Prevention Of Terrorism Ac2

The Unlawful Activities (Prevention) Act This paper tries to analysis the unlawful activities (prevention) act with respect to market failure and redistribution aspect in a law and economic framework. The paper describes the various problems related to the existing anti-terrorist act and analyses its efficiency followed by suggestions. Introduction:

“The true measure of crimes is the harm done to society” Cesare Beccaria, On Crimes and Punishment 64 (1764) September 11, 2001, shook the very foundation of the American government, with the attack on the twin towers and Pentagon causing havoc and terror in the minds of millions of people. Similarly, on December 11, 2001, the Indian Parliament was attacked by Lashkar-e-Taiba1 and Jaish-e-Mohammed2 terrorists, which led to the death of a dozen people (5 terrorists, 6 police and 1 civilian). Similar incidence has taken place in the markets in Delhi on October 29, 2005, striking random and indiscriminate terror in urban locations, have since been regular events. The recent incidence in Mumbai on November 26, 2008, caused the death toll to raise upto 173 and wounding at least 308 people. The victims of terrorism deserve justice and thus questions aroused regarding the appropriate policy of government regarding terrorism. Many acts were undertaken like the POTO (Prevention of terrorism ordinance) in 2001, Terrorist and Disruptive Activities (Prevention) Act (1985-95), which was repealed in 2004, to provide the legal framework to strengthen administrative rights to fight terrorism within the country of India. After the 2008 Mumbai attacks of parliament enacted another anti terror law known as Unlawful Activities (Prevention) Act, 2008. The concepts of economics are used to explain the effects of laws, to assess which legal rules are economically efficient, and to predict which legal rules will be promulgated. The recent focus of policymakers on measures to fight terrorism, it may be useful to examine what insights the field of economics has to offer to inform the development of counter-terrorism policy. One of the most fruitful areas within economics in this regard is the law and economics of criminal behavior. In many ways, terrorist activities resemble criminal activities, and so it might be useful to apply the economic models of crime in this area. The paper tries to analysis the Unlawful Activities (Prevention) Act in the following sections. The first section deals with the need for criminal law, the second section deals with the economics analysis of terrorism of crime, the third section deals with terrorism as an organized crime and the last four sections deal with the Unlawful Activities (Prevention) Act, the evaluation of the act using law and economy and the limitation followed by the conclusion.

Why Do We Need A Law? 1 2

is one of the largest and most active militant organizations in South Asia. is a major Islamic mujahedeen (is a person involved in a jihad) organization in South Asia

Law is an obligation backed by a state sanction, it is an intervention, an instrument for achieving social goals. A law is framed or formulated when there is a market failure or when there are issues regarding equity/ redistribution. Some policy analysts argue that the existence of market failure “provides a necessary and not a sufficient justification for public policy interventions” (Wolf, 1979; Weimer and Vining, 1992). Sufficiency is established when the gains from government intervention outweighs the dangers of government interventions. The Unlawful Activities (Prevention) Act will fall under the criminal law. Criminal law is concerned for both reasons and behavior since they are concerned with intentional harm. It should minimize the social cost of crime, which equals the sum of the harm it caused and the costs of preventing it (Cooter and Ulen, 2004). According to the principle of redistribution, justice requires absolving the innocent and punishing the guilty in proportion to their crimes. Conversely, injustice results from punishing the innocent, absolving the guilty, or punishing the guilty out of proportion to the seriousness of their crimes. An act should be declared criminal if doing so and seeking to deter it increases social welfare. Similarly, the crime should be punished to the extent that maximizes social welfare. The punishment’s extent should be proportional to the seriousness of the crime. Punishment in the criminal laws makes the injurer worse off without directly benefiting the victim. When the supply of crime is elastic, policy maker can reduce the crime significantly by moderate increase in expected punishment. When supply of crime is inelastic, however the variable encompassed by the economic model of rational crime are relatively less important for policy-makers than other variables, such as employment rates, family configuration, drug addiction, quality of schooling, etc. A coercive rule has the potential to benefit the public, by reducing the transactions costs of individuals within the market. The rule reduces the transaction costs by reducing the individual’s need to spend money on self- protection. An Act to provide for the making against individuals involved in terrorism-related activity of orders imposing obligations on them for purposes connected with preventing or restricting their further involvement in such activity; to make provision about appeals and other proceedings relating to such orders; and for connected purposes. Criminal punishment aims to deter intentional harms, not to compensate for them. Therefore criminal is needed since perfect compensation may be impossible, and second even if perfect compensation were possible, the law may seek to protect the rights of potential victims rather than their interests. Punishment is necessary for deterrence. In order to deter thieves, the law must impose enough punishment so that the expected net benefit of crime to the criminal is negative. The economic model of crime and law enforcement relies on the balance between the benefits from offending and the respective costs in terms of probability and severity of punishment, with respect to individuals (decision whether or not to commit a crime) and society (design of optimal law enforcement) to achieve efficient deterrence. Terrorism represents a peculiar form of crime, which poses several difficulties to the application of the neoclassical models of crime. It is a policy or ideology of violence intended to intimidate or cause terror for the purpose of "exerting pressure on decision making by state bodies. In the context of terrorist organizations, the crime results from

