The Union government on February 1, 2018 proposed changes to various provisions of the Prevention of Money Laundering Act (PMLA), 2002 through the Finance Bill. The amendments are expected to make the implementation of PMLA more effective.
One of the key amendments empowers the Special Court to restore confiscated assets to the rightful claimants even during the trial.
Amendments to Prevention of Money Laundering Act, 2002
Amendment in definition of 'proceeds of crime': The amended definition of "proceeds of crime" allows the Enforcement Directorate (ED) to proceed against assets of equivalent value located even outside the country.
Amendment in bail provisions: Section 45(1) of the Act has been amended in a move to de-link PMLA proceedings from those involved in scheduled offences pursued by other agencies. It proposes uniform applicability of bail conditions, instead of only those offences under the schedule which are liable to imprisonment of more than 3 years.
A further limit of Rs 1 crore will allow the court to apply bail provisions more leniently to less serious PMLA cases.
This amendment came after the Supreme Court recently struck down the previous provisions which could deny bail even when there were sound grounds to believe that a person was not involved in money laundering.
Inclusion of Section 447 of the Companies Act in the list of scheduled offences under PMLA: Section 447 of Companies Act is being included as scheduled offence under PMLA so that Registrar of Companies in suitable cases would be able to report corporate frauds cases for action by Enforcement Directorate.
Amendment to Section 8(8) of the PMLA, 2002: It allows the Special Court, if it deems fit, to consider the claims for the purposes of restoration of confiscated assets also during the trial. Earlier, the assets could be restored only after completion of the trial.
ED to share relevant details with other agencies: Sub-Section (2) has been introduced in Section 66 of the Act, making it mandatory for the Enforcement Directorate (ED) to share information relating to contraventions of other laws with other agencies. This shall enable exchange of information among agencies and enhance effectiveness of efforts against black money.
Amendment to Section 5(1) of the Act: Section 5(1) of the Act provides that every order of provisional attachment passed by ED shall cease to have effect after 180 days from the date of the provisional attachment order. This section has been amended to exclude the period of court stay from 180-day limit and also provides for a further period of 30 days to take care of delays in communication of judicial orders.
90 more days to ED to file charge sheets: The proposed Section 8(3) of the Act gives 90 more days to the ED to file charge sheets, after confirmation of attachment orders by the adjudicating authority. The existing provision does not allow even a single day after the orders are confirmed.
Union Budget 2018: Financial Sector
Who: Union Government
When: 1 February 2018