Please click here to download the Newsletter as PDF.
The second quarter of 2026 (April – June 2026) has seen significant enforcement actions and judicial developments in India’s cybersecurity and white-collar crime landscape. In addition to multiple arrests, raids, and investigations undertaken by the Central Bureau of Investigation (“CBI”), the Enforcement Directorate (“ED”), the Securities and Exchange Board of India (“SEBI”), and the Serious Fraud Investigation Office (“SFIO”), this quarter also witnessed some key legislative and regulatory developments.
Enforcements landscape
Prevention of Corruption Act, 1988
CBI arrests Goods and Services Tax officials in bribery case
On April 7, 2026, the CBI arrested a Superintendent and an inspector of the Goods and Services Tax (“GST”) in a bribery case. Reportedly, the officials demanded an undue advantage of INR 30,000 (Indian Rupees thirty thousand) (subsequently negotiated down to INR 15,000 (Indian Rupees fifteen thousand)) to facilitate the clearance of a GST registration. The CBI laid a trap and apprehended the Superintendent red-handed while accepting the bribe amount.
CBI books the finance manager of Indian Oil Corporation Limited in an alleged fraud case
As per the media sources, on June 27, 2026, the CBI booked a senior manager (finance) of Indian Oil Corporation Limited at its Vadodara refinery for allegedly siphoning INR 1,50,000 (Indian Rupees one crore fifty thousand). The officials allegedly misused their official position between March 2024 and June 2025 by generating fake payment vouchers without supporting documents, utilising the system login credentials of junior employees. The FIR invokes provisions of the Prevention of Corruption Act, 1988 (“PC Act”) and the Bharatiya Nyaya Sanhita, 2023 alleging criminal conspiracy and falsification of accounts to facilitate fraudulent payments to selected vendors.
Prevention of Money Laundering Act, 2002
ED arrests former assistant engineer and contractors in fake bill scam
On June 1, 2026, the ED’s Indore Sub-Zonal Office arrested a former assistant engineer of a municipal corporation alongside 2 (two) private contractors in connection with a money laundering investigation. The investigation, stemming from multiple First Information Reports (“FIRs”) related to fraudulent treasury withdrawals, revealed that between 2018 and 2023, fabricated bills amounting to approximately INR 119,53,00,000 (Indian Rupees one hundred and nineteen crore fifty-three lakh) were submitted for non-existent public works. The fraudulent disbursements caused a wrongful loss to the municipal treasury, and the total proceeds of crime have been quantified at INR 92,76,00,000 (Indian Rupees ninety-two crore seventy-six lakh).
Information Technology Act, 2000
CBI conducts nationwide searches and makes arrests in ‘digital arrest’ scams
On June 25, 2026, the CBI launched ‘Operation Chakra-VI’, deploying 60 (sixty) special teams to raid over 80 (eighty) locations across 16 (sixteen) States. The operation targeted transnational syndicates executing ‘digital arrest’ scams, a highly coercive form of cyber extortion where fraudsters place victims under virtual custody. The agency arrested 2 (two) key operators from Chennai and Kolkata who were reportedly responsible for incorporating shell companies and operating mule bank accounts used to launder approximately INR 2,00,00,000 (Indian Rupees two crore) of suspected proceeds of crime.
Companies Act, 2013
SFIO to probe major gold refining company over alleged financial irregularities
Reportedly, on June 3, 2026, SEBI issued an interim order against into a major gold refining and jewellery manufacturing company, barring its promoter-chairman from accessing the securities market after alleging that the company misrepresented its consolidated revenues by approximately INR 15.15 lakh crore (Indian Rupees fifteen lakh fifteen thousand crore) between the financial years 2021 and 2025. As per media sources, following the SEBI order, the Ministry of Corporate Affairs directed the SFIO to launch a comprehensive probe into the company’s financial irregularities. Meanwhile, on June 23, 2026, the ED conducted search and seizure operations at 9 (nine) premises linked to the entity under the Foreign Exchange Management Act, 1999 uncovering suspected offshore benami transactions, around INR 3,000 crore (Indian Rupees three thousand crore) in opaque trade set-offs, and a 40% physical stock discrepancy.
Legislative/regulatory developments
SEBI and Financial Intelligence Unit – India execute intelligence sharing memorandum
On April 16, 2026, SEBI and the Financial Intelligence Unit – India executed a memorandum of understanding to formalise the real-time sharing of intelligence to detect complex money laundering patterns operating through the capital markets.
