taxation for indian BFSI_PPT_2501_24.pptx

Banking, Financial Services & Insurance Board
Deciphering the impact of the three
new laws on BFSI Industry
25th January 2024
CMA Guruprasad V
ACMA ACA ACS CMA FIPA FFA
This PPT is for educational purposes only and not a professional advice. Neither ICMAI nor the Presenter is responsible and the provisions
of the Act may get amended from time to time. The reader of this PPT will have to take appropriate legal and professional advice.

Learning Objectives
Upon Completing this session, you will be able to:
 Decipher the Impact on BFSI of the three new laws:
Bharatiya Nyaya Sanhita, 2023 (New Penal Code)
Bharatiya Nagarik Suraksha Sanhita, 2023 (“BNSS”) (New Code of Criminal Procedure)
Bharatiya Sakshya Bill, 2023 (New Evidence Act)

Introduction
Three new laws
The Government of India on August 11, 2023 introduced:
Bharatiya Nyaya Sanhita, 2023 (New Penal Code)
Bharatiya Sakshya Bill, 2023 (New Evidence Act) and
Bharatiya Nagarik Suraksha Sanhita, 2023 (“BNSS”) (New Code of Criminal
Procedure)
in the Lok Sabha with the stated objective of repealing, 19th century
colonial-era criminal laws, and as a mark of 75 years of Independence

Timeline to implement
The Lok Sabha passed the bill on December 20, 2023 and the Rajya Sabha passed the
bill on December 21, 2023.
The Bharatiya Nyaya Sanhita (BNS), which replaces the Indian Penal Code, 1860;
The Bharatiya Sakshya Adhiniya (BSA), which replaces the Indian Evidence Act, 1872;
and
The Bharatiya Nagarik Suraksha Sanhita (BNSS), which replaces the Code of Criminal
Procedure, 1898
were notified in the Gazette of India on December 25, 2023.
The date to implement the three laws that were passed by the Parliament in
December 2023 yet to be Notified.

Bharathiya Nyaya Sanhita - IPC
Objective
The Bharatiya Nyaya Sanhita,2023 (hereinafter BNS) is an Act to consolidate
and amend the provisions relating to offences and for matters connected
therewith or incidental thereto has been given assent by the President of
India on 25th December 2023.
It shall come into force on such date as the Central Government may by
notification in the Official Gazette appoint.

BNS - IPC
Key changes in BNS
Document has been redefined in Section 2(8) in the BNS by including
“electronic and digital record”.
“Document” means any matter expressed or described upon any substance
by means of letters, figures or marks, or by more than one of those means,
and includes electronic and digital record, intended to be used, or which
may be used, as evidence of that matter.
Computerisation and digitalisation by the BFSI industry is a core activity.
Inclusive definition has made a significant change and
hence adequate care has to be taken by the industry while maintaining and
retaining the Documents.

BNS - IPC
Key changes in BNS
New Definition of Economic Offence
(Clause (iii) of Explanation to Section 111(1)
Economic offence includes
criminal breach of trust,
forgery, counterfeiting of currency-notes, bank-notes and Government stamps, hawala
transaction,
mass-marketing fraud or running any scheme to defraud several persons or
doing any act in any manner with a view to defraud any bank or financial institution or
any other institution or organisation f
or obtaining monetary benefits in any form.

BNS - IPC
Key changes in BNS
Organised Crime and Economic Offence has been defined in the BNS for the first time.
As per Section 111 of the BNS,
Any continuing unlawful activity including
kidnapping, robbery, vehicle theft, extortion, land grabbing, contract killing, economic offence,
cyber-crimes,
trafficking of persons, drugs, weapons or illicit goods or services,
human trafficking for prostitution or ransom,
by any person or a group of persons acting in concert, singly or jointly,
either as a member of an organised crime syndicate or on behalf of such syndicate, by use of
violence, threat of violence, intimidation, coercion, or by any other unlawful means to obtain
direct or indirect material benefit including a financial benefit, shall constitute organised crime.

