Introduction
The Bharatiya Nyaya Sanhita, 2023 has fundamentally altered India’s criminal law landscape. Among its most consequential provisions is Section 111, which introduces a central offence of “organised crime”. Designed to target entrenched criminal syndicates operating across sectors and jurisdictions, the provision reflects a legitimate concern with the scale and sophistication of modern economic and cybercrime.
However, the breadth of Section 111 has also raised serious concerns. Its language is sufficiently open-ended to permit the reclassification of conventional white-collar offences as organised crime, with drastic consequences for those accused. Conduct that would earlier have attracted prosecution for cheating or fraud may now expose individuals to mandatory minimum sentences, life imprisonment, and near-impossible bail conditions. As the BNS came into force on 1 July 2024, replacing the Indian Penal Code of 1860, corporate India has been forced to confront a difficult question: does Section 111 adequately distinguish between organised criminal syndicates and serious, but ordinary, economic offences?
This article examines the scope of Section 111, its overlap with economic fraud, and the risk of prosecutorial overreach. While the provision strengthens the State’s ability to respond to systemic financial crime, its ambiguity threatens legal certainty, business confidence, and procedural fairness.
The Genesis and Scope of Section 111
Before the enactment of the BNS, organised crime was addressed largely through state-specific legislation such as the Maharashtra Control of Organised Crime Act, 1999, and similar enactments in Uttar Pradesh and Gujarat. These laws were aimed at tackling mafia-style violence, extortion, and coercive criminal networks. Their territorial and conceptual limitations, however, made them ill-suited to address modern, pan-India economic offences, particularly those involving digital platforms and cross-border transactions.
Section 111 seeks to remedy this fragmentation by creating a nationwide offence of organised crime. Significantly, it expressly brings “economic offences” within its ambit. The provision defines organised crime as any “continuing unlawful activity” carried out by an individual or a “syndicate”, defined as two or more persons acting in concert, through violence, intimidation, coercion, or other unlawful means, for direct or indirect material benefit.
The range of activities covered is extensive. In addition to traditional organised crimes such as kidnapping, extortion, land grabbing, contract killing, trafficking, and cybercrime with international implications, Section 111 includes economic offences by reference to Section 2(1)(u) of the Prevention of Money Laundering Act, 2002. This effectively incorporates a wide spectrum of financial offences under banking laws, securities regulations, the Negotiable Instruments Act, and allied statutes.
The requirement of “continuing unlawful activity” further expands the provision’s reach. It is satisfied where cognizable offences punishable with three years or more of imprisonment are evidenced either by multiple charge-sheets within the preceding ten years or by an aggregate financial loss exceeding ₹1 crore. Liability extends beyond principal offenders to those who facilitate, harbour, or benefit from the proceeds of crime.
Punishment under Section 111 is severe. Where death results, the sentence may extend to life imprisonment or death. Where grievous hurt is caused, imprisonment may extend to life with mandatory minimum terms. In other cases, imprisonment ranges from three to ten years, accompanied by fines linked to the proceeds of crime and mandatory victim compensation.
While this consolidation of organised crime law is unprecedented, it is also the source of concern. Core expressions such as “unlawful means”, “material benefit”, and even “syndicate” remain undefined, leaving the provision vulnerable to expansive interpretation.
When White-Collar Crime Becomes Organised Crime
Traditionally, white-collar offences such as cheating, forgery, insider trading, or regulatory fraud were prosecuted under the IPC and sector-specific statutes. These offences, though serious, attracted comparatively lower sentences and were generally governed by ordinary bail principles.
The BNS retains these offences—cheating now appears under Section 318—but Section 111 creates a parallel and far more punitive pathway. Once conduct is characterised as “organised”, the legal consequences change entirely.
A standard bank fraud illustrates the risk. A group of officials approving fraudulent loans using falsified documents, resulting in losses of ₹5 crore, would earlier have faced prosecution under cheating provisions with a maximum sentence of seven years. Under the BNS, the same conduct may attract Section 111 if the monetary threshold is crossed or if prior FIRs exist. The minimum sentence escalates sharply, bail becomes non-bailable, and exposure extends to life imprisonment if the prosecution links the fraud to a fatal outcome, such as borrower suicide.