the concerted or interdependent action of various actors committing or possibly preventing offences. Agency problems, including coordination or team issues, are thus likely to be pervasive in the case of organized terrorist activities. Further, families of terrorist members may directly or indirectly support terrorist activities, concealing the whereabouts of the members or providing practical or financial assistance. There is an huge commitment of law-enforcement resources to fight terrorism and there are increasingly severe punishment for the terrorists. Terrorism as such involves negative externalities, it generates public good and there is a problem of information asymmetry, therefore there is a need for law. Terrorism, beyond its immediate impact on innocent victims, also raises the costs of crime, and therefore, imposes a negative externality on potential criminals. Terrorism raises the costs of crime through two channels: firstly, by increasing the presence and activity of the police force, and secondly, it causes more people to stay at home rather than going out for leisure activities. Terror groups generate public goods. The benefits that are generated by retaliation against terrorism are, at least in part, non-rival over individuals. Terrorist activity imposes costs on people regardless of where a particular terrorist incident occurs. The fact that a single citizen takes precautions against the general threat of terrorism does not reduce the precautions that are advisable for other citizens to take. Therefore, reducing the general threat of terrorism through retaliation generates a public good. If the only benefit provided by retaliation were a public benefit, then the problem of motivating cooperative retaliation among citizens would face the standard prisoner's dilemma. In the twoindividual case, each person will hope most to free ride on the retaliation of the other and fear most retaliating alone. The demands of individual rationality then result in neither individual retaliating, which is collectively the worst possible outcome. Thus, the government will intervene and will take precautions. The terrorists try to increase their organization’s size through enhanced resources, successful operations, and recruitment, while the government tries to limit the group’s size through raids, intelligence, group infiltration, and actions to ruin their successes. It is also necessary to assess the role of information and intelligence on behalf of the terrorists and the authorities. Given how little governments really know about the strength of the terrorists that they confront - asymmetric information characterizes efforts to ruin terrorism. Similarly, the terrorists are ill-informed about the resolve of the government and the amount of resources that it is willing to assign to curbing terrorism and they are also not well informed about their punishment. Since most criminals are imperfectly informed about the benefits of crime and the probabilities and magnitude of punishment (Cooter and Ulen, 2004). Thus, there exists an information asymmetric problem. There is a huge cost included in having such law but the benefits derived are outweighing the costs and therefore there is need for a criminal law. For example, the cost associated with airport security. The value of lost time as travelers are screened must be added to the cost of guards and screening equipment. On the benefit side, calculations are less transparent. One way to estimate a portion of this benefit would be to compute the reduced loss of life attributable to airport security measures, i.e., fewer people killed in

