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UNVEILING THE SHADOWS: EXPLORING WHITE-COLLAR CRIME IN INZDIA - TYPES, CAUSES, AND CONSEQUENCES
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Article Details
"UNVEILING
THE SHADOWS: EXPLORING WHITE-COLLAR CRIME IN INZDIA - TYPES, CAUSES,
AND
CONSEQUENCES"
Authored By - Aditi & Satvinder
Singh
3 Year Student Of BALLB(H)
Amity Law School, Amity University
Rajasthan
ABSTRACT
The text delves into the world of
white-collar crime in India, providing a detailed exploration of its types,
causes, effects, and notable cases. Emphasizing the financially motivated and
non-violent nature of these crimes, the discussion spans various offenses,
including money laundering, embezzlement, tax evasion, bribery, racketeering,
and cybercrime. The prevalence of such activities in India is examined, along
with legislative efforts to address them. The text underscores the impact of
white-collar crimes on different sectors and societal elements, attributing
their occurrence to factors like greed, poverty, systemic loopholes, and
technological advancements. Legislative measures, including acts such as the
Companies Act and Income Tax Act, are highlighted, alongside prominent cases
like the Harshad Mehta and Punjab National Bank scams. The conclusion
emphasizes the need for stringent laws, trained investigators, and media
transparency, with a call to address the root cause of white-collar crime –
greed – through education and parental guidance. The abstract closes with a
poignant quote on greed and a message urging a shift in thinking and education
to curb such crimes.
KEYWORDS – White Collar Crime, Money
laundering, Tax, Laws
INTRODUCTION
‘The practitioners of civil, the
hoarders, the profiters, the blackmarketers and speculators are the worst enemy
of our society. They have to do dealt with sternly. However well placed
important and influential they maybe, if we acquiesce in wrongdoing, people
will loose faith in us:
DR
S. RADHAKRISHAN
Crime is not the new scenario we are
familiar with infact we have ages of connection with it .The definition of
crime is ‘ an act punishable by law , as being forbidden by statue or injurious
to the public welfare[1] ’the
law of crime is always very fascinating branch of jurisprudence since early
ages . There are many type of crime. Crime is something which is done directly
and intentionally but indirect crimes are also now very common and in which the
victim even do not feel any physical harm but have to face huge consequences.
In certain good and reputed and high class job there are many loopholes and the
advantage of these loopholes are by taken by the person who are there on those
reputed jobs and start doing offensive and punishable act and deeds in which
they do not have fear of loose there job and status they have in society and also
there job in greed of money, profit and luxury. They do not think about the
nation and its economy which completely changes overnight . These kinds of
crimes are know as WHITE COLLAR CRIME.
“The term white collar crime is know
as the crime refers to financially motivated, non violent crime committed by
individuals business and government officials’’ it was defined by sociologist
Edwin Sutherland in 1939 as ‘ a crime committed by person of reputability and
high social status in the course of their occupation . white collar crime is
done in greed of which come from advancement of technology and commerce. The
definition of white collar crime strictly says that it done by high status
person and there are no certain ways to do it because its kind of fraud and
fraud can be done in any ways to gain the profit from these loopholes. Greed is
the major cause behind it, greed of being superior , greed of being rich ,
greed of profit in any form.
TYPES OF
WHITE COLLAR CRIME
MONEY LAUNDERING – Money laundering is that in which
people illegally converts their money from black to legitimate money .This is
very common in India because it was revealed that the amount currently present
in swiss and offshore bank is estimated to be rupees 300 crore or uss[2]
1.5 trillion . In money laundering
people change money which they earned by illegal method. people do money
laundering because they do not want to pay tax to the government of India.
Money laundering is know as HAWALA
TRANSCTIONS [3] .
Government has also passed prevention of Money Laundering Act 2002 in India.
The section 3 talks about the definition of money laundering. Offence of money
laundering. whosoever directly or indirectly attempts to indulge or knowingly
assists or knowingly is a party or actually involved in any process or activity
connected proceeds of crime including its concealment, possession , acquisition
or use and projecting or claiming it as untainted property shall be guilty of
offence of money laundering . In the case of Ram Jethmalani v. Union of India (2011)
8 SCC 1 Ram Jethmalani and others filles the
petition under Article 32 of
Constitution to prevent Money Laundering Act.
