitimate discipline and furthermore neglected to demonstrate that the blamed A9
caused vanishing for the confirmation identifying with the offenses to screen the wrongdoer
from lawful discipline.

AFTERMATH OF SATYAM SCAM

India began to more clearly move toward a stakeholder-oriented approach with debates
over various versions of the Companies Bill that arose after the Satyam corporate scandal
came to light in 2009. A massive accounting fraud totaling more than $1 billion that
involved oneof India's then-leading technology companies as well as the India affiliate of
leading accounting firm PricewaterhouseCoopers; the Satyamscandal has been billed as
India's Enron.15 The Satyam scandal served asa catalyst for the Indian government to rethink
the corporate governance,disclosure, accountability, and enforcement mechanisms in
place.16Satyam scandal served as a catalyst for the Indian government to rethink the corporate
governance disclosure, accountability, and enforcement mechanisms in place.

In last 10 years there were many suggestions made by various committees and there were
many reforms which were incorporated in company law 2013 after their suggestions. It
15
See Vikramaditya Khanna, Corporate Governance in India: Past, Present and Future?, I
JINDAL GLOB. L.R. 171, 188-89 (2009)
16
See Omkar Goswami, Aftermath Of Satyam, BUSINESSWORLD (INDIA), Jan. 23, 2009

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clearly laid down what will be the responsibility and accountability the stakeholders of the
company.

The Guidelines enhanced the corporate governance standards in India because of the various
measures it consist. These take account of the defined process of appointment of the
independent directors, specifying what will be their roles and responsibilities and also it fixed
the appropriate remuneration of independent director.

Furthermore, the reformative measure in the audit process can be seen as it has crystallised
the functions of the an audit committee and the roles and functions of the companys auditors,
and such other matters like secretarial audit and the institution of a mechanism for whistle
blowers in the firm. A distinctive feature of this set of reforms is that there has been a
deliberate attempt to avoid any knee-jerk reaction so as to steer clear of the fall-outs of
emergency legislation that is often enacted in the wake of a crisis.

Corporate governance crises in the year 2009 resulted in these Guidelines and therefore they
are considered as an important and vital part which will ultimately help in the development of
new concept in law, i.e corporate governance norms in India.

These guidelines are very helpful to combat several shortcomings in the previous area of law,
but they are not to be said a perfect mechanism. The Indian Government has adopted taken an
absolute care with regard to this legislation and has not acted in a hastily manner. Which
resulted in the formulation of guidelines which the companies will like to follow by
themselves and not under pressure or force.

Persuasive methodology with respect to the coporate regulations in India is still a premature
test and there is a need to test the success of these theories. Nevertheless, given the track
record of effectiveness of voluntary codes in other countries, particularly those that are
emerging economies with concentrated shareholding, there is less reason to be optimistic
regarding their success in India.

PRESENT SCENARIO OF CORPORATE CRIMINAL LIABILITY

The current status of the Doctrine of Corporal Legal Liability, is now laid down after the
landmark judgment of Apex Court in Standard Chartered Bank and Ors. etc. v.

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Directorate of Enforcement and Ors17. This judgemen overruled the previous decisions
with respect to Corporate Criminal Liability and had given a new touch to this doctrine. It
was explicitly expressed that the Company is at responsible to be charged regardless of the
possibility that the offense is culpable both with a term of detainment and fine. In the cases
where the organization is discovered liable, the sentence of detainment can't be forced on the
organization and afterward the sentence of fine is to be forced and the court has the legal
caution to do as such.

This course is open just for the situation where the organization is discovered liable yet in the
event that a characteristic individual is so discovered to be a blameworthy, both sentence of
detainment and fine are to be forced on such individual. There is no doubt in that an
organization is at liable to be indicted and rebuffed for criminal offenses.

Despite the fact that there are prior theories such that enterprises can't carry out a
wrongdoing, the for the most part acknowledged present day decide is that aside from such
violations as a partnership is held unequipped for perpetrating by reason of the way that they
include individual malevolent expectation, an organization might be liable to prosecution or
other criminal process, in spite of the fact that the criminal demonstration is carried out
through its operators.

CONCLUSION AND SUGGESTIONS

I. CHANGES ARE REQUIRED IN INDIAN LAW SYSTEM TO TACKLE THESE

CRIMES

In a period of befuddling phase, Niira Radia and A Raja are simply indications of a rise
corporate crimes in India, for example, the 2G range trick, two times the span of India's
wellbeing spending plan, and the unfurling LIC trick shed no blood however drain millions.

