Author: Shubhangi Raj a student of Banasthali Vidyapith
White Collar Crimes: What Do They Mean?
White-collar crimes tend to be committed by those who hold prominent positions in a company and have a high social status during their vocation or professional career. These are nonviolent in nature, yet they pose a significant threat to a nation’s economy. Such crimes are common in third-world countries because higher officials abuse their position, limiting oversight of unlawful operations.
India has a clear economic difference between its social strata, affluent and poor. A large portion of the population is uneducated and living below the poverty line, which leads to a lack of awareness and increased susceptibility to white-collar crimes. In addition, there is a lack of proper application of laws, as well as personal issues such as greed and peer competition. Commercial fraud and white-collar crime have received significant attention in India due to high-profile incidents and governmental efforts to combat them. Addressing these concerns is crucial for maintaining transparency, accountability, and trust in business and the economy.
STATUTORY PROVISION FOR WHITE COLLAR CRIMES AND BIASED LAWS
Section 447 of the Companies Act, 2013 outlines the punishment for fraud. It defines that if a person is found guilty of fraud, he will be imprisoned for a period of less than six months and up to ten years.
Punishment for false statement: According to Section 448 of the Companies Act of 2013, if a person wilfully makes a false statement knowing that it is false, he will be held liable for his illegal conduct.
Section 449 of the Companies Act of 2013 provides for the penalties of supplying misleading evidence. It declares that if somebody provides false evidence in a court of law:
If the company is going to dissolve or if a matter arises under this Act, the violator may face imprisonment and a fine. The sentence will be no less than three years and may extend to seven years, with a fine of up to ten lakh rupees.
Because white-collar criminals are typically those with positions of responsibility in institutions, they frequently avoid punishment by maintaining close relationships with government officials and politicians who influence the country’s judicial system. Corruption is another evil that cripples the system, and decisions are made in favour of the strong even when they are the perpetrators. Bribes are employed at all stages of investigation, and perpetrators walk free. Victims are less likely to disclose crimes because they have lost faith in the rule of law.
If the company is going to dissolve or if a matter arises under this Act, the violator may face imprisonment and a fine. The sentence will be at least three years and may be extended to seven years, with a fine of up to ten lakh rupees.
PREVENTION WHITE COLLAR CRIMES
Preventing and punishing white-collar crimes presents a significant problem for both the government and society. To combat scams and traps, government efforts can raise awareness among the general public. The more knowledgeable people are, the less likely they are to fall victim to fraudulent schemes. Government officials should receive up-to-date professional training on how to deal with violations like these. Investigating authorities should apply strong regulations to control the illegal movement of funds and profits generated by institutions and corporations.
BACKGROUND: ABHAY SINGH CHAUTALA vs CBI
White-collar crime has become a major danger to India’s economic development. These crimes necessitate quick government intervention, not only in the form of harsh legislation, but also in ensuring that it is properly implemented. Corruption, fraud, and bribery are among the most widespread white-collar crimes in our society.
Abhay Singh Chautala, youngest son of former Haryana Chief Minister Om Prakash Chautala, began his political career as up sarpanch of Chautala Gramme Panchayat and later entered active politics after completing his bachelor’s degree. He rose to prominence after winning Haryana’s Rori assembly election in 2000. After winning a by-election in Haryana’s Elanabad constituency in 2009, he highlighted concerns about the state’s infrastructure development and urged for the establishment of new educational institutions and health centers to improve living circumstances. Later, he was elected as an MLA, and during his term, he was convicted of accumulating excessive assets under the Prevention of Corruption Act of 1988.
FACTS OF THE CASE: –
The controversy revolved around MLA Abhay Singh Chautala, who was accused of acquiring fortune disproportionate to his source of income. He faced a trial under Sections 13(1)(e) and 13(2) of the Prevention of Corruption Act, as well as Section 109 of the Indian Penal Code. Thus, the CBI issued a charge sheet against him based on its probe. The CBI conducted searches and recovered incriminating documents, revealing that the appellant’s father, Mr. Om Prakash Chautala, had purchased movable and immovable properties totalling Rs 1,467 crore. The Haryana Government thereafter issued a notification to investigate claims made under the Corruption Act about the amassing of assets disproportionate to Mr. Om Prakash Chautala’s and his family members’ income.
