THE SMUGGLERS AND FOREIGN EXCHANGE MANIPULATORS (FORFEITURE OF PROPERTY ACT, 1976)

0
90

An Act to provide for the forfeiture of illegally acquired properties of smugglers and foreign exchange manipulators and for matters connected therewith or incidental thereto.

WHEREAS for the effective prevention of smuggling activities and foreign exchange manipulations which are having a deleterious effect on the national economy it is necessary to deprive persons engaged in such activities and manipulations of their ill-gotten gains;

AND WHEREAS such persons have been augmenting such gains by violations of wealth-tax, income-tax or other laws or by other means and have thereby been increasing their resources for operating in a clandestine manner;

AND WHEREAS such persons have in many cases been holding the pro-
perties acquired by them through such gains in the names of their relatives, associates and confidants ;

BE it enacted by Parliament in the Twenty-sixth Year of the
Republic of India as follows:-

1.Short title, extent and commencement.

1. Short title, extent and commencement. (1) This Act may be called the Smugglers and Foreign Exchange Manipulators (Forfeiture of
Property) Act, 1976.(2) It extends to the whole of India except the State of Jammu and Kashmir.

(3) It shall be deemed to have come into force on the 5th day of
November, 1975.
2.Application.

2.Application.(1) The provisions of this Act shall apply only to the persons specified in sub-section (2).

(2) The persons referred to in sub-section (1) are the following, namely: –

(a) every person-

(i) who has been convicted under the Sea Customs Act,
1878 (8 of 1878), or the Customs Act, 1962 (52 of 1962), of an offence in relation to goods of a value exceeding one lakh of rupees ; or

(ii) who has been convicted under the Foreign Exchange
Regulation Act, 1947 ( 7 of 1947), or the Foreign Exchange
Regulation Act,

1104.1973 (46 of 1973), of an offence, the amount or value involved in which exceeds one lakh of rupees; or

(iii) who having been convicted under the Sea Customs Act,
1878 (8 of 1878), or the Customs Act, 1962 (52 of 1962), has been convicted subsequently under either of those Acts ; or

(iv) who having been convicted under the Foreign Exchange
Regulation Act, 1947 (7 of 1947), or the Foreign Exchange
Regulation Act, 1973 (46 of 1973), has been convicted subsequently under either of those Acts ;

(b) every person in respect of whom an order of detention has been made under the Conservation of Foreign Exchange and
Prevention of Smuggling Activities Act, 1974 (52 of 1974)

Provided that-

(i) such order of detention, being an order to which the provisions of section 9 or section 12A of the said Act do not apply, has not been revoked on the report of the Advisory
Board under section 8 of the said Act or before the receipt of the report of the Advisory Board or before making a reference to the Advisory Board; or

(ii) such order of detention, being an order to which the provisions of section 9 of the said Act apply, has not been revoked before the expiry of the time for, or on the basis of, the review under sub-section (3)of section 9, or on the report of the Advisory Board under section 8, read with sub-
section (2) of section 9, of the said Act ; or

(iii)such order of detention, being an order to which, the provisions of section 12A of the said Act apply, has not been revoked before the expiry of the time for, or on the basis of, the first review under sub-section (3) of that section, or on the basis of the report of the Advisory Board under section 8, read with sub-section (6) of section 12A, of that
Act ; or

(iv) such order of detention has not been set aside by a court of competent jurisdiction ;

(c) every person who is a relative of a person referred to in clause (a) or clause (b) ;

(d) every associate of a person referred to in clause (a)
or clause (b)

(e) any holder (hereafter in this clause referred to as the present holder) of any property which was at any time previously held by a person referred to in clause (a) or clause (b) unless the present holder or, as the case may be, any one who held

1105.such property after such person and before the present holder, is or was a transferee in good faith for adequate consideration.

Explanation 1.-For the purposes of sub-clause (i) of clause (a), the value of any goods in relation to which a person has been convicted of an offence shall be the wholesale price of the goods in the ordinary course of trade in India as on the date of the commission of the offence.

Explanation 2.–For the purposes of clause (c), “relative”, in relation to a person, means-

(i) spouse of the person;

(ii) brother or sister of the person;

(iii) brother or sister of the spouse of the person;

(iv) any lineal ascendant or descendant of the person;

(v) any lineal ascendant or descendant of the spouse of the person;

(vi) spouse of a person referred to in clause (ii), clause
(iii), clause (iv) or clause (v)

(vii) any lineal descendant of a person referred to in clause
(ii) or clause (iii).

Explanation 3.-For the purposes of clause (d), “associate”, in relation to a person, means-

(i) any individual who had been or is residing in the residential premises (including outhouses) of such person;

(ii) any individual who had been or is managing the affairs or keeping the accounts of such person;

(iii) any association of persons, body of individuals, partnership firm, or private company within the meaning of the Companies Act, 1956 ( 1 of 1956), of which such person had been or is a member, partner or director;

(iv) any individual who had been or is a member, partner or director of an association of persons, body of individuals, partnership firm or private company referred to in clause
(iii)at any time when such person had been or is a member, partner or director of such association, body, partnership firm or private company;

(v) any person who had been or is managing the affairs, or keeping the accounts, of any association of persons, body of

1106.individuals, partnership firm or private company referred to in clause (iii)

(vi) the trustee of any trust, where-

(a) the trust has been created by such person; or

(b) the value of the assets contributed by such person
(including the value of the assets, if any, contributed by him earlier) to the trust amounts, on the date on which the contribution is made, to not less than twenty per cent. of the value of the assets of the trust on that date ;

(vii) where the competent authority, for reasons to be recorded in writing, considers that any properties of such person are held on his behalf by any other person, such other person.

