The Supreme Court has held that companies can be treated as “victims” under the Code of Criminal Procedure (CrPC) and are entitled to appeal against acquittals—even in cases where the state does not file an appeal.
The ruling, issued on July 15, could reshape the way economic offences and corporate harm are addressed in the criminal justice system. The court clarified that denying this right would effectively nullify the proviso to Section 372 of the CrPC, which allows victims to appeal acquittals.
The verdict could be a turning point for how corporate injuries are treated in the criminal justice system, especially in economic offences such as counterfeiting or fraud. While the court didn’t go as far as redrawing the law, it did stress that ignoring a company’s right to appeal would “negate” the clear wording of the law.
The case that sparked this judgment began in 2016. Asian Paints had hired an intellectual property consultancy to investigate counterfeit goods, and soon, a shop named “Ganpati Traders” in Tunga, Rajasthan, came under the radar. During a police raid, 12 buckets of paint bearing the Asian Paints brand were seized—allegedly fake.
Initially, the trial court found the shopkeeper, Ram Babu, guilty. But things flipped at the sessions court, which overturned the conviction. Asian Paints tried to appeal, but the Rajasthan high court dismissed the attempt, saying only the original complainant—in this case, the police or a public prosecutor—could file such an appeal.
The top court didn’t see it that way. It pointed to Section 2(wa) of the CrPC, which defines a victim as anyone who has suffered a loss or injury due to a criminal act. That definition, the court said, includes companies too. So, by that logic, Asian Paints had every right to appeal.
“Financial and reputational losses from counterfeit goods can’t be brushed aside,” the bench observed. “Customers buying fake products believing them to be genuine will cause obvious harm to the brand.”
This interpretation could matter a great deal to businesses, particularly in cases involving trademark infringement or economic offences, where prosecution is often slow or absent.
One of the key takeaways from the ruling is that companies no longer have to rely solely on state prosecutors to seek justice. If an accused is acquitted and the company feels wronged, it can file an appeal on its own, under the proviso to Section 372 of the CrPC.
The court made it clear that this right kicks in directly after an acquittal and is not dependent on any state action. In the judges’ words, denying this would be like erasing the very purpose of that legal provision.
Law firm Singh Law Chambers LLP, which represented Asian Paints, called the judgment a “foundational shift” in how Indian courts view corporate harm. While such phrases may sound bold, the ruling does signal that courts are more open to recognising the impact of economic crimes on brands and companies.
According to the firm, this could push companies to be more proactive investing more in evidence gathering, legal planning, and treating brand protection as a central business issue, rather than a side concern.
