Ease of Doing Business reform bill headed for Parliament vote

New Delhi: A reform bill, which proposes to water down a bunch of provisions to make it easier to do business in India, is expected to be introduced during the current session of Parliament that will resume on March 13. A government official told about the development.

The Jan Vishwas Bill, which proposes to dilute provisions under 42 Acts, was introduced in Parliament in December last year but was referred to a joint committee for further examination.

“The Joint Committee has already done six readings and we expect the Bill to be introduced during the current session of Parliament. It was referred to a joint committee because never before had a bill sought to reduce so many sections in one go. Hence, a closer look at the bill could be one of the reasons why it was referred to the joint committee,” said an official from the Department for Promotion of Industry and Internal Trade (DPIIT).

As an example of how the bill can help businesses flourish, the official said it aims to do away with the system of fines, which can be time-consuming, and replace it with fines .

“The fine is imposed by a judicial system. That means you have to go to court. If we are doing away with it [fines] and replacing it with punishment, then it is in effect an administrative system. So, you open up the courts in a big way. If the penal authority is within the system, it will help businesses,” the official said.

Also, it is proposed to allow for ‘compounding’ of a large number of offenses – where an offender can pay a penalty to avoid imprisonment – notably the Motor Vehicles Act, 1988.

“For example, when there is an e-challan and a notice arrives at your home…. If you have registered your car with false information, it has been made compoundable. Earlier you could have been jailed for this,” the officer said.

The bill seeks to decriminalize 183 provisions, including half a dozen colonial-era laws such as the Indian Post Office Act, 1898, where you can be jailed for not using the correct stamp, and the Boilers Act, 1923, which sets out rules for the operation of steam boilers, important for power plants, sugar, textile, feed, auto rice mills and the pharmaceutical industry.

It is proposed to remove the provision of jail term of up to two years in three sections of the Boilers Act.

Among the 42 Acts involved in the reform process are 19 ministries, including environment, finance, road transport and highways, posts, electronics and information technology, food production and distribution, financial services and agriculture.

The Bill proposes to increase the minimum amount of the fine by 10% every three years from the enactment of the proposed Bill.

“A web of archaic rules and regulations leads to a lack of trust. Ease of Living and Ease of Doing Business reforms aim to achieve the principle of ‘Minimum Government, Maximum Governance’ by redefining the regulatory landscape of the country. It has been the endeavor of the Government…” Commerce and Industry Minister Piyush Goyal said in the ‘Statement and Objectives’ of the Bill.

According to Union Finance Minister Nirmala Sitharaman, over 34,000 provisions have already been decriminalised.