Corporate Criminal Liability: A Critical Analysis

Abstract

This research work is a critical analysis on implementation and working of various legislative provisions on corporate governance, which are not effective in checking the wrongful acts committed under criminal law by the corporate personality. It also analyses various dimensions of problems associated with implementation and issues faced by the third party and society to that extent. Despite of amendments to the existing legislations and enactment of new legislations, wrongful acts are happening in an increasing phase. We come across the instances where acts committed by corporate executives are ultra vires in nature and for which company is not answerable and it is difficult to ascertain whether they are done for the benefit of the company or personal gains or both. Here the researcher makes an attempt to critically evaluate the legislative and policy provisions with the principles for which they have been adopted to find out the actual lacuna in their implementation. Also, to attach the liability on the company or its executives who committed in order to save the interest of third parties and the society. So this is very necessary to bring in control the acts by the corporate personality under the legal provision which are enacted to govern the acts and to control the outcome not leading to harmfull to the society. There was a perception in the minds of the people before 17th century that corporate personality will not contribute to the crime. But after the Standard Charter Bank vs. Directorate of Enforcement, 1 case turned the perception of the people. the judgement which is mainly based on the Latin maxim i.e. Actus non facitreum, nisi mens sit rea.2 With the help of this maxim it was shown that act or ommision made by any person ( it might be human being or legal person or corporate personality), which is prohibited or barred by law, where the intention was to do the same is present is a crime. After this case was decided by the Supreme Court of India, the world has adopted principle called corporate criminal liability. Hence it started gaining importance. As there is advancement in the field of science and technology which ultimately lead to the world with borderless, we might call that as globalization. Due to the extension of communication and supply chain, the corporate personality became large at global level. But in the modern society due to greedy mentality of people and also for the want of higher positions in the society, many persons will breake the law for the benifit that they get through it. This is mainly occupying its space in the companies also, that they can make huge profits and get rid off the crime. This created a sophisticated machanism of committing crime, with the help of extended contacts around the globe. There is necessary to control it through strangent laws and principles. The main reason is to protect the social interest of the people. The social interest should not be affected by the way that the corporate persons will escape from the liability for the crime committed by them. In the society, there will be all class of people with the different interest and ideas behind them. It will be very necesary to safeguard the interest of that people belong to one community from the other community without changing in the basic structure of development. When a corporate crimes are committed, it is the persons behind the crime having benifits is where the intention is found to be present. When the intention is clear that to break the law it should be punished under the legal provisions. But, when we look into increasing in the number of crimes have been committed by the corporates personalities, it is found that legal provions are not effective to that extent.