Explanation 4.-For the avoidance of doubt, it is hereby provided that the question whether any person is a person to whom the provisions of this Act apply may be determined with reference to any facts, circumstances or events (including any conviction or detention)
which occurred or took place before the commencement of this Act.

2A

Act not to apply to certain persons. Act not to apply to certain persons. 1[2A.On and from thecommencement of the provisions of Chapter VA of the Narcotic Drugs andPsychotropic Substance

3.Definitions.

3.Definitions. (1) In this Act, unless the context otherwise requires-

(a) “Appellate Tribunal” means the Appellate Tribunal for
Forfeited Property constituted under section 12 ;

(b) “competent authority” means an officer of the Central
Government authorised by it under sub-section (1) of section
5 to perform the functions of a competent authority under this Act;

(c) “illegally acquired property”, in relation to any person to whom this Act applies, means-

(i) any property acquired by such person, whether before or after the commencement of this Act, wholly or partly out of or by means of any income, earnings or assets derived or obtained from or attributable to any activity prohibited by or under any law for the time being in force relating to any matter in respect of which Parliament has power to make laws;
or

(ii) any property acquired by such person, whether before or after the commencement of this Act, wholly or partly out of or by means of any income, earnings or assets in respect of which any such law has been contravened; or

———————————————————————
1. Ins. by Act 2 of 1989, s.22 (w.e.f. 29-05-1989).
———————————————————————

1106A

(iii) any property acquired by such person, whether before or after the commencement of this Act, wholly or partly out of or by means of any income, earnings or assets the source of which cannot be proved and which cannot be shown to be attributable to any act or thing done in respect of any matter in relation to which Parliament has no power to make laws; or

(iv) any property acquired by such person, whether before or after the commencement of this Act, for a consideration,

1107.or by any means, wholly or partly traceable to any property referred to in sub-clauses (i) to (iii) or the income or earnings from such property;

and includes-

(A) any property held by such person which would have been, in relation to any previous holder thereof, illegally ac-
quired property under this clause if such previous holder had not ceased to hold it, unless such person or any other person who held the property at any time after such previous holder or, where there are two or more such previous holders, the last of such previous holders is or was a transferee in good faith for adequate consideration;

(B) any property acquired by such person, whether before or after the commencement of this Act, for a consideration, or by any means, wholly or partly traceable to any property falling under item (A), or the income or earnings therefrom;

(d) “prescribed” means prescribed by rules made under this
Act;
(e) “property” includes any interest in property, movable or immovable;

(f) “trust” includes any other legal obligation.

(2) Any reference in this Act to any law which is not in force in any area shall, in relation to that area, be construed as a reference to the corresponding law, if any, in force in that area.

(3) Any reference in this Act to any officer or authority shall, in relation to any area in which there is no officer or authority with the same designation, be construed as a reference to such officer or authority as may be specified by the Central Government by notification in the Official Gazette.

4.Prohibition of holding illegally acquired property.

4.Prohibition of holding illegally acquired property. (1) As from the commencement of this Act, it shall not be lawful for any person to whom this Act applies to hold any illegally acquired property either by himself or through any other person on his behalf.

(2) Where any person holds any illegally acquired property in contravention of the provisions of sub-section (1), such property shall be liable to be forfeited to the Central Government in accordance with the provisions of this Act.

5.Competent authority.

5.Competent authority. (1) The Central Government may, by order published in the Official Gazette, authorise as many officers of the
Central Government (not below the rank of a Joint Secretary to the
Government), as it thinks fit, to Perform the functions of the competent authority under this Act.

1108.(2) The competent authorities shall perform their functions in respect of such persons or classes of persons as the Central
Government may, by order, direct.

6.Notice of forfeiture.

6. Notice of forfeiture. (1) If, having regard to the value of the properties held by any person to whom this Act applies, either by himself or through any other person on his behalf, his known sources of income, earnings or assets, and any other information or material available to it as a result of action taken under section 18.or otherwise, the competent authority has reason to believe (the reasons for such belief to be recorded in writting) that all or any of such properties are illegally acquired properties. it may serve a notice upon such person (hereinafter referred to as the person affected) calling upon him within such time as may be specified in the notice, which shall not be ordinarily less than thirty days, to indicate the sources of his income, earnings or assets, out of which or by means of which he has acquired such property, the evidence on which he relies and other relevant information and particulars, and to show cause why all or any of such properties, as the case may be, should not be declared to be illegally acquired properties and forfeited to the Central Government under this Act.

(2) Where a notice under sub-section (1) to any specifies any property as being held on behalf of such person by any other person. a copy of the notice shall also be served upon such other person.

7.Forfeiture of property in certain cases.

7.Forfeiture of property in certain cases. (1) The competent authority may, after considering the explanation, if any, to the show-
cause notice issued under section 6, and the materials available before it and after giving to the person affected (and in a case where the person affected holds any property specified in the notice through any other person, to such other person also) a reasonable opportunity of being heard, by order, record a finding whether all or any of the properties in question are illegally acquired properties.

(2) Where the competent authority is satisfied that some of the properties referred to in the show-cause notice are illegally acquired properties but is not able to identify specifically such properties then, it shall be lawful for the competent authority to specify the. properties which, to the best of its judgment, are illegally acquired properties and record a finding accordingly under sub-section (1).

(3) Where the competent authority records a finding under this section to the effect that any property is illegally acquired property, it shall declare that such property shall, subject to the provisions of this Act, stand forfeited to the Central Government free from all encumbrances.

(4) where any shares in a company stand forfeited to the Central
Government under this Act, then, the company shall, notwithstanding anything contained in the Companies Act, 1956 (1 of 1956), or the art-
icles of asso-

1109.ciation of the company, forthwith register the Central Government as the transferee of such shares.

8.Burden of proof.

8.Burden of proof. In any proceedings under this Act, the burden of proving that any property specified in the notice served under section 6 is not illegally acquired property shall be on the person affected.