The said memorandum is expected to strengthen inter-agency coordination by enabling timely exchange of information relating to suspicious transactions and emerging financial crime trends.
Revised governance and audit framework for insurance entities
On April 6, 2026, the Insurance Regulatory and Development Authority of India (“IRDAI”) issued the IRDAI Information and Cyber Security Guidelines, 2026 introducing stricter governance, compliance, and technical requirements for insurance entities. The revised framework mandates structured exception management with tiered approvals, and tighter audit timelines requiring reporting within 30 (thirty) days by the empanelled auditors of the Indian Computer Emergency Response Team.
Ministry of Electronics and Information Technology explores ‘law-to-code’ framework for data protection compliance
In May 2026, reports indicated that the Ministry of Electronics and Information Technology is exploring a ‘law-to-code’ framework to hardwire compliance with the Digital Personal Data Protection Act, 2023 (“DPDP Act”). This initiative aims to translate statutory provisions into machine-executable algorithms to counter Artificial Intelligence (“AI”) fueled cyber threats, ensuring that data governance operates at machine speed with minimal human intervention. Non-compliance under the DPDP Act carries severe weight, with financial penalties capable of reaching up to INR 250,00,00,000 (Indian Rupees two hundred and fifty crore) per breach for data fiduciaries.
CBI launches ABHAY, an AI-powered notice verification system
On May 15, 2026, the CBI launched ABHAY (AI-Based Helpbot for Authentication of CBI Notices), a real-time notice verification system aimed at combating ‘digital arrest’ scams. The system allows citizens to verify the authenticity of any notice purportedly issued by the CBI by uploading a scanned copy through the CBI’s official website, following one-time password-based authentication. ABHAY then declares the notice as either genuine or potentially fraudulent. The launch is significant in the context of rising ‘digital arrest’ fraud, where victims are coerced into compliance through fabricated law enforcement notices, a scheme that has no legal basis under Indian law.
Judicial discourse
- In Om Prakash Chhawnika vs. State of Jharkhand[1], the Supreme Court of India (“Supreme Court”) yet again clarified that in a complaint case, the police has no power to arrest the accused unless there is apprehension of disobedience with the summons and a non-bailable warrant is issued by the court under Section 87 of the Code of Criminal Procedure, 1973 (“CrPC”). The court also clarified that when cognizance is taken and summons issued, all that the accused needs to do is join proceedings, there being no need for an application for anticipatory bail or a direction to surrender and seek regular bail. This is relevant in view of the trend in states such as Uttar Pradesh and Jharkhand where, upon taking cognizance, the accused are unnecessarily required to secure anticipatory bail.
- In a decision on the scope and applicability of the first proviso to Section 223(1) of the Bharatiya Nagarik Suraksha Sanhita, 2023 (“BNSS”) to proceedings under the Prevention of Money Laundering Act, 2002 (“PMLA”), the Supreme Court, in Parvinder Singh vs. ED[2] has held that the provisions governing complaints under Sections 200 to 205 of the CrPC[3] (now Sections 223 to 228 of the BNSS) are applicable to the proceedings under the PMLA.
Briefly, the Supreme Court held as follows:- the first proviso to Section 223(1) of the BNSS is substantive in nature, as it confers a right upon the accused to be heard before taking cognizance, which forms a part of the right to a fair trial under Article 21 of the Constitution of India;
- cognizance of an offence taken without compliance of the said proviso would be void ab initio; and
- a mere ministerial act of numbering a complaint and fixing a date for hearing on cognizance does not constitute an ‘inquiry’ under Section 2(1)(k) of the BNSS, and therefore, Section 531(2)(a) of the BNSS would have no application.
For a detailed analysis, please refer to the JSA Prism of June 12, 2026.
- In State of Madhya Pradesh vs. Ravi Shankar Singh[4], the Supreme Court struck down the High Court guidelines that had introduced an entirely new stage for pre-trial examination of sanctioning authorities in charge sheets filed under the PC Act. The Supreme Court has held that the High Court in exercise of its jurisdiction under Article 226 of the Constitution cannot direct all the Sessions Courts/Special Courts under the PC Act to examine the sanctioning authority even before framing of charge or commencement of trial when such mechanism is not provided for under the CrPC. The decision is relevant in the continuing judicial discourse on effect of illegal/ improper sanction for criminal prosecutions.
