SC Clarifies Attribution of Mens Rea in Corporate Criminal Prosecutions

On September 7, 2026, the Hon’ble Supreme Court in Sanofi India Ltd. v. CBI, [2026 INSC 957; Criminal Appeal No. 4250 of 2026] examined whether criminal proceedings against a company for offences requiring mens rea can be quashed merely because no natural person acting on its behalf has been identified or arraigned as an accused. The Court answered in the negative and laid down a structured framework for attributing the acts and state of mind of natural persons to a corporation.

Background

Sanofi India Ltd., a public limited pharmaceutical company, supplied pharmaceutical products to the Rare Materials Project of the Bhabha Atomic Research Centre (BARC). The CBI alleged that Dr. P. Anand, a Scientific Officer at BARC, had entered into a criminal conspiracy with pharmaceutical companies in connection with procurement of medicines at inflated rates and quantities exceeding requirements.

Sanofi was arraigned as an accused for offences including criminal conspiracy under Section 120B read with Section 420 of the Indian Penal Code, 1860 (IPC), along with offences under Sections 11, 12, and 13(2) read with Sections 13(1)(b) and (d) of the Prevention of Corruption Act, 1988 (PC Act). No employee or official of the company was arraigned as an accused.

The prosecution alleged, inter alia, that medicines were wrongly classified as proprietary products to facilitate procurement from Sanofi despite lower competing bids and that Dr. Anand received illegal gratification of ₹42,750 from the company.

Sanofi contended that since no employee or officer of the company had been identified and arraigned, prosecution of the company itself could not be sustained for offences requiring mens rea. The High Court rejected the challenge, prompting the appeal before the Supreme Court.

Corporate Mens Rea and Its Attribution

The judgment draws an important distinction between the existence of corporate mens rea and the manner in which it is attributed. While Iridium India Telecom Ltd. v. Motorola Inc., (2011) 1 SCC 74, recognised that a corporation can be prosecuted for offences requiring mens rea, the Supreme Court noted that the decision was concerned with whether a company could possess mens rea, rather than how a natural person’s state of mind is to be attributed to it.

Three-stage framework for attribution

Drawing upon principles developed in Tesco Supermarkets Ltd. v. Nattrass [(1972) A.C. 153], Meridian Global Funds Management Asia Ltd. v. Securities Commission [(1995) 2 A.C. 500], and the decisions in The Queen v. Barclays PLC & Barclays Bank PLC (Crown Court, Indictment No. T2017 7247-7251 & T2018 0055) and Serious Fraud Office v. Barclays PLC [2018] EWHC 3055 (QB) (together, the “Barclays cases”), the Court adopted a sequential, hierarchical three-stage framework:

• First, whether the company’s constitutional documents (memorandum and articles of association) or rules implied by company law vest in the person concerned the power to do the act in question;
• Second, where such power has not been expressly vested, whether authority was delegated to the person, whether expressly or impliedly, with sufficient discretion and independence in the doing of the act; and
• Third, where neither of the above stages establishes attribution, the court must consider whether the statutory provision under which liability is sought calls for a special rule of attribution. The inquiry differs depending on the nature of the statute: (a) where the statutory purpose is narrow and readily identifiable, the court asks, in the abstract, whether that purpose requires treating the person’s act and state of mind as those of the corporation; (b) where the statutory purpose is broad and capable of applying across varying circumstances, the court asks instead whether the statutory purpose, applied to the facts and circumstances of the case, requires such a rule. If a special rule is warranted, the court must then determine whether the person in question falls within the scope of that rule.

The Court emphasised that the inquiry at each stage is transaction-specific and does not seek to identify a corporation’s directing mind in the abstract. It cannot be determined simply by looking at a person’s designation or position within the company. Status, while not a standalone basis for attribution, may weigh heavily at the third stage in favour of fashioning a special rule.

Non-Arraignment at the Section 482 Stage

The absence of an identified natural person does not, by itself, warrant quashing of proceedings under Section 482 of the Code of Criminal Procedure, 1973 (CrPC). At this stage, the court is required to consider whether the allegations, taken at face value, disclose the commission of an offence and whether attribution of mens rea to the company is reasonably possible. The Court made clear that it was addressing this issue specifically in the context of proceedings under Section 482 CrPC and was not laying down a general rule governing every stage of a criminal prosecution.

At the same time, the Court observed that within the existing, individualistic conception of criminal law, corporate mens rea must ultimately be traceable in its entirety to at least one natural person. The mental states of multiple individuals cannot be combined to assemble the company’s criminal intent.

Mandatory Imprisonment and Corporate Liability

The Court also considered whether an offence carrying mandatory imprisonment can be prosecuted against a company. Following Standard Chartered Bank v. Directorate of Enforcement [(2005) 4 SCC 530], it reaffirmed that mandatory imprisonment does not prevent prosecution where the statute also provides for a fine—since the law does not compel the impossible, a judicial discretion to impose a fine alone must be read into such provisions when dealing with juristic persons. However, a company cannot be prosecuted where imprisonment alone is prescribed, or where the nature of the offence requires personal malicious intent incapable of corporate commission.

Conclusion

The judgment provides a framework for determining corporate criminal liability by examining authority, delegation, and statutory purpose, while making clear that, at the Section 482 CrPC stage, proceedings against a company cannot be quashed merely because the individual whose conduct may ultimately be attributed to it has not been identified or arraigned. The Court also observed that if the goal is to make it easier for companies to be held liable for offences requiring mens rea, that is a task for the legislature, not the courts, and called for a systematic study of corporate liability in India along the lines of the options paper prepared by the Law Commission of England and Wales.