While PSU banks grapple with the fallout of the Rs 13,000 crore PNB-Nirav Modi scam and the authority scramble to get hold of Nirav Modi’s as many assets as possible, the government has approved a bill that aims to force absconding wilful defaulters return to India and face criminal prosecution. The Fugitive Economic Offenders Bill, 2018, which traces its origins back to the Budget of the last year 2017, seeks to identify economic offenders or wilful defaulters who have eloped the country, and try them as criminals.
The bill proposes to attach or confiscate property and all assets of such persons, Finance Minister Arun Jaitley said at a press briefing after the Cabinet meet. To avoid “overcrowding”, economic offences worth Rs 100 crore or more will be under the purview of the Bill, Arun Jaitley said. With the new bill, the Government hopes to help the banks and other financial institutions to achieve higher recovery from the financial defaults committed by such fugitive economic offenders, and thereby, improve the financial health of such institutions.
Further, the bill will cover under its ambit not only the property resulting from the proceeds of crime, but also other property of the offender in India and abroad, including benami property.
Who is a fugitive economic offender?
The government has a list of scheduled economic offenses which range from cheating to wilful default. A person identified as an offender under the scheduled offenses with an arrest warrant against him from a competent court, who has left India or refuses to return to the country to avoid prosecution, could be declared a fugitive economic offender, Arun Jaitley said.
To avoid any confusion and clarify the matters further, Arun Jaitley said that it will apply to all those who fit into the criteria as on the date of the law coming into effect. This means that if people such as Nirav Modi and Vijay Mallya choose not to come back to India by the time the law takes effect, they may face immediate heat from the authorities.
Although, most of these two people’s assets have already been seized by the authorities under various provisions of the existing laws, a consolidated law overriding the scattered provisions of various other regulations dealing with the financial crime may come in handy for the government to take quick action such cases, and for the courts to dispose off these cases in a speedy manner.
Other provisions of the bill
Among other provisions, the bill also seeks to arm the government with the power to disentitle fugitive economic offenders from defending any civil claims in the country. Since the bill proposes attaching or seizing the offenders’ property and assets not only in India but overseas too, the government would frame an international cooperation mechanism, Arun Jaitley said. An administrator will be appointed to manage and dispose of the confiscated property under the law. The government plans to table the bill in the upcoming remaining part of the budget session of the Parliament, Arun Jaitley said.