The Cabinet on Thursday approved the Fugitive Economic Offenders Bill. The move comes in the wake of several alleged economic offenders like Nirav Modi and Vijay Mallya fleeing the country to avoid trial and prosecution.
The law is set to come into effect from April onwards. More importantly, it would apply with retrospective effect. In another decision, the Cabinet also stripped the powers of the Institute of Chartered Accountants of India to initiate disciplinary action against CAs and audit firms dealing with listed companies, specific companies and large unlisted firms.
The powers would now be vested with the National Financial Reporting Authority, a new regulatory authority. Finance minister Arun Jaitley told reporters that the proposed law will cover anyone avoiding the law, "whether new or old", indicating that absconders such as Mallya, who is holed up in the UK, may also face action. While the bill provides for confiscation of overseas assets too, the minister said that it will depend on the cooperation of foreign governments.
Also Read | Cabinet clears Fugitive Economic Offenders Bill
The Bill states that the properties of those fleeing the country will be confiscated in cases involving more than Rs 100 crore. A draft of the Bill was circulated in May last year seeking comments from all stakeholders.
The Bill was cleared by the Law Ministry with recommendations on reconciliation of provisions with the existing laws.
The Bill also goes on to define a fugitive economic offender as an individual against whom an arrest warrant has been issued and who has either left the country or refuses to come back to face prosecution.