Retrospective application of the Black Money Act violated the Art. 20, says Legal Experts

“Article 20(1) is a crucial constitutional safeguard in cases where, by a deeming fiction, a subsequent criminal law is intended to be applicable to a person’s past conduct. It enforces the age-old principal of nullum crimen sine lege, which means that there can be no crime without a law. A law imposing punishment should necessarily be in force at the time of commission of an offence.”

“The judgment of the Karnataka High Court, however, should be expected to have a limited application and is likely to be narrowly applied to only two situations – (i) where there did not exist a requirement to disclose foreign income and assets at the time when the resident assessee held the asset; or (ii) where the asset was diluted or extinguished prior to the Black Money Act coming into force. Both these conditions were found to be met in this case. In other cases where these conditions do not exist, it is still arguable that the initiation of criminal prosecution under the Black Money Act may not be hit by Article 20 (1).”

“It would be worth noting that the protection under Article 20 (1) extends only to criminal prosecution, and the law laid down in this judgment would not apply to tax assessment or imposition of fiscal penalties under the Black Money Act against persons who have
failed to disclose their foreign income and assets prior to its enactment.”