WORKSHOP ON COMPANIES ACT, 2013
Challenges and Opportunities for Chartered Accountants
PART - 2
WIRC - AHMEDABAD - 26.10.2013
1
WORKSHOP ON COMPANIES ACT, 2013
PENALTIES / PUNISHMENT FOR DEFAULTS
FOR PROVISIONS w.e.f. 12.09.2013
WIRC - AHMEDABAD - 26.10.2013
2
WORKSHOP ON COMPANIES ACT, 2013
Section
Offence
Penalty / Punishment
33
•
Issue of application form for purchase of any of
the securities of a Company un-accompanied by
an abridged prospectus other than for
underwriting agreement or for securities not
offered to the public or
Not furnishing a prospectus on a request made by
any person before the closing of the subscription
list and the offer
Company- Penalty of fifty
thousand rupees for each
default [section 33(2) ]
•
34
•
Issue, circulation or distribution of a prospectus
containing any statement which is untrue or
misleading in form or context or any inclusion or
omission of any mater in such prospectus which is
likely to mislead.
Every person who authorized
issue of such prospectus liable
for action under section 447
titled ‘Punishment for fraud’.
36
•
Any person knowingly or recklessly making any
statement, promise or forecast which is false,
deceptive or misleading or who deliberately
conceals any material facts, to induce another
person for entering into (a) an agreement for
acquiring, disposing of, subscribing for or
Such person is liable for action
under section 447 titled
‘Punishment for fraud’.
WIRC - AHMEDABAD - 26.10.2013
3
WORKSHOP ON COMPANIES ACT, 2013
Section
Offence
Penalty / Punishment
36
Underwriting securities or (b) for entering into an
agreement to secure a profit to any of parties from the
yield of securities or by reference to fluctuations in the
value of securities or (c) for entering into any
agreement for or with view to obtaining credit
facilities from any bank or financial institution.
38
Any person who :
• Makes or abets making of any application in a
fictitious name to a company for acquiring or
subscribing for its securities or
Such person is liable for action
under section 447 titled
‘Punishment for fraud’.
[ Section 38(1) ]
•
Makes or abets making multiple applications to
the company in different names or in different
combinations of his name or surname for
acquiring or subscribing for its securities or
•
Otherwise induces directly or indirectly a company
to allot or register any transfer of securities to him
or to any other person in a fictitious name .
Where a person has been
convicted under section 38, the
court
may
also
order
disgorgement of gain, if any,
made by and seizure and
disposal or the securities still in
possession of such person
(section 38(3))
WIRC - AHMEDABAD - 26.10.2013
4
WORKSHOP ON COMPANIES ACT, 2013
Section
Offence
Penalty / Punishment
39(3)
Failure to return to the applicant of securities within
such time and in such manner as may be prescribed
the amount received if the amount stated in the
prospectus as the minimum amount has not been
subscribed and if the sum payable on application is
not received within a period thirty days from the date
of issue of prospectus or such other time limit as may
be specified by SEBI
Fault continues or one lakh
rupees whichever is less
(Section 39(5)]
39(4)
Failure to file with the Registrar a return of allotment
of securities in such manner as may be prescribed
Company and its officer in
default – penalty for each
default, of one thousand rupees
for everyday during which
default continues or one lakh
rupees whichever is less
(Section 39(5))
40
•
Company – fine not less than
five lakh rupees which may
extend to fifty lakh rupees.
•
Default to make an application to one or more
recognized stock exchanges before the issue of a
prospectus for person for the securities to be dealt
whit in such stock exchange or
Default in stating the name or names of stock
exchange in which the securities shall be dealt
with or
WIRC - AHMEDABAD - 26.10.2013
Officer in default –
imprisonment for a term which
may extent to one year or with
fine not less than fifty thousand
5
WORKSHOP ON COMPANIES ACT, 2013
Section
Offence
Penalty / Punishment
40
•
Default in complying with requirements that all
application monies received by the company to be
kept in separate bank account in a schedule bank
and not to be utilized for any purpose other than
adjustment against allotment of securities or for
refund to applicants where company is unable to
allot securities.
