Report No. 47
1.8. White-collar crimes.-
Another aspect to which attention can be usefully drawn is that many-but not all-of the offences in question are "white-collar crimes". Without entering into details of the definition of "white-collar crime", one may, for the purpose of the present Report, describe it as a crime committed in the course of one's occupation by a member of the upper class of society. A manufacturer of drugs who deliberately supplies sub-standard drugs is, for example, a white-collar criminal. So is a big corporation guilty of fraudulent evasion of tax.
A person who illegally smuggles (for his personal use) costly television sets, is not a white-collar criminal in the above sense, there being no connection between his occupation and the crime committed by him. Nor is a pensioner who submits a false returns of income. But all of them are guilty of social or economic offences. In short, social offences are offences which affect the health or material welfare of the community as a whole, and not merely of the individual victim. Similarly, economic offences are those which affect the country's economy, and not merely the wealth of an individual victim.
1.9. Socio-economic offences form intersecting circle with white-collar crimes and offences of absolute liability.-
Socio-economic offences and white-collar crimes could thus be intersecting circles.1 Again, socio-economic offences and crimes of strict liability also could be represented by intersecting circles.
1. Para. 1.8, supra.
1.10. Special features of economic crimes.-
The importance of suppressing social and economic crimes in any modern society is obvious. The transition from a rural and simple society to an industrialised and complex one entails regulation by or under law of activities having an economic import. The same process of transition from a simple to complex and a rural to urban society also necessitates an increasing attack on malpractices which were previously unknown, but which now emerge as a result of the process. The process gives rise to a two-fold increase in such malpractices-increase in the number of socio-economic malpractices and increase in their variety. Thus, newer forms of harmful activities not known previously-such as, unfair competition-raise their heads. And malpractices which would previously have been of a simple-recurring, monotonous type, now assume diverse and varying manifestations. Adulteration of foods and drugs is an example in point.
1.11. This has happened in every modern society. In a developing economy, it assumes still greater importance, because conduct which, though criminal, could previously have been overlooked-e.g. petty smuggling-has now to be dealt with more seriously. Just as in war, every inch of territory has to be defended, whatever the risk, so in an economic crisis or in a massive effort to build up a society with a sound and healthy social structure, the purity of every grain has to be protected and every dot of evil has to be wiped out.
The reason why offences against laws enacted to combat such evils do not find adequate response in the social consciousness is psychological. Our minds are familiar with conventional offences like murder, rape and theft-offences where a tangible person or property of an individual is attacked. But it takes time to realise the seriousness of non-conventional crimes where intangible property, in the sense of economic resources of the community are involved, or where the harm caused is indirect and remote, and there is no immediate tangible object of the harm visible to the mind. Neither the offender nor the society adequately realises the harm, because of the absence of an immediate victim.
1.12. Procedure adopted.-
The procedure which we followed in preparing this Report was in brief, as follows:-
After a preliminary study, we had prepared a Questionnaire on the subject, setting out the important points arising from the reference and soliciting views on those points with reference to the major Acts1. The questionnaire was sent out to the State Governments, Bar Associations, Faculties of Law in different Universities, commercial bodies and other interested persons and institutions. We also got prepared a draft Report on the subject. We then held oral discussions with Members of Parliament, Government officers, members of the Bar, commercial bodies academic lawyers and others interested in the subject.
The discussion were held by the full Commission at Bombay and Delhi, and one of our Members (Mr. Justice V.R. Krishna Iyer) held discussions at Madras, Ernakulam and Trivandrum. Chairman discussed some aspects of the problem under our inquiry with the representatives of the Indian Chambers of Commerce and Industry at Calcutta. Thereafter, a revised draft Report was prepared and discussed. It was again discussed and revised, and finalised.
We wish to express our thanks to all those who helped us by communicating their views orally or in writing. It is not considered convenient to refer to each shade of view while discussing the various points, mainly because the Acts involved are numerous and so are the shades of opinion. But we ought to state that before formulating our conclusions, we have taken into account each of these shades of view.
Before we conclude this Introductory Chapter, we ought to place on record our warm appreciation of the assistance which we have received from our Secretary, Shri P.M. Bakshi. At the commencement of the inquiry, Mr. Bakshi prepared a Working Paper in which he posed the major problems which called for our decision. Then a Questionnaire was drafted and, as we have already indicated, it was widely circulated. Mr. Bakshi joined us in our discussions with all persons who helped us by meeting us, and took very comprehensive notes of the discussions.
After the recording of evidence was over, we discussed the problems posed in the Working Paper, initially prepared by Mr. Bakshi, and came to provisional conclusions on the major issues involved in the inquiry. It was in the light of these conclusions that a draft was prepared by Shri Bakshi for further discussions. This draft was considered by us fully and carefully and we reached and recorded our final conclusions on the major issues (involved in the present inquiry). Then, Mr. Bakshi prepared a final draft for our consideration and acceptance. This draft was again examined by us before it was finalised.
We are conscious that some of the major recommendations we have made in our Report are radical in character and they constitute a departure from the traditional concept of criminal jurisprudence. Everyone of the recommendations made by us has, however, been carefully examined by us and the pros and cons of the problem involved have been fully scrutinised. In our view, the implementation of the recommendations we have made may go a long way in helping our country to face effectively the challenge posed by the socio-economic offences with which the Report is concerned.
Whilst we were engaged on this inquiry, the Hon'ble Minister for Law and Justice indicated to the Chairman that the Union Government would very much appreciate if the present case could be forwarded as early as possible, and, on behalf of the Commission, the Chairman had assured the Hon'ble Minister that the Commission hoped to be able to make its report by the end of February, 1972. We would like to add that we have been able to carry out our assurance mainly because of the very valuable help which Mr. Bakshi has given us.
1. As to the major Acts, see para. 2.3, infra.