Photo of Faraz Alam Sagar

Partner in the Disputes, Regulatory, Advocacy and Policy Practice at the Mumbai office of Cyril Amarchand Mangaldas. Faraz has significant experience in the areas of commercial litigation and investment dispute arbitrations. He regularly advises multinational corporations and financial institutions in a wide range of contentious disputes including investigations, litigation and regulatory enforcement proceedings in India. Faraz also has considerable expertise in telecom disputes, white-collar, forensic and corporate espionage investigations. He can be reached at faraz.sagar@cyrilshroff.com

 

The Central Government in India had introduced the Prevention of Money Laundering Act, 2002 (“PMLA”), to prevent the circulation of laundered money. The Act defines money laundering as any process or activity connected to proceeds of crime, including its concealment, possession, acquisition or use and projecting or claiming it as legitimate property. While the PMLA Act allowed for confiscation and seizure of properties obtained from the laundered money, such actions were still subject to the processes of criminal prosecution. This led to many of the persons accused of money laundering, to flee the jurisdiction of Indian courts to avoid criminal prosecution under PMLA and the consequent confiscation of the properties.

On March 12, 2018, the Indian government introduced the Fugitive Economic Offenders Bill, 2018 (“Bill/Proposed Act”), in the Lok Sabha, after receiving approval from the Cabinet, to address the issue of such economic offenders avoiding criminal prosecution. The Bill defines a ‘fugitive economic offender’ as any individual against whom a warrant for arrest in relation to economic offences, under various statutes, listed in a schedule to the Bill (“Scheduled Offence”) has been issued, on or after the enactment of this Bill, by any Indian court, and who:

  • Has left India to avoid criminal prosecution, or
  • Being abroad refuses to return to India to face criminal prosecution.

Pertinently, in 2015, the definition of proceeds of crime in the PMLA was amended to include property equivalent to proceeds of crime held outside the country.

Continue Reading Fugitive Economic Offenders Bill, 2018

The Supreme Court of India has termed the right to travel beyond the territory of India as a fundamental right guaranteed under Article 21[1] of the Constitution of India. This was most famously stated in the case of Menaka Gandhi v Union of India (Supreme Court, 1978), which had confirmed its earlier judgment in Satwant Singh Sawhney v D. Ramarathnam (1967). As a signatory to the Universal Declaration of Human Rights (1948), Indian legislation in this regard is also bound by Article 13, which guarantees people: (1) the right to freedom of movement and residence within the borders of each state; and (2) the right to leave any country, including their own, and to return to their country.

However, reasonable travel restrictions are constitutionally valid, and are enforced through the provisions of the Passports Act, 1967.[2] Recently, Governmental agencies, police authorities and courts have begun issuing these restrictions through ‘Look out Notices’ or ‘Look out Circulars’ (LOC). These communications are being issued to restrict the departure of persons from India if they are subject to an investigation by the issuing agency for a cognisable offence, or where the accused is evading arrest or the trial, or where the person is a proclaimed offender. Until the Maneka Gandhi case there were no regulatory guidelines for enforcing any travel restrictions, or for issuing LOCs.

The Regulatory History of LOCs

Even though LOCs were first officially recognised in 1979, they have recently been used, frequently, to telling effect. In 1979, the Ministry of Home Affairs (MHA) for the first time issued guidelines for issuing LOCs, followed by two more such communications:

  • A letter dated September 5, 1979 (25022/13/78-F.I) (1979 MHA Letter);
  • An office memorandum dated December 27, 2000 (25022/20/98/F.IV) (2000 Memorandum)
  • An office memorandum dated October 27, 2010 (25016/31/2010-Imm) (OM)

Continue Reading Look Out Notices: A Questionable Exercise in Power?

Image credit: Scroll.in, September 26, 2017

Sociologists know that the formation and survival of civilization is conditional upon the universal adherence to a framework of acceptable norms and guidelines of human conduct and interaction. Moses therefore set out as God’s message, the directive to love thy neighbor, (so as not to have him for dinner) and also to not covet his wife (so that he may not make a meal out of you either).

While the Commandments set out God’s message which would be enforced by the fear of being struck down by lightning or if not then ultimately burning in hell, in later times, monarchies, and subsequently the democracies of the modern day needed to impose more earthly discipline. The judicial systems of to-day enforce not the will of the King but draw their legitimacy from the constitution and enforce laws which are framed by the people’s representatives.

Over the centuries, the singular truism which is well recognized is that the guidelines or laws to be enforced, cannot be mired in time and need to evolve so as to be relevant to the prevailing social and moral context. This truism requires constant change, which like all change is disruptive. History therefore inevitably reveals turbulence and conflict as the legal framework slowly adapts in a struggle to keep pace with social evolution.

The controversy and turbulence is more pronounced and correspondingly also more visible and prone to commentary by historians, sociologists and legal scholars alike, in “common law” democracies. This is because under the common law system, the law of the land is made by the courts since it is the manner in which courts interpret statutes that creates the judicial precedents which then is the established law. A study of how judicial decisions framed or established norms and values which we treasure today and perhaps take unthinkingly for granted can be fascinating.

CAM has embarked on an analysis of a series of such landmark decisions in an attempt to present a hindsight perspective into what exactly happened, the socio-political compulsions of the day and their impact in shaping Indian society and governance today.

This is the first piece in our series entitled “Those Were the Days”, which will be published monthly. We hope you enjoy reading this as much as we have enjoyed putting this together.


The case of Kesavananda Bharati v. State of Kerala (Kesavananda Bharati)[1] is perhaps the most well-known constitutional decision of the Supreme Court of India (Supreme Court). While ruling that there is no implied limitation on the powers of Parliament to amend the Constitution, it held that no amendment can do violence to its basic structure (the “Basic Structure Doctrine”). Further, it established the Supreme Court’s right of review and, therefore, established its supremacy on constitutional matters.

Continue Reading Kesavananda Bharati v. State of Kerala and The Basic Structure Doctrine