Rupees which may extend to
three lakh rupees or with both
(Section 40(5) )
57
A person deceitfully personates the owner of any
share or interest or any share warrant or coupon
issued in pursuance of this Act obtains or attempts to
obtain any such share, interest, coupon, share warrant
or any money due to such owner.
Imprisonment for a term not less
than one year which may extend
to three years and with fine not
less than one lakh rupees which
may extend to five lakh rupees.
(Section 57)
58(6)
A person contravenes the order of Tribunal regarding
transfer or transmission of any right to securities or
interest of a member in a private company or a public
company.
Imprisonment for term not less
than one year which may extend
to three years and with fine not
less than one lakh rupees which
may extend to five lakh rupees
(Section 58(6) )
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6
WORKSHOP ON COMPANIES ACT, 2013
Section
Offence
Penalty / Punishment
58(6)
59(5)
Also Tribunal can invoke
provisions of contempt of courts
Act, 1971 and punish for
contempt section 425
Default in complying with the order of the Tribunal
regarding transfer or transmission or rectification of
the register of members and direction to the company
to pay damages, if any, sustain by the party aggrieved
•
•
•
WIRC - AHMEDABAD - 26.10.2013
Company – Fine not less
than one lakh rupees which
may extend to five lakh
rupees.
Officer in defaultImprisonment for a term
which may extend to on year
or with fine not less than
one lakh rupees which may
extend to three lakh rupees
or with both (Section 59(5)
Also, Tribunal can invoke the
provisions of contempt of
courts act, 1971 and punish
for contempt section 425
7
WORKSHOP ON COMPANIES ACT, 2013
Section
Offence
Penalty / Punishment
60(2)
Notice/ Advertisement / other official publication /
business letter, bill head or letter paper of company
contains a statement of authorised capital without
equally prominent statement of subscribed and paidup capital.
Company – penalty of ten
thousand rupees for each
default.
Every Officer in default penalty
of five thousand rupees for each
default.
(Section 60(2)}
68(11)
Contravention of the provisions of section 68
regarding buy –back of shares of other securities of a
company viz :-
Company – fine not less than
one lakh rupees which may
extend to three lakh rupees.
Officer
in
default
–
imprisonment for a term which
may extend to three years or
fine not less than one lakh
rupees which may extend to
three lakh rupees or which both
(Section 68(11).
(a) Authorisation of buy-back contained in the
articles.
(b) (passing of special resolution authorizing the buy
– back.
exclusion for (b) – buy-back for ten percent or
less of the total paid-up capital and free
reserves of the company and approved by
resolution by the Board of Directors at is
meeting.
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8
WORKSHOP ON COMPANIES ACT, 2013
Section
Offence
Penalty / Punishment
68(11)
(c ) the buy-back is twenty – five per cent or less of the
aggregate of paid up capital and free reserves of the
company.
(d) buy-back of equity shares in any financial year is
less than twenty-five percent of its total paid-up
equity capital in that financial year.
(e) Debt-equity ration after such buy-back is not more
than twice the paid up capital and its free reserves
unless specified at a higher ration by the central
government.
(f) Such shares and specified securities are fully paid
up.
(g) Such buy back by a company listed on any
recognized stock exchange is in accordance with SEBI
Regulation s and in respect of other company is in
accordance with the rules as may be prescribed.
(h) Such buy-back is not made within a period of one
year from the date of closure of the preceding offer of
buy back.
(i) Notice of the meeting for such buy back contains an
explanatory statement as prescribed for such
resolution.
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WORKSHOP ON COMPANIES ACT, 2013
Section
Offence
Penalty / Punishment
68(11)
(j) Such buy back to be completed within one year
from date of the passing of special resolution at the
general meeting or resolution by the Board of
Directors.
(k) Such buy back is from the persons specified in
section 68(5).
