The Cabinet on Thursday approved the Fugitive Economic Offenders Bill to deal with those escaping overseas to avoid getting caught. The Bill will empower the government to confiscate any property owned by such persons in India. The bill is aimed at deterring economic offenders like jeweller Nirav Modi from fleeing the country or not returning to face trial. In a press conference today in New Delhi, Jaitley said, “Fugitive Economic Offenders Bill 2018 has been brought to confiscation of assets of a fugitive, including Benami assets. There will also be the provision to confiscate those assets outside India but co-operation of that country will be needed.”
The Cabinet has also approved the establishment of National Financial Reporting Authority (NFRA) today, which Jaitley said will act as an independent regulator for the auditing profession which was one of the key changes brought in by the Companies Act, 2013. “Jurisdiction of NFRA for investigation of Chartered Accountants & their firms under Section 132 of the Act would extend to listed companies & large unlisted public companies, the thresholds for which shall be provided in the Rules,” added Jaitley.
The Indian Express had reported in May 2017 that the proposed law, if it comes into force, will be applicable in cases where value of offences is over Rs 100 crore. The Bill makes provisions for a court of law — Special Court under Prevention of Money Laundering Act — to declare a person a fugitive economic offender.
As per the explanatory note to the draft bill, “A Fugitive Economic Offender is a person who has an arrest warrant issued in respect of a scheduled offence and who leaves or has left India so as to avoid criminal prosecution, or refuses to return to India to face criminal prosecution.”
The note further said that on such declaration of a fugitive economic offender, two consequences will follow: First, any property that is a proceed of crime that the person is accused of, as well as any property owned by such person in India shall stand confiscated and vested in the government of India free from all encumbrances.
“Second, at the discretion of any court, such person or any company where he is a promoter or key managerial personnel or majority shareholder, may be disentitled from bringing forward or defending any civil claim. If at any point of time in the course of the proceeding prior to the declaration, however, the alleged fugitive economic offender returns to India and submits to the appropriate jurisdictional court, proceedings under this Act would cease by law,” the draft Bill said.
A finance ministry statement had also said in this regard that, “It is widely felt that the spectre of high-value economic offenders absconding from India to defy the legal process seriously undermines the rule of law in India. It is, therefore, felt necessary to provide an effective, expeditious and constitutionally permissible deterrent to ensure that such actions are curbed.”
The draft version of the bill was introduced last year days after the Supreme Court found liquor baron Vijay Mallya guilty of contempt and asked him to appear before it on July 10. Mallya-owned Kingfisher Airlines owes over Rs 9,000 crore to banks.
(with inputs from ENS)
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