9.Fine in lieu of forfeiture.

9.Fine in lieu of forfeiture. (1) Where the competent authority makes a declaration that any property stands forfeited to the Central
Government under section 7 and it is a case where the source of only a part, being less than one-half of the income, earnings or assets with which such property was acquired has not been proved to the satisfaction of the competent authority, it shall make an order giving an option to the person affected to pay, in lieu of forfeiture, a fine equal to one and one-fifth times the value of such part.

Explanation.-For the purposes of this sub-section, the value of any part of income, earnings or assets, with which any property has been acquired, shall be,-

(a) in the case of any part of income or earnings, the amount of such part of income or earnings;

(b) in the case of any part of assets, the proportionate part of the full value of the consideration for the acquistion of such assets.

(2) Before making an order imposing a fine under sub-section
(1), the per-son affected shall be given a reasonable opportunity of being heard,

(3) Where the person affected pays the fine due under sub-
section (1), within such time as may be allowed in that behalf, the competent authority may, by order, revoke the declaration of forfeiture under section 7 and thereupon such property shall stand released.

10.Procedure in relation to certain trust properties.

10.Procedure in relation to certain trust properties. In the case of any person referred to in clause (vi) of Explanation 3 to sub-
section (2) of section 2, if the competent authority, on the the basis of the information and materials available to it, has reason to believe (the reason for such belief to be recorded in writing) that any property held in trust in illegally acquired property, it may serve a notice upon the author of the trust or, as the case may be, the contributor of the assets out of or by means of which such property was acquired by the trust and the trustees, calling upon them within such time as may be specified in the notice which shall not ordinarily be less than thirty days, to explain the source of the money or other assets out of or by means of which property was acquired or, as the case may be, the source of the money or other assets which were contributed to the trust for acquiring such property and thereupon such notice shall be deemed to be a notice served under section 6 and all the other provisions of this Act shall apply accordingly.

1110.Explanation.-For the purposes of this section “illegally acquired property”, in relation to any property held in trust, includes-

(i) any property which if it had continued to be held by the author of the trust or the contributor of such property to the trust would have been illegally acquired property in relation to such author or contributor;

(ii) any property acquired by the trust out of any contributions made by any person which would have been illegally acquired property in relation to such person had such person acquired such property out of such contributions.

11.Certain transfers to be null and void.

11.Certain transfers to be null and void. Where after the issue of a notice under section 6 or under section 10, any property referred to in the said notice is transferred by any mode whatsoever such transfer shall, for the purposes of the proceedings under this Act, be ignored and if such property is subsequently forfeited to the Central
Government under section 7, then, the transfer of such property shall be deemed to be null and void.

12.Constitution of Appellate Tribunal.

12.Constitution of Appellate Tribunal. (1) The Central Government may, by notification in the Official Gazette, constitute an Appellate
Tribunal to be called the Appellate Tribunal for Forfeited Property consisting of a Chairman and such number of other members (being officers of the Central Government not below the rank of a Joint
Secretary to the Government) as the Central Government thinks fit, to be appointed by that Government for hearing appeals against the orders made under section 7, sub-section (1) of section 9 or section 10.(2) The Chairman of the Appellate Tribunal shall be a person who is or has been or is qualified to be a Judge of the Supreme Court or of a High Court.

(3) The terms and conditions of service of the Chairman and other members shall be such as may be prescribed.

(4) Any person aggrieved by an order of the competent authority made under section 7, sub-section (1) of section 9 or section 10, may, within forty-five days from the date on which the order is served on him, prefer an appeal to the Appellate Tribunal:

Provided that the Appellate Tribunal may entertain any appeal after the said period of forty-five days, but not after sixty days, from the date aforesaid if it is satisfied that the appellant was prevented by sufficient cause from filing the appeal in time.

(5) On receipt of an appeal under sub-section (4), the Appellate
Tribunal may, after giving an opportunity to the appellant to be heard if he so desires, and after making such further enquiry as it deems fit, confirm, modify or set aside the order appealed against.

1111.(6)The powers and functions of the Appellate Tribunal may be exercised and discharged by Benches consisting of three members and constituted by the Chairman of the Appellate Tribunal.

1[(6A) Notwithstanding anything contained in sub-section (6), where the Chairman considers it necessary so to do for the expeditious disposal of appeals under this section, he may constitute a Bench of two members and a Bench so constituted may exercise and discharge the powers and functions of the Appellate Tribunal:

Provided that if the members of a Bench so constituted differ on any point or points, they shall state the point or points on which they differ and refer the same to a third member (to be specified by the Chairman) for hearing on such point or points and such point or points shall be decided according to the opinion of that member.]

(7) the Appellate Tribunal may regulate its own procedure.

1[(8)On application to the Appellate Tribunal and on payment of the prescribed fee, the Tribunal may allow a party to any appeal or any person authorised in this behalf by such party to inspect at any time during office hours, any relevant records and registers of the
Tribunal and obtain a certified copy of any art thereof.]

13.Notice or order not to be invalid for error in description.

13.Notice or order not to be invalid for error in description. No notice issued or served, no declaration made, and no order passed,under this Act shall be deemed to be invaild by reason of any error in the description of the property or person mentioned therein if such property or person is identifiable from the description so mentioned.

14.Bar of jurisdiction.

14.Bar of jurisdiction. No order passed or declaration made under this Act shall be appealable except as provided therein and no civil court shall have jurisdiction in respect of any matter which the
Appellate Tribunal or any competent authority is empowered by or under this Act to determine and no injunction shall be granted by any court or other authority in respect of any action taken or to be taken in pursuance of any power conferred by or under this Act.

15.Competent authority and Appellate Tribunal to have powers of civilcourt.