The incorporation of the PMLA definition of “economic offence” further widens the net. Offences under securities law, RBI regulations, and mass-investment schemes now serve as gateways to organised crime prosecutions. Cyber-enabled frauds involving multiple victims or cross-border elements fit squarely within this framework.
The danger lies in over-inclusion. Aggressive accounting practices, repeated compliance failures, or collective decision-making at the board level risk being recast as “continuing unlawful activity” by a “syndicate”, collapsing the distinction between criminal conspiracy and commercial risk.
Escalation in Consequences
The shift from traditional white-collar prosecution to organised crime is not merely semantic. Under earlier law, a single act of cheating sufficed for prosecution, with proportionate punishment and generally bailable offences. Under Section 111, liability hinges on continuity or financial scale, but once triggered, the consequences are far more severe.
What was earlier a fine-tunable offence now carries mandatory minimum imprisonment, proceeds-based fines, and long periods of pre-trial detention. For professionals and executives, the reputational and economic damage often precedes conviction.
Bail as the Real Punishment
Perhaps the most punitive aspect of Section 111 lies in its bail regime. Organised crime offences are cognizable and non-bailable from the outset. Bail applications are governed by Section 479 of the Bharatiya Nagarik Suraksha Sanhita, which requires courts to consider the gravity of the offence, the strength of evidence, the risk of tampering, and broader societal impact.
In economic offences, these factors often work against the accused. Digital evidence, large document trails, and the perceived scale of harm frequently result in prolonged custody. While Section 479 permits undertrial release after serving a portion of the maximum sentence, judicial discretion remains constrained.
Courts have attempted to temper this rigidity. The Punjab and Haryana High Court, in Jaskaran Singh v. State (2025), emphasised that mere allegations cannot justify indefinite detention, invoking the constitutional presumption of liberty. Yet, other cases demonstrate prolonged custody even at the investigation stage, reinforcing concerns that bail denial has become a de facto punishment.
Early Judicial Warnings
High Court decisions have begun to draw boundaries. In a 2025 judgment of the Jammu & Kashmir and Ladakh High Court, the court quashed the invocation of Section 111 in a ₹53 crore fraud case where the prosecution failed to establish “continuing unlawful activity” through prior charge-sheets. The court clarified that the seriousness of an economic offence alone does not justify its classification as organised crime.
Similarly, the Karnataka High Court has criticised mechanical bail denials and underscored the need for procedural discipline. At the same time, courts have upheld Section 111 in cases involving extortion-linked fraud, demonstrating that the provision retains real force when properly applied.
Broader Corporate and Economic Impact
The implications of Section 111 extend beyond individual prosecutions. Corporates now face heightened compliance pressures, with boards increasingly concerned about collective exposure. Non-executive directors, traditionally shielded from operational liability, face potential exposure under provisions relating to harbouring or benefiting from crime proceeds.
Investor confidence is also affected. Regulatory uncertainty and the risk of prolonged detention of key managerial personnel have a chilling effect on investment and risk-taking. While stronger enforcement against large-scale fraud enhances economic security, excessive vagueness threatens innovation and growth.
Comparative frameworks such as the U.S. RICO statute demonstrate that breadth can be balanced with rigorous intent and enterprise requirements. Section 111, in its present form, lacks equivalent internal safeguards.
Conclusion
Section 111 reflects a legitimate attempt to address the realities of modern organised and economic crime. Properly applied, it can dismantle entrenched fraud networks and deter systemic financial misconduct. Improperly applied, it risks collapsing the distinction between organised crime and serious white-collar offences.
Clear prosecutorial guidelines, strict judicial scrutiny of “continuing unlawful activity”, and a more balanced bail framework for non-violent economic offences are essential. Without these safeguards, Section 111 risks becoming a tool of overreach rather than reform.
The success of the BNS will ultimately depend not on the severity of its provisions, but on the restraint with which they are enforced.
Contributed By : Siddharth Bankal