(l) A declaration of solvency as prescribed in section
68(6) is filed with the Registrar and by the listed
company also with SEBI duly verified as prescribed
before making the buy back.
(m) After buy back extinguish and physically destroy
the shares or securities so bought back within seven
days of completion of buy back.
(n) Not to make a further issue of same kind of shares
or other securities within six months except issue of
bonus, shares or conversion of warrants, stock option
scheme or sweat equity or conversion of preference
shares or debentures into equity shares.
(o) File with the Registrar a return of buy back within
thirty days of completion of buy back and by a listed
company also with SEBI.
WIRC - AHMEDABAD - 26.10.2013
10
WORKSHOP ON COMPANIES ACT, 2013
Section
Offence
Penalty / Punishment
68(11)
Listed company’s buy back of shares or other specified
securities not compliant with SEBI Regulations for buy
back.
Company fine not less than one
lakh rupees which may extend
to three lakh rupees.
Officer
in
default
–
imprisonment for a term which
may extend to three years or
fine not less than one lakh
rupees which may extend to
three lakh rupees or with both
[Section 68(11)]
86
•
Company – fine not less than
one lakh rupees which may
extend to ten lakh rupees.
Officer
in
default
–
imprisonment for a term which
may extend to 6 months or with
find not less than twenty five
thousand rupees which may
extend to one lakh rupees or
with both.
(section 86)
Failure to register charges on or property or assets
or undertaking (whether situated in or outside
India, Whether tangible or intangible and whether
charge created in our outside India) with the
Registrar within thirty days of such creation, as
may be prescribed or within a period three
hundred days of such creation as may be allowed
by the Registrar with prescribed additional fees.
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11
WORKSHOP ON COMPANIES ACT, 2013
Section
Offence
86
•
•
•
•
91(2)
Penalty / Punishment
Failure to register with ROC modification of terms/
conditions or extend of operation of any change.
Failure to register with ROC acquisition of property
subject to change.
Failure to give intimation of payment or
satisfaction in full within thirty days such payment
or satisfaction.
Failure to keep at its registered office a register of
charges in the prescribed manner and to allow
inspection of such register.
Failure to give 7 days previous notice as prescribed or
giving shorter notice and closing the register of
members, or of debenture holders or of other security
holders or
• Keeping such registers closed for any period or
periods exceeding in aggregate 45 days in a year
or exceeding 30 days at any one time.
WIRC - AHMEDABAD - 26.10.2013
Company and every officer in
default – penalties of five
thousand rupees for every day
during which the register is
closed but not exceeding one
lakh rupees
[section 91(2)]
12
WORKSHOP ON COMPANIES ACT, 2013
Section
Offence
Penalty / Punishment
102
Default in complying with the provisions of section
102 i.e.:
(i) To set out an explanatory statement containing
material facts of each item of special business to
be transacted at a general meeting.
(ii) To specify the nature of the concern or interest
financial or otherwise of every director and the
manager and of every other key managerial
personnel and relatives of the said persons.
(iii) To specify any other information and facts that
may enable the members to understand the
meaning scope and implications of the items of
business and to take a decision thereon.
(iv) Where any item of special business to be
transacted at the meeting relates or affects any
other company, the extent of shareholding
interest in that other company of every
promoter, director, manager and of every other
key managerial personnel of the first mentioned
company also to be set out in explanatory
statement if such shareholding is not less than
two percent of the paid up share capital of that
company.
(i)
On account of nondisclosure or in sufficient
disclosure of concern or
interest of any promoter
director, manager or other
key managerial personnel
or their relatives – any
benefit accruing to such
person shall be held in in
trust for the company and
such person is liable to
compensate the company
to the extent of the benefit
received by him. (section
102(4))
(ii)
Every
promoter
director,
manager,
or
other
key
managerial personnel who is in
default
- fine which may
extend to fifty thousand rupees
or five times the amount of
benefit accruing to such person,
or any of his relatives
whichever is more (section
102(5))
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13
WORKSHOP ON COMPANIES ACT, 2013
Section
Offence
Penalty / Punishment
102
(v) Where any document is referred to any business to
be transacted at the meeting, specification of time
and place for inspection of such document.
