Sections in Companies Act 2013 which are Punishable in nature (Both Compoundable and Non-Compoundable)
Offenses under Companies Act 2013 are categorized under following categories:-
1. Offenses which are Liable to Penalty (They are Adjudicated by ROC’s themselves in an IAM mechanism) {https://taxguru.in/company-law/sections-companies-act-penal-provisions-subjected-in-house-adjudication-framework.html}
2. Offenses which are Punishable in Nature and can be Compoundable offense or Non-compoundable offense.
Here is the gist of sections which are Compoundable in Nature (BY RD or By NCLT) and Sections which are Non compoundable in Nature under Companies Act 2013
Statement showing the delegation of powers of sanctioning of prosecution by the Central Government to Regional Directors in respect of the following sections in Companies Act 2013, Which are Compoundable and maximum fine which can be imposed is Rs 25,00,000.
| Chapter No. | Chapter name | Section Violated | Section under which the prosecution is filed | Nature of Punishment |
| III Part 1 | Public offer | 26 | 26(9) | Only Fine |
| IV | Share capital and debentures | 68 and Regulation of SEBI for 68(2)(f) | 68(11) | Only Fine |
| VII | Management and Administration | 96,97 and 98 | 99 | Only Fine |
| IX | Accounts of Companies | 128 | 128(6) | Only Fine |
| 129 | 129(7) | Imprisonment or Fine or both | ||
| X | Audit and Auditors | 139-146 | 147(1) | Only Fine |
| 139, 144 and 145 | 147(2) | Only Fine | ||
| 148 | 148(8) | Only Fine | ||
| XI | Appointment and qualification of Directors | 166 | 166(7) | Only Fine |
| 167(1) | 167(2) | Only Fine | ||
| XII | Meetings of Board and its Powers | 185 | 185(4) | Imprisonment or Fine or both |
| XIV | Inspection, Inquiry, and Investigation | 206 | 206(7) | Only Fine |
| 221(1) | 221(2) | Imprisonment or Fine or both | ||
| 222(1) | 222(2) | Imprisonment or Fine or both | ||
| XVI | Prevention of oppression and mismanagement | 242(5) | 242(8) | Only Fine |
| 243(1)(b) or 243(1A) | 243(2) | Only Fine | ||
| XVIII | Removal of Names of Companies from the register of Companies | 249(1) | 249(2) | Only Fine |
| XX | Winding-up | 344(1) | 344(2) | Only Fine |
| 347(3) | 347(4) | Only Fine | ||
| XXII | Companies Incorporated Outside India | Chapter XXII | 392 | Only Fine |
| XXIX | Miscellaneous | Committing second or subsequent offense within 3 years | 451 | Only Fine |
| 452(1) | 452(1) | Only Fine | ||
| Improper use of words Limited and private Limited | 453 | Only Fine | ||
| 454(3) or 454(7) | 454(8) | Imprisonment or Fine or both | ||
| 464(1) | 464(3) | Only Fine | ||
| 469(1) | 469(3) | Only Fine |
# In Consultation with SEBI, in case of listed companies.
# wherever there exists an element of Fraud and has been reported in any sections mentioned above- RD, shall not Compound and it must be mandatorily reported in Part A of 3I’s Report.
Statement showing the delegation of powers of sanctioning of prosecution by the Central Government to Tribunal in respect of the following sections in Companies Act 2013, Which are Compoundable and maximum fine which can be imposed is more than Rs 25,00,000.
| Chapter No. | Chapter Name | Sections violated | Section under which the prosecution is filed |
| II | Incorporation of company and matters incidental thereto | 8 | 8(11) |
| III Part 1 | Public offer | 40 | 40(5) |
| IV | Shares Capital and Debentures | Issue of duplicate Certificate to defraud | 46(5) |
| V | Acceptance of Deposits by Companies | 74(1) or 74(2) | 74(3) |
| XXIX | Miscellaneous | Fraud Involving amount less than 10 Lakh or one percent of Turnover. | 447 |
Statement showing the offenses which are Non-Compoundable and are mandatorily punishable with Imprisonment.
| Chapter No. | Chapter name | Sections Violated | Section under which prosecution is filed |
| IV | Share Capital and Debentures | Personation as a shareholder | 57 |
| 58 | 58(6) | ||
| 67 | 67(5) | ||
| V | Acceptance of deposits | 73 or 76 | 76A |
| VII | Management and Administration | Tampering the Minutes | 118(12) |
| VIII | Declaration and Payment of Dividend | Dividend declared but not paid or Posted within 30 days | 127 |
| X | Audit and Auditors | 139,143,144 and 145 | 147(2)
Proviso |
| XII | Meeting of Board and its Powers | 182 | 182(4) |
| 186 | 186(13) | ||
| XIV | Inspection, Inquiry, and Investigation | 207 | 207(4) |
| 217 | 217(6) | ||
| 217(1), 217(2), 217(4), 217(7) | 217(8) | ||
| XI | Prevention of Oppression and Management | 245 | 245(7) |
| XVII | Registered valuers | Contravenes 247 to defraud the Company | 247(3) Proviso |
| XX | Winding up | 336(1) | 336(1) |
| 336(1)(d)(viii) | 336(2) | ||
| 337 | 337 | ||
| 338(1) | 338(1) | ||
| XXIX | Miscellaneous | Fraud involving an amount of at least ten Lakh rupees or 1% of the turnover of the company, whichever is lower not involving public Interest | 447 |
| Fraud involving an amount of at least ten Lakh rupees or one percent. of the turnover of the company, whichever is lower Involving Public Interest | 447 | ||
| Intentionally gives false Evidence | 449 | ||
| 452(1) | 452(2) |
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