Flat Fines Under Jan Vishwas Act 2026 Risk Violating Article 14 Equality: Legal Analysis

The Jan Vishwas (Amendment of Provisions) Act, 2026, passed by Parliament in April 2026, was hailed as a landmark decriminalisation measure, replacing criminal penalties for minor administrative lapses with civil fines across 79 central laws. But as the Act is being notified in stages, a deeper constitutional problem has emerged: the uniform, flat fines at its core may violate Article 14's guarantee of equality by treating vastly different economic actors as if they were identical. Legal experts argue that the design of these penalties, which ignore the offender's ability to pay, is untenable under the Constitution's equality and proportionality jurisprudence.

The 2026 Act, which modifies 784 provisions across 79 statutes, carries forward the decriminalisation initiative begun by the earlier 2023 Act. It removes jail time for regulatory infractions such as faulty weighing scales, improper record-keeping, or minor labelling errors, substituting them with civil penalties. While the move away from criminal sanctions is widely welcomed, the method of calculating those penalties raises serious questions. Under the Legal Metrology Act, for instance, a first-time offender receives an improvement notice, a second offence draws a civil penalty, and a repeat offence a criminal fine—all at fixed amounts irrespective of the size or turnover of the business. A supermarket chain and a neighbourhood kirana store face the same rupee amount for the same lapse, making the fine a mere rounding error for the former but potentially a month's profit for the latter.

This one-size-fits-all approach strikes at the heart of Article 14. The Supreme Court of India has long recognised that equality does not forbid differential treatment; it requires that any classification be reasonable, have a rational nexus to the object sought, and be proportional. The constitutional threshold for proportionality was articulated as early as Chintaman Rao v. State of Madhya Pradesh (1950), where the Court held that any restriction must not go beyond what public interest genuinely requires. That principle was later applied in Om Kumar v. Union of India (2001) to test the quantum of administrative penalties. Read together, these cases suggest that a flat fine, which by design cannot be the least burdensome option for every offender it applies to, is vulnerable on functional grounds—not merely as rhetoric.

The classification problem is stark. Indian law routinely distinguishes businesses by turnover for GST rates, MSME classification, and audit requirements. When a penalty schedule ignores turnover entirely, it fails the intelligible classification test. Fining a start-up and a listed conglomerate the same amount for an identical lapse treats very different entities as identical, which is as much a constitutional problem as treating similar entities differently. A small business forced to pay the maximum flat penalty under any of the amended laws would have a genuine case to argue that the fine schedule fails the classification test and that its application fails the proportionality test for making no allowance for capacity to pay.

Notably, no such constitutional challenge has yet been reported. But that absence speaks more to the prohibitive cost of litigation for small businesses than to the validity of the law. Facing a fine of a few thousand rupees, most entrepreneurs would rather pay than fight a prolonged legal battle. The lack of a public register of repeat offenders—unlike the enforcement register maintained by the UK's Health and Safety Executive —also obscures whether large corporations simply budget for these fines as a routine cost of doing business, turning them into a de facto subscription fee rather than a deterrent. As one legal analyst put it, "Convenience for the regulator has come at the cost of fairness for the regulated, and fairness is not something our Constitution treats as optional."

Yet the solution is not difficult. India's own intellectual property laws, amended under the 2023 version of the same decriminalisation project, already employ a turnover-based penalty formula. Under Section 107(2) of the Trade Marks Act, 1999 and Section 42(2) of the Geographical Indications Act, 1999, falsely representing a mark as registered draws a penalty of 0.5 per cent of the offender's turnover, from audited accounts, or ₹5 lakh, whichever is less. Similarly, Section 122(2) of the Patents Act, 1970 imposes the same 0.5 per cent formula, capped at ₹5 crore. These precedents demonstrate that turnover-linked fines are administrable in India. If patent controllers and trademark registrars can compute half a per cent of an offender's turnover, the same mechanism can be applied to a shopkeeper under the Legal Metrology Act. GST returns, MCA filings, and Udyam data provide real-time turnover information without even requiring the offender to self-report.

The common administrative objection—that India lacks the enforcement machinery to verify turnover for millions of businesses—collapses when examined against this domestic precedent. The government's own 2023 amendments proved the feasibility of the approach within statutes administered by the same ministry. Furthermore, the PRS Legislative Research brief on the withdrawn 2025 version of the Act had flagged that the UK's standard-scale system and Australia's automatically adjusting penalty units solve a related problem of inconsistent fines across laws. That analysis was never incorporated into the final Act, even though it came from Parliament's own research arm.

A window to correct the flaw remains open. Section 1(2) of the 2026 Act empowers the Central Government to bring different provisions into force on different dates. As of mid-July 2026, only a fraction of the Act has been notified—the Finance Ministry switched on its amendments to RBI, LIC, and insurance laws on 23 June, and the Power Ministry did the same for the Electricity Act in early June. The Ministry of Commerce and Industry and the DPIIT, which control the notification schedule for many of the amended laws, do not need fresh legislation to adopt turnover-based fines for provisions not yet live. They already administer the Patents, Trade Marks, and GI Acts and have the drafting expertise to replicate the formula. Doing so at the notification stage would be far cheaper than awaiting a High Court to strike down a flat fine as arbitrary.

Ultimately, the decriminalisation drive is worthwhile, but it must be paired with a penalty design that respects constitutional equality. As the analysis concludes, " Substantive equality requires the law hurt every violator equally, not that it charge them all the same rupee amount." Turnover-based fines, calibrated to the offender's economic capacity, offer a proportionate and administratively feasible alternative. The government has both the precedent and the authority to act; the only question is whether it will seize the opportunity before the courts are forced to intervene.