Further research revealed that the appellant, Abhay Singh Chautala, had accumulated assets worth Rs.1,19,69,82,619/-, which well exceeded his known sources of income.
ISSUES IN THE CASE: –
Subsequent questions were raised before the court.
Was it necessary to impose sanctions against both appellants under Section 19 of the Prevention of Corruption Act?
Whether an MLA is a public servant as defined in sections 21(3), 21(7), and 21(12)(a) of the IPC?
Who has the authority to remove a Member of the Legislative Assembly?
JUDGEMENT: – The Court decided that, in the instant case, it was quite appropriate to rely on the decision in Parkash Singh Badal v State of Punjab. It concluded that the appellant had abused his power and was still in office on the date he took cognizance, therefore, there was no need for sanction under Section 19 of the Prevention of Corruption Act, as established in K.K. Karunakaran v. State of Kerala. His appeals were denied by the court due to their lack of merit. The Court emphasized that the concepts of ‘doubt’ and multiplicity of office’ cannot be applied to conclude the interpretation of section 19(1) as provided in Antulay’s case or Parkash Singh Badal vs. the State of Punjab.
It further highlighted that just because the idea of doubt is included in section 19(2) does not indicate that a public worker who abuses any office other than his own cannot be prosecuted without consequences.
CONCLUSION
As our society progresses towards modernity and the world sees new technical advances, the crime rate rises dramatically. There has been a significant surge in white-collar crime in particular. These crimes are committed in a variety of settings, including politics and education.
The government should enact rules that are strict enough to reduce the commission of such offences, and the system should be structured so that there are stringent regulations that penalise the accused severely. If this is not done, people will quickly lose faith in the system, because these crimes are perpetrated by those who should be role models for society.
This case highlighted the rapid rise of white-collar crime in India. The study of corruption is not new; it has been the subject of extensive investigation and inquiry for decades. Political corruption is the worst in India. The primary source of concern is that corruption weakens the political body and undermines the supreme relevance of law in controlling society. Nowadays, politics is solely for criminals, and criminals are destined to be in politics. This case resulted in a landmark decision highlighting the fact that “No sanction is necessary for prosecution when the accused public servant at the time of cognizance is not holding the public office which he is claimed to have abused.”
FAQS
WHAT ARE THE EFFECTS OF WHITE-COLLAR CRIMES
White-collar crimes can affect their victims in a variety of ways. They may result in significant losses for businesses, causing them to raise product prices, lay off personnel, or reduce compensation to recoup. This, in turn, affects end users and the national economy. With the rise of white-collar crime, customers have begun to lose trust in the authenticity and safety of the products or services they use, which has a detrimental influence on market demand.
White-collar crimes can have a mental and psychological impact on victims, leaving them feeling helpless and leading to suicidal ideation because many of them suffer painful losses. These crimes wreak havoc on a country’s economy, shaking its foundation.
WHY HAS THERE BEEN A SPIKE IN WHITE COLLAR CRIME IN INDIA?
India has a clear socioeconomic difference between its social strata, well-off and poor. A large portion of the population is uneducated and living below the poverty line, which leads to a lack of awareness and increased susceptibility to white-collar crimes. In addition, there is a lack of proper application of legislation, as well as personal issues such as greed and peer competition.
WHAT WERE THE ARGUMENTS RAISED BY THE RESPONDENT?
Mr. Gopal Subramaniam, the learned Solicitor General, acting for the respondent, argued that the law on the matter of sanction was clear, and that in the case of AR Antulay (mentioned above), the entire dispute was resolved, which has been followed to this day. The Solicitor General argued that, under the principle of stare decisis, the aforementioned legal position should not be violated. The learned Solicitor General used the judgements in [3]RS Nayak v. AR Antulay (quoted above) and Balakrishnan Ravi Menon v. Union of India (cited supra) to argue that sanction was unnecessary.
Citing the concept of stare decisis, the attorney general for the respondent contended that the court is required to follow prior cases when deciding a similar matter. The choice to stare ensures that cases with identical scenarios and facts are handled in the same manner. As a result, the Court is required to follow the legal precedent established by past rulings.
REFRENCES
https://www.stevenson.edu/online/about-us/news/white-collar-crime-questions-answered/
https://indiankanoon.org/doc/1342360/
