Fugitive Economic Offenders Bill aims to bring back economic offenders, involved in swindling cases of over Rs.1 billion, taking refuge in foreign soil
To do so, it plans to turn up the heat on such offenders by giving right to authorities to confiscate any of their property (not just the proceeds of the crime) and sell them off too, to satisfy claims of creditors
Existing laws only allow attachment of the proceeds of crime
Experts feel the provision is unconstitutional as it denies a fair chance to the accused
Experts also point out that the Bill may fail to serve its purpose since extradition procedures between nations are typically complex
The jig is up for Nirav Modi, who has defrauded state-owned Punjab National Bank to the tune of US1.8 billion. But he escaped to foreign shores in time to evade prosecution by the Indian law. Approximately two years backs it was former liquor baron Vijay Mallya who did the same to avoid an arrest for defaulting on loans.
Turns out, they are not the only two to have taken refuge abroad. As per information procured by activist Jitendra Ghadge via an RTI (right to information) request, 184 people accused in such scams have fled the nation and hence remain at large.
Facing flak for letting this happen, the union cabinet cleared the Fugitive Economic Offenders Bill at the start of the month. It sets to give teeth to the nation’s battle against economic crimes by deterring economic offenders from remaining outside the jurisdiction of Indian courts.
The Bill was first announced in Finance Minister Arun Jaitley’s 2017 Budget speech. If it doesn’t make its way through the two houses of the Parliament to become a law, it could be promulgated as an ordinance.
How does the new Bill stack up against existing ones?
The draft law describes a fugitive economic offender as a person against whom an arrest warrant has been issued by any court but who has left for foreign shores to avoid criminal prosecution or doesn’t want to return to India for the same within a stipulated time. The offences include forgery, cheating, fraud, insider trading, corruption, and customs evasion.
With the filing of the application in a Special Court, the government can attach any properties mentioned in it for 180 days. This would prevent the accused from selling or trading it. And irrespective of whether he or she has been declared an offender, the authorities can sell it off to satisfy claims of duped creditors.
However, the law is not unique. Existing laws – Money Laundering (PML) Act, 2002 being a prominent one among them – already have provisions to confiscate properties which are the proceeds of crime of proclaimed offenders. However, unless the alleged offender comes to the court for trial, the authorities cannot do much with the attached properties.
The proposed Bill, on the other hand, authorises confiscating all properties owned by the fugitive offender and sell them off too. This is expected to turn up the heat on alleged offenders thereby forcing them to come back.
Will it really force absconders to return for a trial?
That is the moot point and experts are not too upbeat it since they feel the extradition processes between India and other countries, which are typically complicated and time-taking, will largely decide the legal fate of such fugitive offenders. For instance UK courts have earlier denied extradition requests for UK-based alleged bookie Sanjeev Kumar Chawla accused in cricket match fixing, on grounds that the jail condition in India is inhumane and that there is no guarantee of a fair prosecution. In fact, only one extradition request, among many, so far has been accepted by Britain after the signing of a treaty in 1992.
Besides, the provision in the Bill allowing the government to take control of property based only on allegations of wrongdoing, with no conviction, has generated fears that it could end up being as unconstitutional
When the Bill was first floated in August 2017, responding to such concerns, the government said that all necessary constitutional safeguards vis-à-vis providing hearing to the alleged offender through counsel, giving him or her him time to file a reply and serving notice of summons to him have been provided for. Besides, it is meant for cases where the swindled money is over a billion.
The Bill would now be tabled in the Lok Sabha in the ongoing second half of the budget session. All eyes are on now if it would end up being a tough law or a watered-down version.