AMN / New Delhi
The Union Cabinet today approved Fugitive Economic Offenders Bill 2018, Briefing media here about the cabinet decision, Finance Minister Arun Jaitley said the Bill has been brought for confiscation of assets of a fugitive, including Benami assets.
“There will also be the provision to confiscate those assets outside India but co-operation of that country will be needed,” he said.
The Bill will help in laying down measures to deter economic offenders from evading the process of Indian law by remaining outside the jurisdiction of Indian Courts.
Briefing reporters in New Delhi, Finance Minister Arun Jaitley said, the legislation will allow the government to confiscate all the assets in India, including Benami properties, after the economic offenders are declared fugitives. He said the economic offences worth 100 crore rupees or more will come under the purview of the Bill.
Mr. Jaitley said the new Bill defines the category of fugitive economic offenders against whom an arrest warrant has been issued and who have left India to avoid criminal prosecution and refuse to return to face the law. He said the Bill also incorporates the provision of dis-entitlement of the fugitive economic offender from defending any civil claims.
The Minister said the government will bring this bill in Parliament during the second part of Budget session beginning Monday.
Besides the cabinet also approved setting up of National Financial Reporting Authority (NFRA) which will act as an independent regulator for the auditing profession.
Mr Jaitley said jurisdiction of NFRA for investigation of Chartered Accountants and their firms under Section 132 of the Act would extend to listed companies and large unlisted public companies, the thresholds for which shall be provided in the Rules.
The decision aims at establishment of NFRA as an independent regulator for the auditing profession which is one of the key changes brought in by the Companies Act, 2013. The inclusion of the provision in the Act was on the specific recommendations of the Standing Committee on Finance (in its 21st report).
Impact:
The decision is expected to result in improved foreign/domestic investments, enhancement of economic growth, supporting the globalisation of business by meeting international practices, and assist in further development of audit profession.
Jurisdiction:
The jurisdiction of NFRA for investigation of Chartered Accountants and their firms under section 132 of the Act would extend to listed companies and large unlisted public companies, the thresholds for which shall be prescribed in the Rules. The Central Government can also refer such other entities for investigation where public interest would be involved.
The inherent regulatory role of ICAI as provided for in the Chartered Accountants Act, 1949 shall continue in respect of its members in general and specifically with respect to audits pertaining to private limited companies, and public unlisted companies below the threshold limit to be notified in the rules.
The Quality Review Board (QRB) will also continue quality audit in respect of private limited companies, public unlisted companies below prescribed threshold and also with respect to audit of those companies that may be delegated to QRB by NFRA. Further, ICAI shall continue to play its advisory role with respect to accounting and auditing standards and policies by making its recommendations to NFRA.
Background:
The need for establishing NFRA has arisen on account of the need felt across various jurisdictions in the world, in the wake of accounting scams, to establish independent regulators, independent from those it regulates, for enforcement of auditing standards and ensuring the quality of audits to strengthen the independence of audit firms, quality of audits and, therefore, enhance investor and public confidence in financial disclosures of companies.