In a landmark ruling, the Supreme Court on Monday affirmed that companies can be considered “victims” under the Code of Criminal Procedure (CrPC) and are entitled to appeal against acquittals in criminal cases, including those involving intellectual property rights (IPR) violations.
A bench comprising Justices Ahsanuddin Amanullah and Prashant Kumar Mishra allowed an appeal filed by Asian Paints, setting aside a Rajasthan High Court verdict that had dismissed its plea against the acquittal of one Ram Babu, who was allegedly found selling counterfeit paint products under its brand name.
The Court examined the critical legal issue of whether a company could fall within the definition of “victim” under Section 2(wa) of the CrPC, read with the proviso to Section 372, and whether such an entity could independently file an appeal against an acquittal. Clarifying the position, the top court ruled that the term “victim” encompasses both natural and juristic persons who suffer loss or injury due to an alleged offence.
“In the present case, there cannot be any two opinions, that ultimately, it is the appellant who has suffered due to the counterfeit/fake products being sold as if they were manufactured by the appellant,” Justice Amanullah observed in the judgment. “The appellant would suffer financial loss and reputational injury if such products would be bought by the public under the mistaken belief that the same belonged to the appellant’s brand.”
The case arose after Asian Paints, a major player in the paint industry for over seven decades, engaged an IPR consultancy firm to monitor and act against counterfeiters. During a February 2016 market investigation, the firm discovered counterfeit paint buckets bearing trademarks deceptively similar to Asian Paints’ products at a store named Ganpati Traders in Tunga, Rajasthan, owned by accused Ram Babu. Police later seized 12 such buckets.
Following a trial, Ram Babu was acquitted, and the Rajasthan High Court dismissed Asian Paints’ appeal, ruling that only the original complainant — typically the police — could file an appeal.
The Supreme Court, however, disagreed. “The finding of the High Court that the appellant could not have maintained the appeal before it would amount to completely negating the proviso to Section 372 of the CrPC,” it said, affirming that the company, having suffered due to brand dilution and potential financial harm, was indeed the “victim.”
