1[68K. Fine in lieu of forfeiture. — (1) Where the competent authority makes a declaration that any property stands forfeited to the Central Government under section 68-I and it is a case where the source of only a part of the illegally acquired property 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 the market value of such part.
(2) Before making an order imposing a fine under sub-section (1), the person 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 68-I and thereupon such property shall stand released.]
1. Ins. by Act 2 of 1989, s. 19 (w.e.f. 29-5-1989)
Simplified Explanation
Section 68K provides an option for individuals whose property has been declared forfeited under Section 68-I (for illegally acquired property) to pay a fine in lieu of the forfeiture of the property.
Key Provisions of Section 68K:
- Option for Payment of Fine:
- If the competent authority declares a property to be forfeited to the Central Government under Section 68-I, and it is determined that only a part of the property’s source remains unproven (i.e., the origin of part of the property is still in question), the affected person may be given an option to pay a fine.
- This fine will be equal to the market value of the portion of the property for which the source has not been satisfactorily proved.
- Opportunity to Be Heard:
- Before imposing a fine, the affected person must be given a reasonable opportunity to be heard. This ensures fairness in the process, allowing the person to present their case and possibly challenge the imposition of the fine.
- Revocation of Forfeiture:
- If the person affected decides to pay the fine within the time allowed, the competent authority can revoke the declaration of forfeiture made under Section 68-I.
- Upon payment of the fine, the property will be released, meaning the person will regain possession of it, but only after satisfying the financial penalty.
Purpose and Significance of Section 68K:
- Providing a Remedy: This section offers a way for individuals to avoid losing their property entirely, providing a financial alternative to full forfeiture. It serves as a form of compensation for the illegally acquired portion of the property, allowing the person to retain ownership by paying the fine.
- Encouraging Settlement: The provision allows for an alternative resolution to the forfeiture process. Instead of having to go through a lengthy legal procedure to fight the forfeiture, the person may choose to pay a fine and regain the property.
- Flexibility for the Affected Person: If only part of the property is contested, the person has the flexibility to pay for that contested portion instead of losing the entire asset.
- Government’s Interests: This provision also helps the Central Government retain a financial benefit (through the fine) in cases where full forfeiture may be deemed too harsh or where it is difficult to trace the complete illegal origin of the property.
Practical Implications
- For the Affected Person:
- They have the option to either contest the forfeiture and potentially lose the property or pay a fine (based on the market value of the disputed portion) and regain ownership.
- The affected person should be ready to pay the fine within the time limit specified to avoid prolonged legal consequences.
- For Competent Authorities:
- The authorities have the discretion to allow payment of the fine, which may be more efficient than lengthy forfeiture proceedings, and they must ensure that the person affected is given a fair chance to make their case.
- For Legal Professionals:
- Legal advice will be necessary to assess whether paying the fine is in the best interest of the affected person or whether challenging the forfeiture itself would be more beneficial.
This provision helps in striking a balance between the Central Government’s need to confiscate illegally acquired assets and the rights of the affected person by providing an option to settle through a fine.
