Sanofi India Ltd. Vs Central Bureau of Investigation (Supreme Court of India)
Summary: The Supreme Court considered whether criminal proceedings against a company for offences requiring mens rea must be quashed merely because no natural person had been identified and arraigned alongside the company. Sanofi India Ltd. had challenged proceedings arising from a CBI chargesheet concerning alleged conspiracy and offences under the IPC and Prevention of Corruption Act relating to procurement of medicines for BARC. No employee or official of the company had been arraigned. The Karnataka High Court declined to quash the proceedings, and the company appealed. The Supreme Court examined corporate criminal liability and the basis on which the mental state of a natural person may be attributed to a corporation. Drawing on the English decisions in Tesco Supermarkets, Meridian Global and the Barclays cases, the Court adopted a sequential three-stage attribution framework for Indian law. First, the court asks whether the corporation’s constitutional documents or a rule implied by company law vest the relevant power in the person concerned. Second, it asks whether the power was expressly or impliedly delegated with sufficient discretion and independence. Third, where the first two stages do not establish attribution, the court considers whether the statutory purpose requires a special rule of attribution, with the inquiry varying according to whether the statutory purpose is narrow or broad. The Court clarified that status alone is not a standalone basis of attribution and that the framework is transaction-specific. It also held that attribution is unnecessary where the statute itself supplies the rule, creates a statutory vicarious-liability fiction, or imposes direct strict or absolute liability. On the threshold question under Section 482 CrPC, the Court held that non-identification of a natural person does not by itself justify quashing proceedings against a corporation. The allegations may disclose the corporation’s role through its own conduct, decisions and dealings, and mens rea may be disclosed by surrounding facts without naming the particular individual from whom it originated. Likewise, the non-arraignment of a natural person is not, by itself, a prerequisite to maintaining the corporation’s prosecution. The Court distinguished Aneeta Hada and Hindustan Unilever because those cases concerned statutory schemes of vicarious liability containing a condition precedent requiring the company to be arraigned. Here, the alleged corporate liability was direct and depended on the attribution framework. Applying the ordinary Section 482 threshold, the Court found that the chargesheet and material prima facie disclosed that natural persons acted on behalf of Sanofi India Ltd. and that the surrounding circumstances permitted the possibility of the requisite mens rea. The appeal was therefore dismissed. The Court also directed that a copy of the judgment be forwarded to all High Courts.
