Introduction
Can a corporation be prosecuted for a criminal offence when the prosecution cannot identify the particular individual who acted on its behalf?
For years, this question occupied an uneasy corner of Indian criminal jurisprudence. A company is an artificial legal person. It possesses no hands to sign a document, no voice to negotiate a transaction and, most importantly, no human mind capable of forming mens rea in the conventional sense. It acts through human beings. But must the prosecution first identify and arraign that human being before the corporation itself can be placed in the dock?
The Supreme Court of India has now provided a significant answer.
In Sanofi India Ltd. v. Central Bureau of Investigation, Criminal Appeal No. 4250 of 2026, decided on 7 September 2026, a Bench comprising Justice J.B. Pardiwala and Justice Manoj Misra held that a company could face criminal prosecution for an offence requiring mens rea even when the particular employee or officer through whom the alleged offence was committed has not been identified or arraigned as an accused.
The judgment represents an important recalibration of corporate criminal liability. It does not declare that corporations are automatically guilty whenever an employee commits an offence. Rather, it recognises that insisting upon the prior identification of a particular individual in every case could allow corporate entities to escape scrutiny merely because the architecture of decision-making within modern corporations is diffuse, layered and sometimes deliberately opaque.
In the Court’s words, “neither identification nor arraignment of a natural person can be read in as a prerequisite” for prosecuting the corporation at the threshold stage.
That proposition may appear deceptively simple. Its implications, however, are profound.
The Sanofi India Case: What Was the Controversy?
The case arose out of alleged irregularities in the supply of pharmaceutical products by Sanofi India Ltd. to the Rare Materials Project of the Bhabha Atomic Research Centre.
The Central Bureau of Investigation alleged that a BARC scientific officer conspired with pharmaceutical companies to procure medicines at inflated prices and in quantities exceeding requirements. The prosecution also alleged that an illegal gratification of ₹42,750 was received and that BARC suffered a wrongful loss of approximately ₹3.53 lakh.
Sanofi challenged the criminal proceedings, principally contending that none of its employees or officers had been arraigned as an accused.
The argument raised a fundamental question: if the corporation acts only through human beings, can the corporation itself be prosecuted when the prosecution has not yet identified the precise human being responsible for the criminal act?
The Supreme Court answered in the affirmative, subject to important safeguards.
The Supreme Court’s Answer: Identification Is Not a Condition Precedent
The Court made an important distinction between the maintainability of the prosecution and proof of guilt.
At the preliminary stage, the prosecution does not necessarily have to conclusively establish the identity of the particular employee whose conduct is ultimately attributable to the company.
For proceedings against the corporation to survive the threshold, the allegations must prima facie disclose three things:
- that one or more natural persons acted on behalf of the corporation;
- that their conduct was connected with the offence in question; and
- that, considering the surrounding circumstances, the existence of the requisite mens rea is not patently absurd or inherently improbable.
This is crucial because the Supreme Court has not created automatic corporate liability.
The prosecution must still demonstrate a meaningful connection between the corporation, the relevant conduct, and the requisite mental element.
The precise identity and role of the individual may emerge during investigation or trial.
In other words, the law does not require the prosecution to solve the entire evidentiary puzzle before it is permitted to place the company before the court.
Corporate Criminal Liability: From Artificial Personality to Legal Responsibility
The concept of corporate criminal liability has evolved considerably.
Traditionally, the argument was straightforward: a company is an artificial person and cannot possess a human mind. Therefore, criminal responsibility involving mens rea could not easily be attributed to it.
Modern commercial reality has rendered that proposition increasingly untenable.
Corporations negotiate contracts, manipulate markets, formulate strategies, authorise payments and make institutional decisions through their officers and employees. If corporate personality were transformed into a shield against criminal prosecution, the larger the organisation, the greater the potential insulation from accountability.
The Supreme Court has therefore developed doctrines enabling the conduct and mental state of relevant individuals to be attributed to the corporation in appropriate circumstances.
But this attribution cannot be indiscriminate.
As the Court has repeatedly emphasised, an employee’s criminal act does not automatically become the company’s criminal act.
That distinction lies at the heart of Sanofi India.
The Three-Stage Attribution Framework
One of the most significant features of the judgment is the Court’s articulation of a three-stage framework for determining whether an individual’s conduct and mens rea can be attributed to a corporation.
- Corporate Authority
The first inquiry concerns the company’s constitutional and organisational structure.