15.Competent authority and Appellate Tribunal to have powers of civil court. The competent authority- and the Appellate Tribunal shall have all the powers of a civil court while trying a suit under the
Code of Civil Procedure, 1908 (5 of 1908), in respect of the following matters, namely:-

(a) summoning and enforcing the attendance of any person an examining him on oath;

(b) requiring the discovery and production of documents;

(c) receiving evidence on affidavits;

(d) requisitioning any public record or copy thereof from any court or office;

(e) issuing commissions for examination of witnesses or documents;

(f) any other matter which may be prescribed.

16.Information to competent authority.

16.Information to competent authority. (1) Notwithstanding anything contained in any other law, the competent authority shall have power to require any officer or authority of the Central
Government or a State Government or a local authority to furnishing information in relation to such persons, points or matters as in the opinion of the competent authority will be useful for, or relevant to, the purposes of this Act.

(2)Any officer of the Income-tax Department, the Customs Depart-
ment or the Central Excise Department or any officer of enforcement appointed under the Foreign Exchange Regulation Act, 1973 (46 of 1973), may furnish

———————————————————————
1. Ins. by Act 55 of 1980, s.2 (w.e.f.1-7-1981).
———————————————————————

1112.suo motu any information available with him to the competent authority if in the opinion of the officer such information will be useful to the competent authority for the purposes of this Act.

17.Certain officers to assist competent authority and Appellate Tribunal.

17.Certain officers to assist competent authority and Appellate
Tribunal. For the purposes of any proceedings under this Act, the following officers are hereby empowered and required to assist the competent authority and the Appellate Tribunal, namely :-

(a) officers of the Customs Department;

(b) officers of the Central Excise Department;

(c) officers of the Income-tax Department;

(d) officers of enforcement appointed under the Foreign
Exchange Regulation Act, 1973;(46 of 1973)

(e) officers of police;

(f) such other officers of the Central or State Government as are specified by the Central Government in this behalf by notification in the Official Gazette.

18.Power of competent authority to require certain officers to exercisecertain powers.

18.Power of competent authority to require certain officers to exercise certain powers. (1) For the purposes of any proceedings under this Act or the initiation of any such proceedings, the competent authority shall have power to cause to be conducted any inquiry, investigation or survey in respect of any person, place, property, assets, documents, books of account or any other relevant matters.

(2) For the purposes referred to in sub-section (1), the competent authority may, having regard to the nature of the inquiry, investigation or survey, require an officer of the Income-tax
Department to conduct or cause to be conducted such inquiry, investigation or survey.

(3) Any officer of the Income-tax Department who is conducting or is causing to be conducted any inquiry, investigation or survey required to be conducted under sub-section (2), may, for the purpose of such inquiry, investigation or survey, exercise any power
(including the power to authorise the exercise of any power) which may be exercised by him for any purpose under the Income-tax Act, 1961 (43.of 1961), and the provisions of the said Act shall, so far as may be, apply accordingly.

19.Power to take possession.

19.Power to take possession. (1) Where any property has been declared to be forfeited to the Central Government under this Act, or where the person affected has failed to pay the fine due under sub-
section (1) of section 9 within the time allowed therefor under sub-
section (3) of that section, the competent authority may order the person affected as well as any other person who may be in possession of the property to surrender or deliver possession thereof to the competent authority or to any person duly authorised by it in this behalf within thirty days of the service of the order.

1113.(2) If any person refuses or fails to comply with an order made under sub-section (1), the competent authority may take possession of the property and may for that purpose use such force as may be necessary.

(3) Notwithstanding anything contained in sub-section (2), the competent authority may, for the purpose of taking possession of any property referred to in sub-section (1), requisition the service of any police officer to assist the competent authority and it shall be the duty of such officer to comply with such requisition.

20.Rectification of mistakes.

20.Rectification of mistakes. With a view to rectifying any mistakes apparent from record, the competent authority or the
Appellate Tribunal, as the case may be, may amend any order made by it within a period of one year from the date of the order :

Provided that if any such amendment is likely to affect any person prejudicially, it shall not be made without giving to such person a reasonable opportunity of being heard.

21.Findings under other laws not conclusive for proceedings under thisAct.

21.Findings under other laws not conclusive for proceedings under this Act. No finding of any officer or authority under any other law shall be conclusive for the purpose of any proceedings under this
Act.

22.Service of notices and orders.

22.Service of notices and orders. Any notice or order issued or made under this Act shall be served-

(a) by tendering the notice or order or sending it by registered post to the person for whom it is intended or to his agent;

(b) if the notice or order cannot be served in the manner provided in clause (a), by affixing it on a conspicuous place in the property in relation to which the notice or order is issued or made, or on some conspicuous part of the premises in which the person for whom it is intended is known to have last resided or carried on business or personally worked for gain.

23.Protection of action taken in good faith.

23.Protection of action taken in good faith. No suit, prosecution or other proceeding shall lie against the Central Government or any officers of the Central or State Government for anything which is done or intended to be done, in good faith in pursuance of this Act or the rules made thereunder.

24.Act to have overiding effect.

24.Act to have overiding effect. The provisions of this Act shall have effect notwithstanding any thing inconsistent therewith contained in any other law for the time being in force.

1114.25.Provisions of the Act not to apply to certain properties held intrust.

25.Provisions of the Act not to apply to certain properties held in trust. Nothing contained in this Act shall apply in relation to any property held by a trust or an institution created or established wholly for public religious or charitable purposes if-

(i) such property has been so held by such trust or institution from a date prior to the commencement of this Act;
or

(ii) such property is wholly traceable to any property held by such trust or institution prior to the commencement of this Act.

26.Power to make rules.

26.Power to make rules. (1) The Central Government may, by notification in the Official Gazette, make rules to carry out the provisions of this Act.

