Centre proposes– decriminalisation of minor offences for improving business sentiment and unclogging Court processes; Stakeholders suggestions invited

Decriminalisation of minor offences is one of the thrust areas of the Government. The risk of imprisonment for actions or omissions that aren’t necessarily fraudulent or the outcome of malafide intent is a big hurdle in attracting investments. The ensuing uncertainty in legal processes and the time taken for resolution in the courts hurts ease of doing business.

Criminal penalties including imprisonment for minor offences act as deterrents, and this is perceived as one of the major reasons impacting business sentiment and hindering investments both from domestic and foreign investors. This becomes even more pertinent in the post COVID19 response strategy to help revive the economic growth and improve the justice system.

Given the nature of pendency in all tiers of the courts and the time taken for disputes to be resolved, legislative measures have been considered to help restore trust in doing business. In this pursuit, it is also important that a balance be found so that malafide intent is punished while other less serious offences are compounded.

Accordingly, a framework is required such that a penalty levied is sufficient to act as a deterrent. Actions taken for decriminalisation of minor offences are expected to go a long way in improving ease of doing business and helping unclog the court system and prisons. It would also be a significant step in the Government of India’s objective of achieving ‘Sabka Saath, Sabka Vikas and Sabka Vishwas‘.

Criminalizing 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 following principles should be kept in mind when deciding on reclassification of criminal offences to compoundable offences: (i) Decrease the burden on businesses and inspire confidence amongst investors; (ii) Focus on economic growth, public interest and national security should remain paramount; (iii) Mens rea (malafide/ criminal intent) plays an important role in imposition of criminal liability, therefore, it is critical to evaluate nature of non-compliance, i.e. fraud as compared to negligence or inadvertent omission; and (iv) The habitual nature of non-compliance.

Stakeholders may kindly propose and submit their comments/ suggestions regarding decriminalisation of a particular Act or particular Sections of an Act, along with the rationale for the same. Comments/ suggestions may kindly be submitted to the Department at the email address bo2@nic.in within 15 days, i.e., by 23rd June, 2020.

Statement of Reason


Ministry of Finance

[Dt. 08-06-2020]

5 comments

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    please don’t make changes in section 138. Anyone who giving fake cheques after making changes in the act or in the case filing in the criteria of criminal offence is important . If criminal offence case is not filled or bail is implimented then the number of offence is increased. this is not good for the society and law and order.

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    I am against decriminalization of cheque bounce cases. Only because these cases are criminal due to threat of punishment, warrant etc. recovery is made at first sight. If it is decriminalized then there will not be any check on recovery of money. It will be very difficult to recover amount to mass at large. More than 30 percent advocates are dealing with cheque bounce case. Dicriminaluzation will hurdle all these advocates also. Please consider.

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    No decriminalisation of Sec 138 of NIA.

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    Decriminalization of Sec 138, will dilute the impact of Law, almost in every district court every year ppl. Filing complains around 70000 to one lac, and the funds get stuck, atleast bcz of imprisonment fear many compliments are settling at first appearance at the court, I am against this. Gov. Should bring strong Law so that people shall fear of it before committing the offence. I don’t agree with the Government actions.

    • Avatar

      I apposed this bill
      Decriminalization of Sec 138
      Government increase criminal activity in India.
      It should be more hard than present act.

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