skyjackings. Thus, there is a need for law and government intervention since is socially viable. Economic Analysis of Terrorism as a Crime: The basis of economic model of individual behavior is based on the assumption that people rationally choose among their opportunities to achieve the greatest satisfaction of their preferences. Economists commonly assume that individual has perfect information on all these opportunities. There are two ways by which the society can influence the individual behavior. The first would be to construct policies to shape the opportunities from among which an individual can choose and second would be to construct policies to shape the preferences upon which the individual makes her/his choice for desired behavior relatively to her/his opportunities for undesired behavior. Economics has two criteria for judging the desirability of behavior or policies from societal perspective the first is Pareto Optimality3 and the second criterion is social welfare maximization. In economic analysis, crime can be characterized as an externality4. The costs may be distributional in terms of frustration of the affected people. Some crimes like the “crimes of passion” can be defined in economic terms as crimes motivated by interdependent negative utilities. Example murdering someone because of hatred or murdering someone in the name of religion, etc., can be included in this since in such cases there is no wealth transfers in any obvious sense. While comparing the offender’s utility with the victim’s disutility, indeed there can be a fundamental asymmetry between the pleasure that one would obtain from killing another person for dishonoring her/him the victim’s pain and life. Crime of passion bypasses implicit market5 and explicit markets. This is not an efficient act since the wealth of the society is not increased. The preferences of terrorists are very important to the understanding of the benefits from offending as well as for establishing effective punishment. Penalty enhancements only make sense in the economic model if perceived as more severe by potential and actual offenders, and not just by the society. Although many commentators suspect that ordinary punishment is inappropriate because terrorists have peculiar preferences, the fact of the matter is that there has been no empirical assessment of preferences for terrorism and governments suspect that terrorists care about the severity of ordinary punishment to same extent. Another strand of the economic literature looks at criminal incapacitation 3

A society is said to be in Pareto Optimal state if resources are distributed among the members of the society in such a way that no redistribution of resources can make one member better off without making another member worse off and thus are called as “ allocatively efficient” or just “efficient” 4 Externality is an action or activity by which a person realizes her/him preferences, despite the fact other people have incompatible preference, and this incompatibility is not accommodated through the market. 5 Friendship, love, respect, etc

rather than deterrence. Efficient incapacitation is achieved by eliminating opportunities for terrorism at minimum cost for society. One possibility is simply to eliminate the physical ability to commit offenses by imprisonment or by imposing the death penalty. Another possibility is to reduce assets made available to terrorism by cutting terrorists off from their funds. A third alternative is to increase the distance between terrorists and potential victims by imposing harsher immigration laws, including deportation. In the standard models of crime, offences are committed by rational individuals who decide whether or not to commit the crime based on the probability and severity of punishment. Some of the insights provided in the context of the rational individual can be usefully carried over into the terrorism context. For example, it has been noted in the literature that expected punishment should increase with the harmfulness of the criminal act (Polinsky and Shavell 1992). One can argue that terrorism is usually associated with more socially costly offenses and much more serious consequences, and so enforcement should be harsher. The economic models of marginal deterrence could become a serious concern for terrorism. Marginal deterrence becomes relevant when criminals choose their criminal conduct from a range of harmful acts to commit. In such contexts, the threat of sanctions plays a dual role. Sanctions should aim at deterring the lesser crime, but for individuals who choose to commit the lesser crime, there should be a sufficient escalation in the threat to deter the commission of the more serious crime. For example, penalties for the bombing of a building should be high enough to deter the act, but maximal penalties should only be imposed for the most harmful terrorist activities (Stigler, 1970; Wilde, 1992). Terrorism is usually a cooperative crime in the sense that it involves more than one individual. In this context, distrust between agents and principals may deter crime ex ante and reveal information and evidence ex post. Legal mechanisms that create distrust between different parties (e.g., plea-bargaining or leniency programs) generate a chilling effect so that the different parties are less likely to violate the law (since each party is afraid that the other will make a deal with the authorities and provide incriminatory evidence). In the case that a violation does happen, the same legal mechanism is useful to get information and evidence from the different parties. Naturally well-designed pleabargaining or leniency programs increase the effectiveness of law enforcement and reduce enforcement costs. However, if not well designed, plea-bargaining could be counterproductive because it diminishes the expected cost of illegal activities and thus it generates more terrorism (Garoupa 2005). Another strand of economists who are interested in behavior treats terrorists, as behaving rationally. They assume that once terrorists have decided on their objective, they go about their beastly business in a rational manner, given the resources at their disposal. These include their own financial resources, shelter, and logistic and other support (e.g, expertise, training, intelligence information) offered by other groups. Resources can be augmented by training, by profits derived from legitimate businesses, by conversion of new recruits to the cause, and by other means. The reports of Al-Qaida training camps in Afghanistan, and training camps of other groups elsewhere, make perfect sense to an economist. This is an investment that pays off in terms of future terrorist productivity, i.e., increased effectiveness per incident. Bombings are by far the preferred method of