BNS - IPC
Key changes in BNS
Explanation — For the purposes of this sub-section ––
(i) “organised crime syndicate” means a group of two or more persons who, acting either singly
or jointly, as a syndicate or gang indulge in any continuing unlawful activity;
(ii) “continuing unlawful activity” means an activity prohibited by law which is a cognizable
offence punishable with imprisonment of three years or more, undertaken by any person,
either singly or jointly, as a member of an organised crime syndicate or
on behalf of such syndicate in respect of which more than one charge-sheets have been filed
before a competent Court
within the preceding period of ten years and
that Court has taken cognizance of such offence, and
includes economic offence;

BNS - IPC
Punishment for those committing organised crime -Section 111(2)
Whoever commits organised crime shall, if such offence other than causing the
death of any person, be punished with
imprisonment for a term which shall not be less than five years
but which may extend to imprisonment for life, and
shall also be liable to fine which shall not be less than five lakh rupees.

BNS - IPC
Punishment for those committing organised crime -Section 111(2)
Whoever abets,
attempts,
conspires or
knowingly facilitates the commission of an organised crime, or
otherwise engages in any act preparatory to an organised crime,
shall be punished with imprisonment for a term which shall not be
less than five years but which may extend to imprisonment for life, and

BNS - IPC
Any person who is a member of an organised crime syndicate shall be
punished with imprisonment for a term which shall not be less than five years
but
which may extend to imprisonment for life, and
Whoever, intentionally, harbours or conceals any person who has committed the
offence of an organised crime shall be punished with
imprisonment for a term which shall not be less than three years but
which may extend to imprisonment for life, and

BNS - IPC
Whoever possesses any property derived or obtained from the commission of
an organised crime or proceeds of any organised crime or
which has been acquired through the organised crime,
shall be punishable with imprisonment for a term which shall not be less than
three years but
which may extend to imprisonment for life and
shall also be liable to fine which shall not be less than two lakh rupees.

BNS - IPC
If any person on behalf of a member of an organised crime syndicate is, or
at any time has been in possession of movable or immovable property which he
cannot satisfactorily account for,
shall be punishable with imprisonment for a term which shall not be less than
three years but
which may extend to imprisonment for ten years and
shall also be liable to fine which shall not be less than one lakh rupees.

BNS - IPC
Definition of the term “Theft” expanded –
Section 303(1), 112(1) and Section 2(21)
Theft
As per Section 303 (1)
Whoever, intending to take dishonestly any movable property out of the possession
of any person without that person’s consent, moves that property in order to such
taking, is said to commit theft.
As per Section 2(21)
“movable property” includes property of every description, except land and things
attached to the earth or permanently fastened to anything which is attached to the
earth.

BNS - IPC
New Definition on Petty Organised Crime- Section 112
Whoever, being a member of a group or gang, either singly or jointly, commits any
act of theft, snatching, cheating, unauthorised selling of tickets, unauthorised betting
or gambling, selling of public examination question papers or any other similar
criminal act, is said to commit petty organised crime.
Explanation: For the purposes of this sub-section "theft" includes
trick theft, theft from vehicle, dwelling house or business premises, cargo theft, pick
pocketing, theft through card skimming, shoplifting and theft of Automated Teller
Machine.
It is to be noted that the BNS has not defined the terms trick theft, card skimming
and have to be understood as per their ordinary meaning.

BNS - IPC
As per Section 303(2)
Whoever commits theft shall be punished with imprisonment of either description for a term which
may extend to three years, or
with fine, or with both and
in case of second or subsequent conviction of any person under this section, he shall be punished
with rigorous imprisonment for a term which shall not be less than one year but
which may extend to five years and with fine:
Community Service as Punishment
Provided that in cases of theft where the value of the stolen property
is less than five thousand rupees, and a person is convicted for the first time,
shall upon return of the value of property or
restoration of the stolen property,
shall be punished with community service.

BNS - IPC
New Definition on Gaining Wrongfully and Losing Wrongfully – Section 2 (38)
A person is said to gain wrongfully when such person retains wrongfully, as well as
when such person acquires wrongfully.
A person is said to lose wrongfully when such person is wrongfully kept out of any
property, as well as when such person is wrongfully deprived of property.