EMBEZZLEMENT -Embezzlement takes place when a
person was fund for a different purpose than they were intended to be used . The
embezzlers might create bills and receipts for activities that did not occur
and then use the money paid for personal expenses ponzi scheme are example of
embezzlement.The act of embezzlement may be characterized as criminal breach of
trust which has been defined in section 405 of the Indian penal code . There
are many examples from day to day life. For examples
1.
in
banking sector the bank who direct excess to the money deals with the customers
and give them direct excess
2.
the
clerks can easily excess to till money and there direct to till money can be a
way for embezzlement
3.
the
employees of big company sell there electronic gadgets in market and make money
from them
4.
shopkeepers
which works under the big stores of different stores have direct excess to the
money of shops and manipulate them.
TAX EVASION – when a person do fraud to minimize
and change the amount of tax which is tend to pay to government .It is an illegal
way to reduce the burden of tax . it involves illegal practices and deeds which
sometimes is so dangerous. the only effect of this is the changing and
fluctuating economy of our country .
This is very common in India as corruption is in worse form here.
Loopholes in our country is not going to heel if the condition going to be same.
The tax evasion is the crime is punishable. we can reduce it by proper tax
planning and complete awareness of it.
the proper planning of it fixes many loopholes with it of corruption There
is legal ways also from where we can also minimize the tax burden. The method
is that Tax avoidance but this not the perfect way to reduce tax burden it
comes with may cons. The tax avoidance can be done by adjusting the accounts in
certain ways and in manner in which that there can not be any violation of tax
rules . Many prominent economist think that it’s a illegal way because a person
which sharp mind can manipulate the accounts in any way to make it legal
.tax avoidance is immoral but not
illegal . Section 276C of Indian penal code deals with the tax evasion of any
tax, penalty or interest chargeable or imposable under the act The case law of
G.S.R Krishnamurthi vs M.G ovindaswamy talks about the tax evasion
BRIBERY – Bribery is defined by blacks law
dictionary as the offering , giving , receiving , or soliciting of any of value
to influence the actions of an official , or other person , in charge of the
public or legal duty [4] .
It the again the best of form corruption .Basically corruption occur in this
form only in India . This is prevailing in India from ancient time and most
deep rooted form of corruption .In the simple words bribery is know as the
amount or many given with illegal intent. From prominent kings of ancient time
to normal clerks have witnessed this form of white collar crime . With a
bribery rate of 39% India worst in Asia [5]
from the report from by corruption watchdog Transparency International . There
are two types of bribery first is Active Bribery in which a person gives and
offers or promises or gives a bribe and the second one is passive bribery in which a person request , receives ,or
accepts bribe . There are many common
example where bribery prevail in both the forms. for example
1.
Bribery
to police officers to escape from punishment and fines.
2.
Bribery
to officials of government to make their work process work more fast .
3.
Bribery
to the Doctors
4.
Bribery
to the foreign officials
Causes of bribery – higher level of
market and political monopolization.
Low level of democracy transparency.
The case of Biswabhusan naik vs the
state of Orrisa AIR 1952 ORI 289 talks about the long established evil bribery
RACKETEERING -
Racketeering is a a type of crime in person who is an offenders try to make
money by illegal methods such as illegally selling wrong goods, threating or
more immoral and unlawful activities . Racketeering is another white collar
crime which is very deep rooted again in India. from the RICO [6]it
includes 35 crimes in it from robbery to kidnapping and murder unacted by
united states corporation.
CYBERCRIME - The cybercrime is the criminal activity that either targets
the network or data of computers so that maximum damage can be provided or
maximum information can be derived from the other person computers. the cyber
crime is done by the hackers and person who knows everything about the
computers. These types of crime are know
as the crime of this generation. these crimes is not long established but
welcomed with the technology advancement. On one hand the Technology is boon
for ourselves and on another hand it is bane for our nation .That is wrong also
if we blame technology for this because the only thing behind cybercrime is
human mind . The common types of cyber crimes are as follow
·
Phishing
·
Harassment
·
Ransomware
·
Prostitution
·
Child pornography
·
Intellectual
·
Account hacking
·
Drug trafficking
Causes of cybercrime – there are many
causes behind the cyber crime .The main cause behind this is easy access to the
system . The unauthorized hackers get essay excess to the system which is
complex for the people. the second is that storing data in small place as
computer can easily store a large amount of in place so the hackers have again
can easily excess to the data in one places. Sometimes the whole data can be
stolen from other person account in just one click and utilize it for there own
profit for sure. The third cause is that
complex coding . The person who are making the coding and software are humans
only. The time they are creating software also left with bugs and error or
loopholes in simple words. the advantage of these loopholes are taken by the
hackers. The another cause is negligence. anything we neglect actually becomes
our biggest mistakes sometimes. A little negligence from your end welcomes cyber
crimes to knock at your doors. loos of evidence is another cause.