terror. The reason, once more, has to do with the cost of the action. Hostage taking is logistically more complex and operationally more risky than is bombing. Bombing is not only cheap for the terrorist but more costly to detect for government. Once more, as theory predicts, a lower cost will attract more activity. Thus, accordingly terrorism is not a “crime of passion.” instead, terrorists are rational who take lives deliberately, or else who use the threat of taking lives as a tool of negotiation to achieve their objectives at least-cost. Terrorism and Organized Crime: While an individual may independently carry out an act of terrorism, the nature, the goal and the magnitude of terror crimes make terrorism more like an organized crime than individual crime. Organized crime can be characterized as exhibiting economies of scale, undertaking violence against other legal and illegal business, creating a hierarchy which internalizes negative externalities and manages a portfolio of risky activities, and avoiding resource dissipation through competitive lobbying and corruption (Fiorentini and Peltzman 1995). For organized crime, the criminal market is their primary market and legitimate market is the secondary market. Organized crime and terrorists get into legitimate markets in order to improve its standing on the criminal market and there is exists a strong group liability among its members. This characterization can easily be applied to terrorism, the Taliban government of Afghanistan as the obvious example. There are two different rationales for group liability. The first is based on the idea that terrorism has a “constituency” that benefits from terrorist acts. The group liability would target the constituency who benefited from the terrorist act. This is a rationale that focuses on the wrongdoers’ external benefits. The second rationale instead focuses on the identification of superior enforcers. Liability is imposed on the wrongdoer’s group not because the group benefits from the terrorist acts, but because the group can monitor and prevent terrorist acts more effectively. Large financial liability of groups and families that provided support, or could have prevented the commission of a terrorist act serves this purpose. In certain settings, this form of “communal liability” might prove more effective than individual criminal liability of those who were directly involved in the terrorist activity. This claim, based on Becker's analysis, supposes that spreading liability to the members of the group or family infrastructure will provide some level of internal monitoring, and eventually ex post sanctions on members of the group that occasioned the imposition of financial liability on the group as a whole. Historically, communal liability thrives in social contexts where local groups and families have better information than potential victims and central enforcement authorities, thus providing less expensive preventive measures. Obviously, in the case of terrorist activities, local monitoring should be augmented with central enforcement. Through communal liability, local groups and families should be given incentives to cooperate with central enforcement authorities in the prevention of terrorist activities. The creation of internal monitoring incentives created by communal liability should be evaluated against the common pool effects that such system creates. The history of communal

