The Supreme Court of India has ruled that criminal proceedings instituted against a company for offences requiring mens rea cannot be quashed under Section 482 of the Code of Criminal Procedure, 1973 (CrPC) on the sole ground that no natural person had been identified or arraigned alongside it. A Bench comprising Justice J.B. Pardiwala and Justice Manoj Misra dismissed an appeal filed by pharmaceutical major Sanofi India Ltd., upholding the Karnataka High Court’s refusal to quash a Central Bureau of Investigation (CBI) chargesheet concerning alleged corruption and conspiracy in procurement tenders for the Bhabha Atomic Research Centre (BARC). Delivering the verdict, the Court established a three-stage hierarchical framework under Indian law to determine how the mental state of individuals is attributed to corporate entities, holding that whether attribution conclusively attaches to a corporation is an intricate inquiry that must be resolved at trial rather than stifled at the threshold stage.
Background of the Case
The appellant, Sanofi India Ltd., is a public limited company engaged in manufacturing pharmaceutical products. Pursuant to tender processes, the company supplied pharmaceutical products for the Rare Materials Project at BARC in the years 2011-12, 2013-14, and 2015-16.
The company was subsequently arrayed as Accused No. 4 in FIR No. RC.17(A)/2015, which alleged that Dr. P. Anand, Scientific Officer (Medical) at BARC, conspired with pharmaceutical suppliers to procure medicines at inflated rates and in excessive quantities. Following an investigation, the CBI filed a chargesheet in 2017 against Dr. P. Anand (Accused No. 1) and Sanofi India Ltd. (Accused No. 2) for offences punishable under Section 120B read with Section 420 of the Indian Penal Code (IPC) and Sections 11, 12, 13(2) read with Section 13(1)(b) and (d) of the Prevention of Corruption Act, 1988 (PC Act). Crucially, no individual director, officer, or employee of the appellant company was named or arraigned as an accused in the chargesheet.
According to the prosecution, Dr. Anand misclassified items as proprietary to justify procuring them from the company despite lower bids, excluded competing bidders, and refused to place orders with the lowest bidders, resulting in a wrongful loss of INR 3,53,361/- to BARC and a corresponding wrongful gain to the accused. The prosecution further alleged that Dr. Anand received illegal gratification of INR 42,750/- from the company without consideration under various pretexts.
After the Special CBI Court in Bengaluru took cognizance of the offences, Sanofi approached the Karnataka High Court under Section 482 CrPC to quash the proceedings. The High Court dismissed the petition on February 15, 2019, holding—in reliance on Iridium India Telecom Ltd. v. Motorola Inc.—that a criminal prosecution against a corporate entity is maintainable without its directors or persons in charge of its affairs being arraigned, and that the allegations warranted a trial. The company then appealed to the Supreme Court.
Arguments of the Parties
Appearing for Sanofi India Ltd., Senior Advocate Siddharth Luthra contended that for offences requiring proof of mens rea, prosecuting the “alter ego” or governing mind of a corporation is essential to prosecute the company itself. Relying on the House of Lords decision in Tesco Supermarkets Ltd. v. Nattrass, he submitted that corporate criminal liability for mens rea offences rests on the “identification principle,” which attributes liability only through individuals who constitute the directing mind and will of the company. Counsel argued that because the CBI failed to identify and arraign any specific individual whose guilty mind could be attributed to the company or who committed an overt act of conspiracy, no criminal liability could be fastened onto the legal abstraction of the company.
In response, the CBI submitted through its counter-affidavit that decisions of the Supreme Court in Iridium India Telecom Ltd. v. Motorola Inc. and Standard Chartered Bank v. Directorate of Enforcement permit the prosecution of a corporation without identifying or arraigning its employees individually. The agency argued that the chargesheet contained sufficient oral and documentary evidence demonstrating prima facie that the company obtained undue favours from the public servant and paid illegal gratification in return, establishing a triable conspiracy.
Court’s Analysis of Corporate Criminal Liability and Attribution
Examining the conceptual foundations of corporate criminal law, the Supreme Court observed that a corporation, having “no soul to damn and no body to kick,” cannot generate physical acts or mental states on its own and can act only through human agents. Tracing earlier Indian jurisprudence, the Court noted that two initial obstacles had historically impeded corporate prosecutions:
- Mandatory Imprisonment: The Constitution Bench in Standard Chartered Bank v. Directorate of Enforcement (2005) overruled Assistant Commissioner, Assessment-II, Bangalore v. Velliappa Textiles Ltd. (2003), holding that where a statute prescribes mandatory imprisonment and fine, a corporation is not immune; courts have judicial discretion to impose the sentence of fine alone, as the law does not compel the impossible (lex non cogit ad impossibilia).
- Corporate Mens Rea: In Iridium India Telecom Ltd. v. Motorola Inc. (2011), the Supreme Court settled that corporations can possess mens rea and be prosecuted for offences involving intent.
However, the Court pointed out that Iridium India addressed only whether a corporation can possess mens rea, leaving completely unaddressed the second question: how or through whom such mens rea is attributed to a company under Indian law.
