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PNB fraud accused Nirav Modi. The Fugitive Economic Offenders Bill will apply to those persons against whom an arrest warrant has been issued for a scheduled offence as well as wilful defaulters with outstanding over Rs100 crore.
PNB fraud accused Nirav Modi. The Fugitive Economic Offenders Bill will apply to those persons against whom an arrest warrant has been issued for a scheduled offence as well as wilful defaulters with outstanding over Rs100 crore.

PNB fraud fallout: Cabinet clears Fugitive Economic Offenders Bill

Fugitive Economic Offenders Bill is aimed at deterring economic offenders like jeweller Nirav Modi and Vijay Mallya from fleeing the country or not returning to face trial

New Delhi: In a move aimed at giving the government more powers to bring fugitive economic offenders to book, the Union cabinet on Thursday gave its assent to a bill that will empower the government to attach properties of such offenders, both within the country and overseas.

The Fugitive Economic Offenders Bill, 2018 will be applicable for all offences where the monetary value exceeds Rs100 crore. It will bring under its ambit all individuals eluding the Indian legal process on the date of the enactment of the law, thereby ensuring that existing fugitives are covered.

A person will be declared a fugitive economic offender if he has committed an offence (specified in the bill) and an arrest warrant has been issued by a competent court but the person has left the country to escape prosecution.

The bill seeks to give powers to the government to provisionally attach property on the issuance of an arrest warrant to ensure that fugitives are not able to sell their assets pending due process of law.

The bill will be tabled in Parliament in the upcoming second half of the budget session, finance minister Arun Jaitley said at a press briefing, expressing confidence that the bill will be passed by lawmakers at the earliest.

“We will try to make sure this is passed as expeditiously as possible. We can’t allow people to make a mockery of the law... that you first indulge in loot and then refuse to submit to the jurisdiction of the legal system. We have a very responsible Parliament," Jaitley said.

The bill was initially envisaged in Budget 2017 to bring to task wilful defaulters such as Vijay Mallya, who left India in March 2016 and is yet to return as there are ongoing cases of fraud and money laundering against him.

Although the bill has been in the works since last year, the urgency for its introduction increased after the recent Rs12,636 crore scam, perpetrated by jewellers Nirav Modi and Mehul Choksi, hit Punjab National Bank.

Mallya’s spokesperson and Choksi’s lawyer declined to comment. Calls and messages sent to the lawyer representing Modi remained unanswered until press time.

As per the provisions of the bill, the government will be able to confiscate all the assets of an offender both within and outside the country and the confiscation will not be limited to properties that are proceeds or profits of the crime. The bill also provides for confiscation of benami properties. The offender will not be able to pursue any civil cases in India, a government statement said.

Explaining the need for these provisions, Jaitley said, “We see that a new set of assets of the fugitives are discovered that are not with banks. There has to be a mechanism that we can immediately take over these assets."

For confiscation of overseas assets, the government will set up a mechanism for international cooperation.

“For attaching international assets, we need the help of overseas authorities. India will need to make appropriate arrangements with other countries to confiscate these properties. That will be the next avenue of cooperation," Jaitley said.

The bill provides for an administrator to be appointed to manage and dispose of the confiscated property.

“If at any point of time in the course of the proceeding, prior to the declaration, the alleged fugitive economic offender returns to India and submits to the appropriate jurisdictional court, proceedings under the proposed act would cease by law," the statement said, adding that all necessary constitutional safeguards in terms of providing a hearing to the person through counsel, allowing him time to file a reply, serving notice of summons to him, whether in India or abroad and appeal to the high court have been provided for.

“It is a step in the right direction. Many high net-worth individuals have left the country even when there are arrest warrants issued against them and the government has not been able to bring them to task," said Rajesh Chakrabarti, professor and vice-dean at the Jindal Global Business School.

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