Sherya singla v UOI (2013)12SCC 73
challenges the section 66Aof IT[7]
act before the supreme court and it was
found that the section 66A was capable of restricting all forms of
communication and it contained no distinction between mere advocacy or
discussins on a particular cause which is offensive to some and incitement by
such words leading to a causal connection to public disorders , security ,
health , and so on [8]
EFFECTS OF
WHITE COLLAR CRIME
The effects of white collar crimes
are very huge and seen every aspect either is estate loss or emotional loss .
there are some most important areas where white collar crimes effects easily
seen.
·
EFFECT
ON INDUSTRIAL SECTOR OR THE COMPANIES – The companies face huge loss from white collar frauds . As
the companies has faced the consequences of frauds in result the financial
condition goes down so companies includes the prices and decrease the salaries
of employees and hence the price of goods increases and demand decrease as per
the Law of Demand of micro economies.
·
EFFECT
ON THE CUSTOMERS - The fear of customers
is the safety of the product
·
If
its safe or not. white collar crime directly or indirectly effects the
customers and also the rate of sailing price .
·
EFFECT
ON SOCIETY-The fear of white collar crime polluted society in every manner. The
trust and values diminished . By seeing the novel people doing such wrong
deeds.
·
EFFECTS
ON UPCOMING GENERATION – The white collar crime previous held in a nations motivates
the upcoming generation dare to do the crimes by showing the loop holes in the
systems . especially youngsters they easily get effected by the wrong things
and also some children future goes in
dark as the fraud made by the officials exhausted there parents hard core money
.
CAUSES OF
WHITE COLLAR CRIME IN INDIA
GREED -The major cause of doing any crime is
the greed .The greed of having the more .More power, more money, more freedom,
more decision authority .As its well said-THERE
IS SOULTION FOR NEED BUT NOT FOR THE GREED . Greed made the people blind
which enable them to the evil result of
there deeds .Even the experts the master minded people brain get vailed which
enable them to see the breath taking consequences of crime
.greed is ultimately become the reason of there fall.
POVERTY –Based on 2019 PPPS report
international comparison program[9] [10].according
to the united nations millennium development goals programme , 80million people
out 1.2 billion Indians , roughly equal to 6.7%of Indian populations , lived below the poverty line of
$1.25 in 2018-19 . India rank 49 [11]in
the world in the poverty and this poverty is the soul of every crime happening
in the nation. Due to the poverty people easily get attracted by the short
means of earning money without the consideration of the crime and its
consequences. More over poverty
strike people done the white collar
crime .poverty enforce them to do the wrong deeds
LOOPHOLES IN SYSTEM – There are many loopholes in system
is at the end is the reason for white collar crime. The negligence of concerned
authority give to these type of crime. with the advancement in technology
faster growth rate of business, the offenders get introduced by newer and easy
methods of committing crimes . Sometimes the responsible person also in the
crime. the gravity of these type of crimes are more intense and fascinating.
corruption works as catalyst for those loopholes.
INTRODUCTION TO ADVANCEMENT AND
TECHNOLOGY – With
the introduction of advancement in internet it become very easy to commit these
crimes as a huge transactions can also be done in second in anywhere in the
world . criminals attracted from these easy manners of committing crime at
sitting in one place. cybercrime is result of advancement.
NO CERTAIN LAWS – the white collar crime is rising with a great rate because
there is no certain laws in our country. The existing laws do not provide
straight punishments that would prevent the persons who are committing those
crimes. in many cases there are no certain law and punishment. Most of the time
the legislature and offenders belong to the same category.
LEGISLATION
ON WHITE COLLAR CRIME
There are many acts are being passed
by legislations which defines punishments for white collar crime.
·
The
companies act 1960
·
The
Income Tax Act 1961
·
Indian
Penal Code 1860
·
The
Commodities Act 1955
·
The
Prevention of Corruption Act 1988
·
The
Negotiable Instruments Act 1881
·
The
Prevention of Money Laundering Act 2002
·
The
Information Technology Act 2005
·
The
Imports and Exports Act 1950
·
The
special court Act 1992
·
The
Central Vigilance Commission Act 2003
SOME PROMINENT CASES ON WHITE
COLLAR TIME IN INDIA
There are certain white
collar crime cases which entirely changes the economy of India lets have a look
of some white collar cases so that we can understand it completely how it is
done and how it take place through the loopholes and get to know about the
consequences of it.