(2) In particular and without prejudice to the generality of the foregoing power, such rules may provide for all or any of the following matters, namely: –

(a) the terms and conditions of service of the Chairman and other members of the Appellate Tribunal under sub-section (3)
of section 12;

1[(aa) the fees which shall be paid for the inspection of the records and registers of the Appellate Tribunal or for obtaining a certified copy of any part thereof under sub-
section (8) of section 12];

(b) the powers of a civil court that may be exercised by the competent authority and the Appellate Tribunal under clause of section 15;

(c) any other matter which has to be, or may be, prescribed.

(3) Every rule made under this Act shall be laid, as soon as may be after it is made, before each House of Parliament, while it is in session, for a total period of thirty days which may be comprised in one session or in two or more successive sessions, and if, before the expiry of the session immediately following the session or the successive sessions aforesaid, both Houses agree in making any modification in the rule, or both Houses agree that the rule should not be made, the rule shall thereafter have effect only in such modified form or be of no effect, as the case may be; so, however, that any such modification or annulment shall be without prejudice to the validity of anything previously done under that rule.

27.Repeal and saving.

27.Repeal and saving. (1) The Smuggler and Foreign Exchange
Manipulators (Forfeiture of Property) Ordinance, 1975 (20 of 1975), is hereby repealed.

(2) Notwithstanding such repeal, anything done or any action taken under the Ordinance so repealed shall be deemed to have been done or taken under the corresponding provisions of this Act.

———————————————————————
1 Ins. by Act of 1980 (w.e.f.1-7-1981).
____________________________________________________********************************************************

THE BONDED LABOR SYSTEM (ABOLITION) ACT, 1976.ACT NO. 19 OF 1976.[9th February, 1976.]

An Act to provide for the abolition of bonded labour system with a view to preventing the economic and physical exploitation of the weaker sections of the people and for matters connected therewith or incidental thereto.

BE it enacted by Parliament in the Twenty-seventh Year of the
Republic of India as follows:

CHAPTER IPRELIMINARY

 

1.Short title, extent and commencement.

1. Short title, extent and commencement.- (1) This Act may be called the Bonded Labour System (Abolition) Act, 1976.(2) It extends to the whole of India.

(3) It shall be deemed to have come into force on the 25th day of
October, 1975.2.Definitions.

2. Definitions.- In this Act, unless the context otherwise requires,–

(a) “advance” means an advance, whether in cash or in kind, or partly in cash or partly in kind, made by one person
(hereinafter referred to as the creditor) to another person (hereinafter referred to as the debtor)

(b) “agreement” means an agreement (whether written or oral, or partly written and partly oral) between a debtor and crelitor and includes an agreement providing for forced labour, the existence of which is presumed under any social custom prevailing in the concerned locality.

Explanation.–The existence of an agreement between the debtor and creditor is ordinarily presumed, under the social custom, in relation to the following forms of forced labour, namely:–

Adiyamar, Baramasia, Basahya, Bethu, Bhagela, Cherumar, Garru-galu, Hali, Hari, Harwai, Holya, Jana, Jeetha, Kamiya, Khundit-Mundit, Kuthia, Lakhari, Munjhi, Mat, Munish system, Nit-Majoor, Paleru, Padiyal, Pannayilal, Sagri, Sanji,Sanjawat, Sewak, Sewakia, Seri, Vetti;

552.(c) “ascendant” or “descendant”, in relation to a person belonging to a matriarchal society, means the person who corresponds to such expression in accordance with the law of succession in force in such society;

(d) “bonded debt” means an advance obtained, or presumed to have been obtained, by a bonded labourer under, or in pursuance of, the bonded labour system;

(e) “bonded labour” means any labour or service rendered under the bonded labour system;

(f) “bonded labourer” means a labourer who incurs, or has, or is presumed to have, incurred, a bonded debt;

(g) “bonded labour system” means the system of forced, or partly forced, labour under which a debtor enters, or has, or is presumed to have, entered, into an agreement with the creditor to the effect that,–

(i) in consideration of an advance obtained by him or by any of his lineal ascendants or descendants
(whether or not such advance is evidenced by any document) and in consideration of the interest, if any, due on such advance, or

(ii) in pursuance of any customary or social obligation, or

(iii) in pursuance of an obligation devolving on him by succession, or

(iv) for any economic consideration received by him or by any of his lineal ascendants or descendants, or

(v) by reason of his birth in any particular caste or community,

he would–

(1) render, by himself or through any member of his family, or any person dependent on him, labour or service to the creditor, or for the benefit of the creditor, for a specified period or for an unspecified period, either without wages or for nominal wages, or

(2) forfeit the freedom of employment or other means of livelihood for a specified period or for an unspecified period, or

553.(3) forfeit the right to move freely throughout the territory of India, or

(4) forfeit the right to appropriate or sell at market value any of his property or product of his labour or the labour of a member of his family or any person dependent on him,

and includes the system of forced, or partly forced, labour under which a surety for a debtor enters, or has, or is presumed to have, entered, into an agreement with the creditor to the effect that in the event of the failure of the debtor to repay the debt, he would render the bonded labour on behalf of the debtor;

1*[Explanation.– For the removal of doubts, it is hereby declared that any system of forced, or partly forced labour under which any workman being contract labour as defined in clause (b) of sub-section (1) of section 2 of the Contract Labour (Regulation and
Abolition) Act, 1970 (37 of 1970), or an inter-State migrant workman as defined in clause (e) of sub-section (1) of section 2 of the Inter-State Migrant Workmen (Regulation of Employment and
Conditions of Service) Act, 1979 (30 of 1979), is required to render labour or service in circumstances of the nature mentioned in sub-
clause (1) of this clause or is subjected to all or any of the disabilities referred to in sub-clauses (2) to (4), is “bonded labour system” within the meaning of this clause.]