105(3)
Default in making a statement regarding members
right to vote by proxy(ies) with reasonable
prominence in notice calling the meeting of a
company.
(Applicable to co. having share capital/ co. whose
articles allow proxy)
Office in default - Fine which
may extend to ì 5,000
105(5)
Invitations to members to appoint as proxy a person
or one or more persons mentioned in invitations &
Invitations issued at Company’s expense.
Every officer of the co. who
issues such invitation or willfully
authorized or permits their issue
– Fine which may extend to ì
1,00,000
WIRC - AHMEDABAD - 26.10.2013
14
WORKSHOP ON COMPANIES ACT, 2013
Section
Offence
Penalty / Punishment
111
Default to give notice to members of any resolution to
be moved or to circulate a statement relating to
thereat as per requisition of members in conformity
with the provisions of section 111.
Company and every officer in
default penalty of twenty five
thousand rupees.
(Section 111(5)
127
Failure to distribute dividend declared by payment or
posting warrants thereof within thirty days from the
date of declaration of the shareholder entitled for
such dividend.
(provisions not applicable in case specified in the
proviso to Section 127)
Every director of the company
knowingly being a party to the
default - imprisonment which
may extent to two years and
with fine not less than one
thousand rupees for every day
during which such default
continues.
Company - to pay simple interest
at the rate of eighteen percent
per annum during the period for
which such default continues
(Section 127)
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15
WORKSHOP ON COMPANIES ACT, 2013
Section
Offence
Penalty / Punishment
133 (4)(c)
Where CA/CA firm's professional or other misconduct
is proved in proceedings before NFRA
Penalty not less than Rs.
1,00,000 but upto 5 times of the
fees received - Individual CAs
Penalty
not
less
than
Rs.10,00,000 upto 10 times frees
received - CA firms / LLPs
Debarring member / firm from
practice for minimum 6 months
and maximum 10 years as
decided by NFRA
161(1)
Appointing as additional director a person who fails to
get elected as director
If the articles of a company authorize the Board of
Directors, it may appoint any person as an additional
director at any time to hold office upto the date of the
next annual general meeting or the last date on which
the annual general meeting should have been held,
whichever is earlier.
The person to be appointed shall not be a person who
fails to get appointed as a director in a general
meeting,
Company and every officer-indefault for contravention - fine
not less than fifty thousand
rupees which may extend to five
lakh rupees (section 172)
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16
WORKSHOP ON COMPANIES ACT, 2013
Section
Offence
Penalty / Punishment
161(2)
Appointment of a person as alternate director for
more than one director The board of Director if
authorized by its articles, or by a resolution passed by
the company in general meeting appoint a person not
being the alternate Director for any other director in
the company, to act as an alternate director for a
director who is absent for a period not less than three
months from India
Company and every officer-indefault for contravention - fine
not less than fifty thousand
rupees which may extend to five
lakh rupees (section 172)
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17
WORKSHOP ON COMPANIES ACT, 2013
Section
Offence
Penalty / Punishment
First
Provision
to 161(2)
Alternate director not qualified to be ID is appointed
alternate director for ID
The person to be so appointed for an independent
director should be qualified for appointment as an
independent director
Company and every officer-indefault for contravention - fine
not less than fifty thousand
rupees which may extend to five
lakh rupees (section 172)
Second
Provision
to 161(2)
Alternate director not vacating office an original
director returning to India
Company and every officer-indefault for contravention - fine
not less than fifty thousand
rupees which may extend to five
lakh rupees (section 172)
An alternate director shall not hold office for a period
longer than permissible to the director in whose place
he is appointed. He shall vacate his office if and when
the director in whose place he has been appointed
returns to India.
