Lok Sabha Passes Bill to Confiscate Assets of Fugitive Tycoons

The Fugitive Economic Offenders Bill, 2018 has been passed in the Lok Sabha Thursday, which will empower authorities to attach and confiscate properties and assets of economic offenders. The bill will replace an ordinance promulgated by the government in April this year.

Speaking in the lower house, interim Finance Minister Piyush Goyal said the ordinance is the need of the hour. “Cases where the total value involved in such offences is Rs 100 crore or more, will come under its purview. Till 2014 nothing was done on this front,” he was quoted as saying by ANI.

The House later passed the legislation by a voice vote as Finance Minister Piyush Goyal said the government had brought an ordinance before introducing the bill in Parliament which reflected its “aggressiveness” in acting against black money and such offenders.

Goyal also asked why the UPA government had not brought a legislation like this.

He said the Fugitive Economic Offenders Bill 2013 gave power to the agencies to seize properties which are not only in the name of the offender but also the ones that are ‘benami’.

To opposition demand to bring the bill with retrospective effect to book offenders who have already fled, Goyal said it was not possible as the legislation was and the government “knows how to bring the accused to book”.

The law ministry had in September approved the finance ministry’s draft of Fugitive Economic Offenders Bill, 2017, and its passage into law is now being expedited as part of the Narendra Modi government’s response to the Punjab National Bank (PNB) scam.

The bill defines a fugitive economic offender as a person who has an arrest warrant issued in respect of a scheduled offence and who leaves or has left India to avoid criminal prosecution, or refuses to return to India to face criminal prosecution.

The draft bill covers a wide range of offences, including wilful loan defaults, cheating and forgery, forged or fraudulent document of electronic records, duty evasion and non-repayment of deposits, among others.

Once voted into law, the new legislation will empower investigating agencies to confiscate, and vest with themselves, any property of the absconding offenders without any encumbrances.

Also, at the discretion of any court, such person or any company where the absconder is a promoter or key managerial personnel or majority shareholder, may be “dis-entitled” from bringing forward or defending any civil claim. This could effectively take away the fugitive offenders’ rights to reclaim the assets.

The bill is expected to re-establish the rule of law as the accused will be forced to return to India and face trial for his offences. This would also help the banks and other financial institutions to achieve higher recovery from financial defaults committed by such fugitive economic offenders, improving the financial health of such institutions.