(h) “family”, in relation to a person, includes the ascendant and descendant of such person;

(i) “nominal wages”, in relation to any labour, means a wage which is less than,–

(a) the minimum wages fixed by the Government, in relation to the same or similar labour, under any law for the time being in force, and

(b) where no such minimum wage has been fixed in relation to any form of labour, the wages that are normally paid, for the same or similar labour, to the labourers working in the same locality;

(j) “prescribed” means prescribed by rules made under this
Act.

3. Act to have overriding effect.- The provisions of this Act shall have effect notwithstanding anything inconsistent therewith contained in any enactment other than this Act, or in any instrument having effect by virtue of any enactment other than this Act.

CHAPTER IIABOLITION OF BONDED LABOUR SYSTEM


4. Abolition of bonded labour system.- (1) On the commencement of this Act, the bonded labour system shall stand abolished and every bonded labourer shall, on such commencement, stand freed and discharged from any obligation to render any bonded labour.

 

(2) After the commencement of this Act, no person shall–

(a) make any advance under, or in pursuance of, the bonded labour system, or

(b) compel any person to render any bonded labour or other form of forced labour.
———————————————————————
1. Added by Act 73 of 1985, s.2.554.5.Agreement, custom, etc., to be void.

5. Agreement, custom, etc., to be void.- On the commencement of this Act, any custom or tradition or any contract, agreement or other instrument (whether entered into or executed before or after the commencement of this Act), by virtue of which any person, or any member of the family or dependant of such person, is required to do any work or render any service as a bonded labourer, shall be void and inoperative.

CHAPTER IIIEXTINGUISHMENT OF LIABILITY TO REPAY BONDED DEBT


6. Liability to repay bonded debt to stand extinguished.- (1) On the commencement of this Act, every obligation of a bonded labourer to repay any bonded debt, or such part of any bonded debt as remains unsatisfied immediately before such commencement, shall be deemed to have been extinguished.

 

(2) After the commencement of this Act, no suit or other proceeding shall lie in any civil court or before any other authority for the recovery of any bonded debt or any part thereof.

(3) Every decree or order for the recovery of bonded debt, passed before the commencement of this Act and not fully satisfied before such commencement, shall be deemed, on such commencement, to have been fully satisfied.

(4) Every attachment made before the commencement of this Act, for the recovery of any bonded debt, shall, on such commencement, stand vacated; and, where, in pursuance of such attachment, any movable property of the bonded labourer was seized and removed from his custody and kept in the custody of any court or other authority pending sale thereof, such movable property shall be restored, as soon as may be practicable after such commencement, to the possession of the bonded labourer.

(5) Where, before the commencement of this Act, possession of any property belonging to a bonded labourer or a member of his family or other dependant was forcibly taken over by any creditor for the recovery of any bonded debt, such property shall be restored, as soon as may be practicable after such commencement, to the possession of the person from whom it was seized.

(6) If restoration of the possession of any property referred to in sub-section (4) or sub-section (5) is not made within thirty days from the commencement of this Act, the aggrieved person may, within such time as may be prescribed, apply to the prescribed authority for the restoration of the possession of such property and the prescribed authority may, after giving the creditor a reasonable opportunity of being heard, direct the creditor to restore to the applicant the possession of the concerned property within such time as may be specified in the order.

555.(7) An order made by any prescribed authority, under sub-section
(6), shall be deemed to be an order made by a civil court and may be executed by the court of the lowest pecuniary jurisdiction within the local limits of whose jurisdiction the creditor voluntarily resides or carries on business or personally works for gain.

(8) For the avoidance of doubts, it is hereby declared that, where any attached property was sold before the commencement of this
Act, in execution of a decree or order for the recovery of a bonded debt, such sale shall not be affected by any provision of this Act:

Provided that the bonded labourer, or an agent authorised by him in this behalf, may, at any time within five years from such commencement, apply to have the sale set aside on his depositing in court, for payment to the decree-holder, the amount specified in the proclamaation of sale, for the recovery of which the sale was ordered, less any amount, as well as mesne profits, which may, since the date of such proclamation of sale, have been received by the decree-holder.

(9) Where any suit or proceeding, for the enforcement of any obligation under the bonded labour system, including a suit or proceeding for the recovery of any advance made to a bonded labourer, is pending at the commencement of this Act, such suit or other proceeding shall, on such commencement, stand dismissed.

(10) On the commencement of this Act, every bonded labourer who has been detained in civil prison, whether before or after judgment, shall be released from detention forthwith.

7.Property of bonded labourer to be freed from mortgage, etc.

7. Property of bonded labourer to be freed from mortgage, etc.-
(1) All property vested in a bonded labourer which was, immediately before the commencement of this Act under any mortgage, charge, lien or other incumbrances in connection with any bonded debt shall, in so far as it is relatable to the bonded debt, stand freed and discharged from such mortgage, charge, lien or other incumbrances, and where any such property was, immediately before the commmencement of this Act, in the possession of the mortgagee or the holder of the charge, lien or incumbrance, such property shall (except where it was subject to any other charge), on such commencement, be restored to the possession of the bonded labourer.

(2) If any delay is made in restoring any property, referred to in sub-section (1), to the possession of the bonded labourer, such labourer shall be entitled, on and from the date of such commencement, to recover from the mortgagee or holder of the lien, charge or incumbrance, such mesne profits as may be determined by the civil court of the lowest pecuniary jurisdiction within the local limits of whose jurisdiction such property is situated.

556.8.Freed bonded labourer not to be evicted from homestead, etc.

8. Freed bonded labourer not to be evicted from homestead, etc.-
(1) No person who has been freed and discharged under this Act from any obligation to render any bonded labour, shall be evicted from any homestead or other residential premises which he was occupying immediately before the commencement of this Act as part of the consideration for the bonded labour.