BNS - IPC
CHAPTER X
OFFENCES RELATING TO COIN, CURRENCY NOTES, BANK NOTES, AND
GOVERNMENT STAMPS- Section 178 to Section 180
Counterfeiting coin, Government stamps, currency-notes or bank-notes.
The BNS has broadened the definition of Section 498A, 498B,489C,498D and 498E
of the Indian Penal Code by including counterfeiting of Coin and Government
Stamps.
Counterfeiting coin, Government stamps, currency-notes or bank-notes shall be punished with imprisonment
for life, or with imprisonment of either description for a term which may extend to ten years, and shall also
be liable to fine. [Sec 178]
Using as genuine, forged or counterfeit coin, Government stamp, currency-notes or bank-notes shall be
punished with imprisonment for life, or with imprisonment of either description for a term which may extend
to ten years, and shall also be liable to fine. [Sec 179]

BNS - IPC
Explanations of the word Coin, Counterfeiting Government Stamp and
Counterfeiting of Coin for the purpose of Chapter X have been amended and added
in the BNS as below:
“Coin” shall have the same meaning assigned to it in section 2 of the Coinage Act,
2011 and
includes metal used for the time being as money and is stamped and issued by
or under the authority of any State or Sovereign Power intended to be so used;

BNS - IPC
Possession of forged or counterfeit coin, Government stamp, currency-notes or
bank-notes and intending to use the same as genuine or that it may be used as
genuine, shall be punished
with imprisonment of either description for a term which may extend to seven years,
or with fine, or with both. [Sec 180]
Making or possessing instruments or materials for forging or counterfeiting coin,
Government stamp, currency-notes or bank-notes shall be punished with
imprisonment for life, or
with imprisonment of either description for a term which may extend to ten years,
and
shall also be liable to fine. [Sec 181]

BNS - IPC
Prohibition of fictitious stamps ( Sec.186)
(1) Whoever—
(a) makes, knowingly utters, deals in or sells any fictitious stamp, or knowingly
uses for any postal purpose any fictitious stamp; or
(b) has in his possession, without lawful excuse, any fictitious stamp; or
(c) makes or, without lawful excuse, has in his possession any die, plate, instrument or
materials for making any fictitious stamp,
shall be punished with fine which may extend to two hundred rupees.
“fictitious stamp” means any stamp
falsely purporting to be issued by Government for the purpose of denoting a rate of postage,
or
any facsimile or imitation or representation, whether on paper or otherwise,
of any stamp issued by Government for that purpose.
(Based on the experience of Telgi Stamp Scam in the State of Karnataka)

BNSS – Criminal Procedure Code
Objective
The Bharatiya Nagarik Suraksha Sanhita, 2023 (“BNSS”) (hereinafter BNS) is an
Act to consolidate and amend the law relating to Criminal Procedure and has
been given assent by the President of India on 25th December 2023.

(1) In this BNSS, unless the context otherwise
requires,—
(a) “audio-video electronic means” shall include
use of any communication device for the purposes of
video conferencing,
recording of processes of identification,
Search and seizure or evidence,
transmission of electronic communication and
for such other purposes and
by such other means as the State Government may,
by rules provide;

(i) “electronic communication” means the communication of any written, verbal,
pictorial information or video content transmitted or transferred
(whether from one person to another or from one device to another or from a
person to a device or from a device to a person) by means of an electronic device
including
a telephone,
mobile phone, or other wireless telecommunication device, or
a computer, or
audio-video player or
camera or
any other electronic device or
electronic form as may be specified by notification, by the Central Government;

ZERO FIRST INFORMATION REPORT (Zero FIR)
It is mandatory for police to register a FIR where information
regarding commission of a cognizable offence is received,
irrespective of whether it has jurisdiction or not (‘Zero FIR’).
Once the Zero FIR is registered, the concerned police station can
transfer such FIR to the police station which has jurisdiction to
investigate the case.

