What Is White-Collar Crime Under Indian Law?
India does not have a single consolidated statute for white-collar crime. Enforcement instead runs through general criminal law, a handful of special statutes, and sector-specific regulators — and, as of 2026, all three are moving at once. The Bharatiya Nyaya Sanhita, 2023 (“BNS”) replaced the Indian Penal Code, 1860 with effect from 1 July 2024, and its provisions on cheating, criminal breach of trust, and forgery now form the backbone of most white-collar prosecutions filed in India.
Alongside the BNS sit two more specialised regimes that dominate current litigation: the Prevention of Money Laundering Act, 2002 (“PMLA”), which the Enforcement Directorate (“ED”) uses to pursue proceeds of crime, and securities-market regulation under the SEBI Act, 1992 and its subordinate regulations, which the Securities and Exchange Board of India (“SEBI”) uses against insider trading, market manipulation, and unregistered investment advice.
This article’s central claim is that white-collar enforcement in India through 2025–26 is best understood as a two-track story: aggressive, expanding regulatory enforcement on one side, and a Supreme Court that has been steadily tightening the procedural and constitutional constraints on that enforcement — particularly around PMLA bail — on the other. Understanding both tracks together, rather than either in isolation, matters for anyone entering litigation practice in this area today.
BNS 2023 and Economic Offences: Cheating, Breach of Trust, and Forgery
Three BNS provisions carry most white-collar prosecutions. Section 316 consolidates the erstwhile Sections 405–409 of the IPC into a single offence of criminal breach of trust, and raises the maximum sentence for the basic offence from three years to five. Section 318 consolidates the erstwhile Sections 415, 417, and 420 of the IPC into a single offence of cheating, structured in graded tiers: the basic offence under Section 318(2) carries up to three years (up from one year under the old Section 417 IPC); an aggravated tier under Section 318(3) applies where the offender was bound, by law or by contract, to protect the complainant’s interest, carrying up to five years; and the most serious tier, Section 318(4) — the direct successor to the old Section 420 IPC and the provision actually invoked in most property-fraud complaints — applies where the cheating dishonestly induces delivery of property or the making, alteration, or destruction of a valuable security, and carries up to seven years together with a fine. Section 336 separately consolidates the forgery provisions formerly spread across Sections 463 to 471 of the IPC, with Section 335 covering the making of a false document and Section 344 covering falsification of accounts.
Renumbering has not disturbed the underlying jurisprudence. Courts continue to apply the settled distinction between cheating and criminal breach of trust based on the timing of dishonest intent: if deception existed at the very inception of an inducement, the offence is properly cheating under Section 318; if property was lawfully received and only later misappropriated, it points instead to criminal breach of trust under Section 316. This is a useful analytical starting point rather than a rigid either-or rule — courts have not treated the two offences as permanently mutually exclusive on identical facts, and the correct characterisation still depends on the specific allegations and how the ingredients of each offence map onto them. The Supreme Court’s reasoning in Hridaya Ranjan Prasad Verma v. State of Bihar[1] and Vesa Holdings (P) Ltd. v. State of Kerala[2] — both decided under the IPC — continues to guide how BNS courts draw this line.
Organised Economic Crime Under Section 111 BNS
A genuinely new feature of the BNS, with no IPC analogue, is Section 111, which defines and punishes “organised crime.” The provision expressly folds in “economic offences” — including criminal breach of trust, forgery, counterfeiting, financial scams, Ponzi schemes, and hawala transactions — as a form of conduct that can constitute organised crime when carried out by a syndicate. Critically, the threshold for this is specific and not easily met: the statute requires “continuing unlawful activity,” which is itself defined to require more than one chargesheet — that is, at least two — filed before a competent court in relation to such conduct within the preceding ten years, with the court having taken cognizance of each.[3] A single chargesheet, however serious the underlying conduct, does not on its own satisfy this threshold.
Where it does apply, Section 111 carries punishment ranging up to life imprisonment or death for the most serious forms — sharply higher exposure than an ordinary cheating or breach-of-trust charge. It is worth being precise about corporate exposure here: directorship alone does not create automatic liability under Section 111. Liability still has to be established against the specific individual based on their actual role in the alleged syndicate and the continuing unlawful activity, not inferred merely from a board position. What Section 111 does change is the diligence calculus in repeat economic-offence matters: any cheating, breach-of-trust, or forgery brief involving a pattern of prior FIRs and chargesheets against the same individual or group now needs to be screened early for whether the continuing-unlawful-activity threshold could realistically be met, since that changes the bail calculus considerably if it is.