(2) If, after the commencement of this Act, any such person is evicted by the creditor from any homestead or other residential premises, referred to in sub-section (1), the Executive Magistrate in charge of the Sub-Division within which such homestead or residential premises is situated shall, as early as practicable, restore the bonded labourer to the possession of such homestead or other residential premises.

9.Creditor not to accept payment against extinguished debt.

9. Creditor not to accept payment against extinguished debt.- (1)
No creditor shall accept any payment against any bonded debt which has been extinguished or deemed to have been extinguished or fully satisfied by virtue of the provisions of this Act.

(2) Whoever contravenes the provisions of sub-section (1), shall be punishable with imprisonment for a term which may extend to three years and also with fine.

(3) The court, convicting any person under sub-section (2) may, in addition to the penalties which may be imposed under that sub-
section, direct the person to deposit, in court, the amount accepted in contravention of the provisions of sub-section (1), within such period as may be specified in the order for being refunded to the bonded labourer.

CHAPTER IVIMPLEMENTING AUTHORITIES


10. Authorities who may be specified for implementing the provisions of this Act.- The State Government may confer such powers and impose such duties on a District Magistrate as may be necessary to ensure that the provisions of this Act are properly carried out and the District Magistrate may specify the officer, subordinate to him, who shall exercise all or any of the powers, and perform all or any of the duties, so conferred or imposed and the local limits within which such powers or duties shall be carried out by the officer so specified.

 

11.Duty of District Magistrate and other officers to ensure credit.

11. Duty of District Magistrate and other officers to ensure credit.- The District Magistrate authorised by the State Government under section 10 and the officer specified by the District Magistrate under that section shall, as far as practicable, try to promote the welfare of the freed bonded labourer by securing and protecting the economic interests of such bonded labourer so that he may not have any occasion or reason to contract any further bonded debt.

12.Duty of District Magistrate and officers authorised by him.

12. Duty of District Magistrate and officers authorised by him.-
It shall be the duty of every District Magistrate and every officer specified by him under section 10 to inquire whether, after the commencement of this Act, any bonded labour system or any other form of forced labour is being enforced by, or on behalf of, any person resident within

557.the local limits of his jurisdiction and if, as a result of such inquiry, any person is found to be enforcing the bonded labour system or any other system of forced labour, he shall forthwith take such action as may be necessary to eradicate the enforcement of such forced labour.

CHAPTER VVIGILANCE COMMITTEES

13. Vigilance Committees.- (1) Every State Government shall, by notification in the Official Gazette, constitute such number of
Vigilance Committees in each district and each Sub-Division as it may think fit.

 

(2) Each Vigilance Committee, constituted for a district, shall consist of the following members, namely:–

(a) the District Magistrate, or a person nominated by him, who shall be the Chairman;

(b) three persons belonging to the Scheduled Castes or
Scheduled Tribes and residing in the district, to be nominated by the District Magistrate;

(c) two social workers, resident in the district, to be nominated by the District Magistrate;

(d) not more than three persons to represent the official or non-official agencies in the district connected with rural development, to be nominated by the State
Government;
(e) one person to represent the financial and credit institutions in the district, to be nominated by the
District Magistrate.

(3) Each Vigilance Committee, constituted for a Sub-Division, shall consist of the following members, namely:–

(a) the Sub-Divisional Magistrate, or a person nominated by him, who shall be the Chairman;

(b) three persons belonging to the Scheduled Castes or
Scheduled Tribes and residing in the Sub-Division, to be nominated by the Sub-Divisional Magistrate;

(c) two social workers, resident in the Sub-Division, to be nominated by the Sub-Divisional Magistrate;

(d) not more than three persons to represent the official or non-official agencies in the Sub-Division connected with rural development to be nominated by the District
Magistrate;

(e) one person to represent the financial and credit institutions in the Sub-Division, to be nominated by the Sub-Divisional Magistrate;

558.(f) one officer specified under section 10 and functioning in the Sub-Division.

(4) Each Vigilance Committee shall regulate its own procedure and secretarial assistance, as may be necessary, shall be provided by–

(a) the District Magistrate, in the case of a Vigilance
Committee constituted for the district;

(b) the Sub-Divisional Magistrate, in the case of a
Vigilance Committee constituted for the Sub-Division.

(5) No proceeding of a Vigilance Committee shall be invalid merely by reason of any defect in the constitution, or in the proceedings, of the Vigilance Committee.

14.Functions of Vigilance Committees.

14. Functions of Vigilance Committees.- (1) The functions of each
Vigilance Committee shall be,–

(a) to advise the District Magistrate or any officer authorised by him as to the efforts made, and action taken, to ensure that the provisions of this Act or of any rule made thereunder are properly implemented;

(b) to provide for the economic and social rehabiliation of the freed bonded labourers;

(c) to co-ordinate the functions of rural banks and co-
operative societies with a view to canalising adequate credit to the freed bonded labourer;

(d) to keep an eye on the number of offences of which cognizance has been taken under this Act;

(e) to make a survey as to whether there is any offence of which cognizance ought to be taken under this Act;

(f) to defend any suit instituted against a freed bonded labourer or a member of his family or any other person dependent on him for the recovery of the whole or part of any bonded debt or any other debt which is claimed by such person to be bonded debt.

(2) A Vigilance Committee may authorise one of its members to defend a suit against a freed bonded labourer and the member so authorised shall be deemed, for the purpose of such suit, to be the authorised agent of the freed bonded labourer.

15.Burden of proof.

15. Burden of proof.- Whenever any debt is claimed by a bonded labourer, or a Vigilance Committee, to be a bonded debt, the burden of proof that such debt is not a bonded debt shall lie on the creditor.

559.