162(1)
Moving Single resolution for appointment of 2 or more persons
as directors without consent of meeting for such motion
At a general meeting of a company moving a single resolution
for the appointment of two or more persons as directors of the
company without first getting the proposal to move such a
motion agreed to at the meeting without any vote being cast
against it.
WIRC - AHMEDABAD - 26.10.2013
Company and every officer-in-default
for contravention - fine not less than
fifty thousand rupees which may
extend to five lakh rupees (section
172)
18
WORKSHOP ON COMPANIES ACT, 2013
Section
Offence
Penalty / Punishment
180(4)
Such special resolution under section 180(1) (a) may
stipulate conditions including conditions regarding the
use, disposal or investment of sale proceeds resulting
from the transactions.
Proviso to
180(4)
This sub-section shall not be deemed to authorise the
company to effect any reduction in capital except in
accordance with the provisions of this act.
Company and every officer in
default fine which may extend to
ten thousand rupees or further
fine which may extend to one
thousand rupees for every day
after first during which the
contravention continue.
(Section 450).
182
A
Government
company
contributing
any
amount/amounts to a political party in violation of the
prohibition u/s 182
WIRC - AHMEDABAD - 26.10.2013
Company-fine-five times the
amount of such contribution
every
officer
in
defaultimprisonment for a term which
mat extent to six months and
with fine which may amount to
five times the amount so
contributed.
[Section 182(4)]
19
WORKSHOP ON COMPANIES ACT, 2013
Section
Offence
Penalty / Punishment
182
A non-Government company in existence for less than
3 financial years making contribution to political party
Company-fine-five times the
amount of such contribution
every
officer
in
defaultimprisonment for a term which
may extend to six months and
with fine which may amount to
five times the amount so
contributed.
[Section 182(4)]
182(1)
Default in complying with the following provisions
relating to contribution to any political party by a
company (which is in existence for at least 3 financial
years) directly or indirectly:-
WIRC - AHMEDABAD - 26.10.2013
Company-fine-five times the
amount of such contribution
every
officer
in
defaultimprisonment for a term which
may extend to six months and
with fine which may amount to
five times the amount so
contributed.
[Section 182(4)]
20
WORKSHOP ON COMPANIES ACT, 2013
Section
Offence
1st
Provision
to 182(1)
(i)The aggregate of amount so contributed by the
company in any financial year shall not exceed seven
and half per cent of its average net profits during the
three immediately preceding financial years.
2nd Proviso
to 182(1)
182 (2)
182(3)
Penalty / Punishment
(ii)Such contribution shall be approved by the Board of
Directors by passing a resolution at its meeting.
(iii) A donation or subscription or payment given by a
company to any person for the political purpose as
well as expenditure specified in section 182(2)(b) shall
be deemed to be contribution for a political purpose.
(iv) Disclosure in its profit and loss account any
amount or amounts contributed by it to any political
party during the financial year to which that account
relates with particulars of the total amount
contributed and the name of the party to which such
amount has been contributed.
Note: A Government company and a company which
has been in existence for less than three financial
years cannot contribute to such funds.
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21
WORKSHOP ON COMPANIES ACT, 2013
Section
Offence
183(2)
Failure to disclose in its profit and loss account the
total amount or amounts contributed by it to the
National Defence Fund or any other Fund approved by
the Central Government for the purpose of national
defence during the Financial Year to which the amount
relates.
185(1)
Company giving loan to director or specified person –
A Company shall directly or indirectly not give any
loan, loan represented by book debt, to any director
or to any other person in whom he is interested or
give any guarantee or provide any security for any loan
taken by him or such other person.
WIRC - AHMEDABAD - 26.10.2013
Penalty / Punishment
Company and every officer in
default fine which may extend to
ten thousand rupees or further
fine which may extend to one
thousand rupees for every day
after first during which the
contravention continue.
[Section 450]
Company – fine not less than five
lakh rupees which may extend to
twenty five lakh rupees.