The court must examine documents such as the memorandum and articles of association and applicable company-law principles to determine whether the relevant authority was vested in the person whose conduct is sought to be attributed to the company.
For instance, where a Managing Director possesses authority over a particular transaction and acts dishonestly while exercising that authority, there may be a sufficient basis for attributing that conduct to the corporation.
- Delegated Authority
If attribution cannot be established through the company’s formal structure, the court may examine whether the relevant authority was expressly or impliedly delegated to the individual.
The delegation must involve sufficient discretion and independence concerning the transaction in question.
Merely being an employee, representative or negotiator does not automatically make an individual’s state of mind the company’s state of mind.
- Statutory Purpose
If neither corporate authority nor delegated authority provides a satisfactory answer, the court may examine whether the purpose of the particular statute requires a special rule of attribution.
This prevents corporate criminal liability from becoming an amorphous judicial invention. The Court has emphasised that the exercise remains one of statutory interpretation.
The law must determine whether refusing attribution would frustrate the very purpose of the criminal provision.
The Important Safeguard: Every Employee’s Act Is Not the Company’s Act
The judgment should not be misunderstood as a license to prosecute corporations merely because an employee has allegedly committed an offence.
The Supreme Court expressly cautioned against such an approach.
The relevant question is not:
“Who runs the company?”
It is:
“Whose act, in relation to the particular transaction or matter, can legally be treated as the company’s own act?”
This distinction is especially important for large corporations where thousands of employees operate at different levels of authority.
A junior employee acting contrary to company policy cannot ordinarily be equated with the corporate will merely because he or she happens to be on the payroll.
Corporate criminal liability therefore requires attribution, not association.
- The Landmark Foundation: Sunil Bharti Mittal v. CBI
The recent judgment builds upon the Supreme Court’s earlier jurisprudence.
In Sunil Bharti Mittal v. Central Bureau of Investigation, the Court observed that a corporate entity acts through its officers, directors, and other human agents. At the same time, it reaffirmed the cardinal principle that vicarious criminal liability cannot ordinarily be imposed unless the statute expressly provides for it.
This principle remains fundamental.
A director does not become criminally liable merely because he occupies a prestigious chair in the boardroom.
There must either be evidence of the individual’s active role coupled with criminal intent, or a statutory provision specifically creating vicarious liability.
Thus, corporate liability and individual liability remain conceptually distinct.
- Aneeta Hada: The Other Side of the Corporate Liability Principle
Another landmark authority is Aneeta Hada v. Godfather Travels & Tours (P) Ltd., (2012) 5 SCC 661.
In the context of Section 138 read with Section 141 of the Negotiable Instruments Act, the Supreme Court held that prosecution of the persons who may be vicariously liable ordinarily presupposes that the company itself has been arraigned as an accused.
The principle is important because it prevents criminal liability from being mechanically transferred from the corporation to its directors or officers.
The Court has subsequently reaffirmed this proposition in several cases.
The apparent contrast between Aneeta Hada and Sanofi India is therefore instructive.
Aneeta Hada asks whether individuals can ordinarily be prosecuted where the company itself has not been prosecuted.
Sanofi India asks the reverse question: whether the company can be prosecuted where the particular natural person through whom the alleged criminal conduct occurred has not yet been identified or arraigned.
The Supreme Court’s answer to the latter is now clear: yes, provided the allegations disclose the requisite prima facie connection.
The Alter Ego Principle and Its Limits
Corporate criminal law has often relied upon the metaphor of the “alter ego”—the idea that certain persons who constitute the directing mind and will of a corporation may, in appropriate circumstances, be treated as embodying the corporation itself.
But the metaphor has limits.
The Supreme Court has previously explained that the doctrine may operate to attribute the criminal intent of persons guiding the company’s affairs to the corporation. It does not mean that every criminal allegation against a corporation automatically attaches to every director or officer.
This asymmetry is essential.
Corporate liability cannot become a conveyor belt for personal liability.
Equally, corporate personality cannot become an impenetrable fortress behind which criminal conduct disappears into the labyrinth of organisational hierarchy.
The law must navigate the narrow passage between these two extremes.
Why the Judgment Matters for Corporate India
The decision carries considerable implications for corporate governance and criminal enforcement.
Modern corporations are rarely governed by one identifiable individual making every consequential decision. Authority may be fragmented among committees, regional offices, compliance departments, executives, intermediaries and external representatives.
If prosecution could be defeated merely by arguing that the prosecution had not identified the precise employee responsible at the initial stage, corporations could potentially exploit the complexity of their own organisational structures.
