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PREVENTION OF MONEY-LAUNDERING (AMENDMENT) ACT 2009

Year : 2009

[ACT NO. 21 of 2009]
[6th March, 2009]

PREAMBLE

An Act further to amend the Prevention of Money-laundering Act, 2002.

Be it enacted by Parliament in the Sixtieth Year of the Republic of India as follows:-



(1) This Act may be called the Prevention of Money-laundering (Amendment) Act, 2009.

(2) It shall come into force on such date1* as the Central Government may, by notification in the Official Gazette, appoint.

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1. Effective date for enforcement of Act 1st day of June, 2009 vide Notification No. SO1388(E) dated 01.06.2009

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In section 2 of the Prevention of Money-laundering Act, 2002(15 of 2003) (here in after referred to as the principal Act), in sub-section (1),-

(i) After clause (d), the following clause shall be inserted, namely:-

(da) "Authorised person" means an authorised person as defined in clause (c) of section 2 of the Foreign Exchange Management Act, 1999(42 of 1999);

(ii) After clause (j), the following clause shall be inserted, namely:-

(ja) "Designated business or profession" means carrying on activities for playing games of chance for cash or kind, and includes such activities associated with casino or such other activities as the Central Government may, by notification, so designate, from time to time;

(iii) In clause (l), for the words "a non-banking financial company", the words "an authorised person, a payment system operator and a non-banking financial company" shall be substituted;

(iv) In clause (q), after the words and figures "Reserve Bank of India Act, 1934(2 of 1934)", the words "and includes a person carrying on designated business or profession" shall be inserted;

(v) After clause (r), the following clauses shall be inserted,namely:-

(ra) "Offence of cross border implications", means-

(i) Any conduct by a person at a place outside India which constitutes an offence at that place and which would have constituted an offence specified in Part A, Part B or Part C of the Schedule, had it been committed in India and if such person remits the proceeds of such conduct or part thereof to India; or

(ii) Any offence specified in Part A, Part B or Part C of the Schedule which has been committed in India and the proceeds of crime, or part thereof have been transferred to a place outside India or any attempt has been made to transfer the proceeds of crime, or part thereof from India to a place outside India.

Explanation.-Nothing contained in this clause shall adversely affect any investigation, enquiry, trial or proceeding before any authority in respect of the offences specified in Part A or Part B of the Schedule to the Act before the commencement of the Prevention of Money-laundering (Amendment) Act, 2009;

(rb) "Payment system" means a system that enables payment to be effected between a payer and a beneficiary, involving clearing, payment or settlement service or all of them.

Explanation.-For the purposes of this clause, "payment system" includes the systems enabling credit card operations, debit card operations, smart card operations, money transfer operations or similar operations;

(re) "Payment system operator" means a person who operates a payment system and such person includes his overseas principal.

Explanation.-For the purposes of this clause, "overseas principal" means,-

(A) In the case of a person, being an individual, such individual residing outside India, who owns or controls or manages, directly or indirectly, the activities or functions of payment system in India;

(B) In the case of a Hindu undivided family, Karta of such Hindu undivided family residing outside India who owns or controls or manages, directly or indirectly, the activities or functions of payment system in India;

(C) In the case of a company, a firm, an association of persons, a body of individuals, an artificial juridical person, whether incorporated or not, such company, firm, association of persons, body of individuals, artificial juridical person incorporated or registered outside India or existing as such and which owns or controls or manages, directly or indirectly, the activities or functions of payment system in India;

(vi) In clause (y), for sub-clause (ii), the following sub-clauses shall be substituted, namely:-

(ii) The offences specified under Part B of the Schedule if the total value involved in such offences is thirty lakh rupees or more; or

(iii) The offences specified under Part C of the Schedule.



In section 5 of the principal Act, in sub-section (1),-

(a) For the words "ninety days", the words "one hundred and fifty days" shall be substituted;

(b) For the proviso, the following provisos shall be substituted, namely:-

Provided
that no such order of attachment shall be made unless, in relation to the scheduled offence, a report has been forwarded to a Magistrate under section 173 of the Code of Criminal Procedure, 1973(2 of 1974), or a complaint has been filed by a person, authorised to investigate the offence mentioned in the Schedule, before a Magistrate or court for taking cognizance of the scheduled offence, as the case may be:

Provided further that, notwithstanding anything contained in clause (b), any property of any person may be attached under this section if the Director or any other officer not below the rank of Deputy Director authorised by him for the purposes of this section has reason to believe (the reasons for such belief to be recorded in writing), on the basis of material in his possession, that if such property involved in money-laundering is not attached immediately under this Chapter, the non-attachment of the property is likely to frustrate any proceeding under this Act.