Director or other person to
whom loan, guarantee or
security is given or provided in
connection with loan taken by
him or other person –
imprisonment which may extend
to six months or fine not less
than five lakh rupees which may
extend to twenty five lakh rupees
or with both (Section 185(2))
22
WORKSHOP ON COMPANIES ACT, 2013
Section
Offence
Penalty / Punishment
Proviso
To 185(1)
Exception : This prohibition not applicable in the
following cases :
(a) Giving a loan to managing or whole time director
as part of the conditions of service applicable to
all employees or
pursuant to any scheme approved by the
members by a special resolution.
(b) Giving of loan etc. by a company which in its
ordinary course of business provides such loan,
guarantee or provide security for such loans and
it charges interest at a rate not less than the bank
rate declared by the Reserve Bank of India.
192(1)
Non-compliance with restrictions on non cash
transactions involving directors of the company / its
holding company/ its subsidiary / person connected
with him.
• A company shall not enter into an agreement by
which
(a) a director of the company or its holding
subsidiary or associates company or a person
connected with him, acquires assets for
consideration other than cash from the
company
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Any such arrangement by the
company or its holding company
shall be voidable at the instance
of the company except in cases
specified in section 192(3).
23
WORKSHOP ON COMPANIES ACT, 2013
Section
192(1)
192(2)
Offence
Penalty / Punishment
(b) The company acquires assets for consideration Penalty as per section 450
other than cash from such a director or person so
connected.
Unless prior approval of the company in general
meeting by a resolution is accorded.
•
•
If such a director/ person is a director of its
holding company such approval is also required by
a resolution in general meeting of the holding
company.
Notice for such resolution by the company or its
holding company shall contain particulars of the
arrangement with value of such assets duly
calculated by a registered valuer
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24
WORKSHOP ON COMPANIES ACT, 2013
Section
Offence
194
Violation of prohibition on forward dealing in
securities of company by director or KMP.
A director or key managerial personnel of a company
shall not deal in forward dealing of securities of the
company or its holding. Subsidiary or associates
company.
Penalty / Punishment
Director or key managerial
personnel imprisonment for a
term which may extend to two
years or with fine not less than
one lakh rupees which may
extend to five lakh rupees or
with both
(section 194(2)}
Further they are liable to surrender to the company
the securities so acquired.
The Company shall not register the securities in their
name.
If the securities are in dematerialized form, it shall
inform the depository not to record acquisition.
(Section 194(3).
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25
WORKSHOP ON COMPANIES ACT, 2013
Section
Offence
195(1)
Violation of the prohibition on insider trading of
securities
A person including any director or key managerial
personnel not to deal in securities of the company
having access to the non- public price- sensitive
information as specified in section 195(1) (insider
trading of securities) except communication required
in the ordinary course of business or profession or
employment or under any law.
202(2)
Penalty / Punishment
Any person contravening the
provision
of
section
195
imprisonment for a term which
may extend to five years or fine
not less than five lakh rupees
which may extend to twenty five
crore rupees or three times the
amount of profit made out inside
trading, whichever is higher, or
with both. (Section 195(2)).
No Payment by company of compensation for loss of Penalty as per section 450
office or as consideration for retirement from office or
in connection with such loss or retirement to a director
other than MD/WTD/ Manager under the
circumstances specified in section 202(2)
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26
WORKSHOP ON COMPANIES ACT, 2013
Section
202(3)
Offence
Penalty / Punishment
Any payment made to a managing or whole time Penalty as per Section 450
director or manager as per section 202(1) exceeding
the remuneration which he would have earned if he
had been in office for the remainder of his term or for
three years, whichever is shorter as specified in section
202(3)
Proviso to Such payment made to the director in the Penalty as per Section 450
202(3)
circumstances specified in the proviso to section 202(3)
379
A foreign Company is required to comply with the Company – fine not less than one
lakh rupees which may extend to
provisions of chapter XXII fails to do so.
three lakh rupees; for continuing
offence additional fine which
may extend to fifty thousand
rupees for everyday during which
the default continues.
