In India, a Murder Accused Has More Rights Than a Company Director

A man accused of murder in India can stay silent. The State has to prove he did it. One police station. One investigation. One court. And the right to say nothing at all.

Perspective. Last updated: 23 September 2026.

A company director who missed a filing, delayed a PF deposit, or whose staff used the wrong basement can be treated as guilty until he proves he was careful. Dozens of departments can call him. He has to turn up, answer, and hand over records. Company accounts, and in some tracks his own, can be frozen before any court has convicted anybody.

Let us say the awkward part first, so nobody has to say it in the comments. This is not a comparison of punishments. Murder, punished under section 103 of the Bharatiya Nyaya Sanhita (section 302 of the IPC before July 2024), carries death or life imprisonment. A late return does not, and it never should. This is a comparison of something else entirely: who the Indian State is built to chase, and who it is built to protect while it chases.

The sentence nobody voted for

Open almost any Indian business law. Tax. GST. Labour. Environment. Food. Drugs. Cheques. Real estate. Data. You will find the same sentence, copy-pasted across seventy years of legislating:

If the company commits the offence, every person in charge of its business shall be deemed to be guilty, unless that person proves the offence happened without their knowledge, or that they exercised all due diligence.

Read the last part again. Unless that person proves.

In a murder trial, the prosecution proves. In business, you prove. You prove you did not know. You prove you were careful. You prove a negative about a company that may run across several states and employ hundreds of people, to an officer who has never run one.

This clause is not a rumour forwarded on WhatsApp. It is Section 141 of the Negotiable Instruments Act. Section 137 of the GST Act. Section 487 of the Income-tax Act, 2025, in force since 1 April 2026, which carries forward Section 278B of the 1961 Act. Section 70 of the PMLA. Section 48 of the Competition Act. Section 85 of the IT Act. It is in all four Labour Codes that came into force on 21 November 2025. It is in the pollution Acts, the food and drug Acts, legal metrology, RERA. It is the most reproduced sentence in Indian economic law, and almost nobody outside a compliance department has ever read it.

Some laws go further. They order you to speak.

Article 20(3) of the Constitution says no person accused of an offence shall be compelled to be a witness against himself. That right is solid for the man in a murder case. In a tax or GST inquiry it thins out fast.

• GST, Section 70(1A). Inserted by the Finance (No. 2) Act, 2024 and in force from 1 November 2024. A summoned person is bound to attend and must state the truth and produce what is asked for. Section 70(2) makes that inquiry a judicial proceeding.
• Income-tax, Section 490 of the 2025 Act (Section 278E of the 1961 Act). In specified prosecutions the court shall presume a guilty state of mind. It is on the accused to prove otherwise.
• Cheques, Section 139 of the NI Act. The court presumes the cheque was issued to clear a debt. You rebut it.
• PMLA, Sections 24 and 45. You prove the property is not proceeds of crime. And to get bail, the court has to first be satisfied that you are probably not guilty.

An ordinary murder trial has no equivalent. The law does shift the burden in a few grave offences, such as dowry death under section 118 of the Bharatiya Sakshya Adhiniyam or possession cases under section 35 of the NDPS Act, but in a murder prosecution nobody presumes the accused had a guilty mind because his name appears on a document.

One police station, or forty doors

A murder accused deals with a station house officer, then a magistrate, then a Sessions judge. That is the entire cast until appeal.

Here is the cast for a director of an ordinary working company. Every one of these can summon him, inspect him, or prosecute him.

• Tax and money. Income-tax officer, GST proper officer, DGGI, state GST department, Customs, DRI, the Enforcement Directorate under both PMLA and FEMA.
• Company and market. Registrar of Companies, Regional Director, SFIO, SEBI, the RBI or IRDAI depending on the sector, the Competition Commission.
• People and premises. EPFO, ESIC, the labour inspector, the factory or OSH inspector, the fire officer, the shops and establishment inspector, the professional tax clerk, the labour welfare board.
• Product, land and data. FSSAI, the drug inspector, legal metrology, the state pollution board, the NGT, RERA, a consumer commission, CERT-In, the Data Protection Board.
• And then. The municipal licensing office, the local police, and any private person holding a cheque that bounced.

Count them. That is past forty before you leave your own city. Now multiply the last three groups by 28 states and 8 union territories, each with its own inspectors, registers, display boards and renewal dates.

Not one of those offices knows what the other thirty-nine require. The director is expected to know all of them. He is the one common address they all have.