In section 6 of the principal Act,-

(i) In sub-section (1), for the words "one or more Adjudicating Authorities", the words "an Adjudicating Authority" shall be substituted;

(ii) In the proviso to sub-section (8), for the word "sixty-two", the word "sixty-five" shall be substituted.



In section 8 of the principal Act, in sub-section (1), for the words and figure "offence under section 3", the words and figure "offence under section 3 or is in possession of proceeds of crime" shall be substituted.



In section 12 of the principal Act, for sub-section (2), the following sub-section shall be substituted, namely:-

(2)(a) The records referred to in clause (a) of sub-section (1) shall be maintained for a period of ten years from the date of transactions between the clients and the banking company or financial institution or intermediary, as the case may be.

(b) The records referred to in clause (c) of sub-section (1) shall be maintained for a period of ten years from the date of cessation of transactions between the clients and the banking company or financial institution or intermediary, as the case maybe.



In section 17 of the principal Act, in sub-section (1),-

(i) In the opening portion, for the words "the Director", the words "the Director or any other officer not below the rank of Deputy Director authorised by him for the purposes of this section," shall be substituted;

(ii) For the proviso, the following proviso shall be substituted, namely.-

Provided
that no search shall be conducted unless, in relation to the scheduled offence, a report has been forwarded to a Magistrate under section 157 of the Code of Criminal Procedure, 1973, or a complaint has been filed by a person, authorised to investigate the offence mentioned in the Schedule, before a Magistrate or court for taking cognizance of the scheduled offence, as the case maybe.



In section 18 of the principal Act,-

(i) In sub-section (1), the following proviso shall be inserted, namely:-

Provided that no search of any person shall be made unless, in relation to the scheduled offence, a report has been forwarded to a Magistrate under section 173 of the Code of Criminal Procedure, 1973(2 of 1974), or a complaint has been filed by a person authorised to investigate the offence mentioned in the Schedule, before a Magistrate or court for taking cognizance of the scheduled offence, as the case may be.";

(ii) In sub-section (9), the proviso shall be omitted.



In section 28 of the principal Act, in sub-section (2), clause (a) shall be omitted.



In section 32 of the principal Act, in sub-section (2), the following proviso shall be inserted, namely:-

Provided that the Chief Justice of India shall be consulted before removal of the Chairperson or a Member who was appointed on the recommendation of the Chief Justice of India.



In section 38 of the principal Act, for the words "one or more of the other Members", the words "third Member" shall be substituted.



In section 60 of the principal Act, after sub-section (6), the following subsection shall be inserted, namely:-

(7) When any property in India is confiscated as a result of execution of a request from a contracting State in accordance with the provisions of this Act, the Central Government may either return such property to the requesting State or compensate that State by disposal of such property on mutually agreed terms that would take into account deduction for reasonable expenses incurred in investigation, prosecution or judicial proceedings leading to the return or disposal of confiscated property.



In the principal Act, in the Schedule,--

(i) In Part A -

(a) In Paragraph 1, after section 121A and the entry relating thereto, the following sections and the entries shall be inserted, namely:-

Section       Description of offence
489ACounterfeiting currency notes or bank notes.
489BUsing as genuine, forged or counterfeit currency notes or bank notes.;

(b) In Paragraph 2, for sections 15,18 and 20 and the entries relating thereto, the following sections and the entries shall be substituted, namely:-

Section         Description of offence
15.Contravention in relation to poppy straw.
16.Contravention in relation to coca plant and coca leaves.
17.Contravention in relation to prepared opium.
18.Contravention in relation to opium poppy and opium.
19.Embezzlement of opium by cultivator.
20.
Contravention in relation to cannabis plant and cannabis.
21.
Contravention in relation to manufactured drugs and preparations.;

(c) After Paragraph 2, the following Paragraphs shall be inserted, namely:-
 
PARAGRAPH 3
Offences under the Explosive Substances Act, 1908

Section       Description of offence
3.
Causing explosion likely to endanger life or property.
4.
Attempt to cause explosion, or for making or keeping explosives with intent to endanger life or property.
5.
Making or possessing explosives under suspicious circumstances.

