However, a person won’t be prosecuted if they can prove that the contravention took place without their knowledge or that they had exercised all due diligence to prevent such contravention.
Section 70(2) of the PMLA says that if a company is found to be in violation of the anti-money laundering law and if it is proved that such a contravention took place with the “consent or connivance of, or is attributable to any neglect on the part of any director, manager, secretary or other officer of any company,” such individuals would be deemed guilty and face punishment.
Explanation 2 of the same provision underscores that a company “may be prosecuted, notwithstanding whether the prosecution or conviction of any legal juridical person shall be contingent on the prosecution or conviction of any individual”.
Meaning thereby, a company is a separate entity independent from its members or those who operate it, and can be prosecuted.
Source: Barandbench