liability rules in ancient law can be used to illustrate this tension. Historically, the boundaries of the “group” for communal responsibility purposes tend to narrow overtime. Economic analysis of organized crime has stressed welfare comparisons between different market structures (monopoly versus competitive supply) of offenses. Crimes are economic bads, not goods. A monopolistic market is more efficient than a perfectly competitive one in the presence of bads because the output is smaller (Buchanan, 1973; Reinganum, 1993; Garoupa, 2000). Besides monopoly power, transaction costs also determine the activities of organized criminal firms, being more successful when there is a production cost advantage. The criminal organization can be modeled as a vertical structure where the principal extracts some rents from the agents through extortion (Konrad and Skaperdas 1997). Extortion in the context of terrorism is costly because they are enforced by kidnapping and murder. When extortion is costly because the criminal organization resorts to threats and violence, the existence of extortion is social welfare diminishing and may lead to more expenditure on law enforcement. Violence further arises when the criminal organization wants to monopolize the market or avoid competitive entry. Moreover, in the long run, the terrorist group can usually replace internal violence by reputation increasing profits and saving on labor costs (Reuter 1983). The problem posed by an employee is that his detection can compromise the whole organization with higher probability than an external subcontractor. Employees can provide information about past and future deals leading to arrest and seizure of assets involved in the transaction. Therefore the entrepreneur aims to structure the relationship so as to reduce the amount of information available to them concerning his own participation, and to ensure that they have minimal incentive to inform against him. Moreover, employees are afraid of other employees. Thus dispersion and monitoring naturally emerges as to control individual risk In policy terms, sanctioning the organization more severely affects not only the dimension but also the characteristics of a criminal network. Severe punishment reduces the dimension of the network, but it might increase the effectiveness (criminal productivity) of its members. Eventually smaller firms are easier to manage and consequently fewer mistakes are committed, diminishing the likelihood of detection The terrorist groups also face organizational problems that are more easily managed in smaller groups. Also, given the public nature of the good they produce, a smaller group may be more effective since there will be less free-riding (Olson 1971). To effectively monitor and provide adequate incentives to workers, terror groups tend to tap into existing social networks such that they can select for high demanders of the public good. They also use the social network to provide incentives in cases where standard labor incentives are not possible (e.g., when success requires that the worker dies). So, for example, if terror organizations each draw their employees from cohesive communities, the value of status (even past death) is greater, and there can be strong expectations that rewards and punishments will be visited upon surviving individuals about whom the worker cares a great deal. Of terror activities, it makes sense that workers are often selected on the basis of their religiosity since expectations regarding the afterlife can provide strong incentives and can allow for very effective monitoring (Klick forthcoming).

Terror groups also seem to build counterparts in legitimate markets, these legitimate businesses or political groups serve to help fund the terror activities (e.g., Sinn Fein and the IRA, some of the Islamic charity groups that have come under suspicion in recent years, religious schools in Afghanistan, Batasuna and ETA, etc.). This vertical integration arises given the high transactions costs terror groups would have in dealing with completely legitimate businesses (Iannaccone 2004). With this background, the next section deals with the unlawful activities (Prevention) Act which was introduced in order to combat terrorism within the state. The Unlawful Activities (Prevention) Act: India has been a front-runner in the global fight against terrorism, its commitments in terms of the United Nations Security Council Resolution 13736 dated 28th September, 2001 and the resolve not to allow any compromise in the fight against terrorism. The Unlawful Activities (Prevention) Amendment Act, 1967 was formulated inorder to provide a more effective prevention of certain unlawful activities of individuals and associations and for matters connected therewith. It was further amended in 2008 to make provisions to deal with terrorism and terrorist activities and the following preamble were inserted, namely: “WHEREAS the Security Council of the United Nations in its 4385th meeting adopted Resolution 1373 (2001) on 28th September, 2001, under Chapter VII of the Charter of the United Nations requiring all the States to take measures to combat international terrorism; AND WHEREAS Resolutions 1267 (1999), 1333 (2000), 1363 (2001), 1390 (2002), 1455 (2003), 1526 (2004), 1566 (2004), 1617 (2005), 1735 (2006) and 1822 (2008) of the Security Council of the United Nations require the States to take action against certain terrorists and terrorist organisations, to freeze the assets and other economic resources, to prevent the entry into or the transit through their territory, and prevent the direct or indirect supply, sale or transfer of arms and ammunitions to the individuals or entities listed in the Schedule; AND WHEREAS the Central Government, in exercise of the powers conferred by section 2 of the United Nations (Security Council) Act, 1947 has made the Prevention and Suppression of Terrorism (Implementation of Security Council Resolutions) Order, 2007; AND WHEREAS it is considered necessary to give effect to the said Resolutions and the Order and to make special provisions for the prevention of, and for coping with, terrorist activities and for matters connected therewith or incidental thereto.”

