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Fugitive Economic Offenders Bill: Can Modi Government Catch The Next Nirav Modi?

Mr. C.S. Sudheer | Posted On Tuesday, March 06,2018, 01:16 PM

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Fugitive Economic Offenders Bill: Can Modi Government Catch The Next Nirav Modi?



The Modi Government is really serious on catching willful defaulters. Big willful defaulters are using loopholes in Indian Laws, to defraud banks of crores of rupees. Nirav Modi has defrauded Punjab National Bank of nearly Rs 12,600 Crores and escaped the long arm of the law. Now the big question is where is Nirav Modi? Is he in USA or Switzerland or Hong Kong?

The USA is not confirming if Nirav Modi is in the country. The CBI has approached Interpol to track Nirav Modi. A similar case comes to mind of a big willful defaulter, Vijay Mallya. Vijay Mallya has to repay a whopping Rs 9,000 Crores to a number of banks and has fled to London. Once abroad, willful defaulters like Vijay Mallya and Nirav Modi state their own terms.

We will not get justice in India say the willful defaulters. India's poor extradition record means, willful defaulters like Nirav Modi and Vijay Mallya can sleep easy. All they have to do is escape abroad.

Now, all this could change with the fugitive economic offenders bill. Want to know more on business loans? We at will make it easy for you. Just give us a missed call on 022 6181 6111 to explore our unique Free Advisory Service. is not a seller of any financial products. We only provide FREE financial advice / education to ensure that you are not mis-guided while buying any kind of financial products.

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Fugitive Economic Offenders Bill Will Catch Willful Defaulters

The Union Cabinet has approved the Fugitive Economic Offenders Bill 2018, with only one aim. Catch economic offenders who escape the laws of India, by remaining outside the jurisdiction of the Indian Courts.

Simply speaking, they flee to countries like the UK, where it is difficult for the Indian authorities to get them back.

1. What is the economic offenders bill?

The economic offenders bill aims to stop economic offenders who flee the country, to escape the law. These offenders escape the country, after large-scale corporate default, where banks are defrauded of Crores of Rupees.

The bill aims to seize the assets of fugitive economic offenders, once an entity has been declared a fugitive economic offender. Economic offences which involve an amount of Rs 100 Crores or more, come under the economic offenders bill.

An administrator will take care of the seized properties and dispose them to satisfy creditors claims.

See Also: What is E-way bill?

2. Who is a fugitive economic offender?

The original bill of 2017, says that an economic offender is one against whom a warrant for arrest has been issued by any court in India, with regard to a scheduled offense. An economic offender is one who:

  • Leaves or has left India to avoid criminal prosecution.
  • Refuses to return to India to face criminal prosecution.

SEE ALSO: Could The PNB Scam Have Been Prevented?

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3. What are the challenges to the economic offenders bill?

It's obvious that if there are any loopholes in the economic offenders bill, willful defaulters will make use of them.

The obvious challenges are:

1. Willful defaulters will challenge the confiscation of properties through civil courts.

2. The price of the seized properties could fall.

3. Properties would be sold without a trial.

Let's get a better understanding of the challenges the economic offenders bill faces. Clarification is needed on a blanket ban (a complete ban) on willful defaulters, chasing their assets through Civil Courts. If a blanket ban is imposed, it could be against the spirit of justice and fair play.

Another challenge is the selling of the properties of a willful defaulter without a trial. A willful defaulter is presumed innocent, until proven guilty.

An even bigger challenge is the properties of a willful defaulter would become distressed assets. Finding a buyer for distressed assets is quite difficult. Take the case of the Sahara Amby Valley, which has yet to find a buyer, even a year after being put on sale.

A time limit must be provided for the disposal/encashment of the property. Separate limits for movable/immovable properties and the running business needs to be set. A property which could lose value over time, must be disposed off quickly. Be Wise, Get Rich.

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