CHAPTER VIOFFENCES AND PROCEDURE FOR TRIAL


16. Punishment for enforcement of bonded labour.- Whoever, after the commencement of this Act, compels any person to render any bonded labour shall be punishable with imprisonment for a term which may extend to three years and also with fine which may extend to two thousand rupees.

 

17.Punishment for advancement of bonded debt.

17. Punishment for advancement of bonded debt.- Whoever advances, after the commencement of this Act, any bonded debt shall be punishable with imprisonment for a term which may extend to three years and also with fine which may extend to two thousand rupees.

18.Punishment for extracting bonded labour under the bonded laboursystem.

18. Punishment for extracting bonded labour under the bonded labour system.- Whoever enforces, after the commencement of this Act, any custom, tradition, contract, agreement or other instrument, by virtue of which any person or any member of the family of such person or any dependant of such person is required to render any service under the bonded labour system shall be punishable with imprisonment for a term which may extend to three years and also with fine which may extend to two thousand rupees; and, out of the fine, if recovered, payment shall be made to the bonded labourer at the rate of rupees five for each day for which the bonded labour was extracted from him.

19.Punishment for omission or failure to restore possession of propertyto bonded labourers.

19. Punishment for omission or failure to restore possession of property to bonded labourers.- Whoever, being required by this Act to restore any property to the possession of any bonded labourer, omits or fails to do so, within a period of thirty days from the commencment of this Act, shall be punishable with imprisonment for a term which may extend to one year, or with fine which may extend to one thousand rupees, or with both; and, out of the fine, if recovered, payment shall be made to the bonded labourer at the rate of rupees five for each day during which possession of the property was not restored to him.

20.Abetment to be an offence.

20. Abetment to be an offence.- Whoever abets any offence punishable under this Act shall, whether or not the offence abetted is committed, be punishable with the same punishment as is provided for the offence which has been abetted.

Explanation,–For the purpose of this Act, “abetment” has the meaning assigned to it in the Indian Penal Code (46 of 1860).

21.Offences to be tried by Executive Magistrates.

21. Offences to be tried by Executive Magistrates.- (1) The State
Government may confer, on an Executive Magistrates, the powers of a
Judicial Magistrate of the first class or of the second class for the trial of offences under this Act; and, on such conferment of powers, the Executive Magistate, on whom the powers are so conferred, shall be deemed, for the purposes of the Code of Criminal Procedure, 1973.(2 of 1974), to be a Judicial Magistrate of the first class, or of the second class, as the case may be.

560

(2) An offence under this Act may be tried summarily by a
Magistrate.

22.Cognizance of offences.

22. Cognizance of offences.- Every offence under this Act shall be cognizable and bailable.

23.Offences by companies.

23. Offences by companies.- (1) Where an offence under this Act has been committed by a company, every person who, at the time the offence was committed, was in charge of, and was responsible to, the company for the conduct of the business of the company, as well as the company, shall be deemed to be guilty of the offence and shall be liable to be proceeded against and punished accordingly.

(2) Notwithstanding anything contained in sub-section (1), where any offence under this Act has been committed by a company and it is proved that offence has been committed with the consent or connivance of, or is attributable to, any neglect on the part of, any director, manager, secretary or other officer of the Company, such director, manager, secretary or other officer shall be deemed to be guilty of that offence and shall be liable to be proceeded against and punished accordingly.

Explanation.–For the purposes of this section,–

(a) “company” means any body corporate and includes a firm or other association of individuals; and

(b) “director” , in relation to a firm, means a partner in the firm.

CHAPTER VII
MISCELLANEOUS
24. Protection of action taken in good faith.- No suit, prosecution or other legal proceeding shall lie against any State
Government or any officer of the State Government or any member of the
Vigilance Committee for anything which is in good faith done or intended to be done under this Act.

25.Jurisdiction of civil courts barred.

25. Jurisdiction of civil courts barred.- No civil court shall have jurisdiction in respect of any matter to which any provision of this Act applies and no injunction shall be granted by any civil court in respect of anything which is done or intended to be done by or under this Act.

26.Power to make rules.

26. Power to make rules.- (1) The Central Government may, by notification in the Official Gazette, make rules for carrying out the provisions of this Act.

(2) In particular, and without prejudice to the foregoing power, such

561.rules may provide for all or any of the following matters, namely:–

(a) the authority to which application for the restoration of possesion of property referred to in sub-section
(4), or sub-section (5), of section 6 is to be submitted in pursuance of sub-section (6) of that section;

(b) the time within which application for restoration of possession of property is to be made, under sub-section
(6) of section 6, to the prescribed authority;

(c) steps to be taken by Vigilance Committees under clause
(a) of sub-section (1) of section 14, to ensure the implementation of the provisions of this Act or of any rule made thereunder;

(d) any other matter which is required to be, or may be, prescribed.

(3) Every rule made by the Central Government under this Act shall be laid, as soon as may be after it is made, before each House of Parliament while it is in session, for a total period of thirty days which may be comprised in one session or in two or more successive sessions, and if, before the expiry of the session immediately following the session or the successive sessions aforesaid, both Houses agree in making any modification in the rule or both Houses agree that the rule should not be made, the rule shall thereafter have effect only in such modified form or be no effect, as the case may be; so, however, that any such modification or annulment shall be without prejudice to the validity of anything previously done under that rule.

27.Repeal and saving.

27. Repeal and saving.- (1) The Bonded Labour System (Abolition)
Ordinance, 1975 (Ord. 17 of 1975) is hereby repealed.

(2) Notwithstanding such repeal, anything done or any action taken under the Ordinance (including any notification published, direction or nomination made, power conferred, duty imposed or officer specified) shall be deemed to have been done or taken under the corresponding provisions of this Act.

LEAVE A REPLY

Please enter your comment!
Please enter your name here

* Copy This Password *

* Type Or Paste Password Here *