18 Bills to be introduced during Monsoon Session

The Monsoon Session of Parliament, set to begin from Wednesday, has some important Bills lined up for business.

Among the 18 Bills, that the government plans to table during the session that would last till August 10, are legislation to curb illegal deposits and amendments to definition of Micro, Small and Medium Enterprises.

The government has also prepared a list of eight Bills, which were introduced in the Lok Sabha, but not sent to the Department Related Standing Committees, that it wants to be taken up for discussions and get them passed. These include amendment to the Negotiable Instrument Act, the Consumer Protection Bill, Insolvency and Bankruptcy Code, and the Fugitive Economic Offenders Bill. Since, ordinances in relation to amendment in bankruptcy law and fugitive economic offenders have already been promulgated, the government will make all efforts to get these Bills passed during the session itself.

Meanwhile, all eyes will be on the Bill that seeks to change the Prevention of Corruption Act. Union Minister Arun Jaitley believes that the Bill, in its present form, is slowing down decision making and it is a “charter for bringing government to a standstill.” He has repeatedly urged all political parties to support amending the law, failing which he said government officials or bankers could not be blamed for delay in decision making.

The Banning of Unregulated Deposit Schemes Bill, 2018 aims for complete prohibition of unregulated deposit taking activity. The Bill has three key elements, deterrent punishment for promoting or operating an unregulated deposit taking scheme, stringent punishment for fraudulent default in repayment to depositors and designation of a competent authority by the State Government to ensure repayment of deposits in the event of default by a deposit taking establishment.

Banning clause

The Bill contains a substantive banning clause which bans deposit takers from promoting, operating, issuing advertisements or accepting deposits in any unregulated deposit scheme.

The principle is that the Bill would ban unregulated deposit taking activities altogether, by making them an offence ex-ante, rather than the existing legislative-cum-regulatory framework which only comes into effect ex-post with considerable time lags. The Bill creates three different types of offences, namely, running of unregulated deposit schemes, fraudulent default in regulated deposit schemes, and wrongful inducement in relation to unregulated deposit schemes.

The Bill provides for severe punishment and heavy pecuniary fines to act as deterrent. It has adequate provisions for disgorgement or repayment of deposits in cases where such schemes nonetheless manage to raise deposits illegally. This bill seeks to amend the definition of MSMEs on the basis of annual turnover criteria as against prevailing practice of ‘investment in plant & machinery/equipment.’

The government expects that this will encourage ease of doing business, make the norms of classification growth oriented and align them to the new tax regime revolving around GST (Goods & Services Tax).

Accordingly, a micro enterprise will be defined as a unit where the annual turnover does not exceed five crore rupees. A small enterprise will be defined as a unit where the annual turnover is more than five crore rupees but does not exceed ₹ 75 crore.

A medium enterprise will be defined as a unit where the annual turnover is more than seventy five crore rupees but does not exceed ₹250 crore. Additionally, the Central Government may, by notification, vary turnover limits, which shall not exceed thrice the limits specified.

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