Every Officer in default –
imprisonment for a term which
may extend to six months or fine
not less than twenty five
thousand rupees which may
extend to five lakh rupees or
with both (Section 392)
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27
WORKSHOP ON COMPANIES ACT, 2013
Section
Offence
Penalty / Punishment
405
Where the Central Government orders a company or
class of companies to furnish information or statics
relating to such company or where the central
government calls for records or documents in the
company’s possession or allow inspection of the
company to be carried out, if the company falls to
comply with such order or knowingly furnishes any
information or statistics which is incorrect or
incomplete in any material respect.
Company – fine which may
extend to twenty five thousand
rupees.
Every officer in default –
imprisonment for a term which
may extend to six months or fine
not less than twenty- five
thousand rupees which may
extend to two lakh rupees or
with both (Section 405(4))
447
Fraud
Person found guilty of fraud –
imprisonment for a term not less
than 6 months (not less than 3
years where fraud involves
public interest) but which may
extend to 10 years and also fine
not less than amount of fraud
but which may extend to three
times the amount involved.
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WORKSHOP ON COMPANIES ACT, 2013
Section
Offence
Penalty / Punishment
448
Except as otherwise provided in this Act, if a person
makes a statement in any return, report, certificate,
financial statement, prospectus, statement or other
document required by or for the purposes of any of
the provisions of the Act or rules made thereunder –
(a) which is false in any material particulars, knowing
it to be false.
(b) which omits any material fact, knowing it to be
material.
Such a person – liable to action
under section 447
449
Save as otherwise provided in this Act, any person
intentionally gives false evidence –
(a) Upon any examination on oath or solemn
affirmation autopsied under this act.
or
(a) In any affidavit, deposition or solemn
affirmation, in or about the winding up of
any company under this act or otherwise in
or about any matter arising under this act.
Such a person – imprisonment
for a term not less than three
years which may extend to
seven years and with fine which
may extend to ten lakh
rupees.(section 449)
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29
WORKSHOP ON COMPANIES ACT, 2013
Section
Offence
Penalty / Punishment
450
Company or any officer of a company or any person
contravening any provisions of the Act or the rules
made thereunder or condition, limitation or restriction
subject to which approval, sanction etc. have been
accorded for which no penalty or punishment is
provided .
Company and every officer in
default or such other person –
fine which may extend to ten
thousand rupees with a further
fine which may extend to one
thousand rupees for every day
after the first during which the
contravention continues.
(Section 450)
451
Repetition of default by a company or officer
punishable with fine or imprisonment on subsequent
occasions within a period of three years.
Company and officer in default –
where fine is provided twice the
amount
of
fine
and
imprisonment as provided for
such default.
(Section 451)
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30
WORKSHOP ON COMPANIES ACT, 2013
Section
Offence
Penalty / Punishment
452(1)
Any Officer or employee of a company wrongfully
obtains possession of any property/ cash of the
company or wrongfully withholding the same or
knowingly applies it for the purposes other than those
expressed or directed in the articles and authorised by
this Act.
Complaint by the Company or of any member or any
creditor of contributory of the company
Such officer or employee of the
company – fine not less than
one lakh rupees which may
extend to five lakh rupees
(Section 452(1))
Court may also order such
person to deliver up or refund
within a specified time any such
property or cash.
(Section 452(2))
In default – such person to
undergo imprisonment for a
term which may extend to two
years (Section 452(2)).
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31
WORKSHOP ON COMPANIES ACT, 2013
Section
Offence
Penalty / Punishment
453
Any person or persons use the word “Limited “ or
“Private Limited” or any contraction or limitation
thereof as last word or words for his trade or business
along with any name or title without getting duly
incorporated with limited liability.
Such person – fine not less than
five hundred rupees which may
extend to two thousand rupees
for everyday for which that
name or title has been used
(Section 453)
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WORKSHOP ON COMPANIES ACT, 2013