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The scope of Company Law in India is wide, it takes into account the nitty-gritties of winding up of a company and liquidation of its assets. While winding up of a company if its agents fail to comply with the rules and regulation they can be held civilly or criminally liable. You can also check out the penalties for mismanagement, misrepresentation and fraud.

 

1) Sec 284 – Failure by the Promoters, directors, etc., to cooperate with Company Liquidator Any person Max: INR 50 thousand or Max: 6 months

OR

Both

2) Sec 302 – Company Liquidator makes a default in forwarding a copy of the order within 30 days from the date thereof Company liquidator INR 5000 thousand for every day of default Arrest of person trying to leave India
3) Sec 305 – Making a declaration of solvency without having reasonable grounds for the opinion that the company will be able to pay its debts in full from the proceeds of assets sold in voluntary winding up Director Min: INR 50 thousand

Max: INR 3 Lakhs OR

Max: 3 years

OR

Both

4) Sec 306 – Failure to call the meeting of creditors and conduct the meeting according to the provisions Company

Director in default

Min: INR 50 thousand

Max: INR 2 Lakhs

Min: INR 50 thousand

Max: INR 2 Lakh OR

Max: 6 months

OR

Both

5) Sec 307- Failure to publish notice of the resolution of voluntary winding up, by advertisement in official gazette and newspaper Company and every officer in default INR 5 thousand for every day of default
6) Sec 312- Failure to provide notice to the registrar of appointment/vacancy of Company Liquidator within 10 days of appointment/vacancy Company and every officer in default INR 5 hundred for every day of default
7) Sec 314- Failure to prepare a quarterly statement of accounts in such form and manner as may be prescribed and file such statement of accounts duly audited within thirty days from the close of each quarter with the Registrar
Contravention of other provisions other than one mentioned above
Company Liquidator

Company Liquidator

INR 5 thousand for every day of default

Max:  INR 10 lakh

8) Sec 316 – Failure by the Company Liquidator to submit a report on the progress of winding up Company Liquidator Max:  INR 10 lakh
9) Sec 318 – Failure to comply with the provisions related to final meeting and dissolution of company. Company Liquidator Max:  INR 1 lakh
10) Sec 336 – Officer guilty of any false representation or fraud for the purpose of obtaining the consent of the creditors of the company or any of them, to an agreement with reference to the affairs of the company or to the winding up
Every person who takes in pawn or pledge or otherwise receives the property, knowing it to be pawned, pledged, or disposed of in such circumstances
Officer

Every officer

Min: INR 1 Lakh

Max: INR 3 Lakhs &

Min: INR 3 Lakhs

Max: INR 5 Lakhs &

Min: 3 years

Max: 5 years

Min: 3 years

Max: 5 years

12) Sec 337- Penalty for frauds by officers when the company is ordered to be wound up by tribunal or resolution for voluntary winding up is passed Officer Min: INR 1 Lakh

Max: INR 3 Lakhs &

Min: 1 year

Max: 3 year

13) Sec 338 – Liability where proper accounts not kept. Officer in default Min: INR 1 Lakh

Max: INR 3 Lakhs &

Min: 1 year

Max: 3 year

14) Sec 339 – Business of the company has been carried on with intent to defraud creditors of the company or any other persons or for any fraudulent purpose Every person knowingly a part of it Min: Amount involved in the fraud

Max:3 times the amount involved &

Min:6 Months

Max:10 Years

*Fraud involving public interest:

Min: 3 years

15) Sec 342 – Failure to give assistance in connection with the prosecution Officer/Agent of the company Min: INR 25 thousand

Max: INR 1 Lakh

16) Sec 344-Failure to publish a statement that the company is being wound up in every document issued by or on behalf of the company. Company

Every officer

Company liquidator

Receiver

Manager

Min: INR 50 thousand

Max: INR 3 Lakhs

17) Sec 347 – Contravening the orders of the central government as regards disposal of books and papers of the company and making of representations Any person in default Max: INR 50 thousand OR Max: 6 months

OR

Both

18) Sec 348-Statement containing information as to pending liquidations audited by a person not qualified to act as an auditor of the company
Non- Compliance with providing information as to pending litigations
Company Liquidator

Company Liquidator

Max: INR 1 Lakh or

INR 5 thousand for every day of default

Max: 6 months

OR

Both

19) Sec 356 – Failure to file a Certified copy as regards dissolution declared void, to the registrar within 30 days/such time as permitted by the tribunal Company Liquidator or the person on whose application the order was made INR 10 thousand for every day of default

 

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