Decriminalization of Financial Offences: A Move in the Right Direction?

As per the data available on the website of National Judicial Data Grid as on June 23, 2020, total number of cases pending in India are 3,29,08,887 out of which pending criminal cases are 2,37,67,564 (around 72%) and pending civil cases are 91,41,323 (around 27%). As is clearly reflected from the numbers, pending criminal cases are far higher in numbers than the civil cases. Keeping the backlog of cases as one of the main factors, the Government is seeking to decriminalize 39 sections under 19 statues dealing with financial matters, by making them compoundable and has issued a consultation paper dated June 8, 2020 for public comments. Amongst 19 statutes are the legislations ranging from the Negotiable Instruments Act, 1881, RBI Act, 1934, Insurance Act, 1938, Banking Regulation Act, 1949, Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (“SARFAESI Act”), Credit Information Companies (Regulation) Act, 2005, Payment and Settlement Systems Act, 2007, Banning of Unregulated Deposit Schemes Act, 2019.

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