New Delhi: The law ministry has given its concurrence to a draft bill that will give powers to the government to confiscate property of economic offenders and defaulters who flee India, albeit with a new provision, official sources said. It wants a “Saving Clause” to be incorporated in the Fugitive Economic Offenders Bill 2017 before it is introduced in the Lok Sabha in the ensuing winter session of Parliament, they said.
A saving clause provides for certain exception(s) in a statute. It enables the repealed law to be in force with respect to some existing rights. The proposed law will be applicable in cases where the value of offences is over Rs 100 crore.
The bill flows from Finance Minister Arun Jaitley’s 2017-18 Budget speech promising legislative changes or even a new law to confiscate the assets of such fugitives. It seeks to deter economic offenders from evading the process of Indian law by fleeing the country.
The bill proposes to allow the Financial Intelligence Unit (FIU), the premier technical snoop wing under the finance ministry, to file an application for the declaration of fugitive economic offender for confiscation of their assets. The courts under PMLA would be entrusted with the responsibility to try the case. The Finance Ministry had prepared the draft Cabinet note on the bill and sought the law ministry’s opinion on it.
The sources said the ministry, while concurring with the provisions of the bill, suggested that a “Saving Clause” be inserted since the provisions of the proposed bill will have a bearing on the provisions of existing laws. The existing laws under which such offenders are tried include Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002, (SARFESI), Recovery of Debts Due to Banks and Financial Institutions Act (RDDBFI) and Insolvency and Bankruptcy Code (IBC).
The law ministry, according to sources, observed that necessary constitutional safeguards in terms of providing hearing to the person through counsel allowing him time to file a reply, serving notice of summons to him and an appeal to the High Court have been provided for in the bill.
Also, the bill has provision for appointment of an administrator to dispose of the property to pay off the creditors. Besides, the provisions of the proposed law will override provisions of other existing laws. In the recent past, there have been instances of big-time offenders, including economic offenders, fleeing the country to escape the reach of the law.