Direct answer
Do not let the organisation chart become the prosecution's entire role case
Create period-specific maps of shareholding, board composition, delegated authority, bank mandates, ERP access, reporting lines and actual transaction involvement. A director appointed after the disputed period, a non-executive director, a sales employee, an accountant and a beneficial controller present different factual and legal questions. Formal title can be relevant, but it is not the final proof of knowledge or conduct.
The company and individuals may initially share facts but later diverge on instructions, benefit, disclosure, document custody or cooperation. Conduct a conflict review before joint representation, common affidavits or employee interviews. Preserve privilege and native records, and do not pressure staff to adopt management's explanation. Any Section 70 analysis should address the statutory language and pleaded company offence specifically.
Legal analysis
Corporate PMLA attribution requires entity, role, knowledge and benefit maps
The record should show who had legal authority, who exercised it and what each person knew at the relevant time.
Entity boundary
Identify which company received, transferred, held or acquired the disputed property. Group branding and common ownership do not erase separate accounts and obligations.
Practical focus: Use an entity-by-transaction chart with legal and commercial purpose.
Role and period
Board membership, employment and signatory authority can change. Avoid attributing a transaction based on a title held before or after the relevant event.
Practical focus: Prepare dated appointment, delegation and exit records for each person.
Knowledge and direction
Emails, approvals, meeting records and system logs may show information flow, but copied recipients and shared credentials need careful interpretation.
Practical focus: Map actual receipt, response, instruction and execution rather than email presence alone.
Benefit and company defence
Salary, dividend, reimbursement, loan and alleged personal benefit are not interchangeable. The entity may have a separate commercial explanation and statutory defence from individuals.
Practical focus: Reconcile benefit claims to bank, tax and corporate records.
Evidence plan
Corporate evidence needs custodian and version control
A later PDF export can hide metadata and workflow. Preserve native systems and document who produced every schedule.
| Record | What it may establish | What it cannot establish by itself |
|---|---|---|
| MCA and constitutional records | Entity, officers, objects and formal filings | Actual operational control of a disputed transaction |
| Board minutes and delegations | Formal approval and authority limits | Whether information supplied to the board was true or complete |
| Bank mandates and ERP logs | Execution access and workflow | Human intent or authorship where credentials were shared |
| Contracts and performance records | Commercial purpose and delivery | Lawful source without counterparty and payment verification |
| Employment and reporting documents | Role, period and assigned function | Every act performed outside formal description |
| Benefits and related-party schedules | Money or value received by persons or entities | Criminal character without origin and conduct proof |
Response roadmap
A corporate response that protects both record and people
- 01
Issue a scoped preservation notice
Identify custodians, systems and period. Suspend deletion without broadcasting accusations beyond those who need to know.
- 02
Build entity and authority maps
Chart companies, accounts, directors, signatories, systems and delegated limits for the alleged period.
- 03
Conduct conflict review
Assess whether company, promoter, directors and employees can share counsel or privileged work without adverse interests.
- 04
Reconcile the transaction and benefit
Trace money, goods or services and identify actual recipients. Separate corporate use from personal benefit allegations.
- 05
Prepare person-specific responses
Use a common verified chronology but tailored statement, bail, reply and trial analysis for each entity or individual.
Delhi forum context
Parallel corporate and PMLA proceedings need a controlled Delhi strategy
An SFIO, CBI, EOW, bank or tax record may be used alongside PMLA material. Each authority has its own power and process. The company should track what version of a document and explanation was supplied to each one.
Before a Delhi Special Court or High Court, clearly disclose the corporate proceeding map and identify the exact person seeking relief. Avoid using the company's size, employment impact or compliance history as a substitute for the statutory merits, though each may be relevant to tailored relief.
Focused questions
Questions commonly arising at this stage
Can a company itself be accused under PMLA?
The PMLA contains provisions concerning offences by companies. The complaint, statutory language and alleged company conduct must be examined. Entity liability and individual liability require related but distinct analysis.
Is a director automatically responsible for company transactions?
No automatic factual conclusion should be drawn from designation alone. The applicable statutory provision, responsibility for business, knowledge, consent, connivance, negligence-related allegation and evidence must be analysed.
Can the company pay legal fees for employees?
Company law, employment terms, conflicts, privilege, insurance, governance and investigation risks should be reviewed. Payment should not be used to control testimony or conceal an individual's separate interest.
Should internal findings be shared with the ED?
Production obligations, privilege, strategy and accuracy require item-specific advice. Do not assume every internal legal work product is either automatically protected or automatically disclosable.
Primary materials
Official sources for verification
Use the current statutory text, rules, notifications, roster and orders. This page is an issue map, not a substitute for checking the live record.
Case preparation
Convert the papers into a dated, transaction-level brief
For an initial assessment, organise the latest summons or order, case particulars, a one-page chronology, the relevant bank or property trail, and the exact next deadline. Do not alter, rename or selectively delete electronic records.
Part of the Economic & White-Collar Offences research cluster. Substantive legal propositions must be checked against the current Act, rules, notifications and binding decisions applicable to the actual record.