- In Ravi Alias Ravindra Singh vs. State of U.P. and another[5], the Allahabad High Court detailed an exhaustive step-by-step procedure for conducting criminal trials in the absence of a proclaimed offender as per the newly introduced Section 356 of the BNSS. The High Court identified four stages at which an accused may abscond during criminal proceedings and prescribed the statutory procedure for each. It held that a ‘trial in absentia’ under Section 356 of BNSS can commence only after exhausting coercive measures such as non-bailable warrants, proclamation, property attachment under Section 85 of BNSS, and prosecution under Section 209 of BNS for evading court orders. The High Court clarified that courts may resort to Section 356 of BNSS to frame charges and complete the trial only after all prescribed coercive measures have been exhausted and an amicus curiae has been appointed to represent the absconding accused.
- In Vinay Prakash Singh v. Pushpendra Singh[6], the Madhya Pradesh High Court at Jabalpur held that while the proviso to Section 223(1) of the BNSS is intended to ensure that the accused is heard before cognizance is taken, such opportunity does not automatically translate into an obligation to supply entire evidence at the threshold stage. Setting aside the Magistrate’s order dismissing a private complaint for non-supply of documents and electronic evidence to the proposed accused, the High Court held that such mechanical dismissal without examining the merits or procedural fairness in totality, results in miscarriage of justice, and restored the complaint for consideration on merits. The decision offers more clarity on the process to be followed in pre-cognizance hearings, a new process under the BNSS, the contours of which are evolving entirely through judicial decisions.
- In Sumann Mundhara vs. State of Rajasthan[7], the Rajasthan High Court reiterated that by merely directing investigation under Section 156(3) of the Code of Criminal Procedure, 1973, the Magistrate is not absolved of its duties. It is bound to supervise and monitor the investigation and call for progress reports if the investigation is unnecessarily delayed. The decision is useful for businesses seeking to prosecute offenders but facing police lethargy even after an FIR has been registered.
International developments
UK Serious Fraud Office’s resolves foreign bribery case through Deferred Prosecution Agreement
On May 1, 2026, the UK Serious Fraud Office (“SFO”) secured judicial approval for a Deferred Prosecution Agreement (“DPA”) with a UK based defence electronics company, resolving allegations of failing to prevent bribery under Section 7 of the UK Bribery Act 2010. The company agreed to pay approximately GBP 15,000,000 (Great British Pound fifteen million) (a GBP 10,000,000 (Great British Pound ten million) penalty and GBP 4,800,000 (Great British Pound four million eight hundred thousand) in costs). Reportedly, this marks the SFO’s first foreign-bribery-related DPA in nearly 5 (five) years and is notable for the strategic credit given to the company’s new owners, who were praised for ‘exemplary co-operation’ and sweeping compliance remediations.
European Union adopts Anti-Corruption Directive
On April 21, 2026, the European Union (“EU”) formally adopted a landmark Anti-Corruption Directive, which was published in the Official Journal on May 11, 2026. The directive harmonises criminal definitions across the member states and introduces enhanced corporate liability measures, including fines up to 5% of a company’s total worldwide turnover (or Euro 40,000,000 (Euro forty million)) for public sector bribery and misappropriation. It expands jurisdictional reach, meaning non-EU headquartered companies with subsidiaries within the EU can face enforcement actions for corrupt conduct occurring entirely outside the EU.
OECD Working Group on Bribery initiates consultation for phase 5 monitoring
From April 22 to May 25, 2026, the OECD Working Group on Bribery invited stakeholder input from the private sector, civil society, academia, and other groups as it begins designing phase 5 of its peer-review monitoring process for the OECD Anti-Bribery Convention. The consultation is significant as OECD Working Group monitoring has long been one of the principal mechanisms for evaluating whether member countries are enforcing foreign bribery laws in practice and not merely adopting them on paper. The initiative signals the Working Group’s continued commitment to holding member states accountable for their anti-bribery obligations.
This Newsletter has been prepared by:
|
Rupinder Malik |
Kumar Kislay |
Vibhor Jain |
Archit Sehgal |
Simarpreet K Matharoo |
|
For more details, please contact km@jsalaw.com
[1] 2026 SCC OnLine SC 676 (decided on April 23, 2026)
[2] 2026 SCC OnLine SC 903 (decided on May 19, 2026)
[3] The CrPC was replaced by the BNSS with effect from July 1, 2024.
[4] 2026 INSC 650 (decided on June 10, 2026)
[5] 2026:AHC:101857 (decided on May 5, 2026)
[6] MCRC-17776-2026 (decided on May 8, 2026)
[7] 2026 SCC OnLine Raj 3545 (decided on May 18, 2026)
