The Union Budget is likely to decriminalise provisions in as many as five Acts administered by the Reserve Bank of India (RBI).
It is for the first time that Acts under the central bank are being discussed for decriminalisation, a government official told Moneycontrol on July 4.
“The inter-ministerial committee has reviewed the Acts. Nineteen provisions in five Acts were shortlisted for decriminalisation. Out of the 19, six may be decriminalised in the Union Budget, ” he said.
“Payment and Settlement Systems Act, the RBI Act, the FEMA Act, Banking Regulation Act and Indian Coinage Act are among the Acts under review which are administered by the central bank,” he said.
The inter-ministerial committee consists of senior officials from the finance ministry, NITI Aayog, Department for Promotion of Industry and Internal Trade (DPIIT), etc. The committee has been tasked with accelerating the identification of provisions that can be decriminalised in various laws.
What does it imply?
Decriminalising these provisions will help the government to replace many offences that involve imprisonment with just a monetary penalty to boost ease-of-doing business initiatives and save time and cost for both the government and businesses.
Modi government 2.0 had undertaken a significant effort to decriminalise various business and economic provisions to improve ease of doing business.
The Jan Vishwas Bill, which was passed in Parliament during Monsoon session 2023, decriminalised 183 provisions in 42 different laws. The Bill serves as a guiding principle for upcoming amendments in various laws.
The primary rationale behind these decriminalisation efforts is to enhance the business environment in India by reducing the compliance burden and the fear of criminal prosecution for minor or technical infractions. Overall, it represents a significant step towards improving the regulatory landscape for businesses in India, he said.
The decriminalisation of Acts administered by the RBI is likely to be a part of the next edition of the Jan Vishwas Bill, he added.
The government is also likely to decriminalise certain provisions of the Income-Tax Act. The Central Excise Act and the Central Goods and Services Tax Act are also under review, another government official had told Moneycontrol earlier.