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The resolution aimed to place barriers on the movement, organization and fund-raising activities of terrorist groups. It stated that all States "should also ensure that terrorist acts are established as serious criminal offences in domestic laws and regulations and that the seriousness of such acts is duly reflected in sentences served."

The Act is extended to whole of India and it bans certain unlawful association (which has for its object any unlawful activity, or which encourages or aids persons to undertake any unlawful activity, or of which the members undertake such activity; or which has for its object any activity which is punishable under section 153A or section 153B of the Indian Penal Code, or which encourages or aids persons to undertake any such activity, or of which the members undertake any such activity) to be formed in India. A new section was substituted for section 15 in the principal Act, which basically tries to define a terrorist act. Accordingly, whoever tries to threaten or likely to threaten the unity, integrity, security or sovereignty of India or with intent to strike terror or likely to strike terror in the people or any section of the people in India or in any foreign country by using bombs, dynamite or other explosive substances or inflammable substances or firearms or other lethal weapons or poisons or noxious gases or other chemicals or by any other substances (whether biological radioactive, nuclear or otherwise) of a hazardous nature or by any other means of whatever nature to cause or likely to cause death of, or injuries to, any person or persons; or loss of, or damage to, or destruction of, property; or disruption of any supplies or services essential to the life of the community in India or in any foreign country; or damage or destruction of any property in India or in a foreign country used or intended to be used for the defense of India or in connection with any other purposes of the Government of India, any State Government or any of their agencies; or overawes by means of criminal force or the show of criminal force or attempts to do so or causes death of any public functionary or attempts to cause death of any public functionary; or detains, kidnaps or abducts any person and threatens to kill or injure such person or does any other act in order to compel the Government of India, any State Government or the Government of a foreign country or any other person to do or abstain from doing any act, commits a terrorist act. Insertion of new section of 16A, which deals with the punishment for making, demands of radioactive substances, nuclear devices, etc. with the intention of aiding, abetting or committing a terrorist act, shall be punishable with imprisonment for a term which may extend to ten years, and shall also be liable to fine. Further a person will 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 for raising fund for terrorist activities or for organizing any camp or camps for imparting training in terrorism under section 18A and 18B. Insertion of new sections, 43A to 43F, which gives power to arrest, search, etc. to the authorities. Any person has committed an offense that is punishable under this act, then the designated officer has the power to arrest such an individual or search such building conveyance or place whether by day or by night. She/he can authorize the power with the believe from personal knowledge or information given by any person and taken in writing that any person has committed an offence punishable under this Act or from any document, article or any other thing which may furnish evidence of the commission of such offence or from any illegally acquired property or any document or other article which may furnish evidence of holding any illegally acquired property which is liable for seizure or freezing or forfeiture under this. Any officer arresting a person under this act shall, inform as soon as may be, the grounds for such arrest and shall be forwarded

