White Collar Crime in India and the Santhanam Committee

In one line

India has known white collar crime as an organised subject since the Santhanam Committee reported in 1964, and every diagnosis it made has been repeated by every committee since.

In the wording a student can write in an exam: the Committee on Prevention of Corruption, chaired by K. Santhanam, which reported in 1964, is the foundational Indian study; it described the forms white collar crime takes in India, recommended the creation of the Central Vigilance Commission, and its analysis was carried forward by the Law Commission's twenty-ninth report on socio-economic offences and its forty-seventh report on their trial and punishment.

The Santhanam Committee

What it was. A committee appointed by the Government of India to review the arrangements for checking corruption among public servants and to advise on measures for their improvement. It reported in 1964.

What it found. That corruption had increased and had become organised rather than casual; that it had spread from the lower levels into the higher; that the arrangements for detecting and punishing it were inadequate; and that the existence of large sums of unaccounted money was both a cause and an effect of the problem.

Its most quoted observation concerns the classes of persons who obstruct the working of the system: it identified those in trade, industry and the professions who deal with the administration and who, in its account, contribute substantially to corruption. Its analysis was that corruption is a transaction with two sides, and that a study confined to the public servant is half a study.

Its principal recommendations. A Central Vigilance Commission at the Centre with a corresponding machinery in the States; vigilance officers in each Ministry and Department; a code of conduct; the strengthening of the anti-corruption law; and administrative measures reducing the occasions for corruption, principally the elimination of unnecessary discretion, delay and permission.

And its lasting importance for this paper. The Central Vigilance Commission was created by executive resolution in 1964 on this recommendation and was given a statutory footing only in 2003, and the chapters on it in Module IV take the story from there.

The Law Commission reports

The twenty-ninth report examined whether socio-economic offences should be brought into the Indian Penal Code. Its importance is that it treated this class of offence as a category requiring its own treatment, and it set out the features that distinguish it: the motive is avarice rather than passion, the conduct injures the community rather than an individual, the offence is committed in the course of a lawful occupation, and detection is difficult.

The forty-seventh report, on the trial and punishment of social and economic offences, addressed the procedural and evidentiary difficulties set out in the previous chapter, and recommended presumptions, special procedures and sentencing directed at profit rather than at liberty alone.