26,000 ways to go to jail over paperwork

TeamLease RegTech and the Observer Research Foundation actually counted the Indian business rulebook. The numbers are not disputed and they have been quoted in Parliament.

1,536	Acts and rules a business can fall under
69,233	compliance obligations
6,618	filings
26,134	clauses that carry a prison term
843	of those 1,536 Acts contain at least one imprisonment clause

Two out of five. Not a fine. Jail.

Nobody is claiming 26,134 founders are in prison. That was never the point. The point is what that rulebook does to the head of a person trying to build something. Every register, every display board, every renewal, every deposit date sits inside a system whose default setting is criminal, not civil.

Two things that actually happened

Old Rajinder Nagar, 27 July 2024

Rainwater flooded the basement of a building in Old Rajinder Nagar in Delhi that housed a UPSC coaching centre. Three students, Shreya Yadav, Tanya Soni and Nevin Dalvin, drowned.

The next day, six people were arrested: the coaching institute’s CEO, its coordinator, and four co-owners of the building. Police also picked up the driver of an SUV that had driven through the flooded street.

On 2 August 2024 the Delhi High Court moved the case to the CBI and said this to the Delhi Police, in open court:

Mercifully, you have not challaned rainwater for entering the basement.

The court was not saying the coaching centre was innocent. Running a library in a basement cleared for parking and storage is a serious allegation, and the accused are being prosecuted for it. The court was saying something narrower and much harder to answer: the police had a businessman and a passing driver in custody inside twenty-four hours, and had not gone near the officials who signed off on the building, the drains and the fire clearance.

That is the argument of this entire article, made by a High Court rather than by us.

Uphaar, 13 June 1997

Fifty-nine people died of asphyxia in a Delhi cinema. The building owners spent the next quarter of a century inside the criminal system. The Supreme Court eventually allowed a payment of ₹60 crore towards a trauma centre in place of further imprisonment. In 2021 the owners were sentenced to seven years in the connected evidence-tampering case.

The transformer that started it belonged to the electricity board. The licence file belonged to the city. The names India remembers are the owners.

What the court docket actually shows

Here is the hard number, and it is the Supreme Court’s own. As on 31 December 2019, 35.16 lakh cheque bounce cases were pending in Indian courts. The Court took the problem up on its own motion because Section 138 had swallowed the magistracy whole.

Thirty-five lakh criminal cases. About money that did not clear.

Go and see the shape of it yourself. On our index at eCourtsIndia on 20 August 2026, the phrase “Section 138 of the Negotiable Instruments Act” returns 55,691 records, and “Section 302 of the Indian Penal Code” returns 51,067. (Murder is now section 103 of the BNS, but the older records in the index cite the IPC.) Those are mentions inside case records and order text, not a count of cases filed, and we are not going to dress them up as one. But run both on ecourtsindia.com/search and sit with it. A bounced cheque produces about as much judicial writing in this country as murder does.

If you want the mechanics of that docket, we have written about tracking Section 138 cases at scale, and about building legal due diligence on court data for anyone who has to check a director’s exposure before signing a term sheet.

The Supreme Court has said this. It has not stopped happening.

For twenty years the Court has tried to stop departments treating the word “director” as a synonym for “accused”.

• S.M.S. Pharmaceuticals v. Neeta Bhalla: being called a director is not enough. The complaint has to say you were in charge.
• Aneeta Hada: as a rule the company has to be in the dock before its directors can be.
• Pooja Ravinder Devidasani: non-executive and non-signing directors are not automatic accused.
• Sunil Bharti Mittal: there is no vicarious criminal liability without either a statute that creates it or proof of personal intent.

Every one of those is a win. Every one of them arrived after years of hearings, personal appearances, travel, legal bills and headlines. Getting a case quashed in year four is not the same thing as never having been named in year one. Founders live in that gap, and the gap is the punishment.

What has changed, and what has not

Give the credit where it is due. The Jan Vishwas Act, 2023 decriminalised a batch of minor defaults. The Jan Vishwas (Amendment of Provisions) Bill, 2026 went a great deal further, amending 784 provisions across 79 central Acts, and cleared the Lok Sabha on 1 April 2026 and the Rajya Sabha the next day. The four Labour Codes replaced 29 old laws and pushed imprisonment towards serious and repeat defaults. This is real reform and it was overdue.

Now the part nobody has fixed.

Most of those 26,134 imprisonment clauses are not in central law at all. They sit in state labour rules, shops and establishment Acts, municipal bye-laws, fire rules and welfare board notifications. Parliament cannot decriminalise what Parliament did not write.