To fill this doctrinal gap, the Court undertook a detailed survey of English common law, analyzing early nuisance rulings such as Regina v. Great North of England Railway Company, the “directing mind and will” concept articulated in Lennard’s Carrying Company v. Asiatic Petroleum Company, the identification doctrine formulated in Tesco Supermarkets Ltd. v. Nattrass, Lord Hoffmann’s rules of attribution in Meridian Global Funds Management Asia Ltd v. Securities Commission, and the recent English decisions in The Queen v. Barclays PLC and The Serious Fraud Office v. Barclays PLC.
The Three-Stage Attribution Framework
Adopting a sequential and hierarchical approach, the Court formulated a three-stage framework under Indian law to determine whether the act and mental state of a natural person (X) can be treated as that of the corporation:
- Stage 1 (Primary Rules of Attribution): The inquiry examines the corporation’s constitutional documents (memorandum and articles of association) or rules implied by company law to determine whether they vest X with the power to do the act in question.
- Stage 2 (General Rules of Agency and Delegation): If constitutional documents are silent, the court determines whether the power to do the act was delegated to X, expressly or impliedly, accompanied by discretion and independence. Mere subordinate managerial tasks without full discretion do not satisfy this threshold.
- Stage 3 (Special Rules of Attribution): Where the first two stages do not yield an answer, the court examines the statutory provision to determine whether a special rule of attribution must be fashioned:
- For statutes with a narrow and readily identifiable purpose, the court asks whether the purpose of the provision intends that X’s acts and state of mind count as the corporation’s.
- For statutes with a broad purpose (such as general fraud or cheating provisions), the court evaluates whether the statutory purpose, applied to the specific facts and circumstances of the case, calls for fashioning a special rule of attribution.
The Bench clarified that this framework operates in only one direction—from the natural person to the corporation—and does not govern vicarious liability in reverse. Furthermore, the framework does not apply to regulatory offences of strict or absolute liability, nor to statutes that already supply specific attribution mechanisms or create express vicarious liability provisions.
Court’s Findings on Non-Identification and Non-Arraignment
Turning to the core question under Section 482 CrPC, the Court rejected the contention that criminal proceedings against a corporation must be quashed at the threshold if no natural person has been identified or arraigned.
Addressing the aspect of non-identification, the Court held: “What the chargesheet must disclose, on its face, is that the corporation itself has committed the offence, not that it has also identified the particular individual through whom it did so. The corporation’s role can be disclosed through averments concerning its own conduct, decisions, and dealings without naming the individual who carried them out. Non-identification of the natural person does not, by itself, render the allegations incapable of disclosing the corporation’s role in the offence.”
The Bench highlighted that corporate mens rea can often be gathered from surrounding facts and dealings without being tied to an individual by name at the stage of filing the chargesheet: “It would, no doubt, assist matters if the natural persons concerned, and their specific acts, are identified and averred. But this goes to the strength of the case, not to whether the allegations disclose an offence at all. The role of attribution, properly understood, is to establish mens rea conclusively, and that is a task to be undertaken during the trial.”
Addressing the aspect of non-arraignment, the Court distinguished precedents such as Aneeta Hada v. Godfather Travels and Tours Pvt. Ltd. and Hindustan Unilever Ltd. v. State of M.P. The Court held that those rulings mandated the arraignment of the company as a condition precedent only because provisions like Section 141 of the Negotiable Instruments Act, 1881, and Section 17 of the Prevention of Food Adulteration Act, 1954, specifically created derivative, vicarious liability against individuals for crimes committed by the company. In contrast, under general criminal law, corporate criminal liability is direct, not vicarious: “Consequently, the contention that the High Court ought to have quashed the proceedings against the Appellant for non-arraignment of a natural person cannot be accepted.”
Threshold Standard for Corporate Prosecution
While declining to mandate individual identification or arraignment as a prerequisite for maintainability, the Bench emphasized that corporations cannot be subjected to bald, unsubstantiated allegations. To survive scrutiny under Section 482 CrPC, the complaint or chargesheet must meet a clear threshold: “While identification and arraignment of a natural person is not necessary, the allegations must, at least prima facie, reveal that: (i) some natural person or persons acted on behalf of the corporation, (ii) such action is referable to the offence in question, and (iii) the surrounding circumstances of such actions do not render the existence of mens rea patently absurd or inherently improbable.”
Applying this test, the Court found that the chargesheet and accompanying material prima facie showed that natural persons acted on behalf of Sanofi India Ltd. regarding the BARC tenders and that the surrounding circumstances disclosed the plausible presence of mens rea, which is sufficient at the threshold stage.
The Decision
Holding that the Karnataka High Court committed no error in refusing to quash the criminal proceedings, the Supreme Court dismissed the appeal. The Registry was directed to forward a copy of the judgment to all High Courts across the country.
Case Details
Case Title: Sanofi India Ltd. v. Central Bureau of Investigation
Case No.: Criminal Appeal No. 4250 of 2026 (Arising out of SLP (Crl.) No. 3597 of 2019)
Bench: Justice J.B. Pardiwala, Justice Manoj Misra
Date: September 7, 2026
