Black money: Government amends FEMA for stricter punishment

NEW DELHI: Tightening the noose on Indians holding black money abroad, the government today provided for confiscation of domestic property of offenders and punishment of up to five years under the Foreign Exchange Management Act.

The changes to this affect have been made by Finance Minister Arun Jaitley in the Finance Bill, 2015 passed by Lok Sabha today. It will now be taken up by the Rajya Sabha.

As per a new clause inserted in FEMA, a person having assets abroad in contravention of law, "shall be liable to a penalty up to three times the sum involved...and confiscation of the value equivalent, situated in India, of the foreign exchange, foreign security or immovable property".

It is also stipulated that in addition to the penalty, the offence will be "punishable with imprisonment for a term which extend to five years and with fine".

The new provision also says Enforcement Directorate can authorise prosecution of the offenders after recording reasons in writing.

The government has also introduced a stringent Bill in the Lok Sabha to deal with the menace of black money stashed abroad. Besides other things, the law provides for imprisonment of up to ten years for hiding foreign assets.

Jaitley said the new law is to deal with the black money issue stashed abroad and not to harass anyone.

The government will also provide a "compliance window" for persons with overseas assets to come clean.