Standing Committees of the Parliament are a centre point of the entire issue. They spend
remarkable measures of time on issues like the land utilization of post workplaces and the
nature of Bharat Sanchar Nigam Limited administrations, however not on the crucial question
of oversight of the official. Take the audit of range allotment for instance. There is nothing in

17
AIR 2006 SC 2622.

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the framework at show that can administer the working of a free controller like Telecom
Regulatory Authority of India. The main body that can do that is Parliament. What's more,
Parliament does it through Standing Committees. Be that as it may, if take a gander at the
level of time these boards spend in doing that activity, it will be a tiny portion.

They spend their hours on totally insignificant issues. Be that as it may, the issue is the point
at which the Standing Committees meet to settle on the issues they will look at throughout the
following a year, it all ends up plainly about arranging their outings, travel costs and touring
metaphorically called learning encounters.

This is tragic on the grounds that Parliament is the main body that can make inquiries to the
controller. As individual natives, have no locus or specialist to challenge a controller's
strategy choice. The main way we can do it is to make inquiries either straightforwardly in
Parliament or in a roundabout way through Standing Committees. So this oversight of
Parliament on the Executive needs nearer examination in light of the fact that the 2G trick has
demonstrated that corporate are catching open strategy.

Economics scams or white collor crimes of today aren't direct. It's not around one individual
paying off another to get a pot of gold. It's tied in with settling an agreement and the
fundamental fine print of that and the esteem that gathers to you from that. It's not boxes of
money any longer. It's about contracts and arrangements. There is a need to make solid move
against such lawbreakers.

The basic stand ought to be if organizations do anything against the laws of India, they have
to pay for it. The administration can't give a confirmation that legislature ensure them from
being conned. Citizens can't be considered in charge of the awful speculation choices of
organizations.

Penal statutes by and large characterize offenses by keeping in mind the culpability and actus
reus of normal people. While the corporate liability is not the same as the crimes submitted
by people, both as far as meaning and context is concerned. On investigation it is observed
that the criminological speculations pertinent to people likewise stand unmistakable from
the hypotheses of corporate guiltiness.

While managing these sorts of crime submitted in corporate condition there is have to
discover who has submitted such wrongdoing. By and by, so far as Indian Law is concerned
there are general arrangements where obligation of people in charge of acts can be settled

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alongwith organizations on the standard of vicarious risk. In any case, now there is have to
give exact statutory arrangements completely considering every single criminological angle
regarding corporate criminal obligation.

J. Define Corporate Crimes

Penal statutes by and large characterize offenses by keeping in mind the culpability and actus
reus of normal people. While the corporate liability is not the same as the crimes submitted
by people, both as far as meaning and context is concerned. On investigation it is observed
that the criminological speculations pertinent to people likewise stand differntly. While
managing these sorts of crimes in corporate condition there is have to discover who has
submitted such wrongdoing. By and by, so far as Indian Law is concerned there are general
arrangements where obligation of people in charge of acts can be settled alongwith
organizations on the standard of vicarious risk. In any case, now there is have to give exact
statutory arrangements completely considering every single criminological angle regarding
corporate criminal obligation.

K. Corporate criminal liability should be a Distinct Principle

In India corporate criminal aspects of liability is as yet in view of the vicarious liability
concept. There is a requirement for statutory arrangements making corporate obligation in
light of corporate blame associated to such arrangements in the Australian Criminal Code of
1995, which hold the corporates criminally liable when Corporate's BOD or High Managerial
operators, intentionally or neglectfully convey out or get occupied with the significant lead or
explicitly, implicitly or impliedly approved or allowed the commission of the offense. There
can be a likewise obligation when corporate coordinated an act which prompted
rebelliousness with the applicable arrangement. Also they should be held liable when there is
inability to make or keep up a corporate culture that required consistence with the important
arrangement.

L. Independent liability need to be imposed

The obligation of people in charge of acts performed in the interest of the organization
depends on the concept of vicarious liability.One needs to take a different look from this

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approach by embracing the standard of immediate and autonomous criminal obligation of the
administrative people for the corporate wrongs, as the corporates just act through the
common people. The protection of due constancy as by and by took after maybe may
proceed. At long last it is suggested that the internal checks are required to be reinforced
inside the corporate structure for the consistence and convenient discovery of corporate
wrongs.

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