PMLA Bail Law in 2026: From Twin Conditions to Judicial Recalibration
Section 45 of the PMLA imposes the so-called twin conditions for bail: the court must be satisfied both that there are reasonable grounds for believing the accused is not guilty, and that the accused is unlikely to commit any offence while on bail. In Vijay Madanlal Choudhary v. Union of India[4], a three-judge Bench upheld the constitutional validity of this framework along with the ED’s powers of arrest, search, and seizure — and for several years, that judgment has anchored PMLA bail jurisprudence. It is worth flagging, however, that this anchor is not as fixed as it is often treated: review petitions challenging the judgment, filed in 2022, remain pending before the Supreme Court, with hearings on maintainability continuing through 2025. Every case discussed below therefore operates in the shadow of a foundational judgment whose own correctness is still, formally, an open question.
Since 2024, several decisions have refined — without displacing — that framework, largely around a narrower procedural question: what happens to an accused who was never arrested during investigation. In Tarsem Lal v. Directorate of Enforcement[5] (16 May 2024), the Supreme Court held that such a person, appearing before the Special Court pursuant to summons after cognizance has been taken, is not “in custody” in the relevant sense and therefore does not need to apply for bail at all. Instead, the Special Court may simply require a bond under Section 88 of the CrPC to secure the accused’s appearance — an undertaking, not a bail order — and the twin conditions under Section 45 do not come into play unless and until the person is actually taken into custody.
In V. Senthil Balaji v. The Deputy Director, Directorate of Enforcement[6] (26 September 2024), the Court granted bail after roughly fifteen months of pre-trial custody, holding that Section 45 does not authorise detaining an accused indefinitely where there is no realistic prospect of the trial concluding within a reasonable time.
In Sarla Gupta v. Enforcement Directorate[7], the Court held that an accused is entitled not only to the documents the ED relies upon, but also to other material and statements the ED collected during investigation but chose not to rely on — addressing a longstanding information asymmetry between the agency and the defence.
This run of decisions did not amount to a one-directional loosening of PMLA bail law. In Union of India v. Kanhaiya Prasad[8] (13 February 2025), the Court found a High Court’s bail order unsustainable precisely because it had granted bail without recording the satisfaction Section 45 requires on both twin conditions, and remanded the matter for fresh consideration — directing the accused to surrender within a week. Read against Tarsem Lal and Senthil Balaji, Kanhaiya Prasad is best understood not as a reversal of that line of authority but as a reminder that its procedural refinements apply within, rather than instead of, the twin-conditions framework: courts still cannot skip the statutory satisfaction requirement, even where an accused has otherwise strong Article 21 arguments.
The most recent addition to this line is Arvind Dham v. Directorate of Enforcement[9] (6 January 2026), where the Court granted bail to the former non-executive chairman of Amtek Auto Ltd. after roughly sixteen months and twenty days in custody, with cognizance of the prosecution complaint still not taken and well over two hundred prosecution witnesses cited. The appellant had specifically argued that the ED’s claim of a proceeds-of-crime figure running into tens of thousands of crores was inflated, pointing out that the predicate-offence FIRs filed by IDBI Bank and Bank of Maharashtra themselves alleged fraud of a considerably smaller — though still substantial — amount; the Court’s reasoning turned less on resolving that factual dispute than on whether the prosecuting agency had shown any realistic prospect of concluding the trial within a reasonable time. Finding that it had not, the Court applied the established Article 21 speedy-trial principles from Satender Kumar Antil v. CBI[10] and its own reasoning in Senthil Balaji to grant bail — an application of existing doctrine to a fact pattern of unusually prolonged pre-trial detention, rather than a newly minted independent test.
Read together, this run of decisions between 2022 and 2026 shows a Supreme Court applying the twin-conditions framework consistently in principle, while remaining genuinely attentive, on the specific facts of individual cases, to how long an accused has actually been held without meaningful trial progress. This is a live, fact-sensitive area of law rather than a settled one, and any PMLA bail strategy built today needs to track how each new case actually reasons on its facts, rather than extracting a single bright-line test from any one of them — including this article’s own account, which should be checked against the full judgments and any subsequent rulings before being relied upon in practice.
SEBI Enforcement in 2025–26: Insider Trading and the Finfluencer Crackdown
SEBI’s enforcement priorities have visibly shifted toward retail-investor protection in digital spaces. Following circulars dated 22 October 2024 and 29 January 2025 restricting SEBI-regulated intermediaries from associating with unregistered “finfluencers,” SEBI escalated to direct enforcement: on 4 December 2025, it barred finfluencer Avadhut Sathe and his entities from the securities market and impounded over ₹546 crore, characterising his operations as an unregistered investment-advisory service run under the cover of investor education.[11]
SEBI has continued conventional insider-trading enforcement alongside this newer category of action. In October 2025, it issued an interim order alleging that a group of connected traders used unpublished price-sensitive information to trade Indian Energy Exchange Ltd. derivatives, generating alleged gains of ₹173 crore.[12] On the regulatory side, SEBI notified the Securities and Exchange Board of India (Prohibition of Insider Trading) (Amendment) Regulations, 2025, updating the insider-trading framework itself.[13]
For litigators, the practical significance is that SEBI enforcement now spans two distinct categories that call for different legal analysis: classic insider-trading actions against market participants under the Prohibition of Insider Trading Regulations, and a newer category of proceedings against unregistered advisory or education operations conducted through social media, which typically engages the Investment Adviser and Research Analyst Regulations instead. Getting this distinction right at the outset affects which regulations, which defences, and which SEBI wing are actually in play.