without delay to the officer in charge of the nearest police station .The provisions of the Code of Criminal Procedure, 1973 shall apply. If the court is satisfied with the report of the Public Prosecutor indicating the progress of the investigation and the specific reasons for the detention of the accused beyond the said period of ninety days, can extend the said period up to one hundred and eighty days. Provided if the police officer requests, for the purposes of investigation. Section 438 of the Code7 cannot be applied to such cases. An individual is obliged to give information to the investigating officer where the investigating officer has reason to believe that such information will be useful for, or relevant to, the purposes of this Act. The failure or deliberately furnishing false information shall be punishable with imprisonment for three years or with fine or with both. The Act inserts a new section for preventing and coping with terrorist activities. The Central Government can freeze, seize or attach funds and other financial assets or economic resources or prohibit any individual or entity from making any funds, financial assets, if the person engaged in or is suspected to be engaged in terrorism. Evaluation of the Acts using Law and Economics Perspective: The Unlawful Activities (Prevention) Act, which was passed by the parliament, is analyzed with respect to the cost and benefit of the society and that whether it is efficient enough or not. This act provides the concerned authority with adequate amount of power to fight back terrorism, which is necessary. It is necessary to consider that whether the net social benefit acquired from it is greater than the net social loss. Since the negative externality is quite high, therefore strict rules and heavy punishment are introduced to combat it and which will act as an incentive to avoid it. The law basically tries to address the market failures associated with it and this law does not really serve its purpose. There is every possibility that an individual be easily victimize since officials who arrest and prosecute people do not have much information about who did what as they can arrest an individual on the basis of suspicion. Proper information should be taken before arresting an individual. It further adds other kinds of negative externalities like harassment by police, etc due to the implementation of this act. Justice as represented by the principle of redistribution and efficiency is to minimize the social costs of crime (can be divided into property and personal losses of the victim and public and private costs of preventing crime) and accordingly we can suggest that this act has not been able to minimize the social since there are an increase number of death tolls and injuries caused to both property and personal. The 2008 amendment extends the maximum period of pre-charge detention to 180 days, if after 90 days the public prosecutor can show that the investigation has progressed but more time is needed. A judge considering the extension of pre-charge detention should consider whether there is adequate evidence against the accused, justifying his/her continuing detention, not merely whether the investigation is progressing. This is not efficient since results in delay which can be intentional or otherwise and it is economically not viable. 7

When any person has reason to believe that he may be arrested on an accusation of having committed a non-bailable offence, he may apply to the High Court or the Court of Session for direction under this section; and that court may, if it thinks fit, direct that in the even of such arrest, he shall be released on bail.

Under section 51A of the Bill the Central Government has the power to “freeze, seize… attach” and prohibit the use of “funds, financial assets or economic resources” of individuals who is suspected to be engaged in terrorism. Under this section the Central Government can also prevent the entry into or the transit through India of individuals who are suspected to be engaged in terrorism. This power is excessively broad. This provision essentially empowers the Indian government to exercise control over the finances or movements of an individual on the basis of mere suspicion. Thus anyone could be targeted if the government had an interest in freezing their assets or preventing their entry into India, and the accused would have little alternative, as suspicion is inherently difficult to disprove and is therefore inefficient. The powers of arrest have been widened which gives unfettered powers to the police to ask anybody to furnish information in his possession “in relation” to an offence under the Act “on points or matters” where she/he has reason to believe it “will be useful for or relevant to the purpose of the Act”. The 2008, Amendments deny an accused person bail if the court believes that, based on the evidence so far, the accusations against him/ her are prima facie true. It is inappropriate for the judge to consider the guilt or innocence of the accused at a bail hearing. The purpose of a bail hearing is to determine whether the accused will abscond or commit any offences while on bail. At this early stage of proceedings it is highly unlikely that the prosecution will have adequate evidence to prove that the case against the accused is prima facie true. Despite a lack of evidence, however, judges are likely to refuse bail for fear or appearing lenient on alleged terrorists. The 2008 Act, also deny bail to all non-citizens who have entered India “illegally”, thus denying bail to all asylum seekers or refugees not recognized by the government. The right to a fair trial is protected under Article 14 of the International Covenant on Civil and Political Rights (ICCPR), which India is a part. Article 14 protects a number of rights considered necessary for a trial to be fair, including the presumption of innocence and the right to silence (International Covenant on Civil and Political Rights (adopted 16 December 1966, entered into force 23 March 1976) 999 UNTS 171, article 14(2) and article 14(3)(g)). Therefore, any anti-terror legislation must not violate the right to a fair trial by denying an accused the presumption of innocence or reversing the burden of proof. The UK’s Joint Committee on Human Rights has recommended “all terrorism legislation should have a life limited to five years maximum, and require renewal by primary legislation not ministerial order”. In India, the government’s December 2008 amendments have grafted anti-terrorism provisions into the ordinary criminal law, thus making terrorism legislation permanent, unless it is repealed or amended Limitation: The main limitation of this law is that it over- equips/powers its authorities and that it is difficult since while implementation of this act there are certain problems which is faced

by the local people. Thus how does the general administrative set up as well as the institutional environment function in the grass root level is the main concern. The definition of terrorist act is not adequate and should be further looked upon. Further provisions are required to be made in the law to cover various facets of terrorism and terrorist activities, including financing of terrorism, which are not fully covered in the present law, and to make further provisions with the aim of strengthening the arrangements for speedy investigation, prosecution and trial of cases related to terrorism related offences, while at the same time ensuring against any possible misuse of such provisions

