The finance ministry has quietly introduced a lethal amendment to the Customs Act in the Finance Bill,2012,wherein offences that attract punishment of three years imprisonment and above for offences as trivial as duty evasion or mis-declaration of value of goods,are non-bailable. A throwback to the pre-liberalisation era where the taxman was vested with enormous powers,the amendment has sounded alarm bells in the Indian business community.
The said amendment Section 104A to the Customs Act in Finance Bill,2012,states that irrespective of the provisions in the Code of Criminal Procedure (CrPC),a person accused of an offence punishable with imprisonment of three years or more,would not be granted bail unless the public prosecutor has an opportunity to oppose the release. Further,in cases where the public prosecutor opposes the bail,the Magistrate can order release only after he is convinced that the person is not guilty.
In fact,replying to the debate on General Budget in Rajya Sabha on March 26,senior BJP leader Arun Jaitley said the proposed amendment was akin to provisions under Prevention of Terrorism Act (Pota). The provision says when a person applies for bail,no Judge will give him bail. The Judge will issue a notice to the Public Prosecutor. Either the Public Prosecutor has to give his consent or the Public Prosecutor has to say I am convinced that this man is innocent,not guilty. Otherwise,there will be no bail.
When contacted,Jaitley told The Indian Express that there may be cases of disputes relating to value addition or even a genuine case of evasion. You dont need such strong provisions for tariff or duty related offences, he said. The Congress,he pointed out,did not want such a provision to apply even to terrorists,but has now introduced these in custom offences.
It is learnt that the finance ministry has taken note of these concerns and is addressing them. When contacted,revenue department officials said,the amendment was a clarification to address the Supreme Courts observations in the case of Union of India versus Omprakash,2011. So far,the Customs Act essentially followed the CrPC provisions which allowed bail for offences punishable by imprisonment of three years or more. The amendment now explicitly states that such offences will be non-bailable without the Public Prosecutor being given the opportunity to oppose the bail application before a Magistrate. Under the Prevention of Money Laundering Act too,the same provisions exist, a revenue department official said.
Jaitley,in the Rajya Sabha debate,feared the proliferation of this provision across all economic laws. Slowly once you do it in customs offences,in every economic offence,it will start applying. I can tell you there is no better advice you can give to the Indian business than this,dont invest in India because if you do,these are going to be the consequences, he had said.