What This Means for Litigators and Law Students
Three practical takeaways follow from the developments traced above. First, PMLA bail work now requires continuous, case-by-case tracking of how the Supreme Court actually reasons on prolonged pre-trial detention, rather than reliance on Vijay Madanlal Choudhary alone or on any single later case treated as a standalone rule — Kanhaiya Prasad and Arvind Dham were decided less than a year apart and are not in tension so much as they are answering different questions on different facts. Second, Section 111 BNS’s organised-crime threshold is a real but narrow addition to litigation risk in repeat economic-offence matters — it demands genuine screening for multiple prior chargesheets and cognizance within ten years, not a loose assumption that any repeat offender or any director is automatically exposed. Third, SEBI’s expansion into finfluencer and digital-advisory enforcement is creating a new area of securities-litigation practice at the intersection of technology, media, and market regulation — one likely to keep growing over the next several years and worth building early familiarity with, ideally by reading the primary orders rather than summaries of them.
Conclusion
White-collar enforcement in India is not a settled field to be learned once and applied indefinitely. The BNS has been in force for barely two years and its organised-crime provision is still being worked out in the High Courts; PMLA bail doctrine has been refined meaningfully several times within the last eighteen months alone, without any single case actually displacing the twin-conditions framework; and SEBI’s enforcement priorities are visibly adapting to a digital retail-investor base that did not exist in anything like its current form a decade ago. Existing commentary tends to treat the criminal-law reforms, PMLA bail jurisprudence, and securities enforcement as separate silos; an integrated account of how they interact — particularly where an economic-offence matter could plausibly touch all three at once — remains comparatively rare, and is where future scholarship, and future practice, has real room to add value.
References
- Hridaya Ranjan Prasad Verma v. State of Bihar, (2000) 4 SCC 168.
- Vesa Holdings (P) Ltd. v. State of Kerala, (2015) 8 SCC 293.
- Bharatiya Nyaya Sanhita, 2023 (Act No. 45 of 2023), s. 111 (organised crime, Explanations (i) and (ii): requiring continuing unlawful activity evidenced by more than one chargesheet filed before a competent court within the preceding ten years, with cognizance taken), s. 316 (criminal breach of trust), s. 318 (cheating, sub-sections (2)–(4)), s. 335 (making a false document), s. 336 (forgery), s. 344 (falsification of accounts).
- Vijay Madanlal Choudhary v. Union of India, 2022 SCC OnLine SC 929. Review petitions against this judgment (including Karti P. Chidambaram v. Directorate of Enforcement and connected matters) were pending before the Supreme Court as of the most recent hearings this article could verify; readers should check current status before treating any proposition here as beyond challenge.
- Tarsem Lal v. Directorate of Enforcement, Jalandhar Zonal Office, 2024 INSC 434 (decided 16 May 2024).
- V. Senthil Balaji v. The Deputy Director, Directorate of Enforcement, 2024 SCC OnLine SC 2626 (decided 26 September 2024).
- Sarla Gupta v. Enforcement Directorate, (2025) 7 SCC 626.
- Union of India (through the Assistant Director) v. Kanhaiya Prasad, 2025 INSC 210, [2025] 2 S.C.R. 544 (decided 13 February 2025).
- Arvind Dham v. Directorate of Enforcement, 2026 INSC 12, Criminal Appeal No. arising out of S.L.P. (Crl.) No. 15478 of 2025 (decided 6 January 2026).
- Satender Kumar Antil v. Central Bureau of Investigation, (2022) 10 SCC 51.
- Securities and Exchange Board of India, order against Avadhut Sathe and associated entities, 4 December 2025; SEBI circulars dated 22 October 2024 and 29 January 2025 on association of regulated entities with unregistered finfluencers. (Readers should consult the orders and circulars directly on sebi.gov.in rather than relying on secondary reporting alone.)
- Securities and Exchange Board of India, interim order concerning alleged insider trading in Indian Energy Exchange Ltd. derivatives, October 2025.
- Securities and Exchange Board of India (Prohibition of Insider Trading) (Amendment) Regulations, 2025.
- Prevention of Money Laundering Act, 2002 (Act No. 15 of 2003), s. 19 (power of arrest) and s. 45 (twin conditions for bail).
