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Cheque Bouncing And Other Financial Offences To Be Decriminalised
In Budget 2020, the finance minsiter Nirmala Sitharaman had notified the intent of the centre of decriminalizing various laws and accordingly measures in the direction have been carried out for classifying them as civil.
Also, the minister reiterated the centre's will in the latest Aatmanirbhar package announcement.
This classification of offences is being considered primarily in financial sector where offences such as cheque bouncing etc. may now be put into civil offences category.
This is so as to improve ease of business as well as to reduce the court work. And these offences shall now be addressed by having to pay monetary penalty and no jail or other such implication.
And for the same, the DoFS or Department of Financial Services has been comments from the public for decriminalizing 39 sections in 19 Acts which are parts of its administrative domain such as the the Banking Regulation Act, the Reserve Bank of India (RBI) Act, the Insurance Act and the Negotiable Instruments Act.
"Criminalising procedural lapses and minor non-compliances increases burden on businesses and it is essential that one should re-look at provisions which are merely procedural in nature and do not impact national security or public interest at large," the DFS said in the statement of reasons explaining the rationale behind the proposed move.
In the current scenario, cheque bounce can attract a jail term of up to 2 years or a monetary penalty of 2 times the bounce chequed value or both as per the Negotiable Instruments Act. Also, public deposits being used to violated Section 3 of the Banning of Unregulated Deposit Schemes Act as well as under some sections of the RBI Act is also being considered for decriminalization.
And such hurdles deter businesses and investments by both domestic and foreign investor and easing business functioning becomes all the more crucial amid the outbreak of Covid 19.
The classification however shall be based on the premise such that it instills confidence among businesses and investors whose focus shifts to growth while maintaining public interest and protecting national security.
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