PARAGRAPH 4
Offences under the Unlawful Activities (Prevention) Act, 1967

Section
      Description of offence
10 read with section 3Penalty for being member of an unlawful association, etc.
11 read with sections 3 and 7Penalty for dealing with funds of an unlawful association.
13 read with section 3Punishment for unlawful activities.
16 read with section15Punishment for terrorist act.
16APunishment for making demands of radioactive substances, nuclear devices, etc.
17.Punishment for raising fund for terrorist act.
18.Punishment for conspiracy, etc.
18 A
Punishment for organising of terrorist camps.
18 B
Punishment for recruiting of any person or persons for terrorist act.
19.
Punishment for harbouring, etc.
20.
Punishment for being member of terrorist gang or organisation.
21.
Punishment for holding proceeds of terrorism.
38.
Offence relating to membership of a terrorist organisation.
39.
Offence relating to support given to a terrorist organisation.
40.
Offence of raising fund for a terrorist organisation.;

(w) In Part B -

(a) For Paragraph 1, the following Paragraph shall be substituted, namely:-

PARAGRAPH 5

Offences under the Indian Penal Code

Section
       Description of offence
120.B Criminal conspiracy.
255.
Counterfeiting Government stamp.
257.
Making or selling instrument for counterfeiting Government stamp.
258.
Sale of counterfeit Government stamp.
259.
Having possession of counterfeit Government stamp.
260.
Using as genuine a Government stamp known to be counterfeit.
302.
Murder.
304.
Punishment for culpable homicide not amounting to murder.
307.
Attempt to murder.
308.
Attempt to commit culpable homicide.
327.
Voluntarily causing hurt to extort property, or to constrain to an illegal act.
329.
Voluntarily causing grievous hurt to extort property, or to constrain to an illegal act.
364.
A Kidnapping for ransom, etc.
384 to 389
Offences relating to extortion.
392 to 402Offences relating to robbery and dacoity.
411
Dishonestly receiving stolen property.
412
Dishonestly receiving property stolen in the commission of a dacoity.
413
Habitually dealing in stolen property.
414
Assisting in concealment of stolen property.
417
Punishment for cheating.
418
Cheating with knowledge that wrongful loss may ensue to person whose interest offender is bound to protect.
419
Punishment for cheating by personation.
420.
Cheating and dishonestly inducing delivery of properties.
421.
Dishonest or fraudulent removal or concealment of property to prevent distribution among creditors.
422.
Dishonestly or fraudulently preventing debt being available for creditors.
423.
Dishonest or fraudulent execution of deed of transfer containing false statement of consideration.
424.
Dishonest or fraudulent removal or concealment of property.
467.
Forgery of valuable security, will, etc.
471.
Using as genuine a forged document or electronic record.
472 and 473.Making or possessing counterfeit seal, etc., with intent to commit forgery.
475 and 476Counterfeiting device or mark.
481.
Using a false property mark.
482.
Punishment for using a false property mark.
483.
Counterfeiting a property mark used by another.
484.
Counterfeiting a mark used by a public servant.
485.
Making or possession of any instrument for counterfeiting a property mark.
486.
Selling goods marked with a counterfeit property mark.
487.
Making a false mark upon any receptacle containing goods.
488.
Punishment for making use of any such false mark.;

(b) In Paragraph 3, before section 51 read with section 17A and the entry relating thereto, the following section and the entry shall be inserted, namely:-

Section                               Description of offence

51 read with section 9        Hunting of wild animals.;

(c) In Paragraph 5, after section 10 and the entry relating thereto, the following section and the entry shall be inserted, namely:--

Section       Description of offence

13          Criminal misconduct by a public servant.;

(d) After Paragraph 5, the following Paragraphs shall be inserted, namely:-

PARAGRAPH 6

Offences under the Explosives Act, 1884.

Section     Description of offence

9-B         Punishment for certain offences.

9-C         Offences by companies.

PARAGRAPH 7

Offences under the Antiquities and Arts Treasures Act, 1972

Section 
Description of offence
25 read with section 3Contravention of export trade in antiquities and art treasures.
28 Offences by companies.

PARAGRAPH 8

Offences under the Securities and Exchange Board of India Act, 1992

Section
     Description of offence
12A read with section 24
Prohibition of manipulative and deceptive devices insider trading and substantial acquisition of securities or control.

