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The recently passed Jan Vishwas (Amendment of Provisions) Act, 2023 has marked a significant step towards creating a more business-friendly environment. It will lay the foundation for improving the Ease of Doing Business in India. It seeks to reduce compliance and remove the fear of imprisonment for minor offences, to give an impetus to businesses and improve ease of doing business and living, thus bolstering ‘trust-based governance’.
The Act amends 42 Acts such as the Indian Post Office Act, 1898, the Environment (Protection) Act, 1986, the Public Liability Insurance Act, 1991, the Information Technology Act, 2000, the Indian Forest Act, 1927, the Patents Act, 1970, etc.
What are the features of the Jan Vishwas Act, 2023?
1) Decriminalization of Offences: It decriminalizes minor offences (that do not involve any harm to the public interest or national security) and replaces them with civil penalties or administrative actions. 183 provisions are being decriminalized in 42 Central Acts.
For example, under the IT Act, 2000, disclosing personal information in breach of a lawful contract is now punishable with a penalty of up to Rs 25 lakh instead of imprisonment of up to three years.
2) Removal of offences: The Bill fully removes certain offences. These include all offences under the Indian Post Office Act, 1898.
3) Periodic Revision of Penalties: The fines and penalties will be increased by 10% of the minimum amount every 3 years.
4) Adjudicating Officers: The Government may appoint one or more Adjudicating Officers to determine penalties.
Note: An adjudication mechanism is one whereby an administrative or quasi-judicial authority imposes a monetary penalty.
5) Appellate Mechanisms: An appellate mechanism is introduced for grievance redressal regarding the decision of the adjudicating officer.
What was the need of the Jan Vishwas Act, 2023?
1) Bureaucratic Hurdles: The legislation, rules and regulations enacted by the Union and State governments have created barriers to the smooth flow of ideas, money, and entrepreneurship. For instance, according to ORF, a manufacturing sector enterprise with more than 150 employees deals with 500–900 compliances a year that cost nearly Rs 12–18 lakh. It also found that 37.8% of compliances carry imprisonment clauses.
2) Barrier to Investments: A Parliamentary committee noted that regulatory burden poses substantial deterrents for investors.
For instance, lengthy processing times for the needed approvals can escalate costs and dampen investments
3) Pressure on the Justice System: As per the National Judicial Data Grid, 3.3 crore cases out of the 4.4 crore pending cases are criminal proceedings.
4) Presence of Outdated Laws: The bureaucratic system still consists of the baggage of archaic and obsolete laws. These lead to a trust deficit between the people and government institutions.
5) MSMEs: There are excessive business regulations in place that lead to unnecessary red tape. For instance, currently, there are 1,536 laws which translate into around 70,000 compliances that govern doing business in India. These excessive compliances have proved a burden on MSMEs.
What are the benefits of the Jan Vishwas Act, 2023?
The benefits of the Act are outlined as under:
1) Rationalises Criminal Provisions: Rationalizing criminal provisions will ensure that people are not dragged to court for minor, technical or procedural defaults, or unintended violations.
2) Maintains Proportionality: It establishes a balance between the severity of the offence/violation committed and the prescribed punishment.
3) Economic Growth: The elimination of bureaucratic barriers will help in bolstering growth of businesses. The amendments in various laws will save time and cost for both Government and Businesses alike.
4) Reduces Pressure on the Justice System: The criminal proceedings for minor crimes clog the justice delivery system, leading to delays in the proceedings of serious offences as well. Provisions such as decriminalisation would go a long way in reducing undue pressure on the justice system.
5) Improve the Health of MSMEs: The Act lightens the regulatory frameworks and lessens the burden on MSMEs. This would provide them with a more level playing field in comparison to their global counterparts.
6) Trust-Based Governance: It will foster trust-based governance by ensuring that citizens, businesses, and government departments operate without fear of imprisonment.
What are the concerns regarding the Jan Vishwas Act, 2023?
1) Not Real Decriminalization: It replaces imprisonment with fines or penalties, which is not enough for decriminalization. It undertakes what can be called as ‘quasi-decriminalisation.’
2) Expertise of Adjudicating officers: Concerns have been raised about the appointment of adjudicating officers under the Air (Prevention and Control of Pollution) Act and the Environment (Protection) Act, questioning their technical competence for such legal proceedings.
3) Only a Fraction of Laws Touched: The number of offences deregulated under the Act are only a small fraction of India’s regulatory framework. As per the ORF, of the 42 Acts of Parliament mentioned, only 23 Acts impact the ease of doing business, which is a tiny fraction.
4) Issues with respect to Environment Protection: According to the Vidhi Centre for Legal Policy, the blanket removal of imprisonment provision might also remove the deterrence effect of the environmental legislation, especially for large corporations.
5) Issues with respect to Privacy: The Act punishes officers of post offices for the illegal opening of postal articles with imprisonment of up to two years, a fine, or both. Deleting these offences removes the safeguards against invasions of privacy.
6) Independence of Adjudicating Officers: At times, government agencies violate the Air Act and the EP Act. This raises the question, whether government officers would be sufficiently independent as adjudicating authorities in such cases.
Way Forward:
1) Reassess and Strengthen Decriminalization Efforts: Conduct a thorough review to ensure genuine decriminalization by replacing imprisonment with more rehabilitative measures, community service, or other alternatives that address the core issues without resorting to punitive measures.
2) Ensure Expertise of Adjudicating Officers: Institute a transparent and merit-based appointment process for adjudicating officers under the Air (Prevention and Control of Pollution) Act and the Environment (Protection) Act.
3) Ensuring Independence of Adjudicating Officers: Implement safeguards, such as an independent oversight body, to monitor and address potential conflicts of interest, ensuring fair and impartial adjudication.
4) Public Consultation and Feedback Mechanism: Foster a transparent and inclusive legislative process by involving the public, environmental experts, and stakeholders in discussions related to legislative changes.
By adopting these measures, it is possible to address the concerns raised and create a legal framework that not only promotes ease of doing business but also upholds environmental protection, privacy rights, and the integrity of legal proceedings.