HARSHAD MEHTA SCAM
OF 1992
It is the biggest white
collar crime and scam which made us drop our jaws that such huge and mastermind
crimes has taken place in our country. Harshad Mehta 1988-1994 is the biggest
scam in stock Market .This shook the India economy in 1992 .India is facing
economy crash but Harshad successfully did the about 4 thousands crore scam which means 24 thousands
crore of todays time . Harshad s. Mehta
vs Central Bureau of investigation. 1998 (5) Bom CR 783, 1998 2 BOMLR 114 IS
Supreme court case. He had 27 criminals charges on him.
PUNJAB NATIONAL
BANK SCAM
Again there is scam which
shook the economic of India. The scam is of estimated rupees 11,356.84 crore
issued by Punjab national bank. this case covers almost all headlines of worlds.
The is done by the prominent jewelers of India NIRAV MODI.
2G SCAM
The 2G spectrum case is
spoof for government authority. this scam is of rupees 176000 crore of Indian government . A RAJA is being accused
to sell 2G spectrum licenses at very low cost which resulted in a large scam.
this is still going in supreme court.
RECENTS CASES IN INDIA OF WHITE
COLLAR CRIME
·
SEBI VS BURMAN PLANTATION AND OTHERS
·
ABHAY SINGH CHAUTALA VS C.B.I
·
BINOD KUMAR VS STATE OF JHARKHAND AND OTHERS
CONCULSION
The white collar crime have two
surprising features first one is that it is non violent and the second one is
that it done by prominent and people with high class jobs and status. white
collar crime are the crime of new generations. The white collars crimes always
shook the economic of nation as well the society. there are many mastermind such as Harshad
Mehta, Nirav Modi which changes everything and made the concerned authority
think about the loopholes of our system. Its shows mirror to the security of
our nation. The only factor which is affecting the most is the economic of our
nation. The cases of cybercrime is increasing day by day at alarming rate.
India as a developing country has faced difficulties due to the scams which
happens at particular time. The youth is getting motivated from these scams and
feel that there is more scoop of money rather in simple jobs.
The investigating officials are in
need to be trained for these sort of crime and there should be training for
them so they can excess to the offenders and maintain transparency in work as
the crimes are committed by people who are on high position.
The government of India should make
strict and straight laws for white collar crime that reduce the commission of
crimes. there should be quickness in decision making so that there is no burden
and so that people should not loose faith in this as the crimes are done by the
people whom they consider their role model. the media has key role to maintain
the transparency in the system and help to reduce the rate of white collar crimes.
by reveling about the white collar crime at higher level a certain type of fear
is created which helps to reduce the crime rate. This would definitely help in
reducing the rate of white collar crime in India.
A MESSAGE FROM THE AUTHOR
The only thing which give rise to
these crimes are GREED of people. after going through this topic one thing
which remain certain is the greed. greed can be reduced from childhood of
children. This generation has difficult to change but we can change the
thinking from next generation by giving education of consequences of these
crimes to children at early age. Parents play important role this.
“GREED IS
A BOTTOMLESS PIT WHICH
EXHAUTS
THE PERSON IN AN ENDLESS
EFFORT TO
SATISFY THE NEED WITHOUT
EVER
REACHING SATISFACTION”
ERICH
FROMN
WEBLIOGRAPHY
https://blog.ipleaders.in a detailed study on its types and
its detrimental effects .
https://indiankanoon.org
for case names and their citations
scc online
https://www.com.jagranjosh.com for money laundering cases
landmark cyber laws caes in india by
enhelion.com published on march 1 2021
Theweek.com
m.economictimes.com
[2] United states ships
[3] With reference from jagranjosh
.com
[4] What is bribery .
[5] The survey on bribery in Asia .
From m.economictimes.com
[6] RACKETEERING INFLUENCED AND
CORRUPT ORGANIZATIONS ACT
[7] INFORMATION TECHNOLOGY
[8] Landmark cyber law cases in India
by enhelion .com published on march 1 ,2021
[9] World bank$1.25 /day poverty
measures countering the world (January2010) retrieved 16 august 2017
[10] Homi kharas ;laurance candy ( 5
may2014)
[11] Poverty index :India index 49 by
NAvin J Antony issue date – august 17 ,2019 updated august 17 2019
Theweek.in
Article Information
UNVEILING THE SHADOWS: EXPLORING WHITE-COLLAR CRIME IN INZDIA - TYPES, CAUSES, AND CONSEQUENCES
Authors: Aditi, Satvinder Singh
- Journal IJLRA
- ISSN 2582-6433
- Published 2023/11/17
- Issue 7
About Journal
International Journal for Legal Research and Analysis
- Abbreviation IJLRA
- ISSN 2582-6433
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