SC Clarifies Companies’ Right to Appeal as Victims under CrPC

The Hon’ble Supreme Court has clarified that companies fall within the ambit of the term ‘victim’ as defined under Section 2(wa) read with the proviso to Section 372 of the Code of Criminal Procedure (CrPC). This observation was made in an appeal filed by Asian Paints challenging a judgment of the Hon’ble Rajasthan High Court, which had denied the company the status of a ‘victim’ for the purpose of appeal. The case concerned the acquittal of an individual accused of selling counterfeit paint products.

In this matter, the initial complaint had been lodged by an IPR consultancy firm authorized by Asian Paints to handle its intellectual property rights. The Trial Court had convicted the accused under Section 420 of the Indian Penal Code (now Section 318 of the Bharatiya Nyaya Sanhita), along with Sections 63 and 65 of the Copyright Act. However, this conviction was overturned by the First Appellate Court, which acquitted the accused.

Aggrieved by the acquittal, Asian Paints sought to file an appeal before the Rajasthan High Court, asserting its right as a ‘victim’ under the proviso to Section 372 of the CrPC. The maintainability of this appeal was vigorously contested, and the High Court held that since the company had neither filed the original complaint nor been treated as a victim at the trial stage, it could not invoke the right of appeal under the said provision.

The Supreme Court, however, overturned the High Court’s ruling. It held that the actions taken by the IPR consultancy were evidently on behalf of Asian Paints and related directly to the infringement of the company’s intellectual property. It was the company that suffered the actual harm, both financial loss and reputational damage, due to the sale or attempted sale of counterfeit products falsely represented as those of Asian Paints.

Criticising the High Court’s narrow interpretation of the term ‘complainant’, restricted to the individual who physically filed the complaint, the Supreme Court held that this understanding was erroneous. The High Court had further stated that even the complainant would require leave under Section 378(3) of the CrPC to file an appeal, thereby denying Asian Paints recourse under Section 372. However, the Apex Court clarified that Section 372 is a self-contained and independent provision and need not be read in conjunction with any other provision, including Section 378. Consequently, prior leave of the High Court was not required in this case.

The Court further held that the legal right to appeal under the proviso to Section 372 does not depend on whether the victim is also the complainant or informant in the case. The right accrues to the victim from the moment of acquittal, irrespective of whether the acquittal was delivered by the Trial Court or by the First Appellate Court. The proviso is neutral as to the stage at which acquittal occurs.

The right of a victim to appeal was introduced via a 2009 amendment, which inserted Section 2(wa) defining ‘victim’, and added the proviso to Section 372. This amendment granted victims the right to appeal against acquittals, convictions for lesser offences, or inadequate compensation. Before this, only the complainant, the government, or the court itself could appeal decisions of a lower court, limiting the ability of actual victims, often mere witnesses in their own case, to pursue justice.

The Supreme Court’s interpretation not only reaffirms the broader definition of ‘victim’ to include juristic persons like companies but also reinforces their independent right to appeal without the procedural hurdle of seeking leave from the High Court.