And none of these reforms deleted the sentence at the top of this article. The deeming clause survived every round. It was tidied. It was not removed.

The question India has to answer

If employing people is a permanent criminal risk, some people will simply stop doing it. Not the fraudsters. Fraudsters have lawyers and a plan and they were never worried. The ones who stop are the careful ones. The first-generation founder in a tier-two city who actually reads the fine print, sees a jail term attached to a display board, and quietly decides that a salaried job is safer.

That is the real cost of all this, and it does not show up in any ranking.

India says it wants to be a developed economy by 2047. It will not get there while the person who signs the incorporation form is one missed renewal away from a criminal summons.

So, four questions, and they are for you, not for a committee:

• Should “guilty unless you prove you were careful” remain the default setting for economic offences in India?
• When a basement floods, should the first person in the lock-up be the businessman, or the officials who cleared the building, the drains and the fire certificate?
• Should anybody be criminally liable for what a company did without the State having to prove that person knew?
• And why does a bounced cheque need a criminal court at all, when a civil recovery process could finish the job in a fraction of the time?

Serious fraud deserves serious punishment. Nobody is asking for a free pass. The argument is about the default, and the default is currently upside down.

A murder accused gets one investigation and the right to stay silent.

A director gets a queue.

Sources

• TeamLease RegTech and Observer Research Foundation, Jailed for Doing Business: 1,536 Acts and rules, 69,233 compliances, 6,618 filings, 26,134 imprisonment clauses, 843 Acts carrying imprisonment.
• CGST Act Sections 70(1A) and 70(2). Sub-section (1A) inserted by Section 135 of the Finance (No. 2) Act, 2024 (assented 16 August 2024), brought into force from 1 November 2024 by Notification No. 17/2024-Central Tax.
• Income-tax Act, 2025 Sections 487 and 490 (in force from 1 April 2026), corresponding to Sections 278B and 278E of the Income-tax Act, 1961. BNS Section 103 (IPC Section 302). BSA Section 118. NI Act Sections 138, 139 and 141. PMLA Sections 24, 45, 50 and 70. Companies Act Sections 2(60), 149(12) and 447. Competition Act Section 48. IT Act Section 85. Code on Wages Section 55, Social Security Code Section 135, OSH Code Section 109, Industrial Relations Code Section 88.
• Four Labour Codes brought into force on 21 November 2025, replacing 29 earlier laws.
• Supreme Court suo motu proceedings on Section 138 pendency: 35.16 lakh cases pending as on 31 December 2019.
• Delhi High Court order dated 2 August 2024 transferring the Old Rajinder Nagar coaching centre deaths to the CBI, and contemporaneous reporting on the arrests of 28 July 2024.
• Trial court, Delhi High Court and Supreme Court record in the Uphaar cinema fire matter, including the ₹60 crore trauma centre payment and the 2021 sentencing in the evidence-tampering case.
• PIB release of 2 April 2026 and PRS Legislative Research on the Jan Vishwas (Amendment of Provisions) Bill, 2026: 784 provisions across 79 central Acts, passed by the Lok Sabha on 1 April and the Rajya Sabha on 2 April 2026.
• eCourtsIndia full-text index, 20 August 2026. Queries reproduced in the text.

This is analysis of statutes, procedure and public court records. It is not legal advice, and it is not a comment on the guilt of anyone still facing trial. The Rajinder Nagar deaths and the Uphaar fire were atrocities with named victims and grieving families. The argument here is about how the State allocates criminal process, not about diminishing what was lost.

Check any of this for yourself

Every docket claim in this piece is verifiable. Search any company, director or advocate on eCourtsIndia. If a case number is all you have, our guide on what a CNR number actually tells you will get you the rest. For insolvency and SFIO-adjacent matters, start with the NCLT and NCLAT search guide. And if you want the longer argument about why this data layer matters, read why India’s legal AI will be a ten billion dollar category.

Joining a board, or taking money from one? Run the director and the company through LegalCheck before you sign. It pulls court cases against a person or a company into one report, so you see pending cheque bounce complaints, tax prosecutions and insolvency matters before they become your problem. Our LegalCheck launch note explains what a report covers, and the guide to finding all cases against a company walks through the manual route.

Section 138 is the biggest single source of director summonses, and our analysis of the cheque bounce litigation crisis shows how that docket grew. Where a police case exists, Crime Reports holds 12 lakh+ FIR PDFs from 13 states and union territories. Once you know which cases matter, add them to tracking and new orders reach you on WhatsApp or email.

Frequently Asked Questions