The Supreme Court’s approach prevents such an outcome while retaining an evidentiary safeguard.
It essentially says:
Do not convict the company merely because an employee acted illegally. But do not prevent prosecution merely because the corporate structure makes the human source of the alleged conduct difficult to identify at the outset.
That is a more realistic understanding of corporate responsibility.
What the Judgment Does Not Mean
The judgment does not mean that every company can now be prosecuted without any connection to an individual act.
It does not abolish the requirement of mens rea where the offence requires it.
It does not impose automatic criminal responsibility upon companies for every act of their employees.
It does not create automatic liability for directors.
And it does not dispense with the prosecution’s ultimate burden of proving the offence.
The Court’s ruling primarily concerns the threshold question of whether the criminal proceedings should be quashed merely because the specific natural person has not been identified or arraigned.
That distinction between threshold scrutiny and final adjudication is perhaps the most important aspect of the judgment.
A New Vocabulary of Corporate Accountability
The judgment signals a broader transformation in Indian criminal jurisprudence.
The corporation is no longer viewed merely as an abstract legal fiction existing behind a veil of incorporation. Nor is it treated as an omnipotent legal personality to which every act of every employee can be attributed.
Instead, the Court appears to be moving towards a more sophisticated model—one based upon authority, attribution, institutional purpose and evidence.
The jurisprudence therefore moves away from the simplistic question of “Who committed the act?” towards the more nuanced inquiry of:
“Whose conduct can the law legitimately regard as the conduct of the corporation?”
That is a question worthy of a modern commercial democracy.
Conclusion
The Supreme Court’s decision in Sanofi India Ltd. v. CBI marks an important moment in the evolution of corporate criminal liability in India.
Its central proposition is both practical and principled: the absence of an identified or arraigned individual offender does not, by itself, immunise a company from criminal prosecution.
At the same time, the Court has wisely resisted the temptation to replace one extreme with another. Corporate criminal liability still requires a legally defensible attribution of conduct and mental state. The prosecution must establish the requisite connection; the company is not guilty merely because someone within its organisational universe allegedly acted unlawfully.
The deeper significance of the judgment lies in its recognition that corporations are increasingly complex institutions whose decisions cannot always be traced, at the very threshold of proceedings, to one conveniently identifiable human actor.
In the language of jurisprudence, corporate accountability must keep pace with corporate complexity.
And perhaps that is the most consequential message of Sanofi India: the corporate veil is a legal construct, not a sanctuary from criminal accountability. Yet accountability itself must remain tethered to evidence, attribution and law.
As the Supreme Court’s approach demonstrates, the criminal law must neither become a blunt instrument against corporations nor a paper shield for them. Its task is more exacting: to ensure that responsibility follows legally attributable conduct, wherever that conduct may reside within the architecture of the modern corporation.
Landmark Judgments to Remember
- Sanofi India Ltd. v. Central Bureau of Investigation, 2026 INSC 957 — A company may be prosecuted for an offence requiring mens rea even without identification or arraignment of the specific natural person, provided the allegations disclose the requisite prima facie connection.
- Sunil Bharti Mittal v. CBI — Directors are not automatically criminally liable for offences committed by a company; individual liability requires an active role with criminal intent or a statutory basis for vicarious liability.
- Aneeta Hada v. Godfather Travels & Tours (P) Ltd., (2012) 5 SCC 661 — In prosecutions under Section 138/141 of the Negotiable Instruments Act, arraigning the company is ordinarily imperative before fastening vicarious liability upon the persons covered by Section 141.
- Dayle De’souza v. Government of India — The Supreme Court further examined the relationship between corporate prosecution and the liability of directors/partners, reinforcing the principle that individual criminal liability cannot simply be presumed from corporate position.
References
- Sunil Bharti Mittal v. Central Bureau of Investigation, (2015) 4 SCC 609.
- https://indiankanoon.org/doc/159121041/
- Aneeta Hada v. Godfather Travels & Tours (P) Ltd., (2012) 5 SCC 661.
- Sharad Kumar Sanghi v. Sangita Rane, (2015) 12 SCC 781.
- https://indiankanoon.org/doc/75415822/
- Himanshu v. B. Shivamurthy, (2019) 3 SCC 797.
- https://www.supremecourtcases.com/himanshu-v-b-shivamurthy-anr/
- Hindustan Unilever Ltd. v. State of Madhya Pradesh, (2020) 10 SCC 751.
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