Ministry of Finance has recently proposed decriminalisation of some economic offences under different laws and acts and has asked for public comments on the same.
Which small economic offences are proposed to be decriminalized?
As many as 36 sections under 19 different acts are proposed to be decriminalised by the Ministry of Finance. The sections proposed to be amended are as under-
- Cheque Bounce under Section 12, Insurance Act, 1938
- Section 29, SARFAESI Act, 2002
- Section 16(7) and 32(1) PFRDA Act, 2013
- Section 58B, RBI Act, 1934
- Section 26(1), 26(4), Payment and Settlement Systems Act, 2007
- Section 56(1), NABARD Act, 1981
- Section 49, NHB Act, 1987
- Section 42, State Financial Corporations Act, 1951
- Section 23, Credit Information Companies (Regulations) Act, 1951
- Section 138, Negotiable Instruments Act, 1881
- Section 4&5, Prize Chits and Money Circulation Schemes (Banning) Act, 1978
- Section 37, Actuaries Act, 2006
- Section 40, LIC Act, 1956
- Section 76, Chit Funds Act, 1982
- Section 47, DICGC Act, 1961
- Section 23, Factoring Regulation Act, 2011
- Section 36AD (2), 46, Banking Regulations Act, 1949
- Section 21, Banning of Unregulated Deposit Schemes Act, 2019
- Section 30, General Insurance Business (Nationalisation) Act, 1972
What are the reasons stated by the Ministry for such a proposal?
The Finance Ministry stated that the decision for this proposal was a part of Atmanirbhar Economic Package. It is in view of improving the ease of doing business in the country and reducing the burden on criminal courts to solve these pity matters and declutter the jails in the country. It is a further step taken by the ministry during the COVID – 19 economic crisis that would probably ease businesses nation-wide.
What impact will these changes bring?
This step would bring big relief to foreign investors who were worried about criminalised economic offences which were served as a hindrance in their way for investment in the country. However, it will badly affect the creditors who will have to wait longer to get back the money they had lend.