.Conclusion: The bill incorporated provisions borrowed from previous anti-terrorist laws, which were discredited due to their misuse by the police and their anti-rights measures. Yet, despite the fact that these past anti-terror laws failed to achieve their objective, and divided Indian society by being used predominantly against minority groups. Terrorist and Disruptive Activities (Prevention) Act 1987 (TADA), and the Prevention of Terrorism Act 2002 (POTA) were criticized as draconian and anti-rights. In 2004 the government introduced amendments to the Unlawful Activities (Prevention) Act 1967 (UAPA), thus making it India’s main anti-terror legislation. The December 2008 Unlawful Activities (Prevention) Amendment Bill further amends this Act. According to the government, the December 2008 amendments balance the need to fight terrorism with the need to protect civil liberties (P Chidambaram, Parliamentary debates, 10 December 2008) Having in mind the nature of terrorism, we should look at efficient legal policies at the individual and organization levels. Financial penalties are unlikely to play any substantive role with respect to individual terrorists, but may play a larger role regarding fund-supporting organizations. The effectiveness of deportation is enhanced when applied to well-known leaders (e.g., radical clerics) rather than minor and obscure members of the organization. While preventing terrorist acts requires deterring those individuals who would otherwise commit the acts, the role of terrorist organizations and networks suggests that anti-terrorism policy must focus incentives and punishment on the terrorist group as well as the individual terrorist. At the individual level, the standard crime models may need to be modified slightly to generate useful predictions and policy prescriptions in the terrorist context. For example, some terrorists may gain utility from the prospect of receiving certain punishments (e.g., the death penalty) if they wish to be viewed as martyrs for their cause. Therefore, some other forms of punishment will be more effective like shaming mechanisms that are likely to lower the terrorist’s status among his network could be relatively effective. The government must also promote social cohesion and address the grievances of its constituents so to “lessen the influence of terrorist propaganda”. Former UN Secretary-General Kofi Annan has argued that “discrimination on the basis of ethnic origin or religious belief… create[s] grievances that can be conducive to the recruitment of terrorists, including feelings of alienation and marginalization and an increased propensity to seek socialization in extremist groups.” Terrorist laws, such as TADA and POTA, have been used to target minority communities

in India. The state governments should also ensure that any tough anti-terror provisions are balanced by safeguards against police brutality, corruption, and discrimination. A number of expert commissions have advocated the establishment of a Police Complaints Authority in each state to ensure that police actions are within the law and to allow citizens to lodge complaints against police abuse of power such as arbitrary arrest and detention.

Subhashree Banerjee Mphil Scholar, Center for Development Studies, Trivandrum. Reference: 1. Cooter, R. and T. Ulen (2004): “Law and Economics”, Pearson Addison Wesley, Boston 2. Dau-Schmidt, K. and T.Ulen (2002): “ Law and Economics Anthology”, Anderson Publishing Co., Ohio 3. Hirsch, W. (1979): “Law and Economics- An Introductory Analysis”, Academic Press, New York. 4.

Nair, R. (2009):“The Unlawful Activities (Prevention) Amendment Act2008: Repeating Past Mistakes”, Economic and Political Weekly, January, pp. 10 - 14

5. Posner, R. (2003): “Economic Analysis of Law”, Aspen Publisher, New York. 6. Zerbe, R. (2001): “Economic Efficiency in Law and Economics”, Edward Elgar Publishing Limited, Cheltenham