PARAGRAPH 9

Offences under the Customs Act, 1962

Section      Description of offence

135        Evasion of duty or prohibitions.

PARAGRAPH 10

Offences under the Bonded Labour System (Abolition) Act, 1976

Section
       Description of offence
16.Punishment for enforcement of bonded labour.
18.Punishment for extracting bonded labour under the bonded labour system.
20.
Abetment to be an offence.

PARAGRAPH 11

Offences under the Child Labour (Prohibition and Regulation) Act, 1986

Section
          Description of offence
14.Punishment for employment of any child to work i contravention of the provisions of section 3.

PARAGRAPH 12

Offences under the Transplantation of Human Organs Act, 1994

Section      Description of offence
18.
Punishment for removal of human organ without authority.
19.Punishment for commercial dealings in human organs.
20.
Punishment for contravention of any other provision of this Act.

PARAGRAPH 13

Offences under the Juvenile Justice (Care and Protection of Children) Act, 2000

Section
       Description of offence
23.
Punishment for cruelty to juvenile or child.
24.
Employment of juvenile or child for begging.
25.
Penalty for giving intoxicating liquor or narcotic drug or psychotropic substance to juvenile or child.
26.
Exploitation of juvenile or child employee.

PARAGRAPH 14

Offences under the Emigration Act, 1983

Section      Description of offence

24          Offences and penalties.

PARAGRAPH 15

Offences under the Passports Act, 1967

Section     Description of offence

12           Offences and penalties.

PARAGRAPH 16

Offences under the Foreigners Act, 1946

Section    Description of offence

14          Penalty for contravention of provisions of the Act, etc.

14B        Penalty for using forged passport.

14C        Penalty for abetment.

PARAGRAPH 17

Offences under the Copyright Act, 1957


Section         Description of offence
63.
Offence of infringement of copyright or other rights conferred by this Act.
63 A
Enhanced penalty on second and subsequent convictions.
63 B
Knowing use of infringing copy of computer programme.
68 A
Penalty for contravention of section 52 A.

PARAGRAPH 18

Offences under the Trade Marks Act, 1999

Section
           Description of offence
103.Penalty for applying false trade marks, trade descriptions,etc.
104.Penalty for selling goods or providing services to which false trademark or false trade description is applied.
105.Enhanced penalty on second or subsequent conviction.
107.Penalty for falsely representing a trade mark as registered.
120.Punishment of abetment in India of acts done out of India.

PARAGRAPH 19

Offences under the Information Technology Act, 2000

Section        Description of offence

72.         Penalty for breach of confidentiality and privacy.

75.         Act to apply for offence or contravention committed outside India.

PARAGRAPH 20

Offences under the Biological Diversity Act, 2002

Section
         Description of offence
55.
Read with section 6 Penalties for contravention of section 6, etc.

PARAGRAPH 21

Offences under the Protection of Plant Varieties and Farmers'
Rights Act, 2001


Section
         Description of offence
70.
Read with section 68  Penalty for applying false denomination, etc.
71.
Read with section 68  Penalty for selling varieties to which false denomination is applied.
72.
Read with section 68  Penalty for falsely representing a variety as registered.
73.
Read with section 68  Penalty for subsequent offence.

PARAGRAPH 22

Offences under the Environment Protection Act, 1986

Section
     Description of offence
15.Read with section 7  Penalty for discharging environmental pollutants.
15.Read with section 8  Penalty for handling hazardous substance.

PARAGRAPH 23

Offences under the Water (Prevention and Control of Pollution) Act, 1974

SectionDescription of offence
41 (2)
Penalty for pollution of stream or well.
43
Penalty for contravention of provisions of section 24.

PARAGRAPH 24

Offences under the Air (Prevention and Control of Pollution) Act, 1981

Section      Description of offence
37.
Failure to comply with the provisions for operator industrial plant.

PARAGRAPH 25

Offences under the Suppression of Unlawful Acts against Safety of Maritime Navigation and Fixed Platforms on Continental Shelf Act, 2002

Section
        Description of offence
3.
Offences against ship, fixed platform, cargo of a ship, maritime navigational facilities, etc.;

(iii) After Part B, the following Part shall be inserted, namely:-

PART C

An offence which is the offence of cross border implications and is specified in,-

(1) Part A; or

(2) Part B without any monetary threshold; or

(3) The offences against property under Chapter XVII of the Indian Penal Code.".
Last updated on September, 2016

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