Summary Trial mandatory under Bharatiya Nagarik Suraksha Sanhita
(BNSS)
The monetary limits for petty thefts triable in summary trials in terms of value of
stolen property involved has been increased from ₹2000 (section 260(1) of
Criminal Procedure Code) to ₹20000.
Section 283 of BNSS makes summary trial mandatory for petty and less serious
cases.

Additional Powers for Attachment and Forfeiture of Property
Section 107 of BNSS gives Magistrate powers to attach property identified as
‘proceeds of crime’.
The Magistrate may upon an application of an investigating officer giving
reasons to believe that the property is derived from a criminal activity, pass the
following orders:
a. Direct attachment of the property found to be ‘proceeds of crime’ after
hearing all parties concerned;
b. Pass an ex parte interim order attaching property if the Magistrate is of
the opinion that issuing notice to the owner of the property for attachment will
defeat the object of the attachment or seizure; and
c. Upon determination that the property in question falls under proceed of
crime, the Magistrate will direct the District Magistrate to rateably distribute the
property amongst those who were affected by the crime.

Attachment or forfeiture of property of a proclaimed offender
Section 86 of BNSS provides that the Court, upon a written request from an
officer not below the rank of Superintendent of Police or Commissioner of
Police, can initiate the process of requesting assistance from a Court or
authority in a contracting State for attachment or forfeiture of property of
a proclaimed offender.
The intention behind this provision seems to be either to secure the
presence of fugitives or confiscate properties of fugitives who are evading
summons/investigation/trial and have properties outside the country.

As per Section 82(4) of Criminal Procedure Code as per 2005 Amendment,
someone can be declared as a ‘Proclaimed offender’ for only nineteen specified
offences under IPC namely, “302, 304, 364, 367, 382, 392, 393, 394, 395, 396, 397,
398, 399, 400, 402, 436, 449, 459 or 460”.

This led to situations when someone repeatedly evading legal processes of
summons/warrant for any other offence under general penal code of IPC or
any other special law could not be declared as a Proclaimed offender.
By removing the arbitrary list of sections, anyone accused of an offence with
more than 10 years of imprisonment or other special offences could be
declared a proclaimed offender.

Significant defaults are being committed by many loan defaulters who escape
justice by fleeing abroad.
Section 356 has been added to the BNSS which provides for a detailed
procedure for conducting a trial/inquiry in the absence of a person declared
as ‘Proclaimed offender’.

Proclaimed Offenders- Detailed Procedure to be followed
Section 356 of BNSS
Notwithstanding anything contained in this Sanhita or in any other law for the time
being in force,
when a person declared as a proclaimed offender, whether or not charged jointly,
has absconded to evade trial and there is no immediate prospect of arresting him,
it shall be deemed to operate as a waiver of the right of such person to be present
and tried in person, and
the Court shall, after recording reasons in writing, in the interest of justice,
proceed with the trial in the like manner and
with like effect as if he was present,
under this Sanhita and pronounce the judgment

Use of Electronic Mode at Stages of Investigation, Inquiry and Trial
One of the most significant features of BNSS is the introduction of electronic
communication and audio-video electronic means for various procedures
under the BNSS.
BNSS has introduced new definitions which define terms such as “audio-video
electronic” and “electronic communication”.

Use of Electronic Mode at Stages of Investigation, Inquiry and Trial
Summons to witnesses and accused can also be served by electronic
communication.
The form of electronic communication and manner of serving such summon in
electronic communication is to be provided for by the State Government by
way of rules.
Statements can also be recorded by the investigating office by way of audio-
video means.
It is also permissible for the investigating authority to supply documents, such
as the police report etc. in electronic form.
Various courts have allowed the service of summons through electronic
means including through instant messaging applications such as WhatsApp.
This now formally forms a part of the BNSS.

Search and seizure can be recorded by audio-video means including
recording of preparation of seizure list.
A search without warrant is also to be recorded by audio-video means.
The recording is required to be forwarded to the Magistrate without delay.
Section 530 of the BNSS provides that all trials, inquires and proceedings
including appellate proceedings may be held in electronic mode.

Production of Devices Containing Digital Evidence
A Court or an officer in charge of a police station can compel production of
communication devices which are likely to contain digital evidence from the
person who is in possession of such digital evidence.
This provision may give the investigating authority unrestricted use of
electronic device in complete breach of right to privacy as well as privilege.
The positive aspect of having such a provision is that the production of original
devices will ensure the genuineness of the digital evidence.
If such digital evidences have been deleted, with the aid of technology, such
evidences can be retrieved.

Search and seizure
Audio-video recording of search and seizure including preparation of the list of
all things seized.
A search without warrant is also to be recorded by audio-video means.
The recording is required to be forwarded to the Magistrate without delay.

Additional powers for attachment and forfeiture of property
BNSS seeks to provide Magistrate with powers to attach property identified
as ‘proceeds of crime’.
The powers are similar to those granted to the Directorate of Enforcement and
Adjudicating Authority under the Prevention of Money-Laundering Act, 2002
(“PMLA”), however sans any safeguards under the PMLA.
The exercise of powers granted under BNSS is not restricted to schedule of
offences but may cover all offences under the IPC.
The power includes not just tracing the property but also attaching any
equivalent of the property.

The Magistrate may do so upon an application of an investigating officer
giving reasons to believe that the property is derived or obtained from a
criminal activity or commission of offence.

The same can be done in the following circumstances:
•The magistrate may direct attachment of property found to be ‘proceeds of
crime’ after hearing all parties concerned.
•The magistrate may also pass an ex parte interim order attaching property if
the magistrate is of the opinion that issuing notice to the owner of the property
for attachment will defeat the object of the attachment or seizure.
•Once the magistrate determines that the property in question is a proceeds of
crime, it will direct the District Magistrate to rateably distribute the property
amongst those who were affected by the crime.

The Court upon a written request from a police officer (not below the rank of
Superintendent of Police or Commissioner of Police) can initiate the
process of requesting assistance from a Court or authority in a contracting
state for attachment or forfeiture of a proclaimed offender.
The intention behind this provision seems to be either to secure the
presence of fugitives or confiscate properties of fugitives who are evading
summons/investigation/trial and who have properties outside the country.
However, there is a possibility of overlap between this provision and the
Fugitive Economic Offenders Act, 2018, which also provides for requesting
contracting states for execution of order of confiscation of property of
fugitive offenders.

Time bound justice delivery system
BNSS endeavours to address delays in the process of investigation and trial for
which specific timelines have been prescribed.
•Committal proceedings shall be finished within a period of 90 days from the date
of taking cognizance and such period may be extended by a period not
exceeding 180 days;
•Accused and victim shall be supplied a copy of police report and other
documents no later than 14 days from the date of production of or appearance of
accused;

Bharatiya Sakshya Adhiniya – Evidence
Objective
The Bharatiya Sakshya Adhiniya,2023 (hereinafter BSA) is an Act to consolidate and
provide for general rules and principles of evidence for fair trial has been given
assent by the President of India on 25th December 2023.

Modernising Evidence Admissibility in Indian Legal Proceedings
The BSA pays special attention to electronic evidence, recognizing the expertise
of examiners of electronic evidence as per Section 79A of the IT Act.
This provision emphasizes the relevance of digital evidence, aligning it with the
evolving technological landscape.
Section 61, Section 62, and Section 63 deals with the admissibility of Electronic
and Digital Records.

Sections 59, 60, and 61 together establish the framework for the admissibility of
electronic records as evidence in legal proceedings.
Given these provisions, it appears that electronic evidence, as described in
Section 61, can be admitted without the need for special proof under Section 63
of BSA.

Let us Recap
Upon Completing this session, you are now able to:
 Understand the impact of few provisions of the three new laws on BFSI Industry
BFSI in view of being a critical sector of the Indian economy, the management,
employees, compliance officers, auditors have to spend considerable time, effort
and resource should reskill, upskill so that they can stay ahead of the competition
by complying with the latest laws of India as described above.

taxation for